Arab family business on the brink of change
Families have always dominated the economies of the Gulf, controlling huge amounts of wealth and influence but traditionally unwilling to open up their capital – and their books – to the outside world. That model is gradually starting to change, says Alex Warren.
THE FAMILY BUSINESS is one of the great Middle Eastern stereotypes. A sprawling empire impenetrable to any outsider; an ageing patriarch who consistently pops up on the Forbes rich list; a multitude of children vying for control of company assets; and, of course, a cosy relationship with politics.
Such is often the outside perception of the family-owned business groups that wield such influence in economic and political life in the Arab world, and nowhere more so than in the oil-rich states of the Gulf such as Bahrain, the UAE, Qatar, Kuwait and Saudi Arabia. And although much of it is cliché, the power of the families – both the ruling variety and those behind the large trading groups – is greater than ever thanks to sky-high oil prices and a sustained economic boom.
But things might just be changing. With the Gulf states slowly opening their markets – some more quickly than others – and a new generation of western-educated children trying to tweak the old business model, a gradual shift is emerging that might result in more families listing their capital on the region’s stock exchanges.