CEO Today Magazine May 2019 Edition

Strengthening the Economic Development of Kuwait 17 www.ceotodaymagazine.com Dr. Bukhamseen holds memberships in the Board of Directors and in the topmanagement of companies locally and in the region. He regularly meets with Heads of States and Government officials and has to date received many awards and certificates of appreciation, the latest being Preferred 100 Arab CEO for 2017. In our Front Cover Feature this month, Dr. Emad discusses the journey that Bukhamseen Group has faced over the years, with an in-depth look into how it runs and its impact on Kuwait. What difficulties arise when transforming a small family business to one that has interests across several economic sectors in Kuwait? How have you overcome these challenges? The core business of the group started in real estate. During this period, we had started to create complimentary services. After the establishment of real estate, the need to establish contracting services was seen as a necessity, and further, the establishment of the commercial sector that is banking and other sectors such as oil were following each other to compliment the main business. During the past 60 years, we have managed to cover all these sectors. The major difficulties faced in transforming this small business into a large one was to establish procedures and systems that could create an independent culture in each company. After this, we will be overlooking the performance of these activities through a central system, which supervises the independent management of each sector to establish the direction and the main goals of each company and the corporate group. What was the Manakh crisis and how did it affect Bukhamseen Group? The Manakh crisis started in 1982, when there was a sudden increase in share values and volume traded in the region and specifically in Kuwait, whereas trading was predominantly done on margin, with extreme levels of leverage becoming acceptable to the market. The traders were overwhelmed by quick profits with high margins. This in turn pushed valuations even higher, creating unrealistic values of these shares over a short period of time, creating a market bubble. Eventually, and at the first counterparty default, the bubble did burst and the market collapsed after it discovered the weakness of this business model, primarily the counterparty risk. Since Bukhamseen was a main player in the business of share trading and the establishment of group members of some companies, the group was affected by this crisis and, over time, managed to remove itself out from this crisis with strategic solutions. (Although the group was affected by the share market crisis, since it was diversified in various business sectors such as real estate and tourism, it managed to sustain itself through this crisis period.) What would you say have been the most active sectors in Kuwait in the past twelve months? All the sectors are down, however predominantly, real estate is playing a major role andmost active in the economic activities in Kuwait besides its drop in the last year. There were some activities that have slowed down in the market and this has been noticed in the economic sector. The finance sector has started to become active along with real estate, and is gaining momentum with slow activity and profitability. On another note, banking has been fairly active as well, be it in the stock market or in mergers and acquisitions. Where do you see opportunities for transaction growth in the hospitality sector coming from in the future? The main growth that we envision in the future is from the hospitality sector, more specifically international corporate activities from companies interested in entering the Kuwait market and join the big infrastructure and government contracts. What is the current state of tourism in Kuwait, and what role does Bukhamseen play in this? The current state of Dr. Emad with His Highness The Amir of Kuwait, Sheikh Sabah Al-Ahmad Al-Jaber Al-Sabah’