Markets in the region are moving in the right direction and that spurs demand for "right information", said Devin Wenig, CEO, Markets, Thomson Reuters.
"There is lot of information on the internet. But the truth is that if you are a professional who relies on data or information for your work not much relevant information is available," he told Emirates Business in an interview.
Thomson Reuters saw an 11 per cent growth in revenues last year and expects to grow faster. The company also plans to expand in terms of products and head count.
How do you stay ahead of competition when the world is going through an economic crisis and information is so easily available?
There is a lot of information on the internet. But the truth is that if you are a professional who relies on data or information for your work not much relevant information is available. Professionals do not need more information, they need right information. Our major competition is not from free services. In fact, we are the ones to provide information on the internet. When it comes to critical decisions, we do things that no one else does. We have been in the Gulf for a long time and have built our brand. It is not the largest market, but it is an important market.
Does it mean expansion and innovation in terms of products?
We are doing a lot of that here and are launching a whole new series of products and content. Besides that, there are big global product launches that would be relevant to Dubai and the Gulf. We are making local and global investments. Last year, we added 100 people in the Middle East and Africa and would add another 100 this year in news, product and content and also in other supporting functions. Last year, we saw double-digit growth – at 11 per cent in terms of revenues in this region. That growth would probably be better this year.
Do you see growth in the same sphere in 2010?
We keep innovating. There is a lot of concern in this market about restructuring of credit. The economy is growing; capital markets are in early stages of development. They have a long way to go in terms of transparency and market structure. There will be growth in existing and new areas.
In terms of maturity, do you think capital markets in the region are moving in the right direction?
They are moving in the right direction. In some ways, the economic crisis has been a blessing as it has brought in a new call to action about markets and transparency. Before the global crisis, there were debate about whether it was necessary or not, but now it is about how to get there. Now whether you are a sovereign wealth asset manager or a trader, people understand the need of a developed market with established laws, a transparency reporting and disclosure. The reality is it would be hard to diversify without that. Now how you do it, that is the debate.
Do you expect any more consolidations like the DFM and Nasdaq happening?
In general, you would see more fragmentation before consolidation. As markets develop, there will be more fragmentation in the short run.
What are the challenges?
The challenge is that markets will have to manage a lot of different things. The market here for many years was simple. But now the biggest selling products are actually data and systems as people trade in more sophisticated environment – they need end-to-end data and connectivity.
Why do you think markets in this region lagged emerging markets?
For me the level of market is not an important factor. What is important is growth of financial services, which is not dependent on whether stock market goes up or not. There is still profitability in the financial services industry.
By when do you see Middle East and North Africa markets mirroring growth of emerging markets?
I cannot predict that but what I can say is that the market is developing, getting more mature and sophisticated.
You have launched an Islamic finance portal. Do you see growth in this segment faster than the conventional arena?
People are interested in Islamic finance around the world. I think it will grow fast, though it's a small part of the total.
Thomson Reuters recently launched Islamic finance gateway. What are the requirements of Islamic finance clients and how are they any different?
It is not different than any other market but they need data to make better decisions. They want to understand instruments and associate the value to other instruments.
What are the changes in consumer requirements related to information post-economic crisis?
There has been a lot of need for information for pricing. Earlier, people were not clear as to what they had in their balance sheet. That has been a big driver for us. When I say pricing, what I mean is that by the end of the day you need to know what your balance sheet is worth. Another thing clients have been seeking is risk management.
Do you see another asset bubble bursting given there is a lot of talk about overheating of some markets, such as China?
The thing that worries me the most is not another bubble. It is 'very slow growth'. I am not worried about another crisis. I think the crisis part of this has been resolved. What has not been resolved is where growth would come from. But if there is a prolonged slow growth in economy, that could be more worrisome.
Do you see this region being equally exposed to such risk?
There is no region that is independent. This crisis showed how interconnected the world is. But I still think that given the stage of market and infrastructure development, this region, compared to other places, would be in better shape.
PROFILE: Devin Wenig CEO, Markets, Thomson Reuters
Previously, Wenig served as Chief Operating Officer and a Board Director of Reuters Group and held a number of senior management positions.
He first joined Reuters in 1993. Wenig is on the Board of the March of Dimes charity and a member of the Young Global Leaders section of the World Economic Forum