Badr Jafar: Private sector must shoulder stability in times of war

• Risk of over-optimised systems
• Companies must invest in resilience
• Central Bank is supporting SMEs

In times of conflict responsibility in the private sector extends beyond profit, with companies playing a critical role in maintaining stability for employees, supply chains and the wider economy.

In the UAE, where more than 200 nationalities live and work side by side, that responsibility carries particular weight, says Badr Jafar, chief executive of Crescent Enterprises and the UAE’s envoy for business and philanthropy since late 2024.

“The consequences of getting them wrong are no longer theoretical,” he says.

The shock of war has exposed the risks of over-optimised systems, bringing the importance of redundancy and contingency planning into sharper focus. For Jafar, at the heart of this reassessment lies a simple but increasingly urgent insight.

“Concentration is a vulnerability.”

What was once seen as efficiency – tightly optimised supply chains, centralised operations and lean systems – is now being reconsidered through the lens of resilience. Redundancy, diversification and institutional depth, once treated as costs, are emerging as strategic assets, says Jafar.

It is not merely about protection against downside risk. It is about positioning, he adds. Companies that invest now in resilience are likely to be those best placed to capture opportunity when stability returns.

Small business, big stakes

As the second generation of a family enterprise founded by his father Hamid Jafar, Badr Jafar has long extended his remit beyond corporate leadership, championing social entrepreneurship – pursuing answers to entrenched social challenges. 

More than a decade ago he launched the Pearl Initiative, a non-profit promoting transparency and accountability across the Gulf’s corporate landscape, including small and medium enterprises. 

SMEs account for two-thirds of the UAE’s non-oil GDP but remain more exposed to shocks.

During Covid-19 about two-thirds reported a negative financial impact, 60 percent saw profits fall and nearly one in 10 said support measures had kept them from bankruptcy.

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According to Jafar, this time around the Central Bank’s early actions will make a difference on this sector. Financial institutions are engaging constructively and the policy environment has remained stable and predictable.

“The bigger point is that an economy’s resilience is never just about its largest companies. It depends on the health and continuity of the entire ecosystem, the SMEs, the traders, the service providers that make up the connective tissue of daily economic life,” he says. 

“Protecting that ecosystem is not a secondary priority. It is central to how recovery happens.”

Capital communication

This shift is already reshaping how capital flows are assessed. Businesses and investors are beginning to favour resilience-informed models over those built purely for efficiency.

Jafar expects inflows to moderate in the near term but the UAE’s starting point remains strong.

The country attracted $46 billion in foreign direct investment in 2024, a 49 percent annual increase at a time when global FDI declined by 11 percent over the same period. It ranked second globally for new greenfield projects.

Trade flows exceed $1.4 trillion annually, linking the UAE to more than 180 markets, while foreign exchange reserves stand above AED 1 trillion.

Against this backdrop, the challenge is perception and not fundamentals. 

“What does need to shift is how the region communicates its value proposition,” says Jafar.

Growth, on its own, is no longer enough. Investors are looking instead for reliability and systems that hold under pressure and for commitments that endure disruption.

“Every port that remains open, every flight that operates, every contract that is honoured is itself a signal. That kind of signalling is more persuasive than any marketing campaign.”

When the war hit, the country was host to a resident population of just over 11 million, nearly 90 percent of whom are expatriates. While thousands of citizens have returned home from the region since the war began, many more have stayed.

Most of those who remain are expatriates, tied to the UAE through employer-sponsored visas: their ability to live, work and remain in place are dependent on the continuity of business itself.

The burden, then, shifted swiftly to companies – to sustain operations, preserve jobs and maintain a sense of normalcy in the midst of disruption.

“That is a social contribution as much as an economic one,” says Jafar.