Global EditionASIA 中文双语Français
Home / Business / Industries

Opportunity seen in the Middle East

By Jiang Xueqing | China Daily | Updated: 2018-09-14 10:25
Share - WeChat
HSBC has announced that China and the growth that is coming out of Asia is where a lot of its investments will be put to work. [Photo/VCG]

Economic shift from oil to technology an opening for investors, HSBC says

The Middle East economy is going through a transformation from oil-based to knowledge-based, providing new investment opportunities for Chinese technology companies, according to senior executives of the global financial institution HSBC.

The transformation in the Middle East has been taking place for a few years now, as countries in the region work to reduce their dependence on the oil sector by expanding investment in non-oil based industries that produce goods and services. As a result, a significant amount of investment is taking place in areas such as infrastructure, medical facilities and educational facilities, said Kapil Chadda, HSBC's vice-chairman of global banking for Middle East, North Africa and Turkey.

The regional projects pipeline appears solid with more than $2 trillion of projects currently in the planning stage, according to Deloitte's GCC Powers of Construction 2017 report.

"That's a very significant opportunity for people with expertise, skilled technology and capital to come and play a part in the Middle East," Chadda said. "This is a big area of cooperation and focus for us between China and the Middle East."

Over the past few years, China and the Middle East have strengthened their links with growing cooperation focused on three key areas including high tech. A growing number of Chinese technology companies are eyeing the Middle East market. Last year, China's ride-hailing giant Didi Chuxing Technology Co invested in Dubai-headquartered Careem, the equivalent of Uber in the region. Chinese internet businesses and biopharmaceutical businesses are also making investments in countries such as Egypt, Kuwait and Oman.

"Not only has China brought capital to the Middle East, it has brought expertise in implementing projects, and it has also increased the trade and investments into the region," Chadda said.

"The trade between the Middle East and China has doubled in the past 10 years from around $40 billion to $80 billion in 2016 ... The project contracts between the two geographies totaled around $32 billion as of 2017," he said.

HSBC has announced that China and the growth that is coming out of Asia is where a lot of its investments will be put to work. That includes work with the Belt and Road Initiative, which the financial institution regards as a key, strategic objective to support.

"The Belt and Road Initiative is a transformational global project where we would be able to reshape the history of how the global economy is developing," said Daniel Howlett, regional head of commercial banking for Middle East, North Africa and Turkey at HSBC.

"Over the five years the initiative has been operating, it is clearly changing, evolving and maturing," Howlett said.

Since the BRI was proposed five years ago, commodity trade between China and the countries related to the initiative surpassed $5 trillion as of June, generating 244,000 local jobs and tax revenues of $2.01 billion, said Ning Jizhe, vice-chairman of the National Development and Reform Commission of China.

Copyright 1995 - . All rights reserved. The content (including but not limited to text, photo, multimedia information, etc) published in this site belongs to China Daily Information Co (CDIC). Without written authorization from CDIC, such content shall not be republished or used in any form. Note: Browsers with 1024*768 or higher resolution are suggested for this site.
License for publishing multimedia online 0108263

Registration Number: 130349