Treasury and Trade Solutions
30
THE BEATING HEART
Multinationals expanding in the Middle East and Africa, as well as
regional companies growing worldwide, are choosing to centralize
treasury activities in the United Arab Emirates.
Dave Aldred
Head of Middle East,
North Africa, Turkey
and Pakistan,
Treasury and Trade
Solutions,
Citi
The Middle East has long been an
attractive destination for investment
by international companies, largely
in the oil and gas sector. More
recently, the focus of exploration
has shifted to East and West Africa,
with significant discoveries having
been made in Uganda, Mozambique,
Tanzania, Nigeria and elsewhere.
Six of the top ten global discoveries
in the oil and gas sector in 2013
were made in Africa.
1
Investment opportunities in the
Middle East and Africa are no longer
restricted to natural resources,
however. Over the past decade,
opportunities have begun to emerge
in new sectors. Countries across
the Middle East and Africa have
invested heavily in infrastructure,
and economies have become more
diverse — expanding into chemicals
and logistics, for example. At the
same time, urban consumers have
become more affluent. This has
boosted demand for consumer
healthcare, technology, media and
telecoms, as well as construction
services, and prompted investments
in agriculture to boost productivity.
As a result, foreign direct investment
(FDI) into the Middle East and
Africa has increased. According to
fDi Intelligence
, the global insight
wing of the
Financial Times
, FDI into
the Middle East and Africa rose by
24.27% in 2013, compared with 2012.
Meanwhile,
PwC’s Middle East Capital
Projects & Infrastructure Survey
,
published in June 2014, showed
that 75% of respondents expected
an increase in spending over the
coming 12 months. This is largely
driven by major events, including
the Dubai Expo 2020 and Qatar
World Cup 2022, as well as increased
spending on social infrastructure
including housing, education
and health care.
The region’s companies are also
expanding internationally, with
significant sums of cash flowing to
North America. Outward FDI from
the Middle East and Africa grew
by 21.81% in 2013, according to
fDi
Intelligence
, with the United Arab
Emirates (UAE) taking the lead in the
region for outward FDI.
2
1
Oil and Gas In Africa: An Early Review of 2014, Ventures Africa,
November 24, 2014.
2
The fDi Report 2014
,
fDi Intelligence
.
