MIDDLE Eastern investors are increasingly looking to Singapore and other South-east Asian nations for deals as financial ties grow between the two regions.
So says Standard Chartered (Stanchart) Bank's group head for origination and client coverage, Mr V. Shankar.
Stanchart is well-positioned to become a leading player in this area. In the past year, it has advised on more than 40 per cent of the deal flow from Middle East to this region, which totalled US$8 billion (S$10.9 billion). The figure was up from the US$987 million in the 12 months preceding, and Mr Shankar believes it will continue to rise in the years ahead.
'The financial ties between the Middle East and Asia are strengthening by the day and we are seeing more East-East relationships being formed,' he said in a recent interview.
'Oil and natural gas from the Middle East are vital for China, Japan and all the fast-growing markets in the Asia-Pacific region, which are fast ramping up their infrastructure.
'And the oil-generated capital and liquidity in the Middle East are fuelling a search for investments with high returns.'
Mr Shankar added that a recent report by McKinsey estimated that Gulf countries would have US$9 trillion to invest by 2020.
Stanchart began boosting its presence in the Middle East three years ago and now has a team of 50 corporate advisers there.
Mr Shankar, who is also a member of Stanchart's group management committee, said this put the bank in an enviable position as Singapore's business with the Gulf looks set to soar.
'Between 2004 and 2006, total trade between Singapore and the Middle East shot up from US$20.9 billion to US$30.8 billion, an increase of 47 per cent.
'Currently, Singapore companies are working on more than $6 billion worth of projects in the Middle East.'
Stanchart is no stranger to deals between the Republic and Gulf countries. It recently advised the Al-Futtaim group in its successful bid for Singapore's oldest retailer, Robinson & Co.
Looking ahead, Mr Shankar said the bank would leverage on its experience and capabilities in the region to shore up its position as a major player.
'Stanchart is well-placed to seize future opportunities, thanks to our growing geographical reach and the scale and breadth of our products and capabilities.
'We have an established history in Singapore, having been in the market for 150 years, and we have been operating in the Middle East for more than 50 years. We feel we can act as a strong local bank in all the different markets for our clients.'
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