China International Capital Corp. plans to expand its reach in the United Arab Emirates and Saudi Arabia as President Xi Jinping pushes for closer ties to the Middle East amid rising tensions with the US.
(Bloomberg) — China International Capital Corp. plans to expand its reach in the United Arab Emirates and Saudi Arabia as President Xi Jinping pushes for closer ties to the Middle East amid rising tensions with the US.
The Chinese investment bank has already set up two offices and is in the process of obtaining the necessary licenses to carry out financial services activities, according to Barry Chan, the broker’s head of Asia and Australia.
“We want to show our commitment that we are in this region for the long haul, instead of flying in-and-out for several days carrying a suitcase,” Chan said in a recent interview. “We want to build the relationship, rather than just to close the transaction.”
With the US and the Western allies tightening scrutiny over Chinese investments in everything from computer chips to agriculture, Xi has turned to the Middle East for allies. Hong Kong has also pinned its hopes on that region as part of a bid to revive the city’s economy and standing, underscored by a delegation of top officials visiting Saudi Arabia and UAE in February.
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Currently CICC has about five to six people at its offices in the Middle East, with a mix of local hires and Chinese staff, to serve the whole region, said Chan.
A relatively new market, the Middle East has parallels to how Hong Kong financiers viewed as the vast untapped market in the Chinese mainland, said Chan. CICC aims to help the region transform its industries to become less reliant on oil and gas, he added.
Middle East-based firms that target China markets or investors are more likely to engage with bankers from Hong Kong, and the recent inclusion of international listings into Stock Connect, a trading link between mainland China and Hong Kong, is “very helpful” for the sales pitch, according to Chan.
–With assistance from Julia Fioretti.
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