"Intra Middle East and North Africa (MENA) trade has the potential to double by the end of the decade to US$300 billion" said Simon Cooper, Deputy Chairman and CEO, HSBC Middle East & North Africa, at the HSBC Regional Exchange - MENA conference this week. "By building on this opportunity for growing trade, MENA countries can accelerate the development of the non-oil and diversified industries and services necessary for sustainable, long-term economic success."
According to HSBC Global Research, the GCC will earn more from oil over 2011-14 than it did in the previous 15 years combined. In 2013 alone, the value of the region's oil production will be roughly five times greater than it was just a decade before. However, while oil export offers the region several short to medium term advantages, alternative sources of growth and employment are required to promote more balanced, sustainable and competitive economies.
Commenting on the discussion, Tim Reid, Regional Head of Commercial Banking for HSBC MENA highlighted "we have already seen, and strongly support, the refocus of public spending priorities to create an environment in which a private sector-led, non-oil economy can prosper and lead the next phase of the region's development. For example, an estimated US$4.3 trillion of infrastructure spending is scheduled for MENA before 2020. However there is much scope for growing levels of regional trade to play an important role in helping the region to become truly globally competitive".
To help address the challenge, HSBC believes that the region must promote and nurture future export champions other than oil exporters, helping them find their feet in the home region before they compete on the world stage. Similar patterns have historically emerged around the world. British firms generally built their trade in Europe before starting to export to China; Indonesian firms sold to Malaysia before arriving in London and American firms sold to Canada before turning to Mexico.
Mr Reid noted: "MENA is an attractive market for businesses all over the world and the competition continues to heat up as multinationals continue to make their way here. The population is larger than the USA and it has a greater proportion of under 25s than any other faster growing region. These two factors alone showcase an attractive opportunity for businesses from many sectors. There is also a positive outlook for economic growth, and we believe businesses in the region have a good opportunity to build the scale required to develop as prominent regional export champions".
Helping businesses grow across borders and facilitate trade has been strong focus for HSBC regionally and globally. The Group aims to double its trade business in the medium term. HSBC MENA targets are in line with this.
Mr Cooper concluded: "HSBC was founded on trade and throughout its history has been where the growth is, connecting customers to opportunities. Our strong heritage combined with HSBC's global network and expertise, enables us to help businesses capitalise on growth and trade opportunities at home and abroad".
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HSBC in the MENA Region
HSBC is the largest and most widely represented international banking organisation in the Middle East and North Africa (MENA), with a presence in 14 countries across the region. HSBC has operations in the United Arab Emirates, Egypt, Qatar, Oman, Bahrain, Kuwait, Jordan, Lebanon, Pakistan, Algeria and the Palestinian Autonomous Area. In Saudi Arabia, HSBC is a 40% shareholder of Saudi British Bank (SABB), and a 49% shareholder of HSBC Saudi Arabia for investment banking in the Kingdom. In Iraq, HSBC holds a majority shareholding in Dar Es Salaam Investment Bank. HSBC also maintains a representative office in Libya.
This presence, the widest reach of any bank in the region, comprises some 295 offices and around 12,000 employees. In the year ending 31st December 2012, HSBC in the MENA region made a profit before tax of US$1,350m.
For further information please contact:
Saadia McGlinchey
Regional Head of Communications
Commercial Banking
HSBC Bank Middle East Limited
Tel: 971 4 423 5237
Email: saadia.mcglinchey@hsbc.com
© Press Release 2013
