ISSUE 15 | March 2013

BUSINESS INTELLIGENCE FOR INTERNATIONAL TRADE

www.tradeandexportme.com

PUBLICATION
LICENSED BY IMPZ

EDITORS LETTER

Publisher
Dominic De Sousa

A sigh of relief...

Chief Operating Officer

Nadeem Hood

We all know that feeling when we can finally breathe after

a major event of our life has been done and sorted. So you
know how I must be feeling after the inaugural Trade and
Export Middle East Excellence Awards. The Awards were
held on the 25th of February at the Habtoor Grand and since
I can blow my own trumpet without being interrupted
the event was a huge success with close to 200 people in
attendance with the presence of all the top players in the
field of logistics, finance, legal, free zones and business
support services.

Managing Director
Richard Judd
richard@cpidubai.com +971 4 440 9126
EDITORIAL
Senior Editor
Aparna Shivpuri Arya
aparna@cpidubai.com +971 4 440 9133
Contributing Editors
Mike Byrne
mikeb@cpidubai.com +971 4 440 9105
Tamara Pupic
tamara@cpidubai.com +971 4 440 9130
Jenny Kassis
jenny@cpidubai.com +971 4 440 9116
ADVERTISING
Nigel Rodrigues
nigel@cpidubai.com +971 4 440 9124
PRODUCTION AND DESIGN
Production Manager
James P Tharian
james@cpidubai.com +971 4 440 9146
Database and Circulation Manager
Rajeesh M
rajeesh@cpidubai.com +971 4 440 9147
Head of Design
Fahed Sabbagh
fahed@cpidubai.com +971 4 440 9107
Designer
Froilan A. Cosgafa IV
froilan@cpidubai.com +971 4 440 9107
Photographer
Jay Colina
Abdul Kader Pattambi
DIGITAL SERVICES
www.tradeandexportme.com
Digital Services Manager
Tristan Troy Maagma
Web Developer
Abey Mascreen

We also honoured Dubai Trade and United Arab Bank for their support to us and the
trading community. It was a proud moment for me since the magazine and the event
was appreciated by all. Youll see the winners and some snapshots of the Awards
when you turn the pages.
I had also mentioned in my previous editorial about my trip to Paris. I was there in
February and even though it was freezing, I couldnt help but fall in love with the
city. What made it all the more interesting were the people we interviewed. They all
had very interesting stories to tell about how they are working on building the trade
and investment relations with the Middle East whether through the government or
through the private sector. So dont forget to read the country focus on France!
February also witnessed another big event- the Gulfood and so we decided to take
another look at the food sector and talk to the different stakeholders. I am sure youll
enjoy reading what they had to say.
March also promises to be a busy month as I head to Qatar to cover the World Cargo
Symposium and then to Abu Dhabi for the World Port Summit. Next month, we focus
on Canada, a very important trading partner for the region.
As always, I look forward to hearing from you and working out ways to involve you
with the magazine. So dont hesitate to drop me a line.
Till then..

online@cpidubai.com
+971 4 440 9100
Published by

Registered at IMPZ
PO Box 13700, Dubai, UAE

Aparna Shivpuri Arya,

Senior Editor, Trade and Export Middle East

Tel: +971 4 440 9100

Fax: +971 4 447 2409

Talk to us:
Printed by
Printwell Printing Press
Copyright 2013 CPI
All rights reserved
While the publishers have made every effort to ensure the
accuracy of all information in this magazine, they will not
be held responsible for any errors therein.

E-mail: aparna@cpidubai.com

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If youd like to receive a free copy of Trade and Export Middle East every month,
e-mail rajeesh@cpidubai.com requesting a subscription.

MARCH 2013

10
14
22

trade talk

12

MARCH 2013

MARCH 2013

updates

ISSUE 15

06

News: International news and trends with

domestic trading relevance.

09

EVENTS CALENDAR: A snapshot of exhibitions

and conferences around the region, which can
help you spend less time planning and more time
attending.

10

ABOUT TOWN: We bring you coverage from the

events that took place in the month of February.

12

EXPERT COLUMN: In his column, Raed Safadi,

Deputy Director of the Trade and Agriculture
Directorate, OECD, discusses pressing trade
issues with us, every month.

14

INTERNATIONAL TRADE: Dubai Trade gives us an update about Dubais status

as the trading hub and doles out some interesting bits.

18

FINANCE: Western Union Business Solution looks at how small and medium-sized
enterprises (SMEs) can protect against foreign exchange fluctuations when making
cross-border transactions.

22

TRADE AND EXPORT EXCELLENCE AWARDS: We hosted our first Trade and
Export Middle East Excellence Awards 2013 to honour the best in the field of trade.
We bring you the winners and some snapshots of the very successful event.

30

SECTOR WATCH: Since the Gulfood was the talk of the region, we decided to
take a more in-depth look into the food sector. We bring you the findings.

trade talk

CONTENTS

COUNTRY FOCUS: FRANCE

33

INVEST IN FRANCE AGENCY: Created in 2001,

the IFA is responsible for promoting international
investments in France. Aparna Shivpuri Arya spoke
to David Appia, Chairman to get his expert opinion.

38

TOTAL: Aparna Shivpuri Arya met Arnaud

Breuillac, Exploration and Production, President
Middle East, Total, in their Paris headquarters
to get all the interesting details about this fifth
largest publicly-traded integrated international oil
and gas company in the world

42

GREATER PARIS: Greater Paris, is a topic

that has been going on for over a century in
France. The first greater Paris project started in
1920. As part of a press trip to Paris, Aparna
Shivpuri Arya caught up with Alexandre Missoffe,
Director of the Cabinet, Socit du Grand Paris
to get a better understanding of the project.

46

CDC: CDC Enterprises was set up to develop

and support SMEs and industrial services, based
on a stable and long term strategy. Aparna
Shivpuri Arya met Philippe Braidy, President, CDC
Entreprises, to get to know the details about their
work and mission.

48

VINCI: We caught up with Alain Bonnot,

Chairman of Vinci Construction Grand Project,
to know about their operations in the Middle East.

30
46

38

MARCH 2013

Updates
global watch

Exploring investment
opportunities

The two-day 2013 Global Financial Markets Forum (GFMF) attracted

1,300 delegates. Michael Tomalin, the Group Chief Executive
of National Bank of Abu Dhabi (NBAD) outlined the economic
strengths and prospects of the UAE for investors. Mr. Tomalin said
Abu investment to diversifying its economy and transition the

contribution of petroleum from 60% of Emirates GDP to 40% offers

substantial opportunities to investors. He said Abu Dhabi Vision
2030 would develop Abu Dhabi to a global financial.
Abu Dhabi is an enormous opportunity for all, said Mr. Tomalin.
Abu Dhabi is a city that is open to investors, open to you.
Following Mr. Tomalins speech, James A. Baker III, former
US Secretary of Treasury and State and a global statesman,
analysed the global economy.
World economy is recovering from the global recession, said
Mr. Baker. The United States, he said, is growing, however, at a slow
rate. At current growth rate, it will take (the US) years to achieve
full employment.
Mr. Baker called the United States a ticking bomb. The US is
broke, if we didnt have the dollar, we would be Greece, Mr. Baker
said. To bring the debt under control, the US political parties must
agree on a grand bargain on taxes and spending cuts. The economic
and political dysfunction has prevented achieving the grand
bargain, he added.
Noting that Europe has deeper economic difficulties than the US,
Mr. Baker said, Emerging economies are the bright spots.
Leading bankers and economists participated in panel discussions
on financial markets and banking.

Regions ports vital conduit for Africa-Asia

trade development
The vast continent of Africa will take centre
stage at the 2013 World Ports & Trade
Summit, which takes place in Abu Dhabi
from 19-20 March, with a special focus
session on day two of the event to examine
opportunities in the region for both trade
and infrastructure development.
Growth in seaborne trade between
China and Africa is already benefiting UAE
ports, as the worlds third largest economy
and the emerging African continent rely
on the Emirates trading gateway status,
further boosted by growth in bilateral trade
between South Africa and the UAE, which
was valued at almost USD 2 billion in 2011.
In the first decade of the millennium,
trade between African countries and the
GCC jumped by 270% to reach more

MARCH 2013

than USD 18 billion per annum, and this

shows no sign of slowing down with
added impetus particularly from the UAE
- generated by government and private

sector investment interest in West and

Central Africa, following successful forays
into East, South and North Africa, said
Chris Hayman, Chairman of Seatrade.

Updates
REGIONAL TALK

PPPs the way forward for

GCCs health sector
In the years to come, growing healthcare
spending will impose a hefty burden on Gulf
Cooperation Council (GCC)Governments. As we
enter 2013, healthcare costs continue to increase
in the region partly due to the high prevalence
of chronic diseases. Today, thanks to systemic
transformation, strategic planning, and population
screening programs, GCC governments recognise
that the current model in which the state
shoulders most of the direct healthcare costs is
unsustainable over the long term. In light of this,
management consulting firm Booz & Company
found that these governments must use a PublicPrivate Partnership (PPP) approach in order to
tame expenditure, improve quality of service, and
provide further access to expertise.
While expenditure is currently below
international benchmarks when compared

to developed countries on a per capita basis,

this will undoubtedly change, explained Jad
Bitar, a Principal with Booz & Company. As a
result, governments will logically seek more
private-sector participation, but this must be
introduced in a controlled manner.
A healthcare sector model indicates that
the public sector is responsible for regulation,
licensing, and monitoring. In turn, the private
sector can provide services with commercial value
such as cardiac surgeries and medical equipment
manufacturing.
Services that are the furthest from patient
contact and with the greatest commercial value
are well suited for PPPs. Services with mostly
social value, such as health education for the
population, should be retained in the public
sector.

$16 .5

BILLION

revenue for KSA from tourism in 2012

Saudi hospitality sector worth

USD 18.1 billion by 2016
A rise in the number of pilgrims
visiting the Kingdom for Hajj and
Umrah, are boosting domestic
tourism growth, with Saudi
residents making 22.5 million
overnight trips per annum.
Tourism receipts for Hajj
and Umrah currently account
for around 3% of GDP and,
according to tourism officials,
the country gained a reported
USD16.5 billion from tourism
in 2012, representing a 10%
increase on the previous year.
The largest hospitality market
in the GCC, Saudi Arabia

also accounts for the bulk of

international tourist arrivals, at
46% according to an October
2012 GCC Hospitality Industry
Report from Alpen Capital,
representing a 50% year-onyear increase against 2011
figures.
Hotel room supply in the
Kingdom is expected to increase
at a CAGR of 1.5% between
2011 and 2016, increasing
from 243,117 rooms in 2011
to 262,049 in 2016, with 69
p r op e r tie s c ur r e ntly in t h e
planning or construction phase.

MARCH 2013

AIG launches
its trade credit
product in the
UAE
AIG, has launched its trade
credit product in the UAE.
AIG has been underwriting
this class of business globally
for over 40 years. AIGs
product suite goes well
beyond conventional credit
insurance and offers a range
of solutions for companies
of various sizes. The UAE is
seen as the ideal launch pad
for Trade Credit insurance
in the Middle East due to
its accelerated GDP growth,
its perfect geographical
positioning making it a
thriving export market, its
reasonably stable economy
and political environment.
Additionally, the existing
local AIG entity, in operation
for several years, offers the
right infrastructure and
support to the organisations
growing trade credit
footprint.

Community
events calendar

Save the date!

Date

Event

Get in touch! Would you like to list your event here? Or better still, list your detailed event profile? If yes, then please contact: aparna@cpidubai.com

We know that you are a busy trader with a demanding events diary. Therefore, we are providing you with a snapshot of
exhibitions and conferences in the region and around the world, so you spend less time planning and more time attending.

Location

March
2-5

Seminar - Convert Natural Gas

Doha

Gulf Expo-Qatar

Doha

5-7

Paperworld Middle East

Dubai International Exhibition & Convention Centre

10 - 13

MEOS-Middle East Oil and Gas Show and Conference

Bahrain International Exhibition Centre, Manama, Bahrain

13 - 14

Middle East Geospatial Forum 2013

Qatar National Convention Center

17 - 21

Second Turbine Machines Middle East Symposium

Doha

31- 04 April

Saudi Travel and Tourism Market

Riyadh International Exhibition Centre, Riyadh

31 March - 2 April

World Luxury Expo Doha

Doha

Date

Event

Location
6-9

Project Qatar

Doha

1-4

Kingdom Airports, Aviation and Logistics Summit

Riyadh

6-9

Qatar StoneTech

Doha

2-4

Doha Carbon and Energy Forum 2013

Doha

6-9

Heavy Max

Doha

1-6

Qatar Career Fair 2013

Doha

8-9

Workshop Customer Services

Doha

15 - 16

Business and Investment Forum in Qatar - Berlin (TBC)

Doha

14 - 16

QITCOM Conference And Exhibition

Doha

22 - 25

ICC WCF 8th World Chambers Congress

Doha

15 - 17

The Hotel Show

Dubai

3-6

GITEX Shopper 2013

Dubai

26 - 29

Saudi Energy

Riyadh

16 -17

The Internet Show 2013

Dubai

27 - 29

Cityscape Qatar

Doha

30 - 03 May

Arabian Travel Market 2013

Dubai

June
4-6

CHRVI Qatar

Doha

April

May
May

Conference and Exhibition, Qitcom 2013

Doha

11 - 13

Automechanika Middle East

Dubai

6-8

Airport Show 2013

Dubai

13 - 14

34th Session of the Ministerial Council for OPEC Fund for International

Doha

6-9

Energy Qatar

Doha

18 - 23

India Property Show

Dubai

6-9

Makinat Qatar

Doha

18 - 23

India Property Show

Dubai

MARCH 2013

ABOUT TOWN

Lets talk finance

Exporta, the global financial services information provider, returned to
Dubai for the 10th successive year to hold its Annual Middle East Trade
& Export Finance Conference, which took place at the Jumeirah Emirates
Towers Hotel as part of the Middle East Trade Finance Week. We bring you a
synopsis of the discussions.

iscussions centred on a range of

topics, including growth forecasts
for corporates and banks alike,
the changing political risk environment
post-Arab Spring, ongoing challenges in
maintaining liquidity and optimising working
capital, infrastructure and project financing
requirements, as well as considering the
overarching question as to whether the
regions global influence is still determined
by its role as a commodity exporter.
One of the key issues identified over the
course of this event is the tremendous will
and appetite for doing business, establishing
the GCC as a global commodity hub and
increasing business flows with thriving
markets such as Asia and Africa, whilst
still maintaining close ties with traditional
trading partners such as Europe and the
US, says Jeff Ando, Head of Conference
10

MARCH 2013

Production for Exporta Events. One of the

overriding impressions we believe delegates
will have taken away is the desire to drive
things forward, to explore the various
financing options available for maximising
the regions potential.
The reiterated commitment to Asia
and Africa was a central theme, with
continued focus on Dubai as a hub from
which commodities dominate trade flows,
while sanctions were identified as being a
major concern for a banking sector keen to
avoid falling foul of compliance regulations.
Meanwhile, although it was noted that local
banks are filling some of the gaps left by
European banks leaving the region, further
funding options for the corporate sector are
still required.
One of the core benefits of hosting
such a well established event is the long

standing relationships enjoyed with senior

market leaders, with many of the most
established and internationally recognised
multinationals in regular attendance,
said Peter Gubbins, Managing Director
of Exporta. This combined with the
outstanding support provided by the Dubai
Multi-Commodities Centre (DMCC) and
Dubai Trade (part of Dubai World) further
demonstrates the calibre of support this
event enjoys.
As a Government of Dubai authority
established to drive forward the competitive
advantages Dubai enjoys as a global trading
hub, the DMCC has been particularly
successful with its mandate to stimulate
commodity flows, most recently through its
central registry of commodity ownership,
DMCC Tradeflow. Our goal is to ensure
sustainable regional financial and commodity
markets that are both transparent and
liquid. The focus is now on fostering the
development and growth of trade for those
expanding into new markets, said Malcolm
Wall Morris, Chief Executive Officer of
DMCC. Dubai is perfectly positioned at the
crossroads of these markets.
The event concluded with the official
launch of the ICC Regional MENA Banking
Commission on the afternoon of Tuesday
February 19, a joint venture between the
International Chamber of Commerce and
the Dubai Chamber of Commerce & Industry,
established to extend the reach of the ICC
Banking Commission within the MENA
region. Key speakers included H. E Hamad
Buamin, Director General, Dubai Chamber
of Commerce & Industry and Kah-Chye Tan,
Chairman, ICC Banking Commission.

The different flavours

Gulfood 2013 was held from the 25th-28th February in Dubai and provided an
excellent platform for countries to highlight their food products and explore
business opportunities in the region. We bring you a synopsis of the event.

ulfood Exhibition and Conferences

2013
(Gulfood
2013)
was
inaugurated on 25th February 2013
by H.H. Sheikh Hamdan Bin Rashid Al Maktoum,
Deputy Ruler of Dubai and UAE Minister of
Finance, in the presence of H.E. Sheikha Lubna
bint Khalid Al Qasimi, UAE Minister for Foreign
Trade, country ministers, ambassadors and
dignitaries from around the world, highlighting
the importance of the worlds largest annual
food and hospitality trade event.
Spanning over 100,000 square meters of
space, the Gulfood 2013 saw the participation
of 4,200 exhibitors with the biggest European
showcase and the largest South American
presence. More than 110 foreign country
pavilions were set up at the Dubai World
Trade Centre. All of them exhibited different
varieties of food items, beverages, restaurant
supplies, hospitality services and other
related food equipments.
The Gulfood 2013 Conferences, a series
of four key summits, commenced also on
25th February 2013 with H.E. Sheikha Lubna
addressing senior executives of global food
and beverages companies, dignitaries and
trade professionals at the Global Food Leaders
Summit. The forums organised during the
rest of the conferences days included Food
Packaging & Processing Forum, Food Inspection
Conference and Franchising Workshop.
The whole exhibition was attended by over
60,000 qualified business visitors. Attendees
could also participate in the Baking and
Pastry Guild Competition as well as attend
the corporate award ceremonies. In addition,
many professional chefs used this opportunity
to highlight their skills to a large audience.
At a press conference organised prior to
the Gulfood, H.E. Hamad Buamim, Director
General, Dubai Chamber of Commerce and
Industry (DCCI) stressed the importance of
the food and beverage sector for the growth
and development of UAEs economy. With

H E Hamad Buamim Director General Dubai Chamber of Commerce

and Industry speaks at the Gulfood 2013 Press Conference

AED 32.6 billion

value of food consumption in 2013
the value of food consumption in the UAE
expected to have reached AED 28.2 billion in
2012, he said this was forecasted to increase
to AED 32.6 billion in 2013.
Adding to this, Rashid Ahmed Al Teneiji,
Director of Government Communications at
the UAE Ministry of Foreign Trade said, The
UAEs food exports, which totaled AED 15.8
billion in 2010 increased by 10% to reach
AED 17.5 billion in 2011. Gulfood contributes
significantly to this growth by not only
providing promising business opportunities to
the global food industry but also proving to be
an excellent platform for UAE companies to do
business abroad. The presence of a dedicated
UAE pavilion for the first time at the show is an
indication of the countrys development in the
F&B industry as it moves up the value chain.

When we asked some of the countries, about

the importance of an event such as the Gulf
Food, Nawal Benzaid, Agriculture and Agri-food
Counselor, MENA region, Trade Commission of
Canada, said Gulfood is important for our
Canadian companies which are interested in
the Middle East and North Africa market and
want access to South Asia market. The food
opportunities are growing in this part of the
world and with the large expat community,
the demand for sophisticated and diversified
products is increasing. It is a region that is very
dependent on food import and Canada exports
over 70% of its agriculture and agri-food. The
opportunities are huge from commodities to
specialty gourmet products.
The event was a huge success and we hope
it will come back bigger and better next year.
MARCH 2013

11

TRADE TALK
Expert Column

Harnessing trade for

jobs in the Arab region
The Arab region needs to identify new and
sustainable sources of growth, create more
and higher-paying jobs, and absorb increasing
numbers of university graduates into the
labor market. Raed Safadi, OECD, speaks to
us about how trade can be used for creating
jobs in the Arab region.

he
earlier
development
paradigm that had insulated
national economies from
world markets has failed to achieve
the qualitative and quantitative
growth expected by the population.
Harnessing the forces of international
trade and investment is a key medium
to long term policy lever available
to policymakers to decisively and
sustainably respond to the joblessness
problem, especially among the youth.
Integration into world markets for
goods, services and ideas has proven
to be a potent recipe contributing
to growth and better employment
outcomes in developed, developing
and emerging economies alike.
Trade promotes production efficiency
via specialisation, exploitation of
economies of scale, and technology
transfer, as well as enhanced competition.
Openness helps economies to compete
by not only offering new opportunities

12

MARCH 2013

for sales (i.e. exports), but also making

available to producers the widest range
of inputs at the highest quality and
lowest prices (i.e. imports). According to
the World Bank, in the 1990s per capita
real income grew more than three times
faster for those developing countries
that lowered trade barriers (5.0% per
year) than for other developing countries
(1.4% per year). Turkey too managed
to create more than three million jobs
through a process regulatory reform and
free trade agreement with the European
Union.
Productivity growth is at the heart
of economic progress. At the sectoral
level, more productive firms expand
as trade drives more resources
towards them; at the same time,
relatively unproductive firms contract
or exit from the market altogether.
Increased
competitive
pressures
induce organisational change and
production upgrading, which in turn

boost within-firm productivity. Overall, the

long-term evidence from a broad sample of
countries indicates that an increase of 10%
in trade exposure (trade as a percentage of
GDP) was associated with a 4% increase
in output per working-age person. To the
extent that wages are linked to productivity
growth, greater openness also means a rising
standard of living.
The opportunities for creating more and
better jobs in the Arab appear to be large
,not least, given the fact that the region
is the least integrated with the world
economy. The region receives only onethird of the FDI expected for a developing
region of comparable size, and most is
concentrated in a handful of countries.
Global financial integration also lags behind
that of other developing countries. Portfolio
investment is virtually nonexistent because
of the poor state of equity markets. The
number of Arab countries adhering to IMF
Article VIII provisions, which generally
signifies full current account liberalisation,

ABOUT
Raed Safadi is the Deputy Director of the Trade and
Agriculture Directorate of the OECD. Prior to assuming
his current position in 2009, he was the Chief Economist
for the Government of Dubai.
Dr. Raed specialises in the empirical and policy analysis
of international trade. Dr. Raed has previously worked
for the World Bank and as a consultant for numerous
governments, regional development banks and UN
agencies.

exports continue to dominate the total

from the region, while non-oil exports,
on the whole, grew at a slower rate than
for all developing countries. As a result,
the Arab regions share in world export
markets fell by more than half in the 20year period between 1990 and 2010; the
regions total exports in 2010 amounted to
USD 826 billion (of which 72% is oil and
gas), an amount comparable to the combined
exports of the Netherlands and the UK.

$826 million
regions total export in 2010

is proportionally lower, at one-third of the

total, than in other regions.
Overall, financial markets in the Arab
region remain fragmented and dominated
by traditional banking activity. In many
cases, banking systems remain under public
ownership or control with considerable
exposure to government debt, weak
regulatory and enforcement capacity, and
insignificant links to international capital
markets. With minor exceptions, equity and
debt markets, insurance, leasing, and longterm financing remain weak and de-linked
from the international market.
The Arab regions trade performance
is also below that of other regions: oil

It is also the case that intra-regional

trade and investment flows have been
very limited, at 6% or less of their total
trade. Similar figures for the European
Union are 60-65%, and, in Asia, about 60%.
Furthermore, although the geographical
distribution of FDI flows among Arab
countries is not well documented, it appears
that most of regional investment outflows
go outside the area.
While openness to trade and investment
impacts employment positively, those
benefits do not necessarily materialise
immediately and tend not to be distributed
evenly. This makes it necessary to manage
the adjustment costs associated with trade

liberalisation, a point that is especially true

for workers, households, and communities
that are unable to harness market
opportunities because entry costs are
prohibitively high. A major factor to take
advantage of the opportunities from trade is
education. Globalisation and technological
progress continue to shift labour demand
towards adaptable workers with a high
general level of education and the ability
to continue learning throughout their
professional life. This requires investment
and strategies for education and skill
policies that take into account the changing
labor needs of the world economy.
Smooth adjustment requires that an
economy have several components in place.
Infrastructure needs to be of sufficiently
high quality to ensure that the growth of
existing and start-up businesses is not
thwarted by bottlenecks in transportation
and communications. Competition policy
and efficient markets are needed to prevent
large firms from abusing their market
power or obtaining special treatment
from the state. Financial markets need to
be sufficiently developed to fund new and
expanding businesses, and to deal with
the high rate of failure among start-ups
and small businesses. Regulations should
provide appropriate oversight without
imposing onerous time and resource costs,
either entry or exit. The legal system has to
function so that property rights are wellestablished and bankruptcy and business
failure can be accommodated. The rule of law
must ensure that graft, corruption, and other
forms of criminal activity dont disadvantage
the businesses that play by the rules.
MARCH 2013

13

TRADE TALK
INTERNATIONAL TRADE

Talk to the expert

Dubais vast growth and developments have lead to welcoming global trade into
its shores due to its unique geographical location, outstanding infrastructure
and seamless processes. Dubai Trade gives us an update about Dubais status as
the trading hub and doles out some interesting bits.

ubai Trade fore sought the need

for trade process simplification
through re-engineering the end-toend trade supply chain and application of
technology. It has taken the responsibility
of facilitating the trade and logistics
operations in Dubai in an effort to become
the worlds best practice model and present
Dubai as their first choice for doing business
across the globe.
In 2006, Dubai Trade was launched as
an independent department under Dubai
14

MARCH 2013

World and remarkably evolved into an

independent Dubai Free Zone company.
This marked the beginning of Dubai Trades
transformation from an online service
provider to becoming a trade facilitation
entity aiming to streamline the trade
processes in Dubai.
The foundation of Dubai Trade was
built upon the need of trade facilitation to
enhance trade processes for the benefit of all
stakeholders. It aims to give visibility to trace
the trade logistics chain, link all stakeholders

under a single window to achieve end-to-end

trade integration as well as continuously
innovative e-transformation initiatives.
Dubai Trades stated vision is to
transform the trade supply chain and make
trade faster, easier and more cost effective.
After the introduction of e-Services, Dubai
Trade Portal paved the way to improve
the day-to-day business transactions.
The migration from paperwork to online
channels has revolutionized processes,
eliminated physical visits and contributed

towards a greener environment.

Furthermore, the improvement in the
adaption of e-services built upon the
application of the latest technologies on
Dubai Trade Portal is proof of the steadfast
execution of the vision of the leader H.
H. Sheikh Mohammed Bin Rashid Al
Maktoum, Prime Minister and Ruler of
Dubai, of a paperless future for government
transactions.
The Dubai Trade Portal is the single
window for trade and cargo movement in
Dubai and has been on a continuous growth
curve and currently provides services for
traders, shipping lines and agents, clearing
and forwarding agents, hauliers, and free
zone licensees. The portal offers over
750 e-Services that span all key activities
ranging from marine services, manifest and
cargo handling services, cargo clearance
and haulage services to invoicing and
payment services and Free Zone services.
In 2012 alone, Dubai Trade has welcomed
over 21,000 new companies to its fold.
The Portal now caters to facilitating the
daily operations of over 72,000 registered
companies, providing a streamlined flow of
online services designed around customer
needs and targeted at simplification of trade
processes.
Rosoom, the highly secure, flexible and
innovative payment gateway, complements
Dubai Trades e-Services platform, which
allows importers and exporters, shipping
agents, freight forwarders, clearing agents
and haulers to initiate and complete online
all the procedures and processes, including
payment, for the various services and
facilities offered by DP World, Jafza and
DMCC. This is done via a single window
which is shared between users and all
concerned authorities, allowing for swift,
trouble-free and cost effective operations
for both clients and authorities.
Rosoom offers users multiple online
payment options, covering credit, debit and
prepaid cards such as e-Dirham, to facilitate
payments in a safe and secure environment.
Dubai Trade has also integrated Rosoom
with the online payment systems of several
key banks internationally and locally,
making it easier and more secure for trading

ABOUT
Dubai Trade FZE has set an important benchmark for excellence in trading for the
region as a whole, with its online portal www.dubaitrade.ae offering seamless trade
flow for Dubais vast trading community. More than 800 e-services of DP World,
Economic Zones World, Dubai Customs and Dubai Multi Commodities Centre, in
addition to several leading banks are integrated under the Dubai Trade umbrella.
For more information, please contact customercare@dubaitrade.ae

clients of these banks to use the solution.

Additionally, Dubai Trade has recently
developed a highly innovative online
payment solution that combines the
convenience and ease of use of payment
cards with higher security and real-time
management of payments. The new,
customisable Rosoom Wallet, which will
be launched soon, will offer managers a
high degree of flexibility and security in the
management and control of payments.
Rosoom became a major success for
Ports and JAFZA customers followed
by the increased adoption of many key
services. Recording over AED 1 billion in
online payment collections across 1 million
transactions conducted via the payment
gateway.
The time-saving efficiency of the
e-Services developed by Dubai Trade and its
stakeholders, is leading to billions of dollars
in annual savings for the entire trading
community and the economy as a whole.
According to a recent independent study

carried out by the Emirates Competitiveness

Council (ECC) these process re-engineering
initiatives have potentially led to total
savings of AED 148 billion (more than USD
40 billion) over five years ending 2011,
which accounts about 17% of the UAEs
2009 GDP.
Not only has Dubai Trade saved billions
of dollars in the past five years, but it has
also climbed up with rankings of The World
Banks Doing Business reports. According
to the Doing Business report 2008, the
UAE was ranked the 24th Trading Across
Borders topic. In 2013 the UAE ranked 5th
and has maintained its global ranking in
the top ten in the past four years. As UAE
continues to be a world leader in facilitating
trade, despite stiff competition from other
world economies, the UAE retains its
position as number one in the MENA region.
Rendering a recent report by CNN,
Dubai has transformed trading in the UAE
through the construction and expansion of
the Rashid and Jebel Ali ports. Dubai has

MARCH 2013

15

TRADE TALK
INTERNATIONAL TRADE

Sources: DP World; Britannica; Dubai Trade; Dubai Statistics; World Shipping Council and CNN.

AED 1 BILLION
online payment collections across
1 million transactions conducted via the
payment gateway
leaped up the rankings of the worlds busiest
container ports by volume. In 2007, Dubai
ports handled a ground-breaking 10 million
TEU within a single year and upgraded Jebel
Alis port to handle a capacity of up to 14
million TEU.
Moreover, with the immense growth of
the trading community, one of Dubai Trades
initiatives was to offer training from the
experts themselves. The training initiatives
cover two distinct areas. One of which is
e-Services, where Dubai Trade offers specific
training for its customers and users about the
services offered by its partners through the
16

MARCH 2013

portal. And certification courses, the highly

popular CTLP (Certified Trade and Logistics
Professional) programme. All training sessions
are accredited by the Knowledge and Human
Development Authority (KHDA).
CTLP is the regions first comprehensive
vocational training program, endorsed
by The Chartered Institute of Logistics &
Transport (CILT) that covers the end-to-end
process of import and export in the UAE and
the region. It is a professional development
certification course that explains in detail
the business concepts and processes related
to all stakeholders involved. Traders,

Shipping Agents and other companies and

entities have successfully completed the
programme with over 200 graduates in
2012.
Dubai Trade aims to bridge a knowledge
gap of trade and logistics by providing
training programmes that compass
practical awareness and the skill required
for companies involved in the trade supply
chain in the UAE and the region. And with
the great success that followed CLTP, Dubai
Trade introduces the Certified Customs
Broker (CCB), a professional development
course that covers the Customs laws and
procedures that will allow the learners
to be conversant in the Customs laws,
paperwork and practices which will help
them with the import and export processes.
With the pace of growth of Dubai as
a driver, Dubai Trade will always be on
the fast-lane paving towards its vision
and continuously dedicating efforts
to advancing trade facilitation and
streamlining processes in its aim to
establish Dubai as the leading trade and
logistics hub of the world.

TRADE TALK
Finance

Dealing with
currency risk
Western Union Business Solutions, looks at how
small and medium-sized enterprises (SMEs) can
protect against foreign exchange fluctuations
when making cross-border transactions.

urrency volatility is a big concern

for businesses that need to make
international payments, whether
for imports/exports, payroll or logistics. A
sudden shift in an exchange rate can hit the
value of a profitable deal or even in extreme
cases turn it into a loss-maker. Attempting
to understand and constantly monitor
currency markets can be a real headache
for business owners; but knowing how to
properly manage currency risk without
the headache is a real asset, any not as
difficult as one might think.
The importance of managing currency
fluctuation can be seen just by looking at
the Euro-Dirham exchange rates since the
start of 2012. In this period, the exchange
rate has varied from a low of AED 4.43
and a high of AED 4.94 to the Euro. These
currency fluctuations can have a significant
impact on a companys profit margins. It
is for this reason that, after several years
of austerity in an increasingly globalised
market, businesses and SMEs have had
to become savvier in order to minimise
costs and remain competitive against their
peers.

18

MARCH 2013

So, the question stands, what can you do

to hedge against currency risk?
There are a number of cost-effective tools
and new techniques available for SME that
wish to manage their currency risk. By
implementing some of these tools, small
business owners can build an effective
international payments strategy that will
help to protect their companys finances
in what looks to be an uncertain market in
2013.
Forward contracts
A forward contract is one of the simplest
and most effective tools available for SMEs.
It is a very straightforward product that
allows you to buy or sell a foreign currency
at todays market price, delaying the
settlement of the contract to some future, or
forward, point in time. It means that SMEs
can lock-in a particular foreign exchange
rate for an extended period of time (e.g.
12 months) and settle upon delivery at
an agreed date. A forward contract is no
different than a standard currency trade,
other than the fact that the settlement date is
pushed forward into the future. The forward

rate is also adjusted slightly to account for

the interest rate differential between the
two currencies in question.
The ability to set a budget in advance is
a key benefit of using forward contracts.
Moreover, if you see an attractive exchange
rate that is better than what has been
budgeted for, there is the opportunity to
lock-in that rate for a 12 month period,
which means there could be an unbudgeted
foreign exchange gain a great bonus for
any business.
There is one obvious downside to
using a forward contract. On the day of
settlement, you are obligated to settle at
the predetermined price. This means that
there is a chance that the market rate on the
day of settlement is more favourable than
the predetermined forward rate. Whether
or not that risk is worth taking is of course
up to individual choice and circumstance.
With todays volatile market showing no

ABOUT
Western Union Business Solutions enables companies of all sizes to send and receive
international payments and manage foreign exchange, creating unique solutions
tailored to suit their FX needs. Western Union is a leading nonbank provider of
business payments, operating its Business Solutions services through locally licensed
affiliates and partners in 29 countries. Supported by a network of trading offices,
strategic banking relationships and a proprietary global clearing network, businesses
can send cross-border payments in more than 135 currencies.

market which is fixed at the worst-casescenario price. The chosen payments

service will monitor the exchange rate and
can automatically sell when the foreign
exchange rate hits that price. This will help
to ensure that the businesss bottom line is
protected, as it will have already budgeted
for the least-favourable price.
The advantage of a stop-loss is that it allows
for some degree of flexibility while insulating
against the worst effects of a negative rate
movement. It is a product worth considering

A forward contract is one of the simplest and most effective

tools available for SMEs. It is a very straightforward product
that allows you to buy or sell a foreign currency at today's
market price, delaying the settlement of the contract to some
future, or forward, point in time.

signs of abating, however, many businesses

are opting for some level of exchange rate
certainty to protect against a sudden and
damaging fluctuation.
The bottom line is that fixing an exchange
rate in advance eliminates exposure to
volatility. Whether or not that will be
valuable is of course something for each
business to determine for itself.

Stop-losses
A stop-loss is a tool for an SME that knows
what their worst-case-scenario exchange
rate would be for a specific payment,
and allows them to protect against it. By
employing a stop-loss on a particular
payment, SMEs can place an order on the

for SMEs that would prefer to monitor the

market as it allows them to do so with what is
basically a financial safety net that will keep
them from hitting the floor should a currency
begin a downward run.

Future payments
Cash is king in the current financial markets
and with credit availability scarce and SMEs
need to be aware of alternative sources of
cash for when they need it. This is where
future payments come into play as another
useful FX tool.
A future payment is rather similar to a
short-term forward contract, except it is more
payment-specific. For example, by setting
up a future payment, an SME can receive a

short-term cash injection. This is then set at

an agreed exchange rate and settled within a
90-day period. The big advantage of a future
payment is that it both protects against
currency fluctuation and boosts cash flow,
making it a strong tool for businesses that
need access to funds while waiting for stock
that they know will be delivered.
Making use of some or all of these
tools will allow treasurers to develop and
execute a robust currency risk management
strategy that reduces exposure to currency
fluctuations. The three examples outlined
above are tools our clients use to manage
costs and protect profit margins two issues
with which business leaders will of course be
familiar. Some are probably also familiar with
at least some of the products mentioned here
and may have been using these and similar
tools to manage currency risk for a number
of years. The nature of market volatility has
not changed, but the suddenness and degree
of that volatility has certainly become more
pronounced since the credit crunch and start
of the global financial crisis. The business
world has become more globalised and that
does not look set to change. By mitigating and
minimising their exposure to currency risk,
SMEs will help to ensure that they remain
competitive.
*This article has been prepared solely
for informational purposes and does not
purport to provide any financial, investment
or professional advice. It does not in any way
create binding obligations on Western Union
Business Solutions, a Western Union Company.
Western Union Business Solutions makes no
representation, warranty or condition of any
kind, expressed or implied, in this article.

MARCH 2013

19

TRADE TALK
AWARDS

HONOURING
EXCELLENCE IN TRADE
The inaugural Trade Middle East Awards were held on the 25th of February
at Habtoor Grand, to recognise and honour the best in the field of trade.
We bring you the winners who did us all proud that evening.

rade is the cornerstone of this region and makes

a very large contribution to the GDP of these
economies. With the motto of Strive, Achieve and
Inspire the awards were our attempt to recognise and
honour those who work towards making trade simpler and
faster. It is about those organisations that strive to be the
best, achieve it and inspire others through their work.
There were 18 awards given in five major categoriesfinance, free zones, legal, business support services and
warehouse and logistics.
The event opened with a welcome speech by the Senior
Editor of the magazine, Aparna Shivpuri Arya. Speaking

20

MARCH 2013

about the magazine, she said, There has been a lot of

interest generated through our country focus events that
we started last year and we are looking forward to a packed
year ahead. It has given us the opportunity and the privilege
to present these countries to potential and existing trading
partners & businesses in the region.
The opening remarks were given by Nigel Rodrigues
who is the COO of CPI. He highlighted the importance
of trade in the region and the roadmap ahead for the
magazine. H. E Saed Al Awadi, CEO, Dubai Exports, gave
the keynote address and spoke about the importance of
trade in the region.

WAREHOUSING AND LOGISTICS

Warehouse and material handling

company of the year

Al Futtaim Logistics
Established in the 1930s, Al-Futtaim operates collectively over 85 companies
bearing the Al-Futtaim name and encompasses such sectors as commerce,
industry and services across the UAE, Bahrain, Kuwait, Qatar, Oman, Saudi Arabia,
Syria, Pakistan, Sri Lanka, Singapore, Malaysia and Europe.

Air cargo services

provider of the year

Emirates SkyCargo
Emirates SkyCargos fleet includes ten freighters (one Boeing 747-400F, two
747-400ERF and seven 777Fs) that now serves 129 destinations in 75 countries
on six continents.
In December 2012 Emirates SkyCargo took delivery of its seventh Boeing 777F.
Scheduled freighters now operate to 39 destinations.

Sea port of the year

DP World
DP World operates over 60 terminals across six continents, with container
handling generating around 80% of its revenue. In addition, the company currently
has 11 new developments and major expansions underway in 9 countries.
DP World aims to enhance customers supply chain efficiency by effectively
managing container, bulk and other terminal cargo. Its dedicated, experienced and
professional team of more than 30,000 people serves customers in some of the
most dynamic economies in the world.

MARCH 2013

21

WAREHOUSING AND LOGISTICS

Logistics best practice

firm of the year

DHL
Founded in San Francisco more than 40 years ago by 3 budding entrepreneurs
- Adrian Dalsey, Larry Hillblom and Robert Lynn - DHL has continued to expand
at a phenomenal rate. Today, it stands tall as the global market leader of the
international express and logistics industry.
A global network composed of more than 220 countries and territories and
about 275,000 employees worldwide offers customers superior service quality
and local knowledge to satisfy their supply chain requirements.

BUSINESS SUPPORT SERVICES

Company formation firm of the

year & Consulting firm of the year

The Links Group

The Links Group, established in 2002, is a premier company formation
specialist that advises corporations and individuals how to best establish a legal
commercial presence in the Middle East. With more than 40 combined years of
experience in the region, A Dubai SME 100 company, The Links Group is also the
only corporation of its kind to be associated with the Foreign Investment Office
(FDI) of the Dubai Economic Department.

Online trade/market
information portal of the year

Euromonitor
Euromonitor International has established a strong presence in the Middle East
over the past 5 years. Their robust research methodology, supported by 800
researchers and in-country analysts across 80 countries has distinguished them
as the world leader in strategy research for consumer markets. Their passion for
client support combined with the unique capabilities they offer has developed a
high profile client base in the region.

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MARCH 2013

BUSINESS SUPPORT SERVICES

Office set up firm of the year

Regus
Regus is the worlds largest provider of workplace solutions, offering the widest
range of products and services that allow individuals and companies to work
however, wherever, and whenever they need to. Regus operates over 1200
Business centres across 550 cities in 95 countries. Products and services include
fully equipped offices, world-class business support services, meeting conference
and the largest network of public videoconference rooms.

FINANCE

Foreign exchange house of the year

Western Union
Western Union Business Solutions enables companies of all sizes to send and
receive international payments and manage foreign exchange, creating unique
solutions tailored to suit their FX needs. Western Union Business Solutions is
a leading nonbank provider of business payments that offers services in 30
countries around the world. Supported by a network of trading offices, strategic
banking relationships and a proprietary global clearing network, businesses can
send cross-border payments in more than 135 currencies.

Trade finance bank of the year

Abu Dhabi Commercial Bank (ADCB)

ADCB has increased their market share in UAE in the Local Corporates and SME
segment focusing on UAE and India Trade flows. Their innovative approach
to Trade Finance requirements in terms of product offering covering both
Documentary Credit and Open Account provides Clients a complete solution for
their working capital requirements.
ADCB continues to provide innovative trade products along with their online
Trade platform ProTrade as a complete trade partner to support their clients.

MARCH 2013

23

FINANCE

Trade credit insurance

provider of the year

Euler Hermes GCC

They are the worlds leading provider of credit insurance solutions. With over 100
years of experience they have earned trust of their clients around the world.
Credit Insurance protects your business from non-payment of commercial dept.
It makes sure that your invoices will be paid and allows you to reliably manage
commercial and political risk of trade.

Islamic finance bank of the year

Noor Islamic Bank

Established in 2008 in Dubai, Noor Islamic Bank is a full service bank delivering
the broadest range of products for its customers, with an emphasis on unique and
personalized services. Noor Islamic Banks products and services are governed by
a Sharia Board, comprising leading Islamic scholars with extensive experience and
expertise in legal, financial and banking-related matters.

Marine cargo insurance

provider of the year

Zurich
At Zurich we have over 140 years experience of protecting our customers
against the unexpected and we pride ourselves on providing high quality
insurance solutions to customers in more than 170 countries. Zurich has been
serving customers in the Middle East for over 25 years. Our commitment to the
region has seen us expand our business and we now provide General Insurance
solutions to customers in Oman, Kuwait, Lebanon, Bahrain and the UAE.

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MARCH 2013

LEGAL

Excellence in maritime law

Fichte & Co
Fichte & Co is an international commercial law firm, with its head office in the
vibrant and cosmopolitan Emirate of Dubai in the UAE. Their high expertise in the
special field of shipping law as well as in corporate and trade law practice have
enabled Fichte & Co to be reckoned amongst the top tier law firms in the UAE.
Fichte & Co provides customers with personalised business advisory solutions
while constantly bearing in consideration the individualistic needs of our patrons
and is therefore able to promote better understanding and prosperity of the
different business cultures that constantly come together in the Middle East.

Excellence in IPRs

Clyde & Co
Clyde & Co is a global law firm with a pioneering heritage and a resolute focus on
its core sectors of aviation, energy, infrastructure, insurance, marine, and trade.
With over 1,400 lawyers operating from 30 offices across six continents, the firm
advises corporates, financial institutions, private individuals, and governments.

Best International trade law firm

Al Tamimi & Co
Established in 1989, Al Tamimi & Company are the largest law firm in the Middle
East with offices in the UAE, Qatar, Jordan, Iraq, Kuwait and Saudi Arabia. They
are a full service law firm specialising in a range of practice areas and pride
themselves on providing their clients with not only professional expertise but
superior service and quality commercial advice. They have advised on some of
the regions most complex matters and continue to be at the forefront of market
developments.

MARCH 2013

25

Free zone for ease of

doing business

FREE ZONES

Ras Al Khaimah Free Zone

(RAK)
RAK FTZ is a gateway to emerging markets with 6,000
companies from 106 countries. The easy and simple
procedures have made RAK FTZ the first choice by SMEs
from around the globe. Since 2000 RAK FTZ has grown
and they continue to improve our products and services
and strengthen their positioning as a business hub geared
at helping SMEs connect to emerging economies. Opening
their UAE and international offices was another step for us
to facilitate ease of doing business for their clients. They no
longer have to travel to Ras Al Khaimah to get information
or register a company; they come to them to save them time
and money.

Free zone for attracting

maximum investment

FREE ZONES

Jebel Ali Free Zone (JAFZA)

Jebel Ali Free Zone (Jafza) is one of the worlds leading free
zones. Established in 1985, Jafza is today home to over 6,900
companies, including over 100 of the Global Fortune 500
enterprises. It is a leading driver of the burgeoning UAE
economy contributing over 40% of Dubais net FDI. Jafza is
the regions most efficient logistics hub and the only one in the
world located between a top container terminal (Jebel Ali Port)
and a top international airport (Al Maktoum International
Airport), enabling the best multi-modal connectivity.

26

MARCH 2013

Editors choice award

for promoting trade

Dubai Trade
Dubai Trade is the premier trade facilitation entity that offers
integrated electronic services from various trade and logistics
service providers in Dubai under a single window. It underlines
Dubais position as the ideal base for trading across borders
with its unique geographical location, excellent infrastructure
and seamless processes across the private sector and
government agencies.
It is a subsidiary of Dubai World through the intermediary
company, Port & Free Zone World FZE and is incorporated
under the laws of the Jebel Ali Free Zone Authority in Dubai,
United Arab Emirates. It integrates the major stakeholders
in the trade and logistics operations including DP World,
Dubai Customs, Economic Zones World, and Dubai Multi
Commodities Centre.

Editors choice award

for contributing to
trade finance

United Arab Bank

Incorporated in 1975, United Arab Bank (UAB) is a serious
player in a competitive market where more than 50 lenders
compete for about 7 million customers.
Based in Sharjah and operating with 20 offices and branches
throughout the UAE, the Bank offers its clients tailor-made
financial services in both corporate and retail banking, and
has mainly established itself as a leading solutions provider
for a growing commercial and industrial base across the seven
emirates. Through the provision of a comprehensive range
of Corporate Banking, Retail Banking, Trade Finance, SME
Banking and Treasury services, UAB is the Bank of choice
among major corporate clientele segments in the UAE.

MARCH 2013

27

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MARCH 2013

MARCH 2013

29

TRADE TALK
Sector Watch

Food
for thought
B

Gulfood 2013, which concluded on 28th

February, gave us an insight into the potential
and magnitude of the trade and investment
opportunities in the food sector. We bring you
an overview of this sector and talk to some of
the big trade partners about their opinion.

eyond oil the complex and vitally important

trade and investment relationship the
GCC has with the world is not that well
known. New markets are being sought around the
world for a growing range of non-oil goods and
services, while, on the investment side, both the
well-capitalised sovereign wealth funds and an
increasing range of private investors have built up
wide-ranging investment portfolios. And one such
non-oil sector is the food sector.
The global food and beverage production
industry is one of the fastest growing sectors
worldwide, valued at AED 20.6 trillion in 2013. With
demand in the GCC expected to rise significantly
fuelled by population growth, higher per capita
income, and increasing tourism numbers food
imports to the region will increase by as much as
100% to AED 194 billion by 2020.
At a press conference organised prior to the
Gulfood, H.E. Hamad Buamim, Director General,
Dubai Chamber of Commerce and Industry (DCCI)
stressed the importance of the food and beverage
sector for the growth and development of UAEs
economy. With the value of food consumption in
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MARCH 2013

the UAE expected to have reached AED 28.2 billion

in 2012, he said this was forecasted to increase to
AED 32.6 billion in 2013.
When we asked some of the countries, about the
importance of an event such as the Gulfood, Nawal
Benzaid, Agriculture and Agri-food Counsellor,
MENA region, Trade Commission of Canada, said
Gulfood is important for our Canadian companies
which are interested in the Middle East and North
Africa market and want access to South Asia market.
The food opportunities are growing in this part of
the world and with the large expat community, the
demand for sophisticated and diversified products
is increasing. It is a region that is very dependent
on food import and Canada exports over 70% of
its agriculture and agri-food. The opportunities
are huge from commodities to specialty gourmet
products.
Gerard Seeber, Trade Commissioner and Consul
General, Trade Commission of Australia, Dubai
further added to it, Australia has a long-standing
relationship with the UAE as a consistent supplier
of quality foodstuffs and beverages. In addition to
achieving international reputation for producing

food from a natural environment, Australia

has established high levels of food safety and
sophisticated food processing systems. All
the top 10 multinational food companies have
invested in the ideal production environment
that Australia has to offer. Australia has also
won increasing recognition for its worldclass organic, specialty and innovative foods.
Gulfood is a great opportunity to see and
network with some of Australias best.
For Singapore, Gulfood is the largest
launch platform for Singaporean F&B
manufacturers looking to bring their latest
products to the region. This year, more than
40 Singaporean companies participated at
Gulfood and 30 launched new products, said
Lester Lu, Regional Director, IE Singapore.

Background
The GCC countries, with a total population of
40 million, are amongst the worlds richest in
terms of oil and gas reserves and per capita
wealth. However, when it comes to food
sufficiency, due to water shortage and lack
of arable land (less than 2%) on an average,
these countries need to import almost 90%
of their food requirements. This backdrop
makes the growth and outlook of the food
sector a very important issue for the GCC
countries.
The numbers mean that the region will
continue to import from 85% to 90% of its
foodstuffs annually.
Saudi Arabia would continue to play a
key role in terms of volume, accounting for
around 64% of GCCs total food consumption
in 2015. Consumption in Qatar, Oman and
the UAE is likely to grow at a relatively higher
rate as population in these countries is
expected to expand at 4.0%, 3.2% and 3.0%,
respectively, on an average during 201115.
Due to the scarcity of arable land and an
arid climate, agriculutural food production in
the GCC region has been minimal. According
to the FAO, of the total area, the land suitable
for cultivation is just 1.7% in Saudi Arabia and
3.0% in the UAE compared to 18.4% in the US,
23.7% in the UK, 16.3% in China and 51.6%
in India. Nonetheless, Saudi Arabia, which
produces cereals (mainly wheat), vegetables,
fruits, meat (poultry) and dairy products,
leads GCC countries in food production.

Trends
So what food products does the region
import from countries such as Brazil, Canada
and Australia?
Talking about these trends, Michel Alaby,
CEO, ABCC said, The GCC countries top five
food group of products imports range from
cereals, meat, dairy products, fruits and
vegetable/animal fats/oils. National food
industry generally are for food processing,
so food products in that line are also always
in the import demands. When analysing
country by country foodstuff products, the
top five according to the last available data
from INTRACEN in 2011 are:
1 Saudi Arabia USD 12,68 billion
2 United Arab Emirates USD 10,74 billion
3 Kuwait USD 2,28 billion
4 Bahrain USD 1,47 billion
5 Oman USD 1,26 billion
6 Qatar USD 992,27

To this, Nawal added, UAE is our top export

market in the GCC followed by Saudi Arabia.
Last year, our total agriculture and agri-food
exports valued USD 704 million. Our main
exports are canola seeds, pulses (lentils)
and wheat. We also export some value added
products such as Canadian lobster, Canadian
beef, ice cream, and more
Australias main exports would be mostly
agricultural products meat, wheat/
oilseeds and horticulture. For processed
foods major exports include dairy, wine,

cereals, beverages, processed fruits and

vegetables.
Gerard also highlighted the trade relations
between the UAE and Australia. Australia
is now the UAEs third-largest supplier of
food for local consumption as well as for
re-exports to other GCC countries, with
food imports mainly focused on Australian
meat. In 2011, the UAE replaced Egypt as
Australias number one beef and lamb export
market in the Middle East, with red meat
imports reaching 28,804 tonnes, according
to statistics provided by Meat and Livestock
Australia. The trend has continued into 2012,
with the UAE overtaking Saudi Arabia as the
largest importer of red meat products.
According to Lester Lu, Regional Director,
IE Singapore, Singapore exports its products
all around the world, with the GCC being the
sixth largest market for Singaporean food and
beverage exports. Singapores F&B exports
to the GCC have grown significantly from
USD 57.04 million in 2001 to USD 256 million
in 2012. Among Singapores top exports to the
region are milk and cream products, cooking
sauces, seasoning mixes and edible oils.
Beyond these traditionally strong exports,
Singaporean F&B manufacturers are also
eyeing growth opportunities in the health and
wellness, convenience and Halal food sectors.
Opportunities for bilateral
trade and investment
So what does this mean for food exporters? To
this, Gerard stated that Dubais position as a
MARCH 2013

31

TRADE TALK
Sector Watch

trading hub in food will increase in importance

and commodity products will remain in high
demand.
For Australian exporters trade opportunities
in the GCC exist in most food categories.
However, the market is highly competitive
given the regions open trade policies. In
some instances consumption is small, so
opportunities exist for consolidators of mixed
consignments.
Further exploring opportunities, the one
industry within the food sector that offers
opportunities is the Halal industry. The
Halal food market which accounts for
12% of global trade in agri-food products
is estimated at USD 560 billion. The high
concentration of wealth in the area, along
with rapid infrastructure growth, facilitates
international trade, making it highly attractive
for business.
With increasing demand from 1.8 billion
Muslims worldwide, GCC companies are now
positioning themselves as major suppliers
of the halal food industry, which has been

private domestic and foreign players and is

offering financial incentives. The government
is also building infrastructure to boost the
attractiveness of the sector. In its 2010 budget,
KSA allocated USD 12.3 billion, up 30.9%
from the 2009 allocation, to the agriculture
and water sectors with an aim to develop the
required infrastructure for agriculture in the
form electricity, irrigation, transportation
systems, and mills.
The UAE has also been working on vertical
farms, a concept farming technique in which
crops are sowed vertically on different levels
compared to horizontally in traditional farming,
to produce vegetables, fruits and grains indoors
by using limited quantities of seawater.
Challenges
Talking about the challenges, we asked Michel
what he thought of it, since Brazil is a major
trade partner of the region when it comes to
food products. To this he said, MercosurGCC Free Trade Agreement may ease trade
flows between regions. Regarding logistics,

AED 20.6 trillion

value of global food & beverage production
estimated to generate between USD 632 billion
and USD 2.1 trillion annually.
The GCC, which imports around 80% of its
food, will look to Latin America as a vital food
source, with investment in land acquisitions
likely to increase. Brazil is one of the worlds
leading food exporters, with around 11% of
food-related exports sold to the Middle East,
according to the Arab-Brazilian Chamber
of Commerce. Around one-third of Brazils
poultry exports go to the Middle East and it
is a significant exporter of Halal products to
the region .
Government support and financial
incentives in the GCC have encouraged
private participation in the agriculture
sector. The Saudi government has simplified
the bureaucratic process of investment for
32

MARCH 2013

maritime lines are increasing routes, but

some companies request more frequent lines.
Referring to airlines for passengers and cargo,
we have today, two companies: Emirates
Airlines, (daily flights to So Paulo and Rio de
Janeiro) and Qatar Airways, (daily flight to So
Paulo). Eithad Airways will open a daily flight
beginning June, 2013.
Nawal reiterated the same sentiment
and said the distance coupled with high
transportation costs make it difficult to trade.
As it must be evident by now, while
there are challenges there are also a lot of
opportunities that this sector offers.
We also spoke to Frank Courtney from
Barloworld Logistics, to know what are the
logistical challenges. According to Barloworld
Logistics food security & visibility are the top

challenges for the food logistics industry.

Looking at the current horse-meat scandal
in Europe; lack of security and visibility are
at the root of the scandal. Consumers and all
parties involved in a food supply chain need
to have greater visibility in order to be able
verify the authenticity of the products they
make and sell. Greater standards & scrutiny
by government agencies is more pertinent to
ensure food security, however this can only
be effective if the visibility and security is in
place and enforced
Barloworld Logistics recently concluded
a supply chain study with 500 senior
management professionals from various
industries in the GCC. The greatest challenges
faced by the companies surveyed, are related
to interpretations of rules & regulations
within the country and cross boarder
transportation. There is a sizable component
of the companies surveyed that form part of
the food industry. The challenges mentioned
above are more critical when it comes to
perishable cargo.
However, over the last two decades GCC
countries have made substantial investments
into infrastructure and facilities specifically
for the importation of food into the region.
The continual development and investment
by governments and private companies has
resulted in a robust modern infrastructure
availing a myriad of solutions for companies
wanting to export to GCC countries.
In country infrastructural investments,
such as Dubai Flower Centre is an example of
an infrastructural investment by government
wherein multiple tenants benefit from the
cold storage facilities that allows for an
unbroken cold chain. There are also a large
number of logistics companies with facilities
and infrastructure to assist companies
wanting to enter this market.
Government bodies responsible for food
security can ensure the standardisation,
reinforcement and communication of
rules and regulations to ensure better
understanding and compliance which will
eliminate many problems faced by companies
in this region.
We hope our review of the food sector in the
region will help you identify some interesting
opportunities.

Country

focus
FRANCE

FRANCE

BILATERAL TRADE

Industry watch

Interview

MARCH 2013

33

country focus
INVEST IN FRANCE AGENCY

Courting suitors
Created in 2001, the Invest in France Agency (IFA) is responsible for promoting,
prospecting and facilitating international investment in France, and for the
economic attractiveness and image of the country. Aparna Shivpuri Arya spoke
to David Appia, Chairman of Invest In France Agency, to get his expert opinion
on the attractiveness of France as an investment destination.

avid started the discussion by

highlighting two important issues
simplification and stabilisation
of the legal and regulatory environment.
Simplification has always been an
important objective. Making it easier for
companies to operate and do business in
France is the motto, so much remains to
be done, was Davids honest opinion.
First the notion of stabilising the
environment that is important, particularly,
34

MARCH 2013

in the tax field. It is often said by international

and French companies that the environment
and regulation is too heavy and complex.
The tax code is really huge and thick and
streamlining the whole thing is important.
But more than simplification, stabilisation is
important because in France they like new
measures and keep changing the laws. So the
government for the first time committed itself
not to change a number of tax regimes and
they chose five important tax schemes and

procedures benefitting the companies and

announced publicly that these five tax regimes
will not be modified during the governments
five year tenure. Thats really very impressive
quite an innovation here. Its a tricky issue
because the parliament is likely to change
the law but the parliament is supporting the
government and the government announced
that these five things will not be changed.
So its fair to assume that there will be no
change, and that the government and the

parliament are working together. So thats an

interesting point, introducing more stability
in the business environment, opined David.
This is a part of the national pact for
growth, competitiveness and employment.
Number one measure remains in his view the
tax credit to reduce the cost of labour and,
as important, probably the stabilisation and
simplification of the business environment.
Last September, the government convened
a large conference on the issue of the way the
labour market is organised and the labour
laws in general. All stakeholders were invited
and joined the conference, and it was decided
to ask the representatives of the business
community, the professional trade union, and
the trade unions representing the employees
to discuss together. They were asked to enter
into a negotiation to improve the state of play
and the existing rules and laws governing the
labour market; with two primary objectives
introducing more flexibility into the whole
system to make it easier for companies
to adjust when confronted with difficult
economic environment , more flexibility and
for the benefit of workers and employees to
introduce more security in the work market
or work place.
By doing this, David said that companies
will gain flexibility and employees will gain
more security, in terms of training, in terms
of the possibility to go from one company to
another without losing anything in terms of
rights and experience. So last September the
negotiations started , the government gave
the roadmap or four different points that
had to be covered and this was accepted as
a starting point or basis of negotiations by all
participants and they were left on their own
they negotiated on their own. They started
in October, and the negotiation had to be
brought to an end by January 11th that was
the decision of the government. They were
informed by the government that in the event
that they were not able to reach a decision by
January 11th, the government would take it as
their responsibility and introduce a bill into
the parliament.
Everyone expected success, and they
managed to come to an agreement on January
the 11th. And I am very confident that the new

law will respect this very carefully drafted

balance and that the French labour laws will
be amended and improved as decided upon
by the stakeholders. This is to be achieved
by next probably April or May. And this is
something very important because as you
must have heard, that France was considered
as a country where the labour market was too
rigid, pointed David.
I should add one word, as an agency we
are very actively involved in attracting foreign
companies, one more important step taken
in January, was that the government adopted
a communication strategy to improve the
attractiveness of the country. It was first
reiterated by the government that France
is keen to welcome new companies, foreign
companies, is an open country and wants to
remain open to foreign investment. Thats
the first element in the strategy and it has to
be reiterated in every occasion. Second its
a matter of interest to all members of the

David Appia, Chairman of Invest In France Agency

Since all European countries are working

hard on being more attractive to investors,
we asked David, for a GCC potential
investor, what will be the advantages
of investing in France? David, who was

We have the most supportive research tax credit in

Europe- its a 30 % rebate in all expenditures in R&D.
Its absolutely unparalleled and it benefits almost 2000
companies in France, was Davids answer.

government because the attractiveness of a

country relies on a large range of elements
education, transportation, tax regime and
more, David highlighted.
According to the David, the third initiative
by the Government is to ask all stake holders
and owners to join their forces and unite
and work together to improve the conditions
offered by France. That is the third element
in the environment which is of great value to
them. And they are currently in the process of
computing all results for 2012 and they work
together with the regions in France.
We get in touch with the head quarters of
the companies, we verify and check whether
their decision is solid and whether the
investment will take place soon and then we
compute and include in the new report and
we will very soon, David proudly stated.

quite amused with our question, said,

that recently the Government decided
to launch an internal work and it asked a
group of five personalities to work on the
idea or notion of a national brand mark /
brand name mark de France and it was
felt necessary to look at that in more detail
because we have definitely sort of an image
abroad which may vary from one country
to another for sure but of course the name
France means something to everyone,
positive or less positive, related to history,
to culture to gastronomy and so forth. And
it was asked to these experts to try and
find some sort of a brand which might
encapsulate all positive elements of the
image of France abroad.
Im starting with this to let you know
that we are currently engaged in this
MARCH 2013

35

country focus
INVEST IN FRANCE AGENCY

Change in the number of job-creating foreign

investment projects in France (2000-2011)

discussion and this report is to be translated

next may ( 1st of May) so Im not sure what
the results are but they are working on
that, remarked David.
We have excellent infrastructure, roads
and IT infrastructure, but is it really what
makes France different? Well lets say its
clearly an asset. Its a positive element
in the whole picture. Then we do have a
central location in Europe at the heart of
the European market. If I go to the Website
of my sister agencies in Europe, most of
them argue that their countries are in the
heart of the European market, but its true
that as far as France is concerned we are
at the heart of the market. Geographically
we are in the centre of Europe, is it what
makes France different? Thats debatable.
What makes it different that as a country
we can offer a lot of elements to make
it interesting for a foreign investor? In
other words the attractiveness is quite
coherent and large and substantial. We can
offer a lot good location, infrastructure,
good people, high level of technology,
very creative workforce, an excellent
environment in terms of R&D and
36

MARCH 2013

universities. We have the most supportive

research tax credit in Europe- its a 30
% rebate in all expenditures in R&D. Its
absolutely unparalleled and it benefits
almost 2000 companies in France, was
Davids answer.
France also has 71 technological clusters
in the country a sort of open eco-systems,
in which public and private companies,
universities work together and support and
develop collaborative.
Moving along, David said that in the last
two or three years they have been in contact
with an increasing number of foreign
companies, especially from Asia, which
are keen on reaching the Gulf and Africa
and they take France as a base. It relates to
the historical link that France shares with
African countries.
He also brought to fore a very interesting
aspect- that of demography. He said that
the demography of a country tells you
about the economy of tomorrow and France
is well positioned as far as demography
is concerned. Companies do include
demographics in their benchmarks.
He also added that more and more

companies tell them that they value the

position of the country in terms of carbon
footprints. It is not only the companies,
but also the country which is involved.
Without trust and confidence, no money
will come in since money is put in for longterm and unless there is confidence that
wont happen. That is why we would like to
reaffirm that we want foreign investment
and well work towards making your
life easier. We are eager to welcome you,
remarked David.
We then moved on to our last point the
EU-GCC FTA. Talks have been going on a
long time and we wanted to know whether
there will an impact of that agreement on
trade and investment? David was quite sure
when he said, Yes, certainly so, though its
difficult to calculate right now since these
sort of agreements promote trade and
investment by offering mutual concessions.
It will definitely offer a more favourable
environment.
It was impressive to know the work that
IFA is doing to promote France as the
investment destination. And there is no
denying that it has done a good job!

Supporting your
investments
We also spoke to Salim Saifi, who handles the Middle East
operations of IFA to get some more details.
How long has IFA been in the
Middle-East?

What regions of France are the

easiest to do business in?

While we have formally been on the ground

for about five years now, the long standing
relationship that France and the GCC have
enjoyed has existed for decades. We are
privileged to continue this relationship.
Our role is to enable local entities that are
ready to reach out to the global market to
create a European hub and truly become
international.

Most generally people are looking at the

Paris region. Its the main economic region
of France, above all, companies setting up
in the area gain access to vast local, national
and European market opportunities, with
495 million consumers. Other dynamic
French regions are attracting GCC investors
such as Rhone-Alpes (Lyon) and Provence
Alpes Cotes dAzur (Nice and Marseille).

For GCC based companies, I would say

the agri-food business has plenty of
possibilities. Foreign companies are
already highly active in this sector in
France, where they account for almost 30%
of agri-food output. The turnover of the
Halal market is increasing by 10% yearly;
the vitality of the market can be explained
by demographic factors. There is a very
large population of Muslims in France
who adhere to the Halal code of practice
and therefore constitute a huge pool of
potential consumers. In 2010, around
Euro 4.5 billion were spent on Halal food
products for home consumption, and Euro
1 billion were spent in restaurants.
French hotel sector has high potential to
welcome GCC investors, the country is a one
of the most preferred destination for GCC:
we are welcoming approximately 1 million
GCC tourists in France.
Finally, there is also strong interest from
GCC companies to set up their European
office in France to use the country as a
gateway to Europe and as a bridge to Africa.

We work with businesses that have the

potential for expansion globally and interest
in European markets. In addition, we work
with businesses of different sizes that range
from SMEs (Small Medium Enterprises)
to SWFs (Sovereign Wealth Funds). As a
government agency, all communications
with us are strictly confidential and any
assistance we provide is complimentary.

What are the best investment

opportunities for GCC investors
in France?

Who are your key clients in the

region? Can you describe some of the
work that you do for them?

also informed them on new policies and

incentive plans. Today, there are more than
90 companies from GCC doing business in
France, employing 3000 employees.

Can you give examples of the work

you have done? Can you describe
how this work was transformative
for your client?

What metrics do you apply for

success?

IFA has played an integral role in helping

bridge the two regions. For instance,
we have assisted companies in several
business sectors (ICT, media, energy, retail,
hospitality, food) with office openings in
different french region. We helped them
get in touch with key local authorities
that provided them access to a productive
and talented workforce. We resolved all
types of business queries and put them
in touch with subject matter experts. We

Anytime that we are able to create a

relationship where we can help local
companies meet their international
business needs we have succeeded.
France is full of different opportunities for
investment across various sectors and we
make sure that we engage with companies
to ensure that they are leveraging the right
opportunities and to their fullest potential.
Generally, anytime jobs are created we have
succeeded.
MARCH 2013

37

country focus
TOTAL

What lies deep within

Total, the fifth largest publicly-traded integrated international oil and gas
company in the world, has shared historic ties with the Middle East and is very
bullish on what the future holds for the oil and gas sector. Aparna Shivpuri Arya
met Arnaud Breuillac, President Middle East, Exploration and Production
Division, in their Paris headquarters to get all the interesting details.
Mr Breuillac, can you give us a
brief overview of Totals upstream
operations in the Middle East?

Total started its activities in Iraq in 1924

when as part of World War I compensation,
France got a share of the Iraq Petroleum
Company (IPC) alongside the British and the
Americans. In Iraq, the first discovery was
Kirkuk in 1927. We then came to Qatar in
38

MARCH 2013

1936, Oman in 1937, Abu Dhabi in 1939, and

we celebrated last year 25 years of presence
in Yemen.
Today about a quarter of Totals worldwide
oil & gas production comes from the Middle
East 570,000 barrels per day (b/d) in 2011
- and it is a key region to us both as operator
and as partner, one of the pillars of the
company.

In Abu Dhabi, our production comes

mainly from the onshore concession of Abu
Dhabi Onshore Company (ADCO) and from
the offshore concession of ADMA-OPCO,
plus the Total operated Abu Al Bukhoosh
offshore field.
In Qatar, through our participation in
Qatargas I and II, we have a share of the
liquefied natural gas (LNG) business there,

and we are also operator of the Al-Khalij

field, which is an offshore oil field. It is worth
mentioning that the Al Khalij licence has been
extended mid-November for 25 additional
years with Total, operator retaining 40%
interest alongside Qatar Petroleum.
Total is also involved in oil and gas
production In Yemen. Our main asset is our
40% interest in the Yemen LNG company, and
we are also the operator of Block 10 located
in Hadramaout region, which produced upto
86,000 b/d in 2011 about a third of Yemens
total oil production. We are the only major
working in Yemen and we are very proud of
our contribution to the countrys economy.
In the Upstream segment, we are also
present as a partner in Oman, though
Petroleum Development Oman, Oman LNG,
and the Mukhaizaina block, but we are not
operator.

How about Totals more recent

developments in Iraq?

In Iraq, we are a partner with an 18.75 %

interest in the Halfaya field development
operated by the Chinese national company
CNPC. Production on that field started in
June 2012 and we completed Phase 1 of the
development, reaching First Commercial
Production in September 2012 after 90 days
above the contractual production level of
70,000 b/d, thus prompting the beginning of
the pay back of the investment.
We are now producing around 100,000
barrels of oil per day on Halfaya and the fields
full development is set to reach 535,000 b/d.
This project is going on quite well, in spite of a
challenging context in Iraq.
Regarding Iraq, at first we felt a bit
frustrated when we got a relatively modest
share of the Iraqi reconstruction activity
following the first bidding rounds for the
development of fields in the South. But we
rapidly saw that contractual conditions
were not enough rewarding, especially for
exploration in the fourth bidding round,
which we did not participate into.
The Northern part of Iraq also has
significant potential for exploration, and we
decided to go for it last summer, acquiring
participations in 3 exploration blocks.
We hope that we will make discoveries in
the coming year and we dont want to get
involved in the political debate. All we wish

to do is contribute to the development of the

Iraqi oil & gas industry in the south and in
the north.

Total has been having a historical

relationship to the Emirate Abu Dhabi
which is getting ready to renegotiate
the ADCO onshore concession. Where
does Total stand today?

The future of the ADCO concession is a

subject entirely managed by the Abu Dhabi
national company, ADNOC, and the Supreme
Petroleum Council. There are a lot of rumors
flying around about this, they have made
some statements about where they are in the
process, and the fact is we do not know yet.
This being said, Total has been a partner
in ADCO for decades and has contributed to
the successful development of the onshore
fields of Abu Dhabi. Today, we feel that we
still have a lot to contribute to our national
partners objectives for onshore fields both
in terms of technology and human and
financial capabilities and we hope to be part
of the future of ADCO in a mutually beneficial
scheme that will lay the foundation for our
relationship in the coming decades.

What is the extent of your presence in

Qatar?

Another country where Total is very active

in the Middle east is Qatar where we are
present all along the Oil & Gas chain from
exploration down to LNG production, refining
and petrochemicals. We are much willing to
further develop our activities in Qatar.
Our Qatar success story is definitely the

development of the North Field with the

LNG giant Qatargas. Qatar has reached 77
million tonne of LNG per year production
level in 2010. In their view to develop their
hydrocarbon resources in a sustainable
manner, the Qatari authorities have
decided on a moratorium on this field
but we are expecting sooner or later this
moratorium may end and allow for additional
developments.
In the mean time we are working on an
exploration block which is operated by
CNOOC of China, Block BC and activities are
starting on that block this year. We believe
the exploration potential in Qatar is still
interesting enough.
As mentioned earlier, we have also entered
into a new 25 years agreement for the Al
Khalij oil field on which we have been the
operator since the early nineties. As from
January 2014, Qatar Petroleum will hold 60%
and well keep 40% retaining operatorship of
this challenging field.

What is Totals plan regarding Yemen

in the light of the current security
situation in the country?

Yemen is a very important country for

Total. We have been present in Yemen for
more than 25 years now and we are clearly
the only major oil company operating in
Yemen today. In 2009, we have started the
largest foreign investment ever made in
the country, the Yemen LNG plant, with a
40% share. Were also producing oil from
Block 10 which amounts to about a third of
the National oil production. We pay a lot of
attention to our operations in Yemen and
we ensure that security is maintained so
that we can continue to operate. The GCC
roadmap for the country is ongoing but itll
take time and Yemen needs support from the
international community. We contribute to
the countrys economy by maintaining our
activities there

In the light of the current political

situation, do you see further upstream
investment opportunities for Total in
the Middle East?

Middle East is clearly a region which has

a huge oil & gas potential, probably more
than what we know today because until
now, non-conventional resources have been
MARCH 2013

39

country focus
TOTAL

under-explored. A lot of wells have been

drilled in the region to produce conventional
oil & gas reserves but in a way, less effort
has been put into exploration. So we believe
that the potential in the region is not yet fully
identified. We can still see very successful
exploration drilling in the Middle East. In the
past years, seismic technologies have made
tremendous progress and this is partly due to
the computing technologies. Another thing is
the progress achieved in drilling capabilities
which is giving us the possibility to reach very
narrow targets in the reservoirs.

How do you assess the impact of the

shale gas revolution in the US and
the fact that some people are saying
that the lesser dependency of the US
on the Middle East will change the
regions weight on the international
oil & gas market?
When you look at it from a global perspective,
the competitive advantage that the US is
getting from the cheap gas is not without
consequences to their economy. But we
believe that from a geopolitical standpoint

number of LNG export projects that will

get approval in the US and how much that
will affect the US supply-demand balance
and how much would that effect the world
market. Oil is a global market and there is
one price, for LNG it is different- there are
different markets. Unless you come to a
situation where you have enough LNG plants
so that a significant share of the worldwide
production can be arbitrated between the
European, US and Asian market, youll find
that the price might co-relate. But as long as
there is a physical constraint, and not enough
infrastructure, you will always get a gap that
will be dependent on how much gas can
be produced locally and how much can be
imported. In the Middle East, Qatar and its
LNG flagship Qatargas are very well located
to arbitrate between the western and eastern
market, which is very good for them.

Do you see a great potential for the

development of alternative energies
in the region?

I am very optimistic about the work being

done in the field of new energies, especially

77 million
Tonne

per year production- Qatars north oil field

of the world, the supply and demand is such,
and especially the market is so liquid for oil,
that what happens in the Middle East will still
be relevant to the global balance. Emerging
economies like China or India need oil and
this region owns the vast majority of the
resources. It is therefore important for the
industry and therefore important for Total.

Are the LNG prices factoring in the US

shale gas boom situation?
The big uncertainty in that respect is the
40

MARCH 2013

in the UAE which are very keen on developing

these. Total as an energy company, believes
that new energies are absolutely necessary
in the future and will complement fossile
energies in the energy mix. We have moved
away from the time when oil companies
were hostile to anything except oil. Today, oil
producing countries and most international
oil & gas companies believe that we need new
energies.
At Total, we are working in two different
areas. The first one is solar which has a highly

competitive advantage in the region and is a

strong business development line for us.
In Abu Dhabi, the Shams project, one of the
largest concentrated power plants in the world
developed by Total with Masdar and Abengoa
will be inaugurated in the next few weeks.
Through our affiliate Sunpower a
world leader in solar Photovoltaic we
are also looking into the new projects that
countries in the region are looking forward
to develop. Saudi Arabia for instance has
made clear that it would like to increase
its Photovoltaic electricity generation
capacity and we expecting announcements
at the end of this year.
In fact, Middle Eastern countries are using
a lot of energy such as diesel oil to generate
electricity to feed their industry. These are
petroleum products that do not generate
export revenue, so for them to invest in
solar energy is a very good business, as it
is free and abundant once you have built
efficient installations.
The second aspect in which Total is
involved in alternative energies is bio fuels.
We believe that these will complement the
liquid fuel market in the future and we
are investing in this field. We are looking
into developing a credible and profitable
activity for renewable energy.

How do you see the relationship

between International Oil companies
like Total and Middle Eastern
National Oil Companies?

Today, IOCs and NOCs are more and more

working in partnership. Through times, the
relationships between the two have gone
through successive phases: a somewhat
conflicting relationship at the time of
nationalisation, then IOCs worked for NOCs,
more as service providers and now we work
together as partners. In addition, we have
an international exposure, which is valuable
for these national companies. This model
is excellent as it allows combining our
strengths including technical, human and
knowledge capabilities, in addition to the
profitable combination of the skills of the
two. The line of business for us in the region
is to see where we can contribute more,
mutually and profitably with NOCs.

country focus
GRAND PARIS

Be on the right track

Greater Paris, is a topic that has been going on for over a century in France.
The first greater Paris project started in 1920. As part of a press trip to Paris,
Aparna Shivpuri Arya caught up with Alexandre Missoffe, Director of the
Cabinet, Socit du Grand Paris to get a better understanding of the project.

n 2007, just a few weeks after his election, Nicolas

Sarkozy announced his intentions to have a project
for the Greater Paris as Paris represents 1/3 of
the national GDP. He started a special department in the
Government secretariat dtat for the development of
the Paris region. Christian Blanc was in charge of it with a
special focus on the economic impact of the Greater Paris.
Continuing on that Alexandre said, The new president
Francois Hollande made a public statement and said that

42

MARCH 2013

the project is very important and must go forward, and in

our board in Societ de Grand Paris we have got represented
from the state and every department in the Paris region,
and they all vote for the global skills of the Greater Paris.
This project actually started with Sarkozy, but it is now
shared with everyone else and has political support.
Paris has been constructed around fences to protect
against invasion and is denser than other global cities in
the world. It has two million habitants inside a very small

area with a great transportation system

but outside of Paris, the transport system
is less efficient with very few public types
of equipment. Compared to London and
New York, Paris is much smaller.
The Greater Paris territory has:
12 million inhabitants
600,000 fellow students (the biggest
student metropolis in Europe).
553 billion Euros GDP (Number 1
economic region in Europe)
1/3 of the French GDP
90,000 people working in the research.
The goal of Greater Paris project is to end
this cut between Paris and the suburbs,
and organise one unified metropolitan
district, and to connect the greater Paris to
major transport infrastructure.
We are now in a situation (transport)
that carries over one million two thousand
people per day, that is an absurd situation,
people spend on an average an hour in the
transport which is a productivity loss for
the economy, stated Alexandre.
The Greater Paris project started by
identifying the project territories, sort of
clusters all around Paris, some of them
are already powerful like Paris Saclay on
the south west which is already one of the
densest research territory in France.
On being asked if there is an economic
rationale for identifying these clusters,
Alexandre said, We have got to give
international visibility to this territory
to attract new businesses and companies
in these areas. Our aim is also to try and
organise clusters where people match
and researchers can meet scientific
and university private investors to try
to organise, like all the areas behind the
Stanford they came to Silicon Valley
because they planned to manage an
ecosystem of innovation.
Alexandre had mentioned earlier that
Paris contributes 1/3 French GDP, which
got us wondering if the projects will
increase this percentage?
He gave an example to explain that itll
increase, Hitachi wanted a European plant
either in London or Amsterdam, then they

heard about the Greater Paris, so they

found it interesting. We are competing
with the other big cities; it is Paris, New
York, London and a few more.
We h a d a l a w i n 2 0 1 0 , w h i c h
created Socit du Grand Paris (a public
establishment). we started the big public
debate with the population in September
2010, and the region had a big debate
with the national government. the region
said that the transport is a local liability
so we had two projects (more less the
same project). We came to the population
that had been expecting investment in
transport for the last 40 years. The project
region was called Arc express, the state
project was called Grand Paris, and the two

time 4% interest was paid and everyone

was happy with the placing of their
savings with the Paris authority to put the
investment in a long period of time.
Alexandre further added that when
the metro starts to work, commercial
revenues will come through because they
rent commercial spaces in the station and
there is a usage fee for the operator that
will use the lines. Also, they can construct
and do real estate project around the
station and make money out of it. The
balance is to calculate the debts, so that
annual revenues will be in a period of 3540 years.
He then highlighted the importance of
the Grand Paris project by stating that,

533 billion
GDP of Greater Paris territory

projects merged and are now called Grand

Paris Express, Aleaxandre explained.
Going back to the reason for coming
up with this project, Alexandre sais that
housing is a major issue in the Paris region.
While there is no dearth of space, but
no one will build there since there is no
connectivity.
Therefore, if you put together all the
hectares together within a rail of 800
meters, you have got 4000 hectares
that could change to a small state in
the coming years. The idea is to create
new attractions for the area around the
stations and we move every strategic
planning department to empower the
population there. That is on the way to
answer the housing situation
The Paris metro was built very quickly,
Paris townhall issued a bond that was paid
in 1973, seventy years later. During all that

today it take an hour 26 minutes to go

from Issy to another city using 4 different
transport system, but tomorrow it will
take 27 minutes. For the general economy
of the project that is something quite
important.
It will also help create jobs in areas
which now are not that well connected.
As of now, we have an absurd situation,
people are looking for jobs, and jobs are
looking for employees but we have nobody
that matches. The project aims to create
a large labor market and give access
to hundreds of new jobs for new the
population, remarked Alexandre.
The stations of Greater Paris will be real
stations like Gare du Nord, Saint Lazare
with shops, equipments, and offices and
with housing projects above the station,
because it has to have a strong identity of
the new urban center of this territory. That
MARCH 2013

43

country focus
GRAND PARIS

is also a way for Socit du GRAND Paris to

finance the public investment in that urban
transport.
The idea of a metropolis organised
around 8-9 big clusters around is unusual.
Moscow is working in that kind of direction
but the Greater Paris has inspired them,
and we have a contract with Moscow
authority to sell them our experience in
this kind of projects.
Moving forth, Alexandre said that there
are many projects around the Greater Paris
that are linked with the construction of the
transport network. We have investment in
international trade center, many projects,
new exposition park, one hundred
thousand jobs created as a consequence of
the Greater Paris project.
The Greater Paris project is not so much
about making an impact but as a way to
amplify the movement that already exists.
That is the global renovation project
around the Greater Paris network. The
construction of the metro helps the
construction of new housing project. The
project is 100% state owned.
Ta l k i n g a b o u t t h e o r g a n i s a t i o n a l
structure, Alexandre said that for each and
every of their stations they have steering
committees, and once they decide to put
the station they meet commercial activity
they are going to do and so forth.
He proudly pointed out that their project
will be bigger and faster than the existing
metro, with one metro passing every 90s.
He further added, We have 45 thousand
passengers coming from the two airports
and using our lines every day. There is a
project that will allow passengers to travel
straight from the airport to Gare du Nord.
We have got special ability, which is new
in the French landscape of institutions.
One main mission is to construct a new
metro line and another one is to assist the
representative of the state in the strategic
development of the region to make sure
that the transport network, the strategic
vision of the economic activity and the
housing projects are all linked together.
When we asked him about the timeline,
he said that even though they have a
44

MARCH 2013

Alexandre Missoffe, Director of the Cabinet,

Socit du Grand Paris

caldendar, the government is debating on

making a new calendar. The original plan
was to have the first opening in 2018 and
the complete opening of the network in
2025.
However, according to Alexandre this is
going to change first opening could be
around 2018, but the total realisation of
the network might be late due to some
other projects that might come in the first
phase. The decision should be declared in
few weeks.
Every transport line went far beyond
the initial expectation in traffic, for
example when line A was established
i n t h e 1 9 6 0 s , t h ey s a i d t h a t i t w i l l
provide transportation for 400 thousand
passengers a day by 2020 maximum. The
day of its opening it was handling 130%
over the maximum capacity. So we want
to maintain the capacity because once the
line is open we cant change it anymore, we
are building the network for the next 100
years, is Alexnadres rationale.
When we asked him about the challenges
they faced and the best practices, he replied,
We have developed our own software for
security in the stations that allows us to
enter a great number of parameters and
from that you can deduct an efficient way
for the architects to construct the station in

order to reduce the unsecured parameters,

the quality of lights and things that change
from a station to another because the
stations are in different environments. But
I dont think that is something that could
be exported. We also have an innovation
done by the Greater Paris Company
for this project which is to manage
CO2 emissions. The carbon emissions
linked to the construction of the projects
can be calculated by entering data and
information about the status of the ground
(sand, stone, depth, the kind of materials
you are going to use and more.) This gives
you the carbon emissions compared to the
different methods of constructions and
it gives you the idea of which methods
is going to have the less carbon impact,
for engineers that is something quite
interesting.
The financial engineering is very
specific to every city, but perhaps the
commercial studies we have worked on
which kind of commercial activity will
be needed in the station , what are the
peoples expectations, what do they want
from the stations. We did a lot of studies,
trying to figure what people would like
to have in the future. This kind of work is
common in every country of the world;
this could be a source of sharing and
inspiration, Alexandre pointed out.
Ta l k i n g a b o u t t h e j o b - c re a t i o n i n
the long term, Alexandre said that the
construction of the network will need more
or less 15,000 people a year for 10 years.
The positive impact of being a modern
metropolis goes from 100,000 to 600,000
in revenue.
They are already seeing an increase in
investment due to anticipation but for the
moment this is not important because the
station will open in 2018. So 3 4 years
before the opening, big investments will
be coming.
On this note, Alexandre finished his very
detailed presentation which highlighted
the work being done by France to attract
investment. This also serves as a best
practice model for a lot of countries in the
Middle East.

country focus
FRANCE

Make the right investment

CDC Enterprises was set up to develop and support SMEs and industrial
services, based on a stable and long term strategy. Aparna Shivpuri Arya met
Philippe Braidy, President, CDC Entreprises, to get to know the details about
their work and mission.

hilippe started the conversation by giving us a

brief overview of the plans of the organisation.
We are building a new bank Public
Investment Bank. It is a merger between FSI (Strategic
Fund for Investment) and OSEO which is a bank that
provides loans for SMEs. It is a new organisation that
has been discussed between shareholders, but thats
not definite yet.
For all investments in the Middle East region CDC
is a direct partner. Our company is a management
company which has no assets; we invest in banks,
insurance companies, industry and more. We are
a small society, now we have around 200 people
130 employees in France and others in our two
subsidiaries, Philippe added.
Going back to the roots, Philippe said, Historically,
we started investing in France and not directly in SMEs.
Progressively, we have started investing in companies,
especially during the crisis in 2008. When FSI was
created a lot of money was transferred to us in order to
invest in SMEs, but directly.
He further added, We experienced good growth.
When I arrived two years ago we had only 70
employees and now we have 130, which mean that we
have approximately doubled the number of employees
who should support investments in SMEs. SMEs now
need investment in equity.
Continuing on that note he said that their job is to
invest in equity and in SMEs. FSI also invests in big
companies. They also invest in SMEs in the region and
in innovation (early stage investment in companies
which have new processes and which are startups).
When we asked about their modus operandi,
Philippe remarked, We do not invest directly in R&D

46

MARCH 2013

we are not financing research, but we are investing

in startups. For example, we are a limited investor
partner in INOBIO 37% stake in this fund which is in
the field of biotechnology. Biotechnology is a key area,
and there are no short-term results, but we are very
much interested in these new products/innovation.
We dont invest directly in labs, but we have been very
successful.
CDC doesnt look for funds directly, but through
partnerships with major businesses they look
directly for other investors. Philippe is presiding over
a special committee for infrastructure. So, CDC talks to
sovereign funds to adopt global strategy approach. If
that fund has some investments in SMEs, they contact
them in that case.
So which sectors are identified for long-term
investment and what is the period for long-term
investment? To this, Philippe went back into history
and said that the aim in the 90s was to invest in funds
and the idea was to help startups to structure offers. It
was like a Silicon Valley approach.
We are partners in 250 funds 1/3 in innovation/
early stage companies; 1/3 for capital development
growth; and 1/3 are sectorial investments, like
INOBIO in biotechnology. Recently, we have invested
in AEROFLON which is in the field of aeronautics.
We also have funds for investment in the food sector,
environmental technology, and so on. So, we have
some funds and some teams which are specialised,
remarked Philippe.
Therefore, they have industry focused funds and
general funds and venture funds. They dont invest
directly in ventures for that they have partners/
groups which manage ventures for them.

We invest about EUR 400 million per

year and our ambition is to increase it to
600. We have a programme approved by the
government for the following eight years
EUR 5 billion. That is public money which is
coming from FSI and the government. The
government calls it big loan, because the
French government in 2012 has decided to
launch a EUR 3 billion loan for investments in
the future. We have been allowed a part of this
money, EUR 1 billion, for investing in SMEs, he
replied when we asked for more details about
the investments.
We are working with private investors,
we try to invest more money together our

infrastructure/ in major companies and not

necessarily SMEs, he added.
Philippe also said that it depends on the
outcomes the businesses are looking for.
They may be looking for companies which
would serve as entrance points for different
projects, maybe for partnerships in various
technological areas. So, it goes on case by case
basis.
Their role is that of a management company,
so if you have an SME with projects they could
be involved in management of funds.
Soon they will have a merger with FSI and
OSEO. Because of this merger, they will have the
entire range from loans to investors equity

400 million
investment per annum by CDC
leverage is that we invest EUR 1 and collect
EUR 3 from the private sector. The aim of our
group is to mix public and private investment in
order to have massive impact on the economy.

Where are the investors from?

Philippe said that it is very difficult to say
because part of this money is coming from
banks and insurance companies which collect
money themselves from various investors. He
also was unable to comment on how much
investment in coming from the Gulf region.
He however did say that they are working
with the Gulf countries because they are
interested in investing with them. We are also
working with China. Recently, we have created
a fund with China (50%-50%). Its a fund which
tries to invest in boats in China and France. We
are trying to make a win-win strategy to help
French companies to invest/develop in China
and vice versa, Philippe remarked.
We are also working to create a partnership
in Qatar. Its not totally discussed yet. There
are also discussions under way with other
countries of the Gulf region and also in South
America (for example, in Brazil). Our initiatives
depend on the aims and ambitions of their
partners so, it varies. For example, we have
different sectors and funds; we invest in

they will cover the whole scope. This merger

will have 800 staff which will cover the whole
French region since they know very well the
French companies and businesses. That is very
important because they are knowledgeable
and can add value to the projects.
We asked him about how difficult is to think
long-term in the current environment. To this
he said, it is a little difficult since they work
with banks and insurance companies they have
constraints, they need to manage risk and be
cautious. The EU has funds for ten years five
years investment period, and the following
five years for divestment. Thats because the
financial partners want to get added value.
Philippe also pointed out that it is very
important to follow up, because if you have the
partner who wants to divest then new investors
can come in and provide new momentum. Its
hard to have long term vision with the funds,
but because they have this global approach
they can support businesses.
There are different factors, like capital risk.
We try to be sure that the funds we work
with have enough money to invest long term.
We also invest directly and then we dont have
the same approach, because we try to stay as
long as the company needs. Once the company
has developed/reached the size which was

Philippe Braidy, President, CDC Entreprises

aimed, then we exit. Thats why we have

a range of tools which enables them to help
these businesses not only with investments
but with other services as well.
When we asked him if other countries can
follow this model, Philippe was quick to point
out that its very similar to American SBA
because they feed into these funds and the
private companies actually manage these funds.
There are similar structures in other
European countries, but in France the size
is much bigger. Another difference is that in
France their staff is placed throughout the
country.
Because they are investing in businesses
similar to private investors, they can choose the
sectors in which they want to invest and that is
a guarantee that they will invest in businesses
which have potential for growth. They compel
themselves to be minority shareholders/in the
funds as well. Thats why they are obliged to
look for private partners. Its done by CDC for
sovereign funds.
Because of the context economic crisis
their regulators are becoming stricter, like
Basel III. This also creates an opportunity to
look for foreign investors. This is a whole new
area for them, because if you want to attract
foreign investments you have to invest in
foreign countries as well.
With this we came to the end of our
interesting chat. CDC is an extremely
important component of Frances endeavour
to encourage business and investment and
offers foreign businesses an interesting
opportunity.
MARCH 2013

47

country focus
VINCI

Taking technology
to the next level!
As part of the press trip, we caught up with
Alain Bonnot, Chairman of Vinci Construction
Grand Project, to know about their operations in
the Middle East.

e started the discussion by asking

Alain about the kind of work they
are doing in the Middle East and
what strategy do they have for the region.
To this Alain said, Vinci is a ten years old
company but it comes from many old French
companies that are originally more than 100
years old. All those companies were well
known especially in the Middle East like:
SGE, GTM, Chantier Moderne and more, and
all these companies have been consolidated
into one company - Vinci.
The reason for consolidating was
that everybody thought, that 10 15
years ago they had many groups in
France and the main reason was not the
foreign market, but the internal market
and it was necessary to combine these
companies. In the construction sector,
48

MARCH 2013

the external market has been the same.

We are the most important group in
the world in terms of construction, two
Chinese companies are bigger than us but
they are state- home companies. We are
the biggest private group in the world in
terms of construction, but it doesnt mean
that we are very big and that we can take
everything we want. In the past we have
worked a lot in the Middle East especially
in Saudi Arabia, Today, we think that
Middle East is very important for us but
we cant go too fast. Five years ago, we
had an opportunity so we decided to try
to work in Qatar. About ten years ago we
had made LNG tanks and one man from
our company had and made good links
with Qatar. His name is Serge Mollen and
5 years ago Serge signed a shareholders

agreement with the state Qatari, with

Qatari Diar, remarked Alain.
And they decided together to launch a
company QDVC. This company was made for
the huge projects of Qatar. The sharing of the
activities was very clear, VCGP had to operate
and QD had to bring the projects.
We have got a lot of nice projects, the
timing was good and we are finishing today
some projects and we are continuing with
some others. We have started in a special
type of contract which is ECI- early contract
involvement. in Qatar, we have started the
LRT four light rail operation lines, the light
rail tramway network transportation of
Lusail. We have finished the studies, and
the tunnels. We are finishing the stations
and waiting for the contracts of own trail
finishing. With Qatari Diar we are mainly the

country focus
VINCI

Alain Bonnot, Chairman of Vinci Construction

only one in the power supply and its a very

big side.
Therefore it is possible to launch a company
in very few years and with good success, I
think we have very good relationships with
Qatari Diar and the Qatar state, opined Alain.
With the FIFA World Cup, is there greater
pressure to expedite projects?To this Alain
said, I dont know any company in the world
that is not under pressure. We are under
pressure. I think that Qatar is a good client.
We have a good relationship with Qatar and
we hope to stay involved and progress our
activities there. We hope to participate in
the new project of Doha Metro which is very
big and after that there are other projects
especially one which is very interesting for
us. Doha bay crossing, which is a big bridge
to cross the bay of Doha. We have also made
studies for the next bridge between Qatar and
Bahrain (40 km). All our studies are done, we
have made it with COEHE, but we have time to
do this before 2022 and if it has to start one
day we will be ready.
We are preparing this company to succeed.
Our last project is going to initiate what we
havent done before - a flow business. We want
Qatari people to progress in smaller contracts.
I would say that perhaps today we focus on
this market but we dont want to be reduced to
this market and are also interested in Oman.
We have history in Oman have built a dam.
50

MARCH 2013

We hope to keep going on with Oman with

different contracts for dam constructions,
according to Alain.
Highlighting Saudi Arabia, he said, I want
to speak about Saudi Arabia; we know that
Saudi will be in the next years the most
important market of the region. I was in
Riyadh few days ago and we know that this
market will increase a lot, but we dont want
to go too fast. There is a huge plant for the
metro, we are in one consortium, but it is very
big and if we were awarded we would take
just a small part.
We want to remain prudent in Saudi
Arabia but our target is to develop a real
presence in this country, because it is growing
a lot. When we are in a new country, the most
important thing is that we want to settle in it,
to train, to live here, to hire native people, to
create what we have created in many places in
France we want to become a company of the
country. The governments of these countries,
expect from us to transfer the know how,
and the best way for transferring the know
how is that they give us a contract and we
commit to take native people and train them
to participate to the universities and training
programmes, and to be able to show that all
the sides put this in act, remarked Alain.
When we asked him about their competitive
advantage, Alain said, Our technology is
recognised all over the world, but when we
work in a country we know the good way
to hire workforce, the good way to buy iron,
the good way to everything. Once you do all
that, and put your design, you become very
competitive. And this will hold true for other
contracts in the future.
Talking about the cost of doing business
in the Middle East, Alain was quick to point
out that In Vinci, they dont go to the Middle
East or elsewhere to lose money, but to earn
money, and if they cant then they leave.
Our specialty is complex projects (big
bridges, big tunnels, big parking) and our
work is to simplify what is complex. We
have to choose the world that we want to
build, and that is the case in Qatar it has
been possible for us to do what we wanted
with our shareholders. I think this is a reason
of success, but every day is different and

we could fail tomorrow. We have to be very

professional and we have to choose our
targets with the respect of our people, staff,
and our local people. First aim is safety, when
you organise a site around the safety, you
organise it well, and we dont want to face
failure in terms of safety, were Alain words
of wisdom.
Secondly it is also very important to respect
the environment, the client, even if one is in the
most difficult negotiations and discussions. At
the end sustainable development is important.
What we want is to settle in the country and
remain in the country not because we go to the
client but because the client comes to us. That
is what we are trying to do, and sometimes it
works, Alain said.
Talking about their modus operandi,
Alain said that they go in for joint ventures
sometimes.
A local company is completely invested in
the country and the government will never
kill a local company, but when we are in
front of the government, it will not hesitate
and when we are in default, we might be
finished. However, the government will save
the local company. Thats why, it is absolutely
necessary in Qatar to work with great local
companies and in the Middle East we work
with all the great companies, opined Alain.
Lastly, talking about their strategy, Alain
said that a good strategy is not to go to the
client, but to let the client call them. On the
simple sites, there will be nothing we can do;
we will always be more expensive than the
Turkish / Chinese companies. But when it is
complex, when designers draw something
and we are able to draw something different
less expensive, then we are very interested
and we go for it.
What makes this market very special is that
they have plenty of money. The issue is not
the money, the issue is a good engineering
and our strategy is to bring that in and then
anything is possible.
We dont want to go everywhere. We want
to develop relations like Qatar, Oman and
KSA. Today we are not in Kuwait and UAE, but
if there are opportunities, we will explore.
With a very clear focus and a niche, it is no
surprise that Vinci leads the pack.

We are the new AIG

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