How to Develop the Middle East Market

Jeff Ambjorn Regional Director, Middle East & AfricaDubai Office HKTDC

Review of TDC Dubai Office

Consultant Office Since Late 70s Upgraded to Full Regional office in

May 2000Oversees 14 Markets Including UAE,

Saudi Arabia, Egypt, Bahrain, Kuwait, Lebanon, Oman, Qatar, Jordan, Syria, Iran, Yemen, Iraq and Libya

Overview on the Middle East Market Population

Country Million

Egypt 75.5Iran 68.5Iraq 27Saudi Arabia 24Syria 19Yemen 18Libya 6Jordan 6UAE 4.5Lebanon 3.9Kuwait 3.2Oman 2.6Qatar 1Bahrain 0.8

Overview on the Middle East Market Population

Population in ME

0.8 1 2.6 3.2 3.9 4.5 5.9 6

18 1923.9

27.1

68.675.4

0

10

20

30

40

50

60

70

80

Million

Overview on the Middle East Market GDP Growth Rate 2007

Country %

Kuwait 9UAE 8.9Qatar 8Bahrain 7Egypt 6.8Jordan 6.6Iran 5.7Oman 4.5Saudi Arabia 4.2Syria 3.6

Overview on the Middle East Market GDP Growth Rate

1.7

-2

0.5

-2.2

4.2

10.5

8.27.4

2.5 2.98

4.93.2

1

5.9

2.53.7

7.26.2

5.6

-4

-2

0

2

4

6

8

10

12

1985 1988 1990 1993 1995 1997 2000 2002 2005 2007 2008

Overview on the Middle East Market Economic Trends

Free Flow of CapitalsFree Market EnterpriseEconomic Diversification Structure Reforms in Many

countries Accumulated Oil Wealth in the Gulf

States

Overview on the Middle East Market Liberalizations of Trend Regimes

Participation into the WTO8 countries existing WTO Members3 Countries Negotiating for Membership

Intra-regional Free Trade Agreemente.g. GCC

Inter-regional Free Trade Agreement

e.g. US Jordan FTA

Overview on the Middle East Market Major Issue

High Oil PriceHigh Inflation RatesRising Business Cost

High Rents

Hong Kong’s Major Middle East Market Total Export

2007(US$ mil)

% Change 2006/2007

UAE 2591 +26

Saudi Arabia 408 +11.6

Jordan 215 -4.8

Iran 83 -1.9

Kuwait 58 +3.8

Bahrain 56 +32.7

Syria 25 +42.2

Total (Including other ME countries

5049 +17.5

Hong Kong’s Trade With the Middle East Total Export

  2006 2007 2008 (up to March)

  Value (US$ million)

Growth (%)2005-2006

Value (US$ million)

Growth (%)2006- 2007

Value (US$ million)

Growth (%)2007- 2008

Total Export

4,297 + 13.4 5,049 + 17.5 1,291 + 14.7

Domestic Exports

117 + 26.5 108 - 7.2 28 + 4.2

Re-exports

4,180 + 13.0 4,940 + 18.2 1,263 + 14.9

Imports 4,132 + 9.3 4,198 + 1.6 1,249 + 11.2

Total Trade

8,429 + 11.3 9,247 + 9.7 2,540 + 12.9

Priority Markets

United Arab Emirates Saudi Arabia Qatar Kuwait Jordan

Prospective Markets with High Population

Egypt (80 Millions) Iran (70 Millions)

United Arab Emirates

HK’s Largest Business Partner in the Region

Highly Competitive Market

The Region’s Re-export Centre

Advance Banking System

Free Flow of Capital

Saudi Arabia

Largest Oil Exporting Country

Availability of Capital, convertibility of the Saudi Riyal to hard Currencies

Protection of Trade Marks Absence of Controls on

Capital Movement Advance Banking System Liberal Tax System

Qatar

Has the 3rd Largest Reserves of Natural Gas in the World

Highest GDP in the World $ 30,000

Multi-billion Dollar Projects in the Coming Years

Kuwait

The only GCC country with Flexible Foreign Exchange Regime

Islamic Banking Claims 25% of Total Bank Assets

Advice

Taking Middle East as a Heterogeneous Market

Higher-end and Branded Products for High Income Countries

Small Size Orders (Except Big Markets Like UAE and Saudi Arabia)

Market Should be Constantly Reviewed for Products and Changes

Attractive Packaging of the Goods

Practical Tips

Language with Different Background

Contacts with ME Importer Should be Direct and Regular

Flexible Payment Terms

Friendly Business Atmosphere

Develop Personal Relationships for Successful Business

Patience is the Key Word to Do Business in the Middle East

Meetings with Officials Will Not Be Settled Until You Are Physically in the Country

It Is Not Uncommon To Have A Meeting Cancelled Once You Arrive

You Should Arrive at Meetings on Time, Although it is Common to Keep Foreigners Waiting

Business Meetings Start After Prolonged Inquires About Health, Families, Etc.

Meetings Are Generally Not Private Until a Relationship of Trust Has Been Developed

Recent Promotional Activities of TDC in the Middle East

Service Mission to Kuwait, Riyadh, Dubai and Abu Dhabi Led by HKSAR Chief Executive

ICT Mission To Riyadh, Bahrain and Dubai

Health Care Exploratory Mission

HKMA Road Show in Dubai and Amman

Help from TDC

Trade Fairs and Study Missions

hktdc.com to Get Latest Market Information and Trade Contacts

Customized Business Matching Service “PremierConnect”

Hong Kong Fairs

Seminars/ Advisory Services

Thank you!

See you in the Middle East