Thursday 30 October 2014

Second largest Gulf investment giant starts scouting Sri Lanka projects

The second largest sovereign investment giant in the Gulf region has announced on 27 October that it is scouting Sri Lanka for implementation ready projects-and more importantly, the world's richest country is vying for Sri Lanka's surging Stock Market. "In Sri Lanka, we do not want to start any new development or construction, projects but are looking for outright purchase of completed and implementation ready assets as our entry strategy. We are also looking to invest in Colombo's Share Market," said Mohammad Saif Al Suwaidi (Head of Industrials & TMT Investments-Qatar Holding) on 27 October.

QH's Al Suwaidi, who is in Colombo with his three-member investment team, was addressing Rishad Bathiudeen (Minister of Industry and Commerce of Sri Lanka) on 27 October during his courtesy call on Minister Bathiudeen in Colombo. Also present on the occasion were RDS Kumararatne (DG-Department of Commerce) and other DoC officials.

Qatar Holding LLC (QH) is the powerful global investment arm of the Qatar Investment Authority (QIA) which is well-known and also called as the Qatar Fund. QIA is the second largest sovereign wealth fund in the Gulf Cooperation Council region after Saudi Arabian General Investment Authority (SAGIA). QIA's QH was established in 2006. QH invests internationally and locally in strategic private and public equity as well as in other direct investments, and is considered to have a high profile global outreach. Among QH's diverse international holdings are the UK retailer Sainsbury, Deutsche Bank, Credit Suisse, Bank of America and Agricultural Bank of China. Its Credit Suisse stake is reportedly 6%.

"We started to work closely with Sri Lanka in the aftermath of the end of war in 2009-2010. We are under a sovereign wealth fund but very much of a commercial operation, looking for the best RoI for our investors. Around 85% of our portfolio consists of overseas investments while the rest is concentrated on Qatar.

We have investments in 30 countries. Our equity is from Qatari citizens' savings and therefore we are responsible to report back best returns for them" said QH's Al Suwaidi, and added: "In Sri Lanka, we do not want to start any new development or construction projects, but are looking at outright purchase of completed and implementation ready assets as our entry strategy to the country.

We are also ready to invest in Colombo's Share Market, and mostly prefer to deal with Sri Lanka's large corporates, rather than medium or small scale firms.

We are interested in buying completed real estates and properties-for example, a completed resort hotel here or some such finished real estate projects. Specially, we are keen on shopping malls and shopping arcades ready for implementation. Our minimum overseas investments rounds are US$ 100 - US$ 150 million per project, and not less. We are even ready for higher values. When it comes to investment projects, QIA has lots of interest in Sri Lanka's tourism infrastructure, as well as government/public owned institutions such as State Owned Business Enterprises put up for sale to the private investors."

"Qatar–Sri Lanka bilateral relations have advanced to new levels when I led a 10 member strong high level delegation to this September's Joint Economic Cooperation session in Doha. We are pleased of the successful outcomes from the sessions" said Minister Bathiudeen responding to QH's Al Suwaidi, and added: "We welcome QH's investment attention on Sri Lanka and I together with my Ministry are ready to extend our fullest support to QH's FDI efforts here. Thanks to the vision of HE the President Mahinda Rajapaksa, FDI to Sri Lanka in the first half of 2014 exceeded $210 Mn increasing by 51%. 


At present, we are on a drive to enhance tourism infrastructure and QH could find opportunities in it as well as our surging stock market. Even dairy farming is a prospective sector. New highways, wind-power and hydro power projects in the country would be other opportunities for QH here. As for Share market, this is a good time since after three years, our stock market crossed to 7000 points mark this August."

Qatar is the world's richest country. The wide availability of oil and gas reserves have made Qatar the world's highest per-capita income country. In 2013, the State of Qatar topped World Bank's GDP per capita (on purchasing power parity-PPP) list, with a per capita value of US$ 131,758. In 2013, Qatar-Sri Lanka bilateral trade stood at US$ 66 million.
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