‘Kuwaitis have the investment appetite that can drive the GCC’, says Gulf Custody Company | Video

Transcript

As trade in the Gulf region heats up, one country keen to spur growth and build foreign investment links is Kuwait. World Finance interviews Ahmed Al Bahar, Managing Director of Gulf Custody Company, to discuss what his company’s strategy is for the future, what types of investment are growing, and how the Kuwait start-up scene is evolving.

World Finance: Now governments across the Middle East are establishing free trade zones to make it easier for foreign investors to establish themselves locally. Can you tell me, what is Kuwait doing to attract those businesses?

Ahmed Al Bahar: Kuwait introduced the foreign investors’ laws, allowing foreign investors to establish their own companies in Kuwait with 100 percent ownership in Kuwaiti companies. Also Kuwait allowed foreign banks to work freely in Kuwait.

World Finance: What makes Kuwait such an attractive financial hub?

Ahmed Al Bahar: Kuwait is, to me, the financial hub in the region, because Kuwait has the local talent. Kuwaitis have the investment appetite that can drive the GCC.

From our experience, real estate is a big thing

World Finance: What type of local and foreign investment is in demand among your clients?

Ahmed Al Bahar: From our experience, real estate is a big thing. Local and regional equity is, especially for the big companies in the region. Private equities. These are the most attractive instruments in the regional market.

World Finance: Is there a distinction between types of investments a native Gulf financier would invest in versus a foreigner?

Ahmed Al Bahar: Mostly the foreigners are looking for the big chip companies. Let’s say the top 10 companies in each market. The local investor looks at mostly the whole market as speculation, and diversifying between his portfolio, between start-ups and established companies.

World Finance: What sort of start-ups are they looking into?

Ahmed Al Bahar: Well the small companies with small capital, just traded on the stock exchange, to speculate on the future of these companies.

World Finance: What does a diversified portfolio among your clientele usually represent?

Ahmed Al Bahar: What we see is mostly time deposits, murabaḥa transactions, bonds, plus equities.

Mostly the foreigners are looking for the big
chip companies

World Finance: Now as the Gulf region builds its reputation as a financial hub, have you seen more start-ups taking root, and if you have what types of start-ups are attracted to Kuwait and who’s running them?

Ahmed Al Bahar: We look at investment companies in Kuwait which have the leaders, for example, global investment has KMEFIC, a Shia group which are big in retail and food industry, leaders in the market in the region also.

World Finance: What do start-up clients’ investment portfolios usually consist of?

Ahmed Al Bahar: It consists form real estate, equities, private equities, it depends on the bpm of the investment fund. We have no control of our start-up portfolio, investment funds come with its own bpm. After the approval of the regulatory bodies, they choose the allocation of that portfolio.

World Finance: OK, well thank you so much for speaking with us today.

Ahmed Al Bahar: Thank you very much for the interview.