2. Global private equity firms have historically ignored the region with the MENA region only accounting for 0.1% of the US$ 2.3 trillion* PE industry PRIVATE EQUITY FUND DISTRIBUTION Americas 72.1% Europe 22.2% Asia 4.3% Oceana 0.7% South Asia 0.3% MENA 0.1% Africa 0.2% *US$ 400 billion of the global PE industry, including leverage represents a US$ 2 trillion in potential buying power Source: Thomson One Banker, Fortune Magazine Regional PE industry as a % of total PE industry of US$ 2.2 trillion
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7. Gradual liberalization of regulations are conducive to economic growth, yet more efforts are required to create a favorable environment FAVOURABLE REGULATIONS IN MENA REGION FOREIGN OWNERSHIP CUSTOMS CLEARANCE INTELECTUAL PROPERTY RIGHTS LABOR LAWS DISPUTE SETTLEMENT FDI INFLOW Unfavorable Favorable Gradual liberalization of regulations and the impact on Economy
8. UAE Oman Qatar Bahrain Saudi Jordan Tunisia Morocco Lebanon Yemen Algeria Egypt Qatar Tunisia UAE Oman Jordan Morocco Bahrain Egypt Algeria Yemen Saudi Lebanon OPENNESS OF CUSTOMS REGIME EFFICIENCY OF LEGAL FRAMEWORKS Qatar Tunisia UAE Oman Jordan Morocco Bahrain Egypt Algeria Yemen Saudi Lebanon ORGANIZED EFFORTS TO IMPROVE COMPETITIVENESS 1= WEAK 7= STRONG MENA REGION –INVESTMENT INDICATORS UAE attracted 58% of all regional FDI projects
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11. MIDDLE EAST PRIVATE EQUITY GROWTH Total Funds Announced, Fund Raising, Investing and Rumored in MENA – 1994 onwards US$ million, 2002 – March 2007
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13. MIDDLE EAST INFRASTRUCTURE INVESTMENT OPPORTUNITIES MENA INFRASTRUCTURE INVESTMENT REQUIREMENTS 630 US$ BILLION
14. MENA HEALTHCARE SECTOR The sector has grown rapidly over the last decade. It currently accounts for nearly 6 percent of the Dubai non-oil gross domestic product. The sector is predicted to grow by 14% over the coming 5 years.
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17. MENA PRIVATE EDUCATION SECTOR 1. The Estimated size of MENA market is @ US 114 Billion by 2015. 2. The MENA region is set to achieve a world’s highest higher education admission level. 3. The growth going forward will be witnesses in the private sector growth in the higher education
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20. US$ 325 billion of private investment required over next 5 years Even with large budget surpluses in the GCC for example, there is still a large deficit in required financing. GCC PROJECTS (US$ BILLION) The Saudi Arabian government requires investments of US$ 624 billion over the next 15 years ESTIMATED PUBLIC VS PRIVATE FUNDING IN THE GCC UAE Saudi Arabia Qatar Oman Kuwait Bahrain Total Projects Excess Oil Rev. 272 200 113 32 81 25 723 398 Qatar 272 200 113 32 81 25 723 398
21. FACTORS DRIVING THE NEED FOR FACTORS FAVOURING PRIVATE INVESTMENT NON PERFORMING LOANS AS % OF TOTAL LOANS LACKING CORPORATE GOVERNANCE LOW LABOR PRODUCTIVITY INEFFICIENT CAPITAL STRUCTURES EAST ASIA E.EUROPE &C.ASIA LATIN AMERICA MENA OECD SOUTH ASIA SUB SAH AFRICA PUBLIC ACCOUNTABILITY 0.20 0.37 0.77 -0.78 1.89 -0.29 -0.41 INSTITUTIONAL ACCOUNTABILITY -0.11 -0.16 -0.09 -0.32 1.38 -0.41 -0.66
22. FURTHER PRIVATISATION OPPORTUNITIES SNAP SHOT COUNTRY KEY SELECTED AREAS ANNOUNCED PIPELINE NO. OF TRANSACTIONS UAE POWER WATER OIL AND GAS TRANSPORTATION AND PORTS 28 KUWAIT FINANCIAL SERVICES FOOD AND BEVERAGE LOGISTICS ENGINEERING 23 OMAN FINANCIAL SERVICES TELECOMMUNICATIONS POWER TRANSPORTATION AND PORTS 6 SAUDI ARABIA POWER TELECOMMUNICATION TRANSPORTATION AND PORTS OIL AND GAS 8 JORDAN POWER TRANSPORTATION AND PORTS TELECOMMUNICATIONS OIL AND GAS 13 EGYPT FINANCIAL SERVICES TRANSPORTATION AND PORTS TELECOMMUNICATIONS OIL AND GAS 92 PAKSITAN FINANCIAL SERVICES TRANSPORTATION AND PORTS FOOD AND BEVERAGE HEALTHCARE 63 INDIA TRANSPORTATION AND PORTS POWER TELECOMMNUNICATIONS NATURAL RESOURCE 13
23. Thanks and Questions Source of Information 1. Abraaj Capital presentation ; 2. E&Y Global Website 3. Google and Yahoo search sites
