Our columnist Dr Arno Maierbrugger is Editor-in-Chief of www.investvine.com, a news portal owned by Inside Investor focusing on Southeast Asian economic topics as well as trade and investment relations between Asean and the GCC. The views expressed are his own.
By Dr Arno Maierbrugger/investvine.com
Saudi Arabia recently has decided to set up a base in Southeast Asia to function as a trade hub for the region. The Saudi-Singapore Business Council announced on March 21 that it will use the city state of Singapore as a hub to sell Saudi-manufactured products in Asean. At present, Singapore is the official base for Saudi Arabian petrochemical sales in the Asean region via Saudi Basic Industries Corp (Sabic), the country’s largest petrochemical industry conglomerate. Under the new deal, Singapore will act as regional hub for all Saudi-made products bound for the ten Asean countries. A trade company will be set up in Singapore with an investment of about $26mn. The company will operate in areas of energy, training, education and information technology, said Abdullah al-Meleih, co-chairman of the Saudi-Singapore Business Council. Talks are also underway to ease visa regulations for Saudi citizens visiting Singapore in an aim to increase tourist numbers.
This move could serve as a role model for Qatar, which also wants to increase its presence in the Asean region. With major shifts of Qatar’s LNG trade ongoing – Qatargas is increasingly looking at Southeast Asia to sell natural gas to move away from traditional, but ailing markets in Europe and the US -, the country needs a solid base to cash in on the thriving economy of the ten-member Asean bloc.
Singapore could be one option, but another one for sure could be Thailand. The Kingdom – avoided by Saudi Arabia for some diplomatic reasons – has recently inked a major LNG deal with Qatar to be supplied with gas over the next 20 years and is stepping up its port facilities at its major terminal in southern Map Ta Phut. Furthermore, Thailand has also started developing an industrial park in Dawei on the Andaman Sea coasts in neighbouring Myanmar which will also boast a deep-sea port that cuts shipping time from the Middle East to Thailand by a few days. Through its favourable location at the heart of Asean and the role of Bangkok as a business and travel hub, Thailand would indeed be a good choice for Qatar. Both countries have friendly diplomatic relations, and both are regional strategic points which facilitate trade, investment and co-operation.
In May last year, Thailand’s Prime Minister Yingluck Shinawatra already discussed closer ties and co-operation frameworks with HE Sheikh Hamad bin Jassim bin Jabor al-Thani, Prime Minister and Foreign Minister of Qatar. Both countries said they want to work closer together in the fields of food security, energy, construction, medical tourism and joint investments. This could easily warrant a larger presence of Qatar in Thailand to be at the centre of where growth is currently happening in the world.
Setting up a base in Asean
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