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Mideast investors switching money from US
AFP
HOUSTON
Petroleumworld.com 06 29 06
Political tensions have encouraged Arab investors to shift from depositing oil profits in US investments to Europe, India and China, the head of Citigroup's emerging market bank said Wednesday.
"Quite honestly today the investment going into the US is extremely limited," said Shirish Apte, chief executive officer of Citigroup's Central and Eastern Europe, Middle East and Africa Corporate and Investment Banking unit.
"9/11 was a very defining moment between the US and the region," he told the US-Arab economic forum in Houston, Texas.
Travel has become very difficult for Arab investors and the recent scuttling of a deal with the United Arab Emirates to manage US ports due to pressure from US lawmakers has further undermined confidence, he said.
"If there were no other places to invest, clearly the money would come into the US but when you look at what's going on in China and India" it's clear there are attractive options elsewhere, Apte said.
Europe is also an attractive destination for investments, he said.
Today's oil surplus funds are also being directed in a different way than those of the 1970s which were primarily directed towards passive investments such as government bonds, Apte said.
A large portion of the surplus is being reinvested in the infrastructure of the region and expansion of refining capacities. Investors are also now looking to more active investments.
At a session discussing security and free trade, a number of senior Arab officials decried the difficulties and humiliations involved in obtaining visas to enter the United States.
"You say you want our oil and gas but not our business," said Hussein Al-Athel, secretary general of the Riyadh Chamber of Commerce.
"We talk to US companies and business and at the end of the day they say sorry, the lawyers advised us against it there are security concerns."
AFP 28 1710 GMT 06 06
Copyright ©2006 AFP. All Rights Reserved.
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