Many fruitful meetings and optimism in the Persian Gulf
I and my financial analyst are now back in Tallinn from one of our trips to the Persian Gulf. The trip has as usual been very informative with a variety of exciting encounters with our portfolio companies.
In Dubai, we had such an interesting meeting with one of our portfolio companies, Arabtec, one of the largest construction companies in the region. Arabtec has among other things, built the world’s today tallest building, Burj Khalifa in Dubai. The company is one of three in the world who possess the knowledge to build such tall buildings. Arabtec is currently in negotiations with the Russian gas giant Gazprom, and has basically been given the green light for the construction of Gazprom’s new headquarters in St. Petersburg. The skyscraper will have a height of 400 meters!
Another very fruitful meeting we had in the Qatar capital Doha was with Qatar Telecom (QTel). It’s an investment we are very pleased with and we were impressed with Qtel’s expansion plans outside Qatar’s borders. The company has been very successful with its expansion in Indonesia, among others which is a huge market. QTel has over the years always supplied a constant dividend to its shareholders. We like that! By the way, Qatar is in the bidding to host the football World Cup 2022 (the decision to be delivered in early December). This is very exciting, and if they receive the hosting will provide a huge injection into its economy.
Our last stop was in Oman and its capital city Muscat. A beautiful country with a varied landscape of high mountains, deep valleys and a very pleasant climate. To be recommended as a tourist destination! We met among others the local telecom company Telecom Oman where we have a smaller investment. The company talked about their future plans in which the expansion of its broadband network is a high priority. The company has no plans for any international expansion.
My overall impressions of the GCC region right now are that there is a clear optimism among business leaders about the future. This depends a lot on a strong belief that oil prices will remain high for a good period ahead. Estimates talk of about 90-110 USD per barrel which generate a very large surplus in the national budgets. This in turn leads to the respective country’s government will execute their investment budgets.