Over the past decade, technological advancements have enabled new ways of communication, investment, e-commerce and fintech, etc., to revolutionise how we engage with each other. These trends are affecting the global economic dynamics, with the focus shifting towards emerging markets rather than the traditional American and European powerhouses.
The future growth trends for businesses and entrepreneurs are in connecting the needs and opportunities, and strengths of these new markets. eWTP Arabia Capital (eWTPA)’s wider vision of building a local digital ecosystem in the Middle East and North Africa (MENA) is being driven by partnering with market-leading Chinese businesses and providing a gateway to establish their presence in the region.
As China has been a driving force for the global economy over the past two decades or so, it has shifted from production to higher-end services. The lessons learned from this journey provide a good reference for new markets. Meanwhile, these new markets also offer opportunities for China and Southeast Asian enterprises to grow and expand overseas.
When we think about Middle East markets, oil-rich resources spring to mind. As such renewable energy sources would eventually deplete, they must develop new industries and transform the future, hence creating a gap which can be filled quickly by enterprises in China and SE Asia.
Rather than competition, these markets have the potential to supplement one another and create new bonds that are mutually beneficial, as they both understand the needs of emerging markets.
The MENA markets recognise the importance of the venture sector to achieve higher economic aims. Government-led initiatives have therefore been a key driver of growth in the venture sector in the region, evidenced by the development of startsup ecosystems.
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To help effectively build a sustainable digital environment for MENA and facilitate the fast development of the digital economy in the Saudi Arabia region, echoing its Vision 2030 program that aims to achieve governmental operational excellence, improve economic enablers, and enhance living standards by accelerating the implementation of primary and digital infrastructure, and engaging stakeholders.
A stumbling block in the way of strategic alliances between MENA and Southeast Asia is the lack of a platform to match their needs and expectations. While MENA businesses is unfamiliar with the investment landscape in China, there is a lack of a trustworthy, direct bridge. Similarly, China and SE Asian countries may see the opportunities in MENA but cannot find a suitable landing platform.
Filling the gap MENA market
An influential PE with strong connections in China as well as a proven track record in Saudi Arabia would serve to bridge the gap. eWTP Arabia Capital (eWTPA), a leading Saudi Arabia and China-based growth stage venture fund with offices in Beijing and Riyadh, its core investment strategy is to transfer the latest technology and proven business models from China and Asia more broadly to fill a clear gap in its target MENA market.
eWTPA focuses on the sectors of digital infrastructure, core technology and platform, and consumer and enterprise services. It is backed by industry gurus with close links to leading global technology companies in Asia, especially in China.
As the only Chinese fund firm established in Saudi Arabia, and with staff members on the ground to gain valuable insights, it is uniquely positioned to build bridges between China and Saudi Arabia, as well as other emerging markets such as the Middle East and North Africa. This also helps them solve issues in localizing the products and services.
Being a relatively young market player, it also provides plenty of flexibility of options in investment, from VC, and private equity to even joint venture, and provides investment strategies to help enterprises break new ground.
eWTPA launched its first fund (Fund I) in 2019, which is backed by PIF (sovereign wealth fund of Saudi Arabia, Public Investment Fund) and eWTP Capital (Alibaba Group and Ant Finance Group).
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Within a short period of time, this US$400-million-fund has already invested into 16 companies across digital infrastructure, core technology and platform, and consumer and enterprise services which span enterprise services, cloud services, cyber security, fintech, cross-border supply chain, retail and consumer, e-commerce, logistics and digital entertainment and others, which are to work together and build a unique digital ecosystem in the Middle East and North African (MENA) region.
13 of which already in operation, including co-investments with Ali Cloud and STC group to build a Saudi Cloud Computing Company (SCCC) and J&T Express.
In February 2022, eWTPA also co-invested in Y.O.U. beauty products, with over 40,000 outlets in Indonesia, Malaysia, the Philippines and Thailand. In seeking financing to enhance its capabilities to tap new markets, including MENA, Y.O.U. also leveraged eWTPA’s expertise in the supply chain, channel development and e-commerce to make progress in consolidating its position as an industry leader in Southeast Asia.
eWTPA is looking to forge strategic partnerships rather than simply seeking funds. As Singapore is the financial capital of SE Asia, the company is more than willing to make long-term plans and make available its expertise for enterprises in Singapore and surrounding countries.
Moving forward, eWTPA is also looking for partnerships in the wider APAC and Southeast Asia regions to facilitate the growth of the digital ecosystem in the MENA region. The company will also be launching a second fund too to cover more grounds and to allow for more partnerships to join in this unique force or change.
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