Gulf duo invests $5 bn in China

Islamic investment bank Gulf Finance House, in association with Gulf Energy, is set to make what will be the single largest direct investment in China by a Middle East consortium.

The two firms will develop Energy City China, a 13.4 square km purpose-built business and residential district for Asia's top energy companies, in a project worth around $5 billion, according to a statement posted on the Bahrain Stock Exchange.

Today, Esam Janahi, CEO of Gulf Finance House, and Zhang Jinbo, Mayor of Sanhe City, which will be home to the development, signed a letter of intent in Beijing.

Janahi said: "To date, Gulf investments in China have remained relatively low, in spite of China having invested over $7 billion in the Gulf.

"China's oil requirements will rise to 7.3 million oil barrels per day by 2020, a key factor in Gulf Finance House's decision to create Energy City China. With more than 50% of that oil supply expected to come from the Middle East, China is an attractive commercial opportunity for Middle East energy companies."

Energy City China will be located in the Yanjiao business district, 30km from the centre of Beijing. It will house a purpose-built integrated business centre constructed specifically to meet the needs of local and international energy companies.

Among its facilities, the centre will include a bank which will focus on energy- and technology-related investment products, real estate development and private equity; a financial services centre, containing banking and insurance companies; and an International Mercantile Exchange (IMEX), a dedicated energy platform trading a range of energy products, subject to regulatory and governmental approvals.

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