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7th February 2008

Growing Prospects for EU - Middle East Cooperation

The Middle East has a premium pool of over 30 billion US dollars and an insurance market forecast to grow at an annual rate of over ten percent for the next 10 years. In UAE, year on year growth for 2006 rose by 27.5%.

At the forefront of this increasingly attractive marketplace are those based around the Mediterranean Rim, especially Malta and Cyprus.  A growing sense of shared opportunity between these outposts of the European Union and their close neighbours has generated a lot of interest and speculation.

Insurance, especially life assurance, plays an important role in providing the social protection needed for any society, especially where socio-economic dynamics, such as the reduced role of the extended family, are occurring.  Years of misunderstanding and misconception have created certain barriers to the market development of insurance in the Muslim culture, however Takaful, or co-operative, Insurance offers a platform for growth for life assurance companies in the Muslim world.

The untapped potential for Bancassurance illustrates this growth opportunity for market development.  With less than 1% penetration for life sales across the Middle East, global and regional banks are waking up to the importance and potential of life assurance sales through this channel.  By comparison, in Europe, with its mature Bancassurance model, banks own between 50% and 90% share of the total life assurance sales across different countries.

There are several features shared by the aforementioned outposts, Malta and Cyprus, that make them excellent co-locations for Middle Eastern expansion;

• Proximity to mainland Europe and associated time zone benefits
• EU-compliant legal institutions, accounting standards and trade practices
• English an official language and the language of the business community
• Excellent telecommunications infrastructure
• Established regional centres for second and third level support to European companies operating in Middle East, North Africa and Southern Europe
• Flexible, reliable and highly productive workforce
• Highly competitive wages for professional staff
• An ideal test bed for new collaborations (e.g. Malta Enterprise)

As the smallest state within the EU, Malta lies close to North African shores.  Malta’s long history as a regional trading hub has helped develop the strong cross-cultural skills necessary to understand, accommodate and deal with the diversity of cultures in the area.
Cyprus, positioned in the top right hand corner of the Mediterranean and at the South Eastern corner of Europe, rightly claims to be a stepping stone to three continents. Its strategic location has been a major factor in shaping its history throughout the centuries. Upon its membership into the European Union, it has been transformed into a key outpost of the Eastern Mediterranean.

With multi-lingual populations fluent in English, together with close business, political and cultural ties to North Africa and the Middle East, Malta and Cyprus provide perfect platforms for global and regional insurers and banks targeting this region.  Exciting times ahead for the Middle East and Europe, with the potential for positive news around co-operation and mutual success.

Airas Intersoft actively markets Takaful compliant, multi-lingual, including Arabic, applications for Life, Pension, Health & Investments across the Middle East, in partnership with Airas ME.  With client references across the region, combined with iGas installations across Central and South Eastern Europe, the Mediterranean and Africa, we are confident in our ability to meet your needs and we welcome the opportunity to talk with you about your needs across this exciting region.

For more information contact: Airas Intersoft www.airasintersoft.com

  +44 (0)20 8554 0392

  mail@airasintersoft.com