MENA: A Unique Opportunity Capitalizing on the Petrodollar Windfall

1. MENA: A Unique Opportunity Capitalizing on the Petrodollar Windfall This document is confidential and is intended solely for the use and information of MAF-Trust.

2. A Lucrative Investment Opportunity • With oil prices close to USD 100 per barrel, the GCC has benefitted from this with a windfall in excess of USD 2 trillion, driving real GDP growth over 8.1% p.a. between 2003-06 (versus global growth of 3.6%). Growth in 2007 was estimated at 5.6%. • GCC has earned an additional USD 540 billion from hydrocarbon exports in 2007 only. • The region’s GDP doubled between 2002 and 2007 in nominal terms, reaching about USD 800 billion. • EIU forecasts a 6.2% CAGR through 2010 outpacing the international markets and implying the region is well set to maintain its growth at healthy levels. The GCC economy by 2050 could be comparable in size to Germany at USD 4.9 Trillion.

3. OIL Attractive capital markets Current account surplus & FDI Increased corporate activities Mega projects Increased corporate earnings Construction boom Higher employment & income Increased economic activities Increased purchasing power & savings The Oil Multiplier Effect

4. Fundamentals Behind Growth • The ME is experiencing an economic boom born out of structural reforms and supported by the following factors: • Strong liquidity • Current account and fiscal surplus; • Low interest rate environment; • Weak US dollar; • Healthy population growth; • Favorable demographics (more than 70% of the region’s population was below the age of 30).

5. A Rational Utilization Of Wealth • Unlike the previous bull oil cycles, this time GCC economies have spent their petro-dollars more wisely by: • Repaying sovereign debt; • Investing heavily in infrastructure development; • Investing regionally and internationally with the aim to diversify their economies and reduce their future dependence on oil revenues; • Improving regulatory framework to support robust economic growth; • Improving the level of education in this part of the world.

6. Impact Of Growth • More projects. The GCC has USD 1.5 trillion worth of projects in the pipeline over the next 5-7 years, of which 22% are hydrocarbons related. • Increased overall consumer demand: • Construction and RE sectors; • More banking transactions; • Durable and non-durable goods. • Encouraged private sector participation. The estimated private infrastructure investment translates into 6.5x the GCC’s combined public expenditure. • More liberalization through opening up markets to foreign investors.

7. Why Buy The Middle East • Uncorrelated play. Performance of the region is uncorrelated to the rest of the world to a great extent, making it an attractive diversification story, especially during a period of credit crunch in the US. Most assets are actually domestic plays in the telecoms, banking, real estate, building materials and construction sectors. • Growth. Fuelled by high domestic capital expenditure, the region is enjoying high ROEs level (18%+), coupled with a double-digit EPS growth.

8. Why Buy The Middle East • Currency play. Potential currency appreciation. • Superior returns. The CAGR is 37.1% over the past 5 years. • Valuations. The region is now trading at a trailing PE of 17 and forward PE of 14, roughly the same level as the rest of emerging markets. However, the growth is faster, the long-term story is more powerful, and above all the amount of domestic capital is significantly higher.

9. MENA MARKET Multiples TRAILING 12-MONTH EARNINGS GDP source: IMF

10. Risks To The Investment Case • Relatively high levels of inflation. • Geopolitical risk. An event of war! • Potential property oversupply in some markets after 2010. • Slower pace of liberalization and reforms.