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Citi readies for Asia investment surge with new China desk as trade war intensifies

Reuters  |  HONG KONG 

By Sumeet Chatterjee

HONG KONG (Reuters) - Inc will set up a business desk in within the year betting on a pickup in investment flows within the Asian region, its corporate head said, as concerns grow about the impact of a Sino-U.S. trade war.

Citi plans to establish the desk in Mumbai, adding to a business desk in the capital New Delhi, told The desks provide services such as trade finance, corporate loans, and investment

Chinese firms, mainly from tech and pharmaceutical sectors, have been looking to deepen their push into growth markets such as India, with its rising middle-class income and increased spending on big-ticket goods, bankers have said.

The drive comes as the imposes tariffs on Chinese imports, with responding in kind. In the latest battle, the on Tuesday added 10 percent duty to $200 billion worth of Chinese goods.

Investors fear a protracted trade war will be detrimental to global growth, but Keefe said investment and trade is growing elsewhere across Asia, and that Citi intends to capitalise through its network.

The Wall Street bank's revenue from institutional business in intra-trade corridors has risen 33 percent so far this year versus the same period a year prior, and compared with 18 percent for all of 2017, Keefe said.

"There's an increasing and absolute amount of investment flow around right from companies that are headed out of China, from companies that are headquartered elsewhere in who are of scale," Keefe said in a recent interview.

Citi has about 20 business desks supporting investments by companies from China, and India, into places including Beijing, Shanghai, Hong Kong, and Hanoi, as well as New York, and

Plans for additional desks in and are being finalised, Keefe said.

"Obviously it's not helpful to have terms (such as) 'global trade war' in the every day," he said.

"(But) as clients evaluate what all this means in the context of these trade relations being reset, we are finding that they are concluding that additional time, effort, and investment in Asia is good for them."

Keefe said there was growing investment from China in India, where global automakers are raising production capacity, as well as in in sectors such as technology, and

There is also growing investment from in India, where on Monday opened what it called the world's biggest

Citi's from the South Korea-business corridor has risen 78 percent this year.

"The macro setup for Asia has been as good as it possibly could have been for the last couple of years, and that has encouraged a lot of outbound investments and a lot of incremental trade has come through those corridors," Keefe said.

(Reporting by by Christopher Cushing)

(This story has not been edited by Business Standard staff and is auto-generated from a syndicated feed.)

First Published: Wed, July 11 2018. 11:23 IST