Chinese e-commerce companies and fintechs alike have expressed interest in the Middle East since 2018. Tencent’s largest competitor Alibaba is no stranger to the Middle East market. Ant Financial signed an agreement with Israel Credit Card (CAL) in January 2018 to accept payments through Alipay at merchants favoured by Chinese tourists, while the First Abu Dhabi Bank (FAB) partnered with Alipay in Feb 2020 to streamline payment experiences for Chinese tourists in the UAE.
AliExpress, the e-commerce arm of Alibaba, quickly amassed more than 150 million subscribers one month after its August 2018 regional launch. As of October 2018, Chinese shoppers could use Alipay to process transactions at points of sale as well as online through AliPay’s partnership with Network International. It’s clear that Ant Financial has made some definite strides towards expanding its presence and market share in the Middle East.
In comparison, Tencent’s dreams for the Middle East are not so apparent to the everyday speculator. Tencent is looking to expand its presence in the Middle Eastern gaming sector. With the official opening of Tencent Games’ regional headquarters in Dubai Internet City last July, Tencent communicated its intention to invest into the UAE’s evolving tech industry with the hopes that its move to set up regional operations in Dubai would help in creating a platform that invests in and improves the regional gaming sphere.
Tencent’s hopes for the Middle East gaming market is made slightly more visible in a co-branded whitepaper released ahead of November 2019. The whitepaper, which included market research from global games and eSports analytics company Newzoo, estimates that the total revenue for the Middle East & Africa game market would reach $4.8 billion in 2019 and to hit $6 billion by 2021.
A more recent report indicated that Tencent had signed a Memorandum of Understanding (MoU) with Etihad Airways, allowing the airline to leverage Tencent’s cloud computing capabilities and social media platforms to engage with their clients.
Although Ant Financial looks to be seeking regional expansion into the Middle East for Alipay, Tencent is adopting a slightly dissimilar approach. While some may say that Tencent has been making slow inroads into the Middle East and North Africa, it certainly is true that Tencent has been directing its attention and focus to the Middle Eastern gaming sector. It may be too early to tell, but Tencent’s alternative direction towards the Middle Eastern gaming sector may one day set it apart from the route taken by Alibaba.