A growing number of regional and multinational firms from Europe, America and increasingly China are setting up regional treasury centres (RTCs) in the Middle East. Treasury Today interviewees say firms in sectors including logistics, energy and consumer goods want to manage their footprint across the wider Middle East and African region out of new organisations based in the region.
Much of the corporate treasury expansion is coming off the back of the region’s multibillion-dollar mega projects which have created a burgeoning demand for goods and services. As businesses grow in the region, the need to manage treasury aspects becomes more important. At the same time, the financial hubs Dubai International Financial Centre (DIFC) and Abu Dhabi Global Market (ADGM) have helped draw large corporates to set up RTCs.
In some cases, for companies from East Asia – especially China – the strategy is part of a dual treasury setup characterised by one leg in MENA and another in Singapore or Hong Kong to manage global operations. In another trend, the shift from single to dual (or even multiple) RTC models reflects the growing need amongst companies to differentiate between restricted and free-market operations, and to segment treasury accordingly as the region continues to attract global investment and act as a bridge to Africa and Asia. “The rise of RTCs is also being driven by structural shifts in treasury operating models. Traditionally centralised in global HQs, treasury functions are now decentralising to better align with business growth in frontier and emerging markets,” explains Marion Reuter, Head of Transaction Banking UK & Europe and Head of Transaction Banking Corporate Sales UK & Europe at Standard Chartered.
She says a key driver is the need for real-time oversight and faster decision-making in regions where regulatory conditions can change quickly. Having treasury teams in the region offers not just time zone alignment, but also sharper regional insights, which are critical for navigating capital controls, repatriation constrains and compliance requirements.
The key role of a RTC is to serve as the central hub for managing a company’s regional liquidity, funding, cash flow and financial risk, she continues. Beyond operational support, RTCs play a strategic role by driving standardisation, improving visibility across entities and enhancing financial decision-making. They enable better control of working capital, facilitate intercompany lending and FX management as well as interest rate exposures and often act as Centres of Excellence for broader advisory functions such as capital planning, M&A treasury support and yield enhancement.
Selecting the right location
Selecting the right location for a RTC is critical. Key requirements include a stable regulatory and legal environment, favourable tax regime, liberal capital movement policies and access to a well-developed banking system that offers sophisticated treasury products like cross-border cash sweeping, liquidity management, notional pooling and payments-on-behalf-of (POBO)/receivables-on-behalf-of (ROBO) capabilities.
The location should also provide a strong talent pool with treasury expertise, be digitally connected to support ERP/TMS integration and be well-aligned with the business’s operating time zones to support agility in decision-making.
Reuter says the UAE remains the top choice in MENA for hosting RTCs due to its world-class banking infrastructure, stable and business-friendly regulatory environment in DIFC and ADGM and the unparalleled ease of doing business and liberal foreign exchange regime with no capital controls.
“The UAE offers access to a deep pool on multilingual treasury and finance talent, fully convertible currency and comprehensive liquidity management solutions including domestic and cross-border sweeping and notional pooling. The UAE also benefits from economic and political stability, strong global connectivity and is a considered gateway to Middle East and Africa, making it ideal for regional cash and risk centralisation,” she says.
“For companies operating across restricted markets such as Egypt or parts of Africa, a RTC in Dubai can offer the ability to act swiftly when regulatory environments shift. A company with a RTC in the region can react quickly – mobilising regional knowledge and engaging banking partners – while their headquarters (HQs) may not yet be open due to time zone differences. In such scenarios, a RTC moves from being an operational hub to a strategic enabler,” says Reuter.
Siemens opened a RTC in Abu Dhabi in 2019 in a bid to deliver funding faster to the company’s businesses. The centre in ADGM serves Siemens subsidiaries in Libya, Egypt, the Gulf States, Iraq, Afghanistan, Pakistan and Yemen, and was the fifth treasury centre that Siemens operates globally, joining other regional units in Hong Kong, Beijing, Mumbai and Iselin (New Jersey).
“By opening a regional treasury centre in the UAE, we are reinforcing our internal resources on the ground, enabling us to react more swiftly to regional requirements,” said Ulrich Schiessl, Managing Director of Siemens Capital Middle East.
Saudi Arabia is also an increasingly viable alternative, driven by ongoing economic liberalisation under Vision 2030. It offers strong domestic payment infrastructure (including SARIE and Instant Payments), full availability of both local currency (LCY) and foreign currency (FCY) accounts and domestic sweeping capabilities (cross-border sweeping requires manual intervention).
However, Reuter notes that account opening for non-resident non-Gulf Cooperation Council (GCC) individuals is subject to approval, and while FCY can generally be converted, practical hurdles and policy shifts may occasionally limit flexibility.
Moreover, if a company doesn’t have a regional headquarters in Saudi Arabia, it isn’t eligible to bid for government contracts or those issued by state-owned companies like oil giant Aramco. In the recent past, most businesses selling their wares into Saudi haven’t operated out of Saudi Arabia. In a hub and spoke structure, many tend to register in countries like the UAE or Bahrain and fly executives into Saudi when needed. Now new rules that foreign entities must register, pay tax and employ Saudi nationals in a quid pro quo for accessing the market are changing this approach.
By opening a regional treasury centre in the UAE, we are reinforcing our internal resources on the ground, enabling us to react more swiftly to regional requirements.
Ulrich Schiessl, Managing Director, Siemens Capital Middle East
The strategy is already bringing results explains Stuart D’Souza, Founder and Director of Arabian Enterprise Incubators (AEI Saudi) which supports foreign companies doing business in Saudi. “There is nowhere else like Saudi on the planet. The market is characterised by optimism and confidence underscored by the government’s flagship Vision 2030 policies.”
Qatar, Bahrain and Oman each offer stable and modern financial systems, with full currency convertibility (Qatar has restrictions of converting LCY to USD) and domestic sweeping options, continues Reuter. Bahrain in particular is known for its liberal regulatory approach, absence of capital controls and relatively streamlined banking operations.
Oman and Qatar support modern payment systems and banking digitisation but offer more limited liquidity structuring capabilities. Egypt provides a large labour force and deep local banking presence, but foreign exchange (FX) availability, currency transferability and administrative hurdles can pose operational challenges for treasury centralisation.
“Each city has specific areas they are focusing on, including legal and regulatory aspects required for the efficient functioning of a treasury centre. As these setups mature, we would expect each of them to attract different clients, based on each corporate’s requirements,” predicts Sameer Shah, Head of Cash Management Sales for Middle East and Africa at Deutsche Bank.
The process
In the process of setting up a RTC, there are several do’s and don’ts to consider. On the “do” side, companies should clearly define the RTC’s role within the overall treasury model and ensure alignment between headquarters and regional functions. Investing in technology and automation is essential – connecting the RTC to global ERP and TMS platforms improves efficiency, transparency and control.
Standardising treasury policies, processes and controls across all entities and locations will also help reduce complexity and operational risk. Partnering with banks present in the market is another important enabler for smooth liquidity and cash management.
Companies should avoid over-centralising decision-making without clarity of responsibilities, as this can lead to confusion or control issues, says Reuter.
It’s also important not to overlook local regulatory requirements, especially around FX controls, tax rules and intercompany transactions. A fragmented technology setup or inconsistent processes between HQ and RTC locations can lead to inefficiencies and data quality issues. Lack of local talent or weak governance structures may also pose risks.
The biggest risks to consider include sudden regulatory changes, restrictions on fund repatriation or FX convertibility challenges – especially in emerging markets. Technology integration issues, operational silos or inadequate risk oversight can also impact the success of the RTC. A well-structured RTC can deliver significant value, but success depends on selecting the right location, aligning stakeholders, choosing the right banking partner and building a robust future-ready operating model, she adds.
“Letting subsidiaries manage treasury aspects and not setting proper governance with policies and procedures can create risks for the organisation. Aspects like currency risk, tax subjects like transfer pricing, withholding taxes, etc, and subsidiary capital structures are complex and require specialised knowledge to manage closely and effectively,” concludes Shah.
