Last year at FOW we announced our project with RJ O’Brien, the oldest and largest independent futures brokerage and clearing firm in the United States, providing them with stable, global connectivity to support their clients.
Global connectivity is vital for many of our clients, and this year has seen healthy economic growth in many regions including the Middle East and APAC. One nation who is seeing consistent economic growth is Israel. They are well known for being a high-tech powerhouse and have been ranked as having the ‘world’s greatest innovative capacity and entrepreneurship‘ in 2014 by IMD Global Competitiveness Yearbook.
FINTECH IN ISRAEL
As a high-tech hub, Israel attracts investment from all over the world. Europe is Israel’s biggest trading partner and, after the Brexit vote, the UK stated they would improve their trade deal with Israel which should hold promise for Israeli cyber-industries, including high-tech and fintech start-ups. However, due to political changes in Europe and a weakened economic performance, Israeli firms have shifted their focus to the Far East, particularly India, China, Taiwan and Singapore.
Israel has the highest number of start-ups per capita globally.
Funding for Israeli start-ups reached a record high in recent years, with Chinese investors wanting a piece of the advanced tech pie. Israel has the highest number of start-ups per capita globally. With a surge in investment, the nation’s Economic Minister, Naftali Bennett, stated that there are plans to develop trade agreements with the key economies of Asia.
It is clear that relations between Israel and China are strengthening as time goes on. Recently, two major investment companies from Israel and China reached an agreement to run a new $100 million fund called Catalyst-CEL which is meant to focus on Israeli tech companies that meet China’s needs.
CHALLENGES IN ASIA
However, there are long-standing challenges that need to be addressed in order for Israeli firms to thrive in Asia, including cultural differences, language barriers, and restrictive regulations. There are risks to the current exponential growth in Asia that could affect an Israeli firm’s ability to succeed, including tightening global financial conditions, policies that have an internal focus, and limited productivity convergence.
Despite the obstacles, Asian businesses still view Israel as an opportunity. Recently Sompo Holdings Inc., a Japanese insurance company, set up a fintech hub in Tel Aviv. This is the first Japanese insurer to do so, and their aim is to utilise local expertise on cyber-security and digital tech. Many are acknowledging that there is now both quality and quantity when it comes to fintech in Israel, with major banks such as Citi, HSBC, and Barclays setting up fintech hubs in Tel Aviv.
Cultural differences and regulations are common obstacles for many firms looking to expand into the APAC region. We aim to help transform emerging markets into easy-to-access regions, and support financial organisations such as Sucden Financial and Fidessa solve challenges they faced throughout their Asian expansions.
Phillip Futures have spent years becoming one of Singapore’s top brokerages for the trading of global Future’s and Commodities, and are a founding clearing member of SGX.
Meet with Tom Fulford-Brown, Sales Director for the UK and MEAPAC region, at FOW Tel Aviv to discuss how your firm can improve its global connectivity.