Neil Parsons

'We chose Dubai as a base because we liked what the authorities had to say about their ambitions to expand as a financial services centre,' says regional director Neil Parsons. 'We want to raise our profile in the Middle East, and build on the relationships we already enjoy with some regional banks, and create new relationships with some of the financial institutions that we have not got to know yet'.

There is also another possibility. Aberdeen Asset Management is actively seeking a strategic investor in its own business. At present Abbey National holds a 38% stake in Aberdeen as a result of its take-over of Scottish Provident, and Abbey has given Aberdeen two years to find a friendly buyer for this stake.

'This has given rise to some rumours that we are about to be taken over ourselves,' says Parsons. 'But this is absolutely not the case. However, it is true that we would like to find a strategic investor, and given our ambitions in this region, a Middle Eastern investor would be ideal'.

With $40bn under management, Aberdeen is a leading independently owned UK based investment management business. Analysts at www.moneyguru.com rate the group as a 'good quality funds manager for a number of large institutions'. It also has a wide range of unit trusts, investment trusts, ISAs, pension funds and offshore funds for institutions and private individuals.

But has the group been hit by the recent turbulence in world equity markets?

'Inevitably we have,' admits Parsons. 'Some investors now see this as the time to buy. We are more cautious and think we will probably have to wait until the fourth quarter for a real pick-up. Markets will remain volatile over the short term.

'Middle Eastern investors are taking a very similar view. These days we all have access to financial websites, and see the same online information. So we have seen quite a fall off in new business in this region, but we have not over-extended ourselves and take the long-term view of developing of our business here'.

Aberdeen is also exploring Islamic investment products and hopes to have something to offer the market this summer. 'We particularly note that Islamic banks in the region are sitting on funds which could be better invested in appropriate Islamic instruments,' says Parsons. 'And this is very much an area in which we hope we can offer our expertise'.

Another ambition is to launch a local fund to invest in the UAE stock market, and even to list some of Aberdeen's international funds on the Dubai Financial Market.

'The DFM is not ready for this yet, but we would like to be prepared for when the liquidity and credibility is in place,' says Parsons. 'We will be gradually building up our operations in Dubai over the next 12 months, and will be developing our relationships with institutions around the region. I am confident that the Middle East is the right place to be and that we will build relationships with many more financial institutions.