Malta should capitalise on the huge potential of around 100 million Chinese travelling abroad within the next 10 years. Overseas travel is the fastest growing sector in China which has a population of around 1.3 billion people.

This was the main recommendation made by Robert Lloyd George how Malta can make the most of the booming Chinese economy.

He was speaking at a business breakfast organised yesterday by The Malta Business Weekly and the Le Meridien Phoenicia. The theme of the business breakfast was “China and the emerging markets”.

Mr Lloyd George is the chairman and chief executive officer of specialist investors in Asia and global emerging markets, Lloyd George Management.

At the moment only one per cent of the Chinese population travels overseas and the favourite destinations are mainly surrounding countries such as Hong Kong, Taiwan and Singapore.

This is expected to change as within the next few years there will be a 10-fold increase as travelling Chinese will venture further abroad, mainly towards the United States and Europe. And Malta should be ready to welcome as much as possible of these Chinese explorers, Mr Lloyd George said.

Apart from travelling, China and India are also spreading out into the westernised world with a series of acquisitions especially in the manufacturing sector. Among the most recent acquisitions made by Chinese companies, Mr Lloyd George mentioned personal computer manufacturing company, Lenovo which purchased the PC manufacturing arm of IBM, and Mittal Steel which is currently engaged in a hostile bid with Arcelor.

Only yesterday, it was reported in the international media that Mittal Steel, run by Indian billionaire, Lakshmi Mittal, would officially launch its E20.7bn hostile bid for Arcelor next week, as it had gained antitrust clearance for the move in the US and should soon get clearance from the European authorities.

During his presentation Mr Lloyd George said that China has the largest population in the world an apart from its low labour costs – which is beneficial for mass production – it is among the major trading powers in the east. China’s advances are also affecting businesses in every area especially through its international network, capital and know-how accumulated over the past few years.

In the textile sector in 2005 China’s exports to the US soared from 16 per cent to 60 per cent. China’s bilateral trade balances with Asia, including South Korea, Taiwan and ASEAN countries, and the US exceeded US$110bn in 2006 after having started from nought in 1992.

As a result of this economic boom, China also became a huge importer of oil and raw material. Up till last year China was producing slightly more than 3.5 million barrels per day of petroleum and consuming just less than seven million barrels per day of petroleum.

Mr Lloyd George said he believed that China will soon astonish the world with major breakthroughs in various areas like biotechnology because it had fewer constraints than those in the West.

Another significant aspect of the Chinese culture is the huge emphasise made on education and self-improvement. The Chinese are making a huge effort to educate their children and a significant amount of families can afford to send their off springs to the best universities in the US.

This was possible through the savings culture which contrasts highly with that of the US. China’s saving ratio is in excess of 35 per cent. This also provides a fertile ground for investments as the Chinese are keen on adopting the luxuries and lifestyle commonly associated with that of the western countries such as buying cars, travelling and having a mortgage.

Lloyd George Management was founded in 1991 by Mr Lloyd George. The firm was established to take advantage of the opportunities which emerging markets offer. The firm has grown to manage over US$13.5bn in Asian and global emerging markets for institutions, pension funds, governments and local authorities, endowments, foundations and private investors. Lloyd George Management also offers a range of mutual funds.

Mr Lloyd George was educated at Oxford University and began his investment career in London in 1974. After working in the Paris Stock Exchange and in banking in Brazil, he joined the Fiduciary Trust Company of New York to work on international investments for the UN Pension Fund. Mr Lloyd George was managing director of Indosuez Asia Investment Services in Hong Kong from 1984, before founding Lloyd George Management in 1991. He has published three books including The East West Pendulum.