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The move comes as Gulf states accelerate diversification beyond hydrocarbons, creating opportunities in infrastructure, energy transition, logistics, technology, and advanced industries. Saudi Arabia’s Vision 2030 programme and the UAE’s efforts to develop finance, technology, and industrial sectors have attracted large pools of international and regional capital.

For Temasek, establishing a permanent presence is also a shift from its earlier approach of assessing the region largely from outside. Chairman Teo Chee Hean said in June that the investment company was actively looking at a Middle East office, while stressing that new locations had to be justified by investment opportunities rather than geographical coverage.

“We do not have an office, for example, right now in the Middle East, and we are actively looking at that and finding the right time to do so,” Teo told The Business Times. He said Temasek needed to be in markets where it believed there were opportunities to deploy capital.

The decision follows years of increasing engagement. In March 2025, Seviora Group, Temasek’s wholly owned asset-management platform, opened its first Middle East office in Abu Dhabi Global Market. Seviora said the office would help it tap the region’s expanding asset-management industry.

Temasek has also been building relationships with major Gulf institutions. In May, it joined BlackRock’s Global Infrastructure Partners, Abu Dhabi’s L’IMAD, and Abu Dhabi National Oil Company in a proposed infrastructure investment partnership targeting up to USD 30 billion across the Gulf and Central Asia.

The partnership targets energy, transportation, logistics, digital infrastructure, water, and waste management.

The new offices come as Temasek seeks to increase exposure to Europe, the Middle East, and Africa. The three regions accounted for about 12% of its portfolio as of March 2026, mostly in Europe. In July, Temasek said it had invested about 13 billion euros in EMEA over the previous two years and was targeting up to about 17 billion euros in the region by 2029.

The expansion is part of a broader effort to build an investment pipeline across markets being reshaped by energy transition, infrastructure development, industrial policy, and technology. Temasek has also indicated greater interest in sectors such as defense, particularly in Europe, as geopolitical considerations increasingly influence investment decisions.

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That geopolitical backdrop makes the timing notable. The Gulf and wider Middle East have been affected by the ongoing conflict involving Iran, with consequences for energy markets, trade routes, and investor risk assessments.

Gulf financial centres have nevertheless continued to attract international asset managers and sovereign investors.

The conflict impacted Temasek’s own portfolio.

In its latest annual results, the company said events in the Middle East caused a 2% net portfolio value drawdown in the final month of its financial year, partly reversing earlier gains in its global direct investments portfolio.

Despite those risks, Temasek continues to view the region through a long-term investment lens.

The expansion will give investment teams closer access to sovereign wealth funds, institutional investors, family offices, and companies. It should also improve local sourcing and due diligence.

Chia Song Hwee, chief executive of Temasek Global Investments, has been appointed chairman for the Middle East and Africa, while Ankit Khemka remains managing director for the region. Chia said being on the ground would allow Temasek to deepen engagement with partners and bring complementary expertise from across its investment ecosystem to regional markets.

The new offices will also expand Temasek’s global network. The company currently has 13 offices across nine countries, including Singapore, China, India, the UK, France, Belgium, the US, and Mexico.

Once operational, Abu Dhabi and Riyadh will expand the network to 15 offices across 11 countries by 2027.

The move comes as competition for Gulf capital and strategic partnerships intensifies. Regional sovereign wealth funds are seeking global opportunities while international investors seek access to Gulf-led projects and private markets.

For Temasek, the two offices could therefore serve a dual purpose: helping it deploy more capital locally while connecting Gulf opportunities with its wider portfolio and global network.

The company’s record SUSD 518 billion net portfolio value as of March 2026 gives it substantial financial capacity, although its stated approach remains focused on long-term, sustainable returns rather than simply expanding assets or geographic reach.

The offices will formalise a strategy built through investments, fund relationships, and portfolio-company activity. That could deepen regional deal flow. It also brings decisions closer to prospective partners regionally.