Preliminary agreement between Abu Dhabi Ports and GCPI will further expand co-operation in transport and maritime sectors. Photo: Abu Dhabi Ports Group
Preliminary agreement between Abu Dhabi Ports and GCPI will further expand co-operation in transport and maritime sectors. Photo: Abu Dhabi Ports Group
Preliminary agreement between Abu Dhabi Ports and GCPI will further expand co-operation in transport and maritime sectors. Photo: Abu Dhabi Ports Group
Preliminary agreement between Abu Dhabi Ports and GCPI will further expand co-operation in transport and maritime sectors. Photo: Abu Dhabi Ports Group

Business

Abu Dhabi Ports signs deal with Iraqi ports company to explore investment opportunities

The preliminary agreement with General Company for Ports of Iraq will also strengthen co-operation in transportation and maritime sectors

Shweta Jain
Shweta Jain

September 20, 2021

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Abu Dhabi Ports, which operates ports, industrial cities and free zones in the emirate, has signed a preliminary agreement with the General Company for Ports of Iraq (GCPI), to explore potential investment opportunities and strengthen co-operation in transportation and maritime sectors.

Abu Dhabi Ports will also develop national infrastructure in Iraq, such as roads and rail networks, which will connect the country’s Al Faw Ports with markets in Jordan and Turkey, it said in a statement on Monday.

As part of the pact, Abu Dhabi Ports will conduct feasibility studies on the management and operation of the Iraqi company’s ports and economic zones and other infrastructure, it added.

The move demonstrates UAE’s drive to enhance co-operation with other Arab states, Suhail Al Mazrouei, the UAE's Energy and Infrastructure Minister, said.

“Leveraging the lessons learned as part of our nation’s pursuit to develop strategic sectors and build frameworks that contribute to the economic and social development of the UAE, we are transferring this invaluable knowledge to our kin in Iraq in order to support the formulation of a diverse and sustainable economy in Iraq,” he said.

Owned by one of the region’s largest holding companies, ADQ, Abu Dhabi Ports plans to list on the Abu Dhabi Securities Exchange later this year. The listing is subject to market conditions and regulatory approvals, ADQ said this month.

On Sunday, Abu Dhabi Ports said it partnered with the Aqaba Development Corporation to establish a cruise terminal at the Marsa Zayed project in Aqaba, Jordan. It will be the first terminal to be developed by Abu Dhabi Ports in Jordan and its first cruise facility outside the UAE.

“The co-operation with Iraq will also enhance trade and the flow of foreign investments to Iraq and will elevate the quality of maritime transportation and logistics services available in the region,” said Capt Mohamed Juma Al Shamisi, group chief executive of Abu Dhabi Ports.

The preliminary agreement between the two entities is set for an initial period of 12 months with a clause for automatic renewal, the statement said.

Abu Dhabi Ports owns and manages 11 ports and terminals in the UAE and Guinea, including Khalifa Port, Zayed Port, Musaffah Port, Fujairah Terminals, Community Ports, Kamsar Port and Abu Dhabi Cruise Terminal. It operates more than 550 square kilometres of industrial zones within Khalifa Industrial Zone Abu Dhabi (Kizad) and ZonesCorp, the largest integrated trade, logistics and industrial business grouping in the Middle East.

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The bio

Favourite book: Peter Rabbit. I used to read it to my three children and still read it myself. If I am feeling down it brings back good memories.

Best thing about your job: Getting to help people. My mum always told me never to pass up an opportunity to do a good deed.

Best part of life in the UAE: The weather. The constant sunshine is amazing and there is always something to do, you have so many options when it comes to how to spend your day.

Favourite holiday destination: Malaysia. I went there for my honeymoon and ended up volunteering to teach local children for a few hours each day. It is such a special place and I plan to retire there one day.

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Who: UAE v USA
What: first T20 international
When: Friday, 2pm
Where: ICC Academy in Dubai

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Mercer, the investment consulting arm of US services company Marsh & McLennan, expects its wealth division to at least double its assets under management (AUM) in the Middle East as wealth in the region continues to grow despite economic headwinds, a company official said.

Mercer Wealth, which globally has $160 billion in AUM, plans to boost its AUM in the region to $2-$3bn in the next 2-3 years from the present $1bn, said Yasir AbuShaban, a Dubai-based principal with Mercer Wealth.

“Within the next two to three years, we are looking at reaching $2 to $3 billion as a conservative estimate and we do see an opportunity to do so,” said Mr AbuShaban.

Mercer does not directly make investments, but allocates clients’ money they have discretion to, to professional asset managers. They also provide advice to clients.

“We have buying power. We can negotiate on their (client’s) behalf with asset managers to provide them lower fees than they otherwise would have to get on their own,” he added.

Mercer Wealth’s clients include sovereign wealth funds, family offices, and insurance companies among others.

From its office in Dubai, Mercer also looks after Africa, India and Turkey, where they also see opportunity for growth.

Wealth creation in Middle East and Africa (MEA) grew 8.5 per cent to $8.1 trillion last year from $7.5tn in 2015, higher than last year’s global average of 6 per cent and the second-highest growth in a region after Asia-Pacific which grew 9.9 per cent, according to consultancy Boston Consulting Group (BCG). In the region, where wealth grew just 1.9 per cent in 2015 compared with 2014, a pickup in oil prices has helped in wealth generation.

BCG is forecasting MEA wealth will rise to $12tn by 2021, growing at an annual average of 8 per cent.

Drivers of wealth generation in the region will be split evenly between new wealth creation and growth of performance of existing assets, according to BCG.

Another general trend in the region is clients’ looking for a comprehensive approach to investing, according to Mr AbuShaban.

“Institutional investors or some of the families are seeing a slowdown in the available capital they have to invest and in that sense they are looking at optimizing the way they manage their portfolios and making sure they are not investing haphazardly and different parts of their investment are working together,” said Mr AbuShaban.

Some clients also have a higher appetite for risk, given the low interest-rate environment that does not provide enough yield for some institutional investors. These clients are keen to invest in illiquid assets, such as private equity and infrastructure.

“What we have seen is a desire for higher returns in what has been a low-return environment specifically in various fixed income or bonds,” he said.

“In this environment, we have seen a de facto increase in the risk that clients are taking in things like illiquid investments, private equity investments, infrastructure and private debt, those kind of investments were higher illiquidity results in incrementally higher returns.”

The Abu Dhabi Investment Authority, one of the largest sovereign wealth funds, said in its 2016 report that has gradually increased its exposure in direct private equity and private credit transactions, mainly in Asian markets and especially in China and India. The authority’s private equity department focused on structured equities owing to “their defensive characteristics.”

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Updated: September 20, 2021, 6:00 PM
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