We all love lists, don't we? Well, here's a list of a few reasons why Turkey will remain an "emerging" market for the foreseeable future.
Without wishing to appear ungrateful to the country where I just spent a pleasant week in the Ottoman splendour of Istanbul, I left with the impression it still had some way to go before it could fulfil its ambitions to be the "role model" for the rest of the Muslim world.
You might dismiss my observations as a tourist's gripes, but I think they're symptomatic of inherent flaws in the country's development:
1. The fact that arrivals at Ataturk airport cannot buy a visa in Turkish lira, but have to stump up in euros or US dollars. It shows a basic lack of faith in the currency, despite the government's track record in tackling inflation.
2. The fact that Istanbul taxis do not have air conditioning. Well, they do in theory, but the drivers of the cars (small, uncomfortable Fiats for the most part) prefer to travel with all windows wide open. Astonishingly, a request to switch on the AC was met by a demand for a surcharge of 5 lire (Dh10). Imagine a Dubai taxi driver trying that one on.
3. Istanbul traffic. It's a fantastic city, but the pleasure of sightseeing was negated by the gridlock that gripped all its streets, even major thoroughfares. On the evening Madonna played there last week, it took an hour to travel 2 kilometres. Urban infrastructure should be a serious priority for the government of Recep Tayyip Erdogan, the prime minister.
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On the subject of lists, this is the time of year when all eyes in the Middle East are on the local list par excellence: the Arabian Business Power 500.
This annual catalogue of the region's movers and shakers always throws up a talking point or two, though not usually about the identity of the winner. Saudi Arabia's Prince Al Waleed bin Talal has been judged the most powerful man in the Arab world by AB's experts for the past seven years, and he romped home again this time. "Despite so much success, there is no sign of the prince slowing down," purred the website. Looks like we can take a fair stab at next year's winner then.
The identity of the man in second place, however, is quirky. Few could gainsay the track record of Sheikh Ahmed bin Saeed Al Maktoum, chairman of Emirates Group as well as chief strategist of Dubai's economic and financial recovery. But his inclusion, and in fact that of Prince Al Waleed, seem to contradict AB's own rule excluding royals or politicians from the list.
Stranger still were the comments of Walid Akawi, the chief executive of AB's owner, ITP Publishing, at an obligatory glittering event at the Pavillion in Downtown Dubai on Monday.
The event was honoured by the presence of Mohamed Alabbar, chairman of property developer Emaar, who was himself ranked number four in the list. As head of the UAE's best-known property company since 1997, in good times and bad, Mr Alabbar's "place in history is already secure", AB gushed.
But Mr Akawi went further in his speech to the audience. "Mr Alabbar has done more to grow the region's business than anyone else in the world," he proclaimed.
What, more than Prince Al Waleed or Sheikh Ahmed? Or more even than Reem Asaad, the Saudi activist whose inclusion on the list at number three was due to the fact that women in the kingdom can now sell bras and knickers in lingerie shops there?
All very quirky, but it depends on your definition of power, I suppose.
fkane@thenational.ae
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.”
COMPANY PROFILE
Name: Kumulus Water
Started: 2021
Founders: Iheb Triki and Mohamed Ali Abid
Based: Tunisia
Sector: Water technology
Number of staff: 22
Investment raised: $4 million
The Settlers
Director: Louis Theroux
Starring: Daniella Weiss, Ari Abramowitz
Rating: 5/5
MATCH INFO
Barcelona 2
Suarez (10'), Messi (52')
Real Madrid 2
Ronaldo (14'), Bale (72')
Emergency
Director: Kangana Ranaut
Stars: Kangana Ranaut, Anupam Kher, Shreyas Talpade, Milind Soman, Mahima Chaudhry
Rating: 2/5
if you go
The flights
Direct flights from the UAE to the Nepalese capital, Kathmandu, are available with Air Arabia, (www.airarabia.com) Fly Dubai (www.flydubai.com) or Etihad (www.etihad.com) from Dh1,200 return including taxes. The trek described here started from Jomson, but there are many other start and end point variations depending on how you tailor your trek. To get to Jomson from Kathmandu you must first fly to the lake-side resort town of Pokhara with either Buddha Air (www.buddhaair.com) or Yeti Airlines (www.yetiairlines.com). Both charge around US$240 (Dh880) return. From Pokhara there are early morning flights to Jomson with Yeti Airlines or Simrik Airlines (www.simrikairlines.com) for around US$220 (Dh800) return.
The trek
Restricted area permits (US$500 per person) are required for trekking in the Upper Mustang area. The challenging Meso Kanto pass between Tilcho Lake and Jomson should not be attempted by those without a lot of mountain experience and a good support team. An excellent trekking company with good knowledge of Upper Mustang, the Annaurpuna Circuit and Tilcho Lake area and who can help organise a version of the trek described here is the Nepal-UK run Snow Cat Travel (www.snowcattravel.com). Prices vary widely depending on accommodation types and the level of assistance required.
