The UAE and Oman have established investment partnerships worth Dh129 billion ($35.12 billion) across multiple sectors including renewable energy, railway, green metals and technology.
The collaboration was announced following the state visit of Oman's Sultan Haitham to the UAE this week.
The two countries will set up an industrial and energy mega project valued at Dh117 billion, with solar and wind projects, and green metal production units, the UAE’s Ministry of Investment said on Tuesday.
Abu Dhabi National Energy Company (Taqa), Masdar, Emirates Global Aluminium, Emirates Steel Arkan, Oman’s OQ Alternative Energy and Oman Electricity Transmission Company will be part of the new investment deal.
“The UAE and Oman have strong historical relations that are founded on shared values, goals and principles,” said Mohamed Alsuwaidi, Minister of Investment.
“The agreements represent a major milestone in our bilateral ties, as they pave the way for us to leverage our collective strength to realise our shared vision of advancement and prosperity.”
The two countries also decided to set up a technology-focused fund worth Dh660 million to invest in the digital economy in Oman and the wider Mena region. Abu Dhabi holding company ADQ and Oman’s sovereign wealth fund Oman Investment Authority will be part of the fund.
Rail connection
A UAE-Oman rail connectivity project, valued at Dh11 billion, and a shareholding partnership between Etihad Rail, Mubadala and Omani Asyad Group Company worth Dh3 billion, was also announced.
The two countries are building a rail network covering a distance of more than 300km to boost connectivity.
Trains that can reach speeds of 200kph will connect Abu Dhabi with Sohar to the north of Muscat, the Oman News Agency said in 2022. Freight trains will run at up to 120kph.
The deal includes connecting the UAE's existing freight services line to Sohar.
Passenger trains will run between Sohar and Abu Dhabi in 100 minutes, and between Sohar and Al Ain in 47 minutes.
Freight trains will have an annual capacity of 22.5 million tonnes of bulk cargo and 282,000 containers.
The announcement of the new projects comes as the UAE and Oman continue to boost investment ties, with non-oil trade between the two countries reaching about Dh51 billion in 2023.
During Sultan Haitham's visit on Monday, the two countries pledged to further strengthen ties.
“The agreements signed today will serve to bolster relations across key sectors and foster socio-economic benefits, contributing towards a stable and prosperous future for both countries,” the Ministry of Investment said.
THE BIO
Born: Mukalla, Yemen, 1979
Education: UAE University, Al Ain
Family: Married with two daughters: Asayel, 7, and Sara, 6
Favourite piece of music: Horse Dance by Naseer Shamma
Favourite book: Science and geology
Favourite place to travel to: Washington DC
Best advice you’ve ever been given: If you have a dream, you have to believe it, then you will see it.
Who's who in Yemen conflict
Houthis: Iran-backed rebels who occupy Sanaa and run unrecognised government
Yemeni government: Exiled government in Aden led by eight-member Presidential Leadership Council
Southern Transitional Council: Faction in Yemeni government that seeks autonomy for the south
Habrish 'rebels': Tribal-backed forces feuding with STC over control of oil in government territory
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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Countries recognising Palestine
France, UK, Canada, Australia, Portugal, Belgium, Malta, Luxembourg, San Marino and Andorra
The Sand Castle
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Stars: Nadine Labaki, Ziad Bakri, Zain Al Rafeea, Riman Al Rafeea
Rating: 2.5/5
The five pillars of Islam
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T20 World Cup Qualifier A, Muscat
Friday, February 18: 10am - Oman v Nepal, Canada v Philippines; 2pm - Ireland v UAE, Germany v Bahrain
Saturday, February 19: 10am - Oman v Canada, Nepal v Philippines; 2pm - UAE v Germany, Ireland v Bahrain
Monday, February 21: 10am - Ireland v Germany, UAE v Bahrain; 2pm - Nepal v Canada, Oman v Philippines
Tuesday, February 22: 2pm – semi-finals
Thursday, February 24: 2pm – final
UAE squad: Ahmed Raza (captain), Muhammad Waseem, Chirag Suri, Vriitya Aravind, Rohan Mustafa, Kashif Daud, Zahoor Khan, Alishan Sharafu, Raja Akifullah, Karthik Meiyappan, Junaid Siddique, Basil Hameed, Zafar Farid, Mohammed Boota, Mohammed Usman, Rahul Bhatia
All matches to be streamed live on icc.tv
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Rating: 4/5
