Can cities in the UAE become innovation labs? Mohammed and Peyman Al Awadhi offer their thoughts on the subject shortly after moderating a panel during the Clinton Global Initiative last week.
What is your take on the UAE as an innovation centre?
Mohammed: Given that there are 150 nationalities living in the UAE, the country has a huge potential to be a hub for innovation in entrepreneurship, in culture, in everything really. Having said that, it's also really young. It's not as established as a New York, a London or a lot of the other countries around the world.
Peyman: Dubai is positioned very well for that to happen. There's obviously a very large percentage of the population that is very young and very well educated, and while obviously the Government provides a lot of opportunities for jobs within the Government, there's also a bigger need for people to get into the other side of the industry – which is entrepreneurship. The Government has a lot of initiatives to support entrepreneurship in Dubai, and that is why you'll see a lot of infrastructure, a lot of entities. There's a lot of money to support entrepreneurs and innovation generally.
How do you take it from that level, whether it’s corporate America or corporate UAE, and get to the social good level?
Peyman: During Ramadan, there are organisations that mobilise and put together care packages for low-income construction workers just to show they're being thought of and cared for. Don't forget as a country we're quite new. There are a lot of other – I wouldn't say priorities above that – but at this stage of development of the country, the infrastructure, things like education, all of that is taking up a large portion of the budget in the UAE. But what's happening is recently there's been a heavy move toward social good entities, whether they're government or private and supported by these government entities.
What’s great is there’s an encouragement from the government to get more UAE nationals involved, because seven to 10 years ago that work was predominantly done by people who were doing it in their home countries, they moved to the UAE and they’re sort of continuing that in the UAE. Now you’ll see that a lot of social initiatives are being done by UAE nationals.
Like what?
Peyman: There's an entity called ThinkUp, and they'll regularly gather Emiratis and do social initiatives – like we have the National Day celebrations on December 2, and usually everybody is in the streets. ThinkUp GCC, the next morning, got lots of UAE nationals and helped the city of Dubai clean up the city. We also have an Emirati national who used to work for the government entity in Dubai and has left that job and is now helping refugees in Zaatari camp in Jordan.
How is that movement going to accelerate?
Mohammed: We make up 15 per cent of the population, and of that 15 per cent what percentage of the population are adults? And what percentage are the entrepreneurial, social good type? We're talking about a fraction of society.
The social good movement is in its infancy, but what I’m seeing happening is that because of the internet and social connectivity, people from Dubai are reaching out to people across the world and they’re collaborating. So the impact of that is not necessarily seen in Dubai or the UAE – it can be seen anywhere in the world. Over the next five or 10 years we’re going to see even more such collaborations, and it’s driven by this social connectivity.
Peyman: The Ruler of Dubai just this Ramadan announced the Suqia [Water Aid] campaign, which is similar to what the guys at Water.org are doing on a smaller scale at this point but something that we want to grow. His initiative raised Dh180 million that went towards providing clean water for five million people. The target was five million people but they overshot that just in one month of Ramadan. You had private money coming in, you had government money coming in, you had individual money coming in – it was great. I see this [sector] growing heavily.
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The biog
Born November 11, 1948
Education: BA, English Language and Literature, Cairo University
Family: Four brothers, seven sisters, two daughters, 42 and 39, two sons, 43 and 35, and 15 grandchildren
Hobbies: Reading and traveling
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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Centre Court - from 4pm (UAE time)
Angelique Kerber (1) v Irina Falconi
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Milos Raonic (6) v Jan-Lennard Struff
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End of free parking
- paid-for parking will be rolled across Abu Dhabi island on August 18
- drivers will have three working weeks leeway before fines are issued
- areas that are currently free to park - around Sheikh Zayed Bridge, Maqta Bridge, Mussaffah Bridge and the Corniche - will now require a ticket
- villa residents will need a permit to park outside their home. One vehicle is Dh800 and a second is Dh1,200.
- The penalty for failing to pay for a ticket after 10 minutes will be Dh200
- Parking on a patch of sand will incur a fine of Dh300