EU observers will hope Egypt is still on the right track



Barring an unexpected late change of heart by a majority of voters, Abdel Fattah El Sisi will have been sworn in as Egypt's new president by this time next month. That much is clear, but what isn't is whether the international community will deem the electoral process as having been robust. A big part of that exercise involves the role of international election monitors. Several different groups have announced their intention to monitor Egypt's presidential contest.

The Carter Center, for example, despite Jimmy Carter’s reported views on Egypt, has opted to send a small expert mission – not a full observer mission – similar to the one sent by the European Union earlier this year.

The African Union suspended Egypt’s membership after the military’s removal of former president Mohammed Morsi last year, but is now sending a high-profile mission to observe the presidential elections. The political symbolism of this cannot be underestimated.

Moreover, the Arab League is dedicating a significant number of individuals to its own mission, and will even make efforts to observe voting by Egyptian expatriates internationally.

The most important mission, however, comes from the European Union.

The EU delegation endured a rocky start. After much speculation that Jose Salafranca, a Spanish member of the European Parliament, would lead it, he unexpectedly withdrew his interest in the position and left Brussels without an alternative plan. Mário David eventually emerged as the EU’s contingency candidate.

Mr David is a member of the Portuguese Social Democratic Party in the European Parliament, and is the vice-president of the same right-wing European parliamentary coalition as Mr Salafranca. He appears to be a politician who is generally favourable to Egypt’s road map, albeit with some criticisms of the current arrangement.

The Egyptian authorities have been particularly keen to bring the Europeans in to observe the elections to assure international recognition and legitimacy for these next and important steps on the country’s military-backed road map.

For their part, a number of European member states have also been privately keen to travel to Egypt, under the assumption that a report on the presidential elections will point out the flaws as well as the successes – although analysts don’t expect the final report to be particularly critical.

So, where does that leave the parliamentary elections, the final stage of the road map?

At present, the laws for those contests are being discussed. This is not simply a legal exercise, but a deeply political one. Political parties, by and large, want the law to benefit political party representation. Others with significant clout within the Egyptian administration, particularly big business interests, want the law to ensure more room for individual candidates. The political forces that backed the January 25, 2011 revolution would not be represented well in the latter scenario.

Any electoral mission, however, that is deployed later on in the year would find comments on the merits of such a parliamentary election law to be probably beyond their mandate. Nonetheless, such a mission is likely to have a good deal to say about the public atmosphere that permeates in the run-up to it, including access to media, as well as freedom to expound upon its views without any threat.

As Egypt moves along this phase of its transition, the credibility of these milestones should not be underestimated.

They underpin the trustworthiness of the road map, which has already received harsh criticism for its punitive response to Mr Morsi’s supporters and other opponents of the current authorities.

With the overwhelming support from within the public and private sectors for only one presidential candidate in this campaign, will observers take the opportunity to point out the flaws within the process? Will observers point out the polarised political environment as well as the repressive measures that have been criticised by groups and organisations inside and outside of Egypt?

Their first major chance, it seems, is almost upon them with this presidential election – and it promises to be instructive.

Dr HA Hellyer is an associate fellow at the Royal United Services Institute in London and the Brookings Institution in Washington DC

On Twitter: @hahellyer

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.”

The Transfiguration

Director: Michael O’Shea

Starring: Eric Ruffin, Chloe Levine

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Name: Peter Dicce

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A State of Passion

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Stars: Dr Ghassan Abu-Sittah

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This article is part of a guide on where to live in the UAE. Our reporters will profile some of the country’s most desirable districts, provide an estimate of rental prices and introduce you to some of the residents who call each area home.

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Sheep:easy-going, peacemaker, curious
Monkey:family-orientated, clever, playful
Rooster:honest, confident, pompous
Dog:loyal, kind, perfectionist
Boar:loving, tolerant, indulgent   

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Favourite book: ‘Purpose Driven Life’ by Rick Warren

Favourite travel destination: Switzerland

Hobbies: Travelling and following motivational speeches and speakers

Favourite place in UAE: Dubai Museum