Jordan's economy is forecast to grow 2.5 per cent this year, according to the International Monetary Fund. Courtesy: Four Seasons Hotel Amman
Jordan's economy is forecast to grow 2.5 per cent this year, according to the International Monetary Fund. Courtesy: Four Seasons Hotel Amman
Jordan's economy is forecast to grow 2.5 per cent this year, according to the International Monetary Fund. Courtesy: Four Seasons Hotel Amman
Jordan's economy is forecast to grow 2.5 per cent this year, according to the International Monetary Fund. Courtesy: Four Seasons Hotel Amman

Jordan foreign minister discusses investment and jobs in Qatar


Khaled Yacoub Oweis
  • English
  • Arabic

Jordanian Foreign Minister Ayman Al Safadi discussed activating a pledge by Qatar to invest $500 million in Jordan during a meeting in Doha on Monday, an official Jordanian statement said.

Finding jobs in Qatar for up to 20,000 Jordanians was discussed in meetings between Mr Safadi and Foreign Minister Sheikh Mohammed bin Abdulrahman Al Thani, the statement said.

The two countries agreed to “build the environment that guarantees implementing the two initiatives as soon as possible, despite the Coronavirus pandemic.”

Tensions between Jordan and Qatar eased in 2018-2019, after Qatar said it would invest $500 million in Jordan and employ 10,000 Jordanians in Qatar.

Qatar made the offer after economic hardship contributed to anti-government protests in Jordan in mid-2018. Saudi Arabia, the Emirates and Kuwait pledged a $2.5 billion package to Jordan after the protests.

The foreign minister’s visit to Doha comes after reconciliation last month between Qatar and Saudi Arabia, the Emirates, and Bahrain, ending a dispute that erupted in 2017.

Jordan largely refrained from criticising Qatar at the time, but downgraded its diplomatic representation in Doha, which did the same.

Mr Safadi also met on Monday Qatar's Emir Sheikh Tamim, who “emphasised increasing and deepening cooperation with Jordan”, the statement said.

In the last two decades Jordan and Qatar have had sharp differences over Qatari support for the Palestinian militant group Hamas and Doha’s alliance with Turkey, as well as other regional issues.

In 2006, Jordan withdrew its ambassador to Qatar after Qatar, unlike other Arab countries, declined to vote for Prince Zeid Al Hussein, a Jordanian candidate, to head the United Nations.

Jordan had withdrawn the ambassador four years prior over an Al Jazeera broadcast the government found insulting to the royal family.

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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