An EU monitoring mission has called for a reform of Lebanon's electoral finance framework, after a report found that May's parliamentary elections "were overshadowed by widespread practices of vote buying and clientelism".
In its final report, the EU's Election Observation Mission said "the legal framework for campaign finance suffers from serious shortcomings concerning transparency and accountability". The devastating economic situation in Lebanon had only made the practice of vote buying more prolific, the report said.
"Numerous cases of vote buying and clientelism have been reported. Distributing 'bread bags', food parcels and medical supplies as well as generators, solar power and fuel were among the practices used by certain political parties and candidates, often in their offices, to unduly influence the voters.
"Instances of intimidation, including of female candidates, destruction of campaign material and the obstruction of campaign activities have also been observed and reported from several districts."
At a press conference where the results were released, Gyorgy Holvenyi, a member of the European Parliament, noted that the 2022 electoral framework remained almost unchanged compared to the last time Lebanon went to the polls in 2018 — with none of the 25 recommendations issued by the previous EU EOM acted upon.
"The monitoring of campaign finance is limited to the electoral campaign bank account that the candidates and lists have to open when registering, with total bank secrecy on other personal accounts of the candidates or of their close relatives," the report said.
"This allows candidates to avoid using their electoral bank account, and potentially channel illicit sums of money through totally opaque bank accounts, to which neither the SCE nor other institutions have access," it said, referring to Lebanon's heavily underfunded Supervisory Commission for Elections.
The EU mission said the SCE should be given the mandate to audit the personal accounts of candidates and their families. It noted that while there are supposed spending limits on campaigning, the SCE "had no resources to assess the reliability of the financial information provided by candidates and the respect of these ceilings".
It recommended that the SCE be established as a fully independent body, separate from the Ministry of Interior. EU observers reported a highly-monetised campaign, "where a culture of in-kind and financial handouts for electoral purposes by institutions owned or managed by candidates or parties, prevailed".
"These practices are due to a legal provision according to which the distribution of services and payments during the campaign period are not subject to the spending ceilings and do not fall under the control of the SCE if the same have been provided for three years prior to the elections. The candidates are not obliged to report these to the SCE, which thus has no control over such practices," the mission said.
The EOM called for strict regulation of the goods, payments and services given by institutions owned or managed by candidates and parties.
In the elections in May, Iran-backed Hezbollah and its allies lost a parliamentary majority, paving the way for a greater political stalemate and delays in passing the much-needed economic reforms that Lebanon needs.
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Stars:Robert Pattinson
Director:Matt Reeves
Rating: 5/5
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What is the Supreme Petroleum Council?
The Abu Dhabi Supreme Petroleum Council was established in 1988 and is the highest governing body in Abu Dhabi’s oil and gas industry. The council formulates, oversees and executes the emirate’s petroleum-related policies. It also approves the allocation of capital spending across state-owned Adnoc’s upstream, downstream and midstream operations and functions as the company’s board of directors. The SPC’s mandate is also required for auctioning oil and gas concessions in Abu Dhabi and for awarding blocks to international oil companies. The council is chaired by Sheikh Khalifa, the President and Ruler of Abu Dhabi while Sheikh Mohamed bin Zayed, Abu Dhabi’s Crown Prince and Deputy Supreme Commander of the Armed Forces, is the vice chairman.
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.”
If you go
Where to stay: Courtyard by Marriott Titusville Kennedy Space Centre has unparalleled views of the Indian River. Alligators can be spotted from hotel room balconies, as can several rocket launch sites. The hotel also boasts cool space-themed decor.
When to go: Florida is best experienced during the winter months, from November to May, before the humidity kicks in.
How to get there: Emirates currently flies from Dubai to Orlando five times a week.
The biog:
Languages: Arabic, Farsi, Hindi, basic Russian
Favourite food: Pizza
Best food on the road: rice
Favourite colour: silver
Favourite bike: Gold Wing, Honda
Favourite biking destination: Canada
Avatar: Fire and Ash
Director: James Cameron
Starring: Sam Worthington, Sigourney Weaver, Zoe Saldana
Rating: 4.5/5