After six years of bitter civil war, Libya this week got a government of unity at last, but uniting this shattered country will be more difficult.
The Government of National Unity, a transitional administration, was sworn in on Monday and is now in charge of keeping the peace long enough for elections for a permanent government to be held in December.
It will not be easy.
UN special envoy to Libya Jan Kubis welcomed the birth of the new government.
“Today’s swearing-in session illustrates the eagerness and the determination of Libyans to overcome their differences,” he said.
The UN played an important role in creating the new government, which has become Libya’s fifth transitional government in the decade since the revolution that overthrew Muammar Qaddafi.
A UN-chaired forum negotiated the formation of the government over four, often torturous, months, moulding it to replace Libya’s two rival governments – one in the west and another in the east. Those governments had been at war since 2014, operating parallel administrations and armies.
Now, both are set to dissolve.
The new prime minister, Abdul Hamid Dbeibah, promised on Monday that the government will be one “of all Libyans”, ensuring his 33-member Cabinet is drawn from groups across the country.
For the moment, at least, he has parliament’s backing, with members voting 132-2 to endorse his Cabinet, although the 54 politicians who did not show up to vote hints that not everybody is satisfied.
The first problem for Mr Dbeibah, 61, a wealthy businessman from the city of Misurata, is what to do about a front line that snakes down the middle of country near the coastal city of Sirte.
The front line congealed last summer after rival forces fought themselves to a standstill. Earthworks and fortifications dot the line and the main coastal highway connecting east and west Libya remains blocked.
For the moment, the rival forces remain in place, but a UN-brokered ceasefire agreed to in October has stayed intact. The UN has deployed a small observation team to assess whether a larger monitoring effort can be deployed. In Geneva, a joint military commission consisting of five officials from each former government has so far been successful in providing a talking-shop to quickly solve ceasefire breaches.
Mr Dbeibah will also be cheered by the recent reunification of the central bank, which had been divided between east and west. Another boost is that Libya’s oil production is strong, with its fields for the moment free of the blockades and strikes that have often restricted output.
But running a government containing all factions will likely make decision-making cumbersome, particularly because it must decide what kind of constitution will govern the permanent government to be elected in December. There is strong support for a referendum on this constitution to be held in the summer.
Tripoli, meanwhile, continues to be dominated by more than a dozen powerful militias who periodically skirmish with each other. The militia chiefs will need to be convinced to hand over power to regular army and police agencies to give the capital security.
The capital’s administration must also find a way of ending frequent shortages of electricity and water. More than 1.3 million of Libya’s 6.5 million people depend on the UN for humanitarian aid.
Another priority is ensuring the departure of an estimated 20,000 mercenaries. On Friday, the UN Security Council called for mercenary withdrawal “without delay” and Mr Dbeibah has labelled the mercenary presence a “stab in our back."
While the ceasefire is holding, terrorism remains a threat. At the weekend, the Libyan National Army, commanded by Field Marshall Khalifa Haftar, raided an ISIS hideout in the south of the country, announcing the capture of its “most prominent leader”, Mohamed Milhoud Mohamed.
One key test of Mr Dbeibah’s government will be whether its unity remains intact when he makes the inevitable tough decisions about demobilising armies and where the budget is spent.
Another potential problem is a UN report alleging corruption in the formation of the new government which was given to the UN Security Council, but has yet to be made public.
The struggle is on for active managers
David Einhorn closed out 2018 with his biggest annual loss ever for the 22-year-old Greenlight Capital.
The firm’s main hedge fund fell 9 per cent in December, extending this year’s decline to 34 percent, according to an investor update viewed by Bloomberg.
Greenlight posted some of the industry’s best returns in its early years, but has stumbled since losing more than 20 per cent in 2015.
Other value-investing managers have also struggled, as a decade of historically low interest rates and the rise of passive investing and quant trading pushed growth stocks past their inexpensive brethren. Three Bays Capital and SPO Partners & Co., which sought to make wagers on undervalued stocks, closed in 2018. Mr Einhorn has repeatedly expressed his frustration with the poor performance this year, while remaining steadfast in his commitment to value investing.
Greenlight, which posted gains only in May and October, underperformed both the broader market and its peers in 2018. The S&P 500 Index dropped 4.4 per cent, including dividends, while the HFRX Global Hedge Fund Index, an early indicator of industry performance, fell 7 per cent through December. 28.
At the start of the year, Greenlight managed $6.3 billion in assets, according to a regulatory filing. By May, the firm was down to $5.5bn.
The specs: Macan Turbo
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UAE currency: the story behind the money in your pockets
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.”
Sri Lanka-India Test series schedule
- 1st Test India won by 304 runs at Galle
- 2nd Test Thursday-Monday at Colombo
- 3rd Test August 12-16 at Pallekele
If you go
The flights
Emirates and Etihad fly direct to Nairobi, with fares starting from Dh1,695. The resort can be reached from Nairobi via a 35-minute flight from Wilson Airport or Jomo Kenyatta International Airport, or by road, which takes at least three hours.
The rooms
Rooms at Fairmont Mount Kenya range from Dh1,870 per night for a deluxe room to Dh11,000 per night for the William Holden Cottage.
THE SPECS – Honda CR-V Touring AWD
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0-100kmh in 9.4 seconds
Top speed: 202kmh
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The specs
Engine: 3.9-litre twin-turbo V8
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COMPANY PROFILE
Name: Kumulus Water
Started: 2021
Founders: Iheb Triki and Mohamed Ali Abid
Based: Tunisia
Sector: Water technology
Number of staff: 22
Investment raised: $4 million
Labour dispute
The insured employee may still file an ILOE claim even if a labour dispute is ongoing post termination, but the insurer may suspend or reject payment, until the courts resolve the dispute, especially if the reason for termination is contested. The outcome of the labour court proceedings can directly affect eligibility.
- Abdullah Ishnaneh, Partner, BSA Law
Ferrari 12Cilindri specs
Engine: naturally aspirated 6.5-liter V12
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Available: Now
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RESULT
Kolkata Knight Riders 169-7 (20 ovs)
Rajasthan Royals 144-4 (20 ovs)
Kolkata win by 25 runs
Next match
Sunrisers Hyderabad v Kolkata Knight Riders, Friday, 5.30pm