More than half a million people in Gaza a step away from famine, says UN

Live updates: Follow the latest news on Israel-Gaza

A quarter of the population of the Gaza Strip – more than half a million people – is one step away from famine, the UN warned on Tuesday, as Israel continues its war on the Palestinian militant group Hamas.

“In December, it was projected that the entire population of 2.2 million people in Gaza would face high levels of acute food insecurity by February 2024,” Ramesh Rajasingham, UN director of Co-ordination of Humanitarian Affairs, told the 15-member UN Security Council.

“And here we are at the end of February with at least 576,000 people in Gaza, one quarter of the population, one step away from famine.”

One in every six children under the age of two is acutely malnourished, he said.

Mr Rajasingham said that if nothing is done, widespread famine in Gaza is “almost inevitable”.

"The humanitarian community is facing overwhelming obstacles just to get a bare minimum of supplies into the besieged enclave," he said.

Maurizio Martina, deputy director general of the Food and Agriculture Organisation, said the entire food supply chain has been affected, with power cuts, water shortages and severe restrictions on fuel shipments.

Ninety-seven per cent of the groundwater in Gaza is reportedly “unfit for human consumption”, Mr Martina said.

Agricultural production is also beginning to collapse, he said.

Desperate Gazans scramble to secure bags of food from aid lorries – video

Carl Skau, deputy executive director of the World Food Programme, said the UN agency is ready to “swiftly expand and scale up” operations should there be a ceasefire agreement.

“But in the meantime, the risk of famine is being fuelled by the inability to bring critical food supplies into Gaza in sufficient quantities, and the almost impossible operating conditions faced by our staff,” Mr Skau said.

Israel's almost five-month assault on Gaza, which has resulted in the deaths of more than 29,800 people, according to local health authorities, has made the entire population reliant on international aid.

It followed Hamas-led raids on southern Israeli communities, which killed 1,200 people.

Israeli forces are “systematically” blocking access to Gaza, Jens Laerke, spokesman for Ocha, said in Geneva earlier on Tuesday.

All planned aid convoys to the north have been blocked from entry by Israel in recent weeks.

Algeria's UN envoy, Amar Bendjama, said that with Gaza's entire population totally dependent on humanitarian aid, Israel is using starvation as a warfare tactic.

Latest from the Israel-Gaza war – in pictures

“The deliberate use of starvation as a policy is a blatant violation of international law with the intent to push the Gaza population to lose hope and dignity, and to push them to violence and to a breakdown of law and order,” Mr Bendjama said.

US deputy UN ambassador Robert Wood urged Israel to keep border crossings open for humanitarian aid to enter Gaza, open more crossings, meet humanitarian needs at scale and support the rapid, safe delivery of relief items.

“Simply put, Israel must do more,” Mr Wood said.

Samuel Zbogar, Slovenia's envoy to the UN, underscored the urgency of addressing the escalating crisis in Gaza, highlighting the series of significant briefings the Security Council has received.

“Which one of these briefings is a straw that will break the camel's back?” Mr Zbogar asked.

He stressed the critical juncture at which the international community stands, faced with difficult choices.

“There are times when we need to make choices and we need to prioritise among them," Mr Zbogar said.

"Slovenia is choosing a ceasefire to prevent famine in Gaza, a ceasefire to provide relief to Palestinian people and to release hostages."

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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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ETFs have zero upfront fees and annual charges as low as 0.07 per cent a year, which means you get to keep more of your returns, as actively managed funds can charge as much as 1.5 per cent a year.

There are thousands to choose from, with the five biggest providers BlackRock’s iShares range, Vanguard, State Street Global Advisors SPDR ETFs, Deutsche Bank AWM X-trackers and Invesco PowerShares.

Ten tax points to be aware of in 2026

1. Domestic VAT refund amendments: request your refund within five years

If a business does not apply for the refund on time, they lose their credit.

2. E-invoicing in the UAE

Businesses should continue preparing for the implementation of e-invoicing in the UAE, with 2026 a preparation and transition period ahead of phased mandatory adoption.

3. More tax audits

Tax authorities are increasingly using data already available across multiple filings to identify audit risks.

4. More beneficial VAT and excise tax penalty regime

Tax disputes are expected to become more frequent and more structured, with clearer administrative objection and appeal processes. The UAE has adopted a new penalty regime for VAT and excise disputes, which now mirrors the penalty regime for corporate tax.

5. Greater emphasis on statutory audit

There is a greater need for the accuracy of financial statements. The International Financial Reporting Standards standards need to be strictly adhered to and, as a result, the quality of the audits will need to increase.

6. Further transfer pricing enforcement

Transfer pricing enforcement, which refers to the practice of establishing prices for internal transactions between related entities, is expected to broaden in scope. The UAE will shortly open the possibility to negotiate advance pricing agreements, or essentially rulings for transfer pricing purposes.

7. Limited time periods for audits

Recent amendments also introduce a default five-year limitation period for tax audits and assessments, subject to specific statutory exceptions. While the standard audit and assessment period is five years, this may be extended to up to 15 years in cases involving fraud or tax evasion.

8. Pillar 2 implementation

Many multinational groups will begin to feel the practical effect of the Domestic Minimum Top-Up Tax (DMTT), the UAE's implementation of the OECD’s global minimum tax under Pillar 2. While the rules apply for financial years starting on or after January 1, 2025, it is 2026 that marks the transition to an operational phase.

9. Reduced compliance obligations for imported goods and services

Businesses that apply the reverse-charge mechanism for VAT purposes in the UAE may benefit from reduced compliance obligations.

10. Substance and CbC reporting focus

Tax authorities are expected to continue strengthening the enforcement of economic substance and Country-by-Country (CbC) reporting frameworks. In the UAE, these regimes are increasingly being used as risk-assessment tools, providing tax authorities with a comprehensive view of multinational groups’ global footprints and enabling them to assess whether profits are aligned with real economic activity.

Contributed by Thomas Vanhee and Hend Rashwan, Aurifer

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