At a meet-and-greet this week with the foreign diplomatic corps in Berlin, German Chancellor Olaf Scholz admitted his guests might be finding it hard to explain in their cables home “where Germany is going politically”.
What should foreigners make of the rise of Germany’s far right? What about its stagnant economy and its changing security policy? These were reasonable questions, Mr Scholz said, and nobody knows for sure “where we will be in 10, 20 or 30 years”.
The problem for Mr Scholz is that nobody knows exactly where he will be in even one year’s time. With a September 2025 election coming gradually into view, support for the Chancellor is at rock bottom after three crisis-hit years and a spate of terrorist incidents in recent weeks.
Polls paint a bleak picture. Only 23 per cent of Germans think Mr Scholz should even run for a second term. A resounding 84 per cent are unhappy with his government and the parties in his left-green-liberal “traffic light coalition” would win only 30 per cent of the vote between them according to one recent survey, down from 52 per cent at the last election.
Perhaps the only good news for Mr Scholz is that the opposition leader Friedrich Merz is not especially popular either, and faces a power struggle with the swaggering Bavarian premier Markus Soeder to fly the conservative flag in 2025. But the far-right Alternative for Germany (AfD) has preyed on this sense of disaffection with all mainstream parties.
"It is really a tough time for the German government under any circumstances, but it's also coming towards a government that has not found its stride in simply governing," said Hans-Jakob Schindler, a former German diplomat and director of the Counter Extremism Project. He said no mainstream party had "found a recipe" to counter the AfD's narrative.
An air of constant infighting in Mr Scholz's coalition "gives the impression that it's a really dysfunctional government", even if in fact it can point to certain successes such as ending Germany's reliance on Russian gas imports, Mr Schindler told The National.
Migration tailspin
An explosion of voter anger over migration has sent German politics into a tailspin. Refugee centres have been filling up for months with more than 174,000 asylum claims lodged this year, almost a third of them from Syrians. On August 23, three people were killed in a knife attack in Solingen and a Syrian with no right to stay in Germany was arrested.
Seizing on the violence, the AfD won a state election in Thuringia on September 1, the most significant victory for a far-right party since 1945. The party is under intelligence surveillance after a court ruled it sees Muslims and refugees as second-class citizens, and that rhetoric about "invaders" and "knifemen" is not the result of isolated "gaffes".
There is an air of crisis as Mr Scholz holds cross-party talks with the opposition and entry checks are ordered around Germany's entire land border. The AfD is delighted at what it calls a "new conservative zeitgeist". Bernd Baumann, an AfD MP, looked theatrically to the sky as he declared in parliament that history had shown "we were right".
As a candidate in 2021 Mr Scholz was praised for a calm and reassuring manner. In office that has often been perceived as weakness and inertia, a complaint that surfaced during Russia's invasion of Ukraine and has become a prime grievance with his leadership style.
He also has limited room for manoeuvre within his coalition, where his Green coalition partners are wary of an "overheated discussion" about migration. There was dismay when a Green party leader spoke of a "caretaker government" but a lame-duck image is gaining ground. Mr Soeder says the Scholz era is "not going to work out".
Deportation options
Interior Minister Nancy Faeser insists it is not "business as usual". In a flurry of activity the government has closed borders, organised a first deportation to Taliban-ruled Afghanistan and drafted two new laws on asylum and extremism. Among other things, refugees who take holidays in their home country will lose their protection status in Germany.
The opposition Christian Democrats (CDU), the party of former chancellor Angela Merkel, now say she made a mistake by opening Germany’s borders to Syrian refugees in 2015. They believe the crackdown by Mr Scholz's government does not go far enough.
At the heart of the debate is whether police can summarily turn away refugees at the border. Ms Faeser's boast that 30,000 people have been denied entry in the past year covers people with visa bans or who were otherwise ineligible, but not asylum seekers.
Mr Merz wants to declare an emergency under EU law to make this possible, rather than relying on asylum seekers being returned later under EU rules. The government is exploring its legal options but would prefer to make the EU regulations work by withholding social security benefits and waiting for a wider asylum reform to take effect.
Ministers have fused together migration and extremism issues in a "security package" that includes a widening of surveillance powers. Since the Solingen attack there have been further scares involving an Austrian gunman near Israel's consulate in Munich and a Syrian with alleged plans to kill soldiers with machetes.
Mazen Darwish, a Syrian lawyer who helped prosecute a member of President Bashar Al Assad's regime in Germany, said Syrian civil society wanted to be "partners in finding extremism". "We are against any criminal, whatever his nationality, religious or ethnic [background], and this is yesterday, and today and tomorrow," he said.
Election war games
Mr Scholz insists he will seek a second term in 2025, recalling his late surge to victory three years ago after months stuck in third in the polls. His plain-speaking Defence Minister Boris Pistorius has been touted as an alternative but has shown no inclination to stage a party coup.
On the right Mr Merz is the most obvious flag-bearer for the Christian Democrats, but their Bavarian sister party provides a challenger in the form of Mr Soeder. Having lost the nomination to the luckless Armin Laschet four years ago, Mr Soeder is signalling he wants his turn in 2025.
Talk of possible coalitions is already in the air but it is taboo for any mainstream party to work with the AfD, despite its plans to run a "chancellor candidate" for the first time in 2025. Here, too, there may be a power struggle between joint party leaders Tino Chrupalla and Alice Weidel.
Nonetheless, the AfD's Mr Baumann believes there is a "shifting of the power axis" as politicians bid to outdo each other in their toughness on migration. Mainstream parties have failed to understand how far-right narratives gain traction online and on social media, said Mr Schindler.
Every AfD MP has a TikTok account, whereas most of their centrist rivals do not promote their policies there, he said.
"What is true for terrorism is true for all political issues right now – the online sphere plays a very significant role," he said. "It's a real indicator of how inept the traditional parties are at countering this populist phenomenon and communicating as effectively as populists."
Volvo ES90 Specs
Engine: Electric single motor (96kW), twin motor (106kW) and twin motor performance (106kW)
Power: 333hp, 449hp, 680hp
Torque: 480Nm, 670Nm, 870Nm
On sale: Later in 2025 or early 2026, depending on region
Price: Exact regional pricing TBA
Race card:
6.30pm: Maiden; Dh165,000; 2,000m
7.05pm: Handicap; Dh165,000; 2,200m
7.40pm: Conditions; Dh240,000; 1,600m
8.15pm: Handicap; Dh190,000; 2,000m
8.50pm: The Garhoud Sprint Listed; Dh265,000; 1,200m
9.25pm: Handicap; Dh170,000; 1,600m
10pm: Handicap; Dh190,000; 1,400m
The Details
Kabir Singh
Produced by: Cinestaan Studios, T-Series
Directed by: Sandeep Reddy Vanga
Starring: Shahid Kapoor, Kiara Advani, Suresh Oberoi, Soham Majumdar, Arjun Pahwa
Rating: 2.5/5
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.”
Sweet%20Tooth
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Hot%20Seat
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Company Profile
Founder: Omar Onsi
Launched: 2018
Employees: 35
Financing stage: Seed round ($12 million)
Investors: B&Y, Phoenician Funds, M1 Group, Shorooq Partners
Mane points for safe home colouring
- Natural and grey hair takes colour differently than chemically treated hair
- Taking hair from a dark to a light colour should involve a slow transition through warmer stages of colour
- When choosing a colour (especially a lighter tone), allow for a natural lift of warmth
- Most modern hair colours are technique-based, in that they require a confident hand and taught skills
- If you decide to be brave and go for it, seek professional advice and use a semi-permanent colour
ELECTION%20RESULTS
%3Cp%3EMacron%E2%80%99s%20Ensemble%20group%20won%20245%20seats.%26nbsp%3B%3C%2Fp%3E%0A%3Cp%3EThe%20second-largest%20group%20in%20parliament%20is%20Nupes%2C%20a%20leftist%20coalition%20led%20by%20Jean-Luc%20Melenchon%2C%20which%20gets%20131%20lawmakers.%26nbsp%3B%3C%2Fp%3E%0A%3Cp%3EThe%20far-right%20National%20Rally%20fared%20much%20better%20than%20expected%20with%2089%20seats.%3C%2Fp%3E%0A%3Cp%3EThe%20centre-right%20Republicans%20and%20their%20allies%20took%2061.%3C%2Fp%3E%0A
more from Janine di Giovanni
MATCH INFO
Austria 2
Hinteregger (53'), Schopf (69')
Germany 1
Ozil (11')
Karwaan
Producer: Ronnie Screwvala
Director: Akarsh Khurana
Starring: Irrfan Khan, Dulquer Salmaan, Mithila Palkar
Rating: 4/5
Racecard
%3Cp%3E%0D5pm%3A%20Al%20Maha%20Stables%20%E2%80%93%20Maiden%20(PA)%20Dh80%2C000%20(Turf)%201%2C400m%0D%3Cbr%3E5.30pm%3A%20Al%20Anoud%20Stables%20%E2%80%93%20Handicap%20(PA)%20Dh80%2C000%20(T)%201%2C200m%0D%3Cbr%3E6pm%3A%20Wathba%20Stallions%20Cup%20%E2%80%93%20Handicap%20(PA)%20Dh70%2C000%20(T)%201%2C400m%0D%3Cbr%3E6.30pm%3A%20Arabian%20Triple%20Crown%20Round%202%20%E2%80%93%20Group%203%20(PA)%20Dh%20300%2C000%20(T)%202%2C200m%0D%3Cbr%3E7pm%3A%20Liwa%20Oasis%20%E2%80%93%20Group%202%20(PA)%20Dh300%2C000%20(T)%201%2C400m%0D%3Cbr%3E7.30pm%3A%20Dames%20Stables%20%E2%80%93%20Handicap%20(TB)%20Dh80%2C000%20(T)%201%2C400m%3C%2Fp%3E%0A
Timeline
2012-2015
The company offers payments/bribes to win key contracts in the Middle East
May 2017
The UK SFO officially opens investigation into Petrofac’s use of agents, corruption, and potential bribery to secure contracts
September 2021
Petrofac pleads guilty to seven counts of failing to prevent bribery under the UK Bribery Act
October 2021
Court fines Petrofac £77 million for bribery. Former executive receives a two-year suspended sentence
December 2024
Petrofac enters into comprehensive restructuring to strengthen the financial position of the group
May 2025
The High Court of England and Wales approves the company’s restructuring plan
July 2025
The Court of Appeal issues a judgment challenging parts of the restructuring plan
August 2025
Petrofac issues a business update to execute the restructuring and confirms it will appeal the Court of Appeal decision
October 2025
Petrofac loses a major TenneT offshore wind contract worth €13 billion. Holding company files for administration in the UK. Petrofac delisted from the London Stock Exchange
November 2025
180 Petrofac employees laid off in the UAE
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
U19 World Cup in South Africa
Group A: India, Japan, New Zealand, Sri Lanka
Group B: Australia, England, Nigeria, West Indies
Group C: Bangladesh, Pakistan, Scotland, Zimbabwe
Group D: Afghanistan, Canada, South Africa, UAE
UAE fixtures
Saturday, January 18, v Canada
Wednesday, January 22, v Afghanistan
Saturday, January 25, v South Africa
UAE squad
Aryan Lakra (captain), Vriitya Aravind, Deshan Chethyia, Mohammed Farazuddin, Jonathan Figy, Osama Hassan, Karthik Meiyappan, Rishabh Mukherjee, Ali Naseer, Wasi Shah, Alishan Sharafu, Sanchit Sharma, Kai Smith, Akasha Tahir, Ansh Tandon
Red flags
- Promises of high, fixed or 'guaranteed' returns.
- Unregulated structured products or complex investments often used to bypass traditional safeguards.
- Lack of clear information, vague language, no access to audited financials.
- Overseas companies targeting investors in other jurisdictions - this can make legal recovery difficult.
- Hard-selling tactics - creating urgency, offering 'exclusive' deals.
Courtesy: Carol Glynn, founder of Conscious Finance Coaching