A woman carries a portrait of Hezbollah leader Hassan Nasrallah past houses hit by Israeli air strikes, in Aita Al Shaab, a village on the border with Israel, on June 29. AP
A woman carries a portrait of Hezbollah leader Hassan Nasrallah past houses hit by Israeli air strikes, in Aita Al Shaab, a village on the border with Israel, on June 29. AP
A woman carries a portrait of Hezbollah leader Hassan Nasrallah past houses hit by Israeli air strikes, in Aita Al Shaab, a village on the border with Israel, on June 29. AP
A woman carries a portrait of Hezbollah leader Hassan Nasrallah past houses hit by Israeli air strikes, in Aita Al Shaab, a village on the border with Israel, on June 29. AP

Behind scenes talks involving Iran halted greater Israel-Hezbollah conflict



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Weeks of back-channel negotiations involving Iran played a crucial role in preventing a wider conflict between Israel and Hezbollah, despite Sunday's scenes of rockets and drones over Israel and Lebanon, according to Arab and western political and diplomatic sources.

The sources in Cairo, Beirut and other regional capitals told The National that Arab mediators in the Gaza ceasefire talks have been increasing their exchanges with Tehran throughout the negotiations, keeping them updated on milestones.

The killing of Hamas leader Ismail Haniyeh accelerated the exchanges and led to a proposal: minimal retaliation, at least for the time being, in return for more ceasefire influence.

“Egyptian and Qatari diplomacy played a big role,” said a political source in Beirut. “Political understandings outside the military scope were reached.

“There was no written agreement, that’s for sure, but there were agreed-upon actions that wouldn’t drive the whole region to hell. Hezbollah’s retaliation was calculated, aligning with these undeclared understandings.”

At the start of August, the group's leader Hassan Nasrallah pledged to make Israel “weep” after the late July killing of Hezbollah's senior military commander, Fouad Shukr. In response, Israel threatened to devastate Lebanon. Flights were cancelled, summer travellers rushed to leave, and the Middle East stood on the brink of another major war.

Less than four weeks later, the powerful militant faction retaliated with hundreds of drones and missiles aimed at Israeli targets. Israel claimed to have thwarted the Sunday attack, denying any significant damage.

Mr Nasrallah then calmly announced that the response was complete, asked the travellers to return, and assured them that the conflict would not escalate further, at least for the time being.

Mr Shukr and an Iranian military associate were killed in an Israeli strike on a densely populated neighbourhood in Beirut's southern suburbs last month. Hours later, Hamas leader Ismail Haniyeh was assassinated in Tehran. The two killings marked an escalation with major repercussions for the Middle East in general and the Gaza ceasefire talks.

Israel, Iran and Hamas quickly affirmed that they are not seeking a wider war, but the vows of retaliation against Israel suggested a fiercer cycle of violence in parts of the region, particularly as efforts to secure a ceasefire in Gaza have remained unsuccessful.

Egypt, Qatar, and the US are the key mediators in the talks. They have enabled several rounds of indirect negotiations between Hamas and Israel aimed at ending the conflict, which has been spreading violence and instability across the region, from Yemen to Syria and beyond.

Vital role

This mediation work, which also included phone calls between Egyptian, Qatari, Jordanian, Lebanese, Turkish and Iranian officials, intensified after the recent assassinations.

“Since when do the Egyptians contact the Iranians directly regarding a matter related to the Palestinian cause and the Gaza Strip? It almost never happens. But it happened this time, despite the differences between the two countries,” said another political source in Beirut.

“The Egyptians wanted more time after the failure of the round of talks in Doha. They wanted to ensure that the region is quiet to ease the pressure on the talks, and the Iranians seem to have listened but in return for a bigger role in the Palestinian file.”

Sources close to the recent negotiations, which concluded in Cairo on Sunday without a breakthrough but could resume this week, have confirmed that Egyptian and Qatari mediators have accelerated their exchanges on ceasefire talks with Iran.

“Iran is a key behind-the-scenes player in the Gaza negotiations,” said a source. “It has become even more vital after the assassination of Ismail Haniyeh, because he was killed in Tehran.”

The source said the diplomatic efforts to broker a Gaza ceasefire and a hostage and detainee swap between Hamas and Israel have for months been part of the agenda in quiet and indirect contacts between Iran and the US, brokered by Oman.

Egypt has regularly spoken to the Iranians about the attacks on shipping lanes in the Red Sea by their proxies in Yemen, the Houthis, to stop or minimise their actions because they significantly affected Cairo's revenue from the Suez Canal, the waterway linking the Red Sea to the Mediterranean.

Relations between Egypt and Iran were fraught for years after the 1979 Islamic Revolution, but they began to thaw in the past two to three years, although diplomatic representation between the two remains below ambassadorial level.

On Monday, Qatari Prime Minister Sheikh Mohammed bin Abdulrahman landed in Iran for consultations with Iranian officials – a day after the round of Gaza ceasefire negotiations in Cairo failed to bear fruit. Qatar has been a primary mediator on behalf of the Palestinian armed group, but Iran is not a formal party to the negotiations.

“Hezbollah's attack took into account the prevailing regional political climate. The negotiations taking place in Cairo are under the control of the Egyptians and the US, and Hezbollah is aware of this,” a source close to the group said.

The Lebanese militant group claimed to have attacked 11 Israeli military sites, including one near Tel Aviv, with more than 320 Katyusha rockets and drones, as a retaliation for the assassination of Mr Shukr. The attack was preceded by pre-emptive Israeli strikes and followed by hits on sites in Lebanon, which Hezbollah said were evacuated as a precaution.

The attack mirrored action by Iran when regional tensions escalated after Tehran launched an unprecedented drone and missile barrage against Israel in April, in a retaliatory response to an attack on its consulate in Damascus. Most of the drones and missiles were intercepted by Israel, the US and other allied forces stationed in the region.

“I don't think there was a back channel, but I think that the way Hezbollah planned the attack was a way that says to Israel, I'm not looking for a full-scale war at the moment,” said Amir Avivi, a former brigadier general in the Israeli army.

The former military official said many of the attacks that the Israeli army conducted “were to destroy launchers. Most of them are short range, not long range”.

“The way Hezbollah chose to attack Gilot base, north of Tel Aviv, was with UAVs. Now I think that Hezbollah knows if they send a UAV, and it's not a small one like the ones are using along the border, which are very small and difficult to detect – a UAV that needs to fly all the way to Tel Aviv is pretty big – they know that Israel will most likely see the UAV and foil the attack.”

Internal pressure

In Tehran, Afifeh Abedi, a researcher of Iran's foreign policy, said that Hezbollah must have co-ordinated its response with Iran.

“Lebanon's Hezbollah carried out the … operation in response to the assassination of Fouad Shukr, and probably had negotiations with Iran, but the time and location of the operation were determined independently and by the decision of the Lebanese resistance.”

This month, political sources in Beirut told The National that Hezbollah and its allies in Lebanon have been indirectly offered “incentives” by western envoys to ensure that the retaliation to Israel’s assassination of Mr Shukr does not lead to a full-scale war. Among the incentives hinted at, albeit unofficially, was helping with political concession, including Lebanon's presidential impasse.

Lebanon has been without a president for almost two years after Michel Aoun's mandate expired in October 2022. The deeply divided current parliament has failed 12 times to elect a successor, with competing blocs backing two candidates. The pro-Hezbollah faction backs Marada leader Suleiman Frangieh, while their opponents support former minister Jihad Azour.

Israel and Hezbollah last fought a major conflict in 2006, a 34-day war that devastated parts of Beirut, killing about 1,200 people in Lebanon, mostly civilians, and about 160 in Israel, mostly soldiers.

Analysts say both sides have vastly more firepower, with Hezbollah thought to have up to 150,000 rockets and missiles, 10 times its arsenal in 2006. Israel has expanded its air force, in part shown by attacks on Gaza, leaving most of the enclave with a population of 2.3 million in ruins.

Since 2006, Hezbollah, which is represented in both the parliament and government, has been at odds with many Lebanese politicians. These critics accuse the party of holding the country hostage to its own interests and undermining the army's authority.

The ongoing war with Israel, which began on October 8 in support of Hamas in Gaza, has forced about 100,000 Lebanese, mainly Shiite, to flee border towns for other regions, including Christian areas, in a major displacement that has increased internal pressure on Hezbollah.

In 2006, many people fled to Syria, but the continuing civil war in the neighbouring country and the dire economic situation in Lebanon have made it difficult to do so again.

On Sunday, the southern suburbs of Beirut were described by one local as completely empty after the overnight exchanges of fire. The densely populated area, known locally as Dahieh, is one of Hezbollah’s main support bases.

“Nasrallah has told his constituents to go back to the homes they fled by signalling that there isn’t going to be the war they feared,” a European diplomat involved in Middle East security told The National. “It is not that he does not want it; he cannot afford it.

“Nasrallah does not want to fight on the internal front and a war with Israel at the same time.”

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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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1.45pm: Maiden Dh75,000 1,400m
Winner: Dirilis Ertugrul, Fabrice Veron (jockey), Ismail Mohammed (trainer)
2.15pm: Handicap Dh90,000 1,400m
Winner: Kidd Malibu, Sandro Paiva, Musabah Al Muhairi
2.45pm: Maiden Dh75,000 1,000m
Winner: Raakezz, Tadhg O’Shea, Nicholas Bachalard
3.15pm: Handicap Dh105,000 1,200m
Winner: Au Couer, Sean Kirrane, Satish Seemar
3.45pm: Maiden Dh75,000 1,600m
Winner: Rayig, Pat Dobbs, Doug Watson
4.15pm: Handicap Dh105,000 1,600m
Winner: Chiefdom, Royston Ffrench, Salem bin Ghadayer
4.45pm: Handicap Dh80,000 1,800m
Winner: King’s Shadow, Richard Mullen, Satish Seemar

Desert Warrior

Starring: Anthony Mackie, Aiysha Hart, Ben Kingsley

Director: Rupert Wyatt

Rating: 3/5

Key facilities
  • Olympic-size swimming pool with a split bulkhead for multi-use configurations, including water polo and 50m/25m training lanes
  • Premier League-standard football pitch
  • 400m Olympic running track
  • NBA-spec basketball court with auditorium
  • 600-seat auditorium
  • Spaces for historical and cultural exploration
  • An elevated football field that doubles as a helipad
  • Specialist robotics and science laboratories
  • AR and VR-enabled learning centres
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Why your domicile status is important

Your UK residence status is assessed using the statutory residence test. While your residence status – ie where you live - is assessed every year, your domicile status is assessed over your lifetime.

Your domicile of origin generally comes from your parents and if your parents were not married, then it is decided by your father. Your domicile is generally the country your father considered his permanent home when you were born. 

UK residents who have their permanent home ("domicile") outside the UK may not have to pay UK tax on foreign income. For example, they do not pay tax on foreign income or gains if they are less than £2,000 in the tax year and do not transfer that gain to a UK bank account.

A UK-domiciled person, however, is liable for UK tax on their worldwide income and gains when they are resident in the UK.

Earth under attack: Cosmic impacts throughout history

4.5 billion years ago: Mars-sized object smashes into the newly-formed Earth, creating debris that coalesces to form the Moon

- 66 million years ago: 10km-wide asteroid crashes into the Gulf of Mexico, wiping out over 70 per cent of living species – including the dinosaurs.

50,000 years ago: 50m-wide iron meteor crashes in Arizona with the violence of 10 megatonne hydrogen bomb, creating the famous 1.2km-wide Barringer Crater

1490: Meteor storm over Shansi Province, north-east China when large stones “fell like rain”, reportedly leading to thousands of deaths.  

1908: 100-metre meteor from the Taurid Complex explodes near the Tunguska river in Siberia with the force of 1,000 Hiroshima-type bombs, devastating 2,000 square kilometres of forest.

1998: Comet Shoemaker-Levy 9 breaks apart and crashes into Jupiter in series of impacts that would have annihilated life on Earth.

-2013: 10,000-tonne meteor burns up over the southern Urals region of Russia, releasing a pressure blast and flash that left over 1600 people injured.

The burning issue

The internal combustion engine is facing a watershed moment – major manufacturer Volvo is to stop producing petroleum-powered vehicles by 2021 and countries in Europe, including the UK, have vowed to ban their sale before 2040. The National takes a look at the story of one of the most successful technologies of the last 100 years and how it has impacted life in the UAE. 

Read part four: an affection for classic cars lives on

Read part three: the age of the electric vehicle begins

Read part one: how cars came to the UAE

 

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Name: The Protein Bakeshop

Date of start: 2013

Founders: Rashi Chowdhary and Saad Umerani

Based: Dubai

Size, number of employees: 12

Funding/investors:  $400,000 (2018) 

Community Shield info

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Arsenal manager Arsene Wenger

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