Hamas fighters stand by as Palestinians gather on a street to watch the handover of three Israeli hostages to a Red Cross team in Deir Al Balah in February. Reuters
Hamas fighters stand by as Palestinians gather on a street to watch the handover of three Israeli hostages to a Red Cross team in Deir Al Balah in February. Reuters
Hamas fighters stand by as Palestinians gather on a street to watch the handover of three Israeli hostages to a Red Cross team in Deir Al Balah in February. Reuters
Hamas fighters stand by as Palestinians gather on a street to watch the handover of three Israeli hostages to a Red Cross team in Deir Al Balah in February. Reuters

Gaza truce talks falter after Israeli negotiators insist Hamas surrenders weapons first


Hamza Hendawi
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Live updates: Follow the latest on Israel-Gaza

Israeli negotiators are insisting that Hamas must surrender its weapons before it agrees to a proposed five-year Gaza truce presented by Egyptian and Qatari negotiators, sources briefed on the talks told The National on Tuesday.

They said Israel's negotiators were also determined that it must retain the right to take military action whenever a threat to its security is identified inside Gaza.

Hamas has agreed to lay down, but not surrender, its weapons, as well as its exclusion from the administration of postwar Gaza and the reconstruction of the enclave of 2.3 million people.

The militant group has also agreed in principle that some of its senior officials will leave Gaza to live in exile as long as Israel guarantees they will not be pursued.

“Israel is not only insisting on Hamas giving up its weapons but also wants to destroy the entire military capabilities of Hamas, including the tunnels,” said one source, who pointed out that modest progress has been made during the talks in Cairo.

Israel's Strategic Affairs Minister Ron Dermer, who led his country's delegation in the talks, returned home on Tuesday.

“The talks are continuing. They are complex and making very slow progress, but they did not collapse,” the source added.

The talks are the latest bid by mediators from Egypt, Qatar and the US to broker a truce in Gaza after one reached in January ended on March 1. Gaza remained relatively calm until March 18, when Israel resumed military operations there.

The mediators have been trying to persuade Hamas and Israel to agree to a new truce as the Palestinian death toll in Gaza mounts, reaching 52,365 on Tuesday, according to Palestinian authorities. Israel has also prevented humanitarian supplies from reaching Gaza, leading to acute food shortages.

The sources said Israel also demanded during the latest talks that Hamas shares information about the 59 hostages it is believed to still be holding in Gaza.

Broadly, the Egyptian and Qatari mediators have presented Israel and Hamas with a plan that entails a 45-day truce during which Hamas would release all hostages in return for the freedom of hundreds of Palestinians imprisoned in Israel. It also provides for a gradual Israeli withdrawal from Gaza, and Hamas laying down its arms.

Raheem Salah was one of a group of Palestinian prisoners released in Gaza on Tuesday. A truce could provide for further detainees to be freed. AP
Raheem Salah was one of a group of Palestinian prisoners released in Gaza on Tuesday. A truce could provide for further detainees to be freed. AP

The 45-day truce would take effect as part of a five-year ceasefire, during which Hamas would take steps to transform itself into a political party, reconstruction would begin and a new law-and-order security force trained by Egypt and Jordan would begin work in Gaza.

Egyptian intelligence chief Hassan Rashad held talks with Mr Dermer on Monday night before experts from Israel and Egypt met to examine and finalise details of the proposed deal.

They said Turkey, which has close relations with Hamas and Qatar, has been indirectly involved in the search for an end to the Gaza war, with officials from its intelligence agency negotiating with Algeria on terms and conditions for Hamas officials to live there in exile. The Turkish officials are also in contact with Iran, Hamas's main foreign backer, they added.

The Gaza war was sparked by an October 2023 attack on communities in southern Israel by Hamas and allied groups. They killed about 1,200 people and took about 250 others hostage.

Israel responded with a military operation that has laid to waste vast built-up areas in the tiny territory on the coast of the east Mediterranean. Besides the Palestinian deaths, the Israeli operations have wounded more than 100,000 Palestinians, according to authorities in Gaza.

Egypt, which borders both Gaza and Israel, has played an increasingly active role in the negotiations since the Israeli military captured a narrow strip on the Palestinian side of the Egypt-Gaza border along with the Rafah crossing in May last year.

Egypt says Israel's action is a breach of their 1979 peace treaty and subsequent accords regulating the border area. Israel insists that it needs to keep its military in the area to stop what it says is the smuggling of weapons and dual-use material for Hamas through underground tunnels linking Gaza with Egypt's Sinai Peninsula. Egypt maintains it destroyed the tunnels nearly a decade ago.

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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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