A man gestures with a currency note as Lebanese protesters block the roads with garbage bins and burning tires during protests after Saad Hariri abandoned efforts to form a new government, in Beirut, Lebanon, July 15. EPA
A man gestures with a currency note as Lebanese protesters block the roads with garbage bins and burning tires during protests after Saad Hariri abandoned efforts to form a new government, in Beirut, Lebanon, July 15. EPA
A man gestures with a currency note as Lebanese protesters block the roads with garbage bins and burning tires during protests after Saad Hariri abandoned efforts to form a new government, in Beirut, Lebanon, July 15. EPA
A man gestures with a currency note as Lebanese protesters block the roads with garbage bins and burning tires during protests after Saad Hariri abandoned efforts to form a new government, in Beirut,


Can Syria be the counterweight to Iran's influence over Lebanon?


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July 20, 2021

The government formation process in Lebanon has hit a dead end, with the decision of prime minister-designate Saad Hariri to step down. A broader question asked by Mr Hariri and his entourage is why Hezbollah failed to put any pressure on President Michel Aoun and his son-in-law Gebran Bassil to be more flexible over accepting Mr Hariri’s draft lists of ministers.

Mr Hariri’s view is that Hezbollah in public said it wanted a government, and even mediated to reach an agreement, but did little to force Mr Aoun and Mr Bassil to accept a consensual outcome. Mr Aoun’s approval was necessary since any decree formalising a new government requires the signature of both the president and the prime minister-designate.

One reason may be that Hezbollah is not especially keen to halt Lebanon’s financial and economic slide. The Iran-backed group feels that as the situation in the country gets worse, it will be better able to exploit it to expand Iran's influence. That may well be true. But there appears to be another factor at play, and it may be a surprising one given the circumstances prevailing today.

As the Syrian regime has managed to consolidate itself in recent months – with the re-election (if it can be called that) of President Bashar Al Assad – Syria, backed by Russia, has sought to re-establish a presence in Lebanon. While Iran remains the dominant outside actor in Lebanon, the attempt by Syria and its allies to establish a presence cannot be ignored and will have an impact on the future of Lebanon.

There is a growing belief that Arab countries may see Syrian influence in Lebanon as a counterweight to Iran’s. That is not to say that Syria and Iran will enter into a confrontation, nor can Damascus realistically weaken Iran and Hezbollah. But if the Syrians can revitalise their Lebanese networks, if they can have a greater say over Lebanese affairs, this could narrow Iran’s margin of manoeuvre there, so in its decision-making, Iran would have to factor in Syrian stakes, and by extension Arab ones.

More importantly, such a process may well be backed by Russia, which hardly reassures Iran and its local proxies. There have been unconfirmed reports that the Russians have sought to reconcile some of their local Lebanese contacts with the Assad regime. Moscow’s rationale is that if Damascus can expand its power in Lebanon, Syria would be stabilised and Russia’s sway there would also grow.

In the past year, Hezbollah has seen much outside intervention in Lebanese affairs. The French tried to push an initiative to reform the economy last year, in the aftermath of the horrific explosion in Beirut port. France, together with the US, has also sought to support the Lebanese army and ensure that Lebanon’s vulnerabilities do not open the door to full Iranian hegemony. And Egypt and Qatar have also been involved in local politics or in providing aid.

For Hezbollah, anything that diminishes Iran’s dominant hold on Lebanon is unacceptable. So the party likely regards Syria as a potential rival, one with the advantage of having its own sympathisers on the ground. That may explain why Hezbollah was so reluctant to pressure Mr Aoun and Mr Bassil on a new cabinet.

Next year, a key event will have a major bearing on Syrian-Iranian ties: Mr Aoun’s term will end. The president’s primary objective is to ensure that he will be succeeded by his son-in-law. While Mr Bassil’s chances of being elected are slim, Hezbollah does not seem willing to give up on him, and this may well be explained by the dynamics with Syria.

In the past year, Hezbollah has seen much outside intervention in Lebanese affairs

The reason for this is that Mr Bassil’s main opponent for the presidency is Suleiman Franjieh, a politician personally close to the Al Assad family. While Mr Franjieh and Hezbollah are also allies, his presidency would go a long way towards reviving Syrian power, turning the country into a shared Syrian-Iranian interest.

Hezbollah’s only way to prevent this may be to bring Mr Bassil to office. This will not be easy, nor is it likely to succeed given that a majority in parliament, which elects the president, opposes him. Moreover, it will be difficult for Hezbollah to intimidate Syria’s allies to elect Mr Bassil if Damascus insists on Mr Franjieh.

The presidential election in 2022 may well be one between an Iranian asset, Mr Bassil, and a Syrian one, Mr Franjieh. Iran and Syria are highly unlikely to allow their ties to deteriorate though – and whatever happens Mr Assad will continue to help Iran in its confrontation with Israel. However, Iran and Syria have different priorities and Mr Assad is in desperate need of Arab funding for reconstruction, so he needs to show that regional support for him is worth it.

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China

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UAE

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Norway

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Canada

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Singapore

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Australia

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Saudi Arabia

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South Korea

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Your rights as an employee

The government has taken an increasingly tough line against companies that fail to pay employees on time. Three years ago, the Cabinet passed a decree allowing the government to halt the granting of work permits to companies with wage backlogs.

The new measures passed by the Cabinet in 2016 were an update to the Wage Protection System, which is in place to track whether a company pays its employees on time or not.

If wages are 10 days late, the new measures kick in and the company is alerted it is in breach of labour rules. If wages remain unpaid for a total of 16 days, the authorities can cancel work permits, effectively shutting off operations. Fines of up to Dh5,000 per unpaid employee follow after 60 days.

Despite those measures, late payments remain an issue, particularly in the construction sector. Smaller contractors, such as electrical, plumbing and fit-out businesses, often blame the bigger companies that hire them for wages being late.

The authorities have urged employees to report their companies at the labour ministry or Tawafuq service centres — there are 15 in Abu Dhabi.

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Founders: Abdulmajeed Alsukhan, Turki Bin Zarah and Abdulmohsen Albabtain.

Based: Riyadh

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Founded: September, 2020

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Investors: Checkout.com, Impact46, Vision Ventures, Wealth Well, Seedra, Khwarizmi, Hala Ventures, Nama Ventures and family offices

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Install an air filter in your home.

Close your windows and turn on the AC.

Shower or bath after being outside.

Wear a face mask.

Stay indoors when conditions are particularly poor.

If driving, turn your engine off when stationary.

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Tax authority targets shisha levy evasion

The Federal Tax Authority will track shisha imports with electronic markers to protect customers and ensure levies have been paid.

Khalid Ali Al Bustani, director of the tax authority, on Sunday said the move is to "prevent tax evasion and support the authority’s tax collection efforts".

The scheme’s first phase, which came into effect on 1st January, 2019, covers all types of imported and domestically produced and distributed cigarettes. As of May 1, importing any type of cigarettes without the digital marks will be prohibited.

He said the latest phase will see imported and locally produced shisha tobacco tracked by the final quarter of this year.

"The FTA also maintains ongoing communication with concerned companies, to help them adapt their systems to meet our requirements and coordinate between all parties involved," he said.

As with cigarettes, shisha was hit with a 100 per cent tax in October 2017, though manufacturers and cafes absorbed some of the costs to prevent prices doubling.

Our legal consultants

Name: Hassan Mohsen Elhais

Position: legal consultant with Al Rowaad Advocates and Legal Consultants.

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Price, base: Dh138,000 (estimate)
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Transmission: Continuously variable transmission
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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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Our legal consultant

Name: Hassan Mohsen Elhais

Position: legal consultant with Al Rowaad Advocates and Legal Consultants

Our family matters legal consultant

Name: Hassan Mohsen Elhais

Position: legal consultant with Al Rowaad Advocates and Legal Consultants.

Bio:

Favourite Quote: Prophet Mohammad's quotes There is reward for kindness to every living thing and A good man treats women with honour

Favourite Hobby: Serving poor people 

Favourite Book: The Alchemist by Paulo Coelho

Favourite food: Fish and vegetables

Favourite place to visit: London

Our family matters legal consultant

Name: Hassan Mohsen Elhais

Position: legal consultant with Al Rowaad Advocates and Legal Consultants.

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Matches can be watched on BeIN Sports

Updated: November 01, 2021, 1:26 PM