US President Joe Biden knows the implications of his decision to withdraw troops from Afghanistan. AP Photo
US President Joe Biden knows the implications of his decision to withdraw troops from Afghanistan. AP Photo
US President Joe Biden knows the implications of his decision to withdraw troops from Afghanistan. AP Photo
US President Joe Biden knows the implications of his decision to withdraw troops from Afghanistan. AP Photo


US policy risks fuelling extremism in the Middle East – again


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July 25, 2021

The American exit strategies in Afghanistan and Iraq carry seeds for future regret and, in light of its many flaws and pitfalls, great risks that could engender new threats to US, regional and international security. The biggest beneficiaries of the withdrawal will include the Iranian regime, the Taliban, ISIS and Al Qaeda.

Some will say that the US has a right to end these wars, but it is also true that successive administrations in Washington fuelled these very wars to advance their own goals. They essentially, and perhaps inadvertently, invested in extremism in Afghanistan and fundamentalism in Iran decades ago. The Iranian revolution in 1979, for instance, came with astonishing western enablement, thereby leading to the birth of its theocracy that has since engaged in domestic repression and aggressive expansionism in its neighbourhood. Also in 1979, the US began its partnership with extremists in Afghanistan in its bid to curb the spread of communism there; this led to Al Qaeda’s rise and the Taliban’s eventual ascendancy.

Today, the US is once again – in essence – providing Iran with the tools it needs to spread its influence in Central Asia through Afghanistan and in Syria and Lebanon via Iraq.

President Joe Biden is not ignorant about the strategic implications of withdrawing the US altogether from Afghanistan and Iraq.

He is aware that this strategy will empower Tehran in the region. The speed of America’s exit complies with Iran’s key demand that Washington withdraw from neighbouring countries both to its west and east. Washington has done so in its bid to revive the 2015 nuclear deal – an outcome that, in all likelihood, will lead to sanctions being lifted against the regime. Mr Biden also understands that his exit strategy will give Al Qaeda, ISIS and other such militant groups a boost, as they all seek to reinvent themselves in the region – an outcome that could threaten international security.

The US, it must be said, is not being naive about its actions. One might even ask: could it be playing the sectarian card in an altogether new form? Perhaps the thinking inside the Biden administration follows a simple formula based on, firstly, washing America’s hands clean of the wars it waged in faraway lands, and secondly, giving priority to one of Mr Biden’s electoral promises – to bring the troops home. While there is little wrong with doing the latter, it could come at huge costs globally.

The US needs a “remain strategy” that works in tandem with its “exit strategy”, or else its interests and those of its allies will be put at risk. Iraq remains a crucial country and must not be allowed to fall into Tehran’s hands. Iraq is the primary component of Iran's “Persian Crescent” project that extends all the way up to the Mediterranean Sea through Lebanon, a country whose politics is currently dominated by Hezbollah – an Iranian proxy. Syria, meanwhile, has fallen into the both Tehran and Moscow's arcs of influence.

Some of this is America's doing.

The September 11, 2001 attacks on US soil spawned some bad policy vis-a-vis the Middle East. AFP
The September 11, 2001 attacks on US soil spawned some bad policy vis-a-vis the Middle East. AFP

Following the September 11, 2001 terror attacks in the US, George W Bush essentially gave the Iranian regime a huge boost, when his administration decided to invade and occupy Afghanistan and Iraq. By doing so, Mr Bush eliminated Iran’s foes in both countries – the Taliban and Saddam Hussein’s regime.

Then Mr Bush’s successor, Barack Obama, followed up with another precious gift to Tehran, when he overturned the US’s traditional alliance with the Arab states by reaching out to the Iranian regime. Mr Obama signed the 2015 nuclear deal with Iran after giving in to its dictates and conditions regarding the exclusion of its ballistic missile programme, and more importantly, its regional behaviour, from any negotiations. This facilitated Iran’s theocratic expansion across the Arab region. At the same time, he backed the rise of the Muslim Brotherhood to power in North Africa.

Past US presidents did little better. From Jimmy Carter to Ronald Reagan to Bill Clinton, they all helped to fuel sectarian strife in the region. Even Saddam, who once thought of himself as an indispensable partner of the Americans during the Iran-Iraq War in the 1980s, eventually discovered that the US was not averse to abandoning its allies if it suited its immediate interests.

Today, the Biden administration appears to be following a set of modest aspirations, complete with its own logic and justifications. In truth, however, it is granting Iran – at this historic juncture, and in the wake of the preceding Trump administration’s maximum pressure policy – potent ammunition that will help to propel its regional projects with the purpose of undermining the sovereignty of countries such as Iraq and Lebanon.

The Islamic Revolutionary Guard Corps is almost all powerful in Iran. AFP
The Islamic Revolutionary Guard Corps is almost all powerful in Iran. AFP
The Biden administration appears to be following a set of modest aspirations

As Iran prepares to inaugurate Ebrahim Raisi as its president, the country’s supreme leader – Ayatollah Ali Khamenei – and the powerful Islamic Revolutionary Guard Corps are dictating terms for a revised nuclear deal with the major global powers. With talks under way in Vienna, it is clear that Tehran will reject any preconditions concerning its regional policies. After getting the US and the European powers involved in the talks to yielded to its initial demands, the regime is now pushing Washington to guarantee that it won’t maintain sanctions at a later stage as a form of compromise. This is with a view to prevent any further attempts to use sanctions as leverage over Iran’s regional policies.

Tehran could yet agree to a compromise on the ballistic missile issue but will not budge on its short and medium-range missile programme. For Iran, these are more important than the long-range ballistic missiles that it will probably never use. If the West agrees to this compromise, it will have yielded to Tehran’s regional plans.

The Vienna process has slowed down, with Tehran seemingly content to see a new deal in place after Mr Raisi enters office next month. Clearly, the regime prefers using its president-elect to extract concessions from the West with regard to its expansionist policies.

Preparations, meanwhile, may be under way in Tehran on the question of how to accelerate its expansion in the region after sanctions are lifted. And unless the Biden administration pays attention, it will not be just the Arab countries that will pay the price, US national security will also be at risk.

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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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Dh514 for citizens; Dh865 for tourists

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Dh212

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Dh478

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Dh85

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“So far we have taken about 70 to 80 orders for items like shirts and trousers,” said Vikram Attrai, manager at Stallion Bespoke Tailors in Dubai.
“Last year in the same period we had about 200 orders and lots of demand.
“We custom fit uniform pieces and use materials such as cotton, wool and cashmere.
“Depending on size, a white shirt with logo is priced at about Dh100 to Dh150 and shorts, trousers, skirts and dresses cost between Dh150 to Dh250 a piece.”

A spokesman for Threads, a uniform shop based in Times Square Centre Dubai, said customer footfall had slowed down dramatically over the past few months.

“Now parents have the option to keep children doing online learning they don’t need uniforms so it has quietened down.”

 

 

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Updated: July 28, 2021, 5:10 AM