Turkish President Tayyip Erdogan at a news conference following the Nato summit, in Brussels, Belgium, on March 24. Reuters
Turkish President Tayyip Erdogan at a news conference following the Nato summit, in Brussels, Belgium, on March 24. Reuters
Turkish President Tayyip Erdogan at a news conference following the Nato summit, in Brussels, Belgium, on March 24. Reuters
Turkish President Tayyip Erdogan at a news conference following the Nato summit, in Brussels, Belgium, on March 24. Reuters


An opportunity for Erdogan in the Ukraine war


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March 28, 2022

Nearly five weeks into Russia’s war in Ukraine, Turkey has emerged as the West’s favoured fulcrum, maintaining strong ties with both combatants and doing the diplomatic heavy lifting that could broker a sigh-inducing ceasefire.

Turkish President Recep Tayyip Erdogan on Friday said the warring states had made progress on several key points of negotiation, including Ukraine expressing willingness to partially disarm and accept Russian as an official language. Ukraine Foreign Minister Dmytro Kuleba quickly clarified that Ukrainian is his country’s only state language, while the President, Volodymyr Zelenskyy, on Sunday said his government is ready to consider neutrality and accepting Russian forces returning to previously occupied areas of eastern Ukraine.

Turkey is set to host a new round of peace talks on Tuesday, and Mr Erdogan may well have a bounce in his step in these first days of Spring. For starters, he seems to have been welcomed back into the western fold. In the past fortnight, a steady stream of dignitaries has come a’ calling, including the leaders of Nato, Germany, Israel and Greece.

Turkish President Recep Tayyip Erdogan (L) welcomes German Chancellor Olaf Scholz in Ankara on March 14. AFP / Turkish Presidential Service
Turkish President Recep Tayyip Erdogan (L) welcomes German Chancellor Olaf Scholz in Ankara on March 14. AFP / Turkish Presidential Service

Despite a trip to nearby Poland, US President Joe Biden was not among the visitors. But after a phone call with Mr Erdogan last week, he praised Turkey’s diplomatic efforts and talked of seeking ways to strengthen bilateral ties.

Mr Erdogan may have sought to take advantage of his turn in the spotlight last week when he urged the EU to restart Turkey’s accession talks, which began in 2005 and have been stalled at least since Ankara and Brussels agreed to a refugee deal in early 2016. Ankara has also been working with Paris and Athens to open a humanitarian corridor in southeastern Ukraine, to help rescue thousands trapped in the besieged port of Mariupol.

There has even been talk that the long-gestating eastern Mediterranean pipeline may get fresh energy as Europe seeks to wean itself off Russian oil and gas. Since the US backed out a few months ago, Turkey has been talking with the Israelis about building a pipeline carrying Israeli gas to Europe through Turkish territory.

Nato-member Turkey has not joined western sanctions on Russia, and has in recent days rolled out the welcome mat for Russian oligarchs seeking sanctuary

The Ides of March have also been good domestically. Mr Erdogan and his ruling AKP have lost political ground in the past three years mainly because of a lingering economic crisis and the presence of millions of mostly Syrian refugees. Many Turks see them as taking too many jobs during a period of high inflation and unemployment. But as tens of thousands of both Ukrainians and Russians have arrived in recent weeks, Turkey’s opposition parties have largely refrained from protesting against the open-door policy.

Perhaps the sight of nearly 4 million Ukrainians pouring into Europe has spurred new sympathy for refugees in Turkey – a greater willingness to continue shouldering the burden.

Or maybe it’s linked to Turkey’s unemployment rate, which fell sharply in 2021, from a high of 13.8 per cent in April to 11.4 per cent by January 2022, which is not far off the pre-crisis rate of 10.9 per cent.

Either way, all this has given Turkey’s longtime leader a boost. In December, as the Turkish lira hit record lows, Mr Erdogan’s approval rating sunk to 38 per cent, his lowest in more than six years. A poll last week put him back above 43 percent – a significant reversal after more than two years of steady decline.

The old adage appears to be holding true: in times of war, people rally around their leader. When fearing an external threat, Turks, in particular, seem to prefer a strong leader unafraid to call on his military.

Yet the other shoe may soon fall. Economists largely agree that the war and Russian sanctions will inevitably hurt the Turkish economy, which relies on Russian tourists, grains and gas, as well as billions in trade and business deals.

There could also be a spillover of violence. On Saturday Turkish authorities picked up a spiked mine bobbing near the northern end of Istanbul's Bosporus, some 620 kms south of Odessa, where both Russian and Ukrainian forces have reportedly deployed mines. Hours later reports emerged of another mine in the area, which Turkish security services soon dismissed.

A snow-covered square outside Hagia Sofia in Istanbul, on March 11. AFP
A snow-covered square outside Hagia Sofia in Istanbul, on March 11. AFP

For all the snow that blanketed Istanbul on the weekend, within a matter of weeks sunbathers and boaters will start descending on beaches just a few miles from there. More importantly, the Bosporus is one of the world’s busiest shipping routes, and any extended shutdown would further undermine Turkey’s economy.

Nato-member Turkey has not joined western sanctions on Russia, and has in recent days rolled out the welcome mat for Russian oligarchs seeking sanctuary. Many analysts now fear Turkey may seek to find ways to help Russian firms evade western sanctions.

It wouldn’t be the first time. Starting in 2012, Turkish banks helped Iran evade western sanctions and ended up buying some $13 billion in Iranian gas with gold. Turkey also has a more recent record of questionable financial dealings. Last October, the Financial Action Task Force, the world’s leading anti-money laundering body, put Turkey on its grey list of countries that need to swiftly resolve several financial deficiencies.

Israel, which has also refrained from joining western sanctions, has vowed not to enable Russians looking to evade sanctions. Turkey has yet to make a similar pledge. But this is likely more an attempt to remain in the good graces of Russian President Vladimir Putin as peace talks hint at a breakthrough, rather than any expression of interest in sanctions evasion.

Some months ago, I outlined Mr Erdogan’s remarkable resilience, after nearly two decades in power, and wondered how he might bounce back from record-low polling numbers. We may now have our answer: by leveraging a war that has rendered his leadership more valuable at home and abroad.

Of course, a great deal may happen between now and the elections in June 2023.

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MATCH INFO

Qalandars 109-3 (10ovs)

Salt 30, Malan 24, Trego 23, Jayasuriya 2-14

Bangla Tigers (9.4ovs)

Fletcher 52, Rossouw 31

Bangla Tigers win by six wickets

EA Sports FC 24
Labour dispute

The insured employee may still file an ILOE claim even if a labour dispute is ongoing post termination, but the insurer may suspend or reject payment, until the courts resolve the dispute, especially if the reason for termination is contested. The outcome of the labour court proceedings can directly affect eligibility.


- Abdullah Ishnaneh, Partner, BSA Law 

Six large-scale objects on show
  • Concrete wall and windows from the now demolished Robin Hood Gardens housing estate in Poplar
  • The 17th Century Agra Colonnade, from the bathhouse of the fort of Agra in India
  • A stagecloth for The Ballet Russes that is 10m high – the largest Picasso in the world
  • Frank Lloyd Wright’s 1930s Kaufmann Office
  • A full-scale Frankfurt Kitchen designed by Margarete Schütte-Lihotzky, which transformed kitchen design in the 20th century
  • Torrijos Palace dome
Bullet%20Train
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THE BIG THREE

NOVAK DJOKOVIC
19 grand slam singles titles
Wimbledon: 5 (2011, 14, 15, 18, 19)
French Open: 2 (2016, 21)
US Open: 3 (2011, 15, 18)
Australian Open: 9 (2008, 11, 12, 13, 15, 16, 19, 20, 21)
Prize money: $150m

ROGER FEDERER
20 grand slam singles titles
Wimbledon: 8 (2003, 04, 05, 06, 07, 09, 12, 17)
French Open: 1 (2009)
US Open: 5 (2004, 05, 06, 07, 08)
Australian Open: 6 (2004, 06, 07, 10, 17, 18)
Prize money: $130m

RAFAEL NADAL
20 grand slam singles titles
Wimbledon: 2 (2008, 10)
French Open: 13 (2005, 06, 07, 08, 10, 11, 12, 13, 14, 17, 18, 19, 20)
US Open: 4 (2010, 13, 17, 19)
Australian Open: 1 (2009)
Prize money: $125m

The specs

Engine: Direct injection 4-cylinder 1.4-litre
Power: 150hp
Torque: 250Nm
Price: From Dh139,000
On sale: Now

GIANT REVIEW

Starring: Amir El-Masry, Pierce Brosnan

Director: Athale

Rating: 4/5

THE POPE'S ITINERARY

Sunday, February 3, 2019 - Rome to Abu Dhabi
1pm: departure by plane from Rome / Fiumicino to Abu Dhabi
10pm: arrival at Abu Dhabi Presidential Airport


Monday, February 4
12pm: welcome ceremony at the main entrance of the Presidential Palace
12.20pm: visit Abu Dhabi Crown Prince at Presidential Palace
5pm: private meeting with Muslim Council of Elders at Sheikh Zayed Grand Mosque
6.10pm: Inter-religious in the Founder's Memorial


Tuesday, February 5 - Abu Dhabi to Rome
9.15am: private visit to undisclosed cathedral
10.30am: public mass at Zayed Sports City – with a homily by Pope Francis
12.40pm: farewell at Abu Dhabi Presidential Airport
1pm: departure by plane to Rome
5pm: arrival at the Rome / Ciampino International Airport

Specs

Engine: 51.5kW electric motor

Range: 400km

Power: 134bhp

Torque: 175Nm

Price: From Dh98,800

Available: Now

The chef's advice

Troy Payne, head chef at Abu Dhabi’s newest healthy eatery Sanderson’s in Al Seef Resort & Spa, says singles need to change their mindset about how they approach the supermarket.

“They feel like they can’t buy one cucumber,” he says. “But I can walk into a shop – I feed two people at home – and I’ll walk into a shop and I buy one cucumber, I’ll buy one onion.”

Mr Payne asks for the sticker to be placed directly on each item, rather than face the temptation of filling one of the two-kilogram capacity plastic bags on offer.

The chef also advises singletons not get too hung up on “organic”, particularly high-priced varieties that have been flown in from far-flung locales. Local produce is often grown sustainably, and far cheaper, he says.

Terminal High Altitude Area Defense (THAAD)

What is THAAD?

It is considered to be the US' most superior missile defence system.

Production:

It was first created in 2008.

Speed:

THAAD missiles can travel at over Mach 8, so fast that it is hypersonic.

Abilities:

THAAD is designed to take out projectiles, namely ballistic missiles, as they are on their downward trajectory towards their target, otherwise known as the "terminal phase".

Purpose:

To protect high-value strategic sites, such as airfields or population centres.

Range:

THAAD can target projectiles both inside and outside of the Earth's atmosphere, at an altitude of 93 miles above the Earth's surface.

Creators:

Lockheed Martin was originally granted the contract to develop the system in 1992. Defence company Raytheon sub-contracts to develop other major parts of the system, such as ground-based radar.

UAE and THAAD:

In 2011, the UAE became the first country outside of the US to buy two THAAD missile defence systems. It then deployed them in 2016, becoming the first Gulf country to do so.

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

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Updated: March 28, 2022, 2:00 PM