UK Prime Minister Keir Starmer's Commonwealth meeting in Apia, Samoa last week may have been underwhelming. AP
UK Prime Minister Keir Starmer's Commonwealth meeting in Apia, Samoa last week may have been underwhelming. AP
UK Prime Minister Keir Starmer's Commonwealth meeting in Apia, Samoa last week may have been underwhelming. AP
UK Prime Minister Keir Starmer's Commonwealth meeting in Apia, Samoa last week may have been underwhelming. AP


By focusing on the Global South, Starmer's Britain may be heading in the wrong direction


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October 29, 2024

For all its global reach, modern UK is a country that has almost unique troubles in defining its message to other nations around the planet.

British foreign policy most recently embraced the need for improving relations the Global South, but for some time it has been apparent that this is not working as an organising principle for London.

There are good historical reasons for the frequently rediscovered difficulties that the UK encounters in relations with poorer or ideologically diverse countries. In a way, nothing better exemplifies this challenge than the Commonwealth.

The UK doesn’t own or run this international grouping, despite it often misleadingly being reported as the “British Commonwealth”. Among the 50-plus members, no other country has come to the fore as the top player either. Instead, disinterest is a bigger issue.

Exemplifying this point was the absence of India’s leader at the Commonwealth meeting in Samoa last week. Prime Minister Narendra Modi was in Russia, instead, representing the globe’s most populous nation at the Brics gathering.

President Cyril Ramaphosa of South Africa, another Brics member-state, also skipped the Samoa conference even though the Commonwealth was a leading forum for the abolishment of apartheid in his country. On display at the Kazan meeting was a nine-member bloc that, in gross domestic product terms, is now bigger than Western Europe and rivals the US.

  • Russian President Vladimir Putin, right, and Turkish President Recep Tayyip Erdogan shake hands on the sidelines of the Brics summit. AFP
    Russian President Vladimir Putin, right, and Turkish President Recep Tayyip Erdogan shake hands on the sidelines of the Brics summit. AFP
  • Mr Putin and Mr Erdogan on the sidelines of the Brics summit. AFP
    Mr Putin and Mr Erdogan on the sidelines of the Brics summit. AFP
  • Mr Putin, left, and Chinese President Xi Jinping with Zinash Tayachew, wife of Ethiopian Prime Minister Abiy Ahmed, during a reception at the summit. EPA
    Mr Putin, left, and Chinese President Xi Jinping with Zinash Tayachew, wife of Ethiopian Prime Minister Abiy Ahmed, during a reception at the summit. EPA
  • Palestinian President Mahmoud Abbas, centre, and Mauritania's President Mohamed Ould Ghazouani at the reception. EPA
    Palestinian President Mahmoud Abbas, centre, and Mauritania's President Mohamed Ould Ghazouani at the reception. EPA
  • President Sheikh Mohamed meets Mr Xi during the Brics summit in Kazan, Russia, on Wednesday October 23. Photo: UAE Presidential Court
    President Sheikh Mohamed meets Mr Xi during the Brics summit in Kazan, Russia, on Wednesday October 23. Photo: UAE Presidential Court
  • Sheikh Mohamed in discussions with Cyril Ramaphosa, President of South Africa. Photo: UAE Presidential Court
    Sheikh Mohamed in discussions with Cyril Ramaphosa, President of South Africa. Photo: UAE Presidential Court
  • Sheikh Mohamed with Iranian President Masoud Pezeshkian. Photo: UAE Presidential Court
    Sheikh Mohamed with Iranian President Masoud Pezeshkian. Photo: UAE Presidential Court
  • Sheikh Mohamed greets Narendra Modi, Prime Minister of India. Photo: UAE Presidential Court
    Sheikh Mohamed greets Narendra Modi, Prime Minister of India. Photo: UAE Presidential Court
  • Sheikh Mohamed with Egyptian President Abdel Fattah El Sisi. Photo: UAE Presidential Court
    Sheikh Mohamed with Egyptian President Abdel Fattah El Sisi. Photo: UAE Presidential Court
  • Sheikh Mohamed and other Brics leaders, from left, Ethiopian Prime Minister Abiy Ahmed, Egyptian President Abdel Fattah El Sisi, South African President Cyril Ramaphosa, Chinese President Xi Jinping, Russian President Vladimir Putin, Indian Prime Minister Narendra Modi, Iranian President Masoud Pezeshkian and Brazilian Foreign Minister Mauro Vieira, pose for a family photo at the Brics summit. AFP
    Sheikh Mohamed and other Brics leaders, from left, Ethiopian Prime Minister Abiy Ahmed, Egyptian President Abdel Fattah El Sisi, South African President Cyril Ramaphosa, Chinese President Xi Jinping, Russian President Vladimir Putin, Indian Prime Minister Narendra Modi, Iranian President Masoud Pezeshkian and Brazilian Foreign Minister Mauro Vieira, pose for a family photo at the Brics summit. AFP
  • Chinese President Xi Jinping, Russian President Vladimir Putin and Indian Prime Minister Narendra Modi, at a Brics summit session. AP
    Chinese President Xi Jinping, Russian President Vladimir Putin and Indian Prime Minister Narendra Modi, at a Brics summit session. AP
  • President Sheikh Mohamed arrives at the Brics summit. Reuters
    President Sheikh Mohamed arrives at the Brics summit. Reuters
  • Sheikh Mohamed at the Brics summit which is being staged in Kazan, Russia. Reuters
    Sheikh Mohamed at the Brics summit which is being staged in Kazan, Russia. Reuters
  • Russian President Vladimir Putin, right, and Sheikh Abdullah bin Zayed, Deputy Prime Minister and Minister of Foreign Affairs shake hands during the welcoming ceremony prior to an informal dinner on the sidelines of the Brics Summit. AP
    Russian President Vladimir Putin, right, and Sheikh Abdullah bin Zayed, Deputy Prime Minister and Minister of Foreign Affairs shake hands during the welcoming ceremony prior to an informal dinner on the sidelines of the Brics Summit. AP
  • From left, Sheikh Abdullah bin Zayed, Egyptian President Abdel Fattah El Sisi, South African President Cyril Ramaphosa, Indian Prime Minister Narendra Modi, Ethiopian Prime Minister Abiy Ahmed and Brazilian Foreign Minister Mauro Vieira attend the welcoming ceremony. AP
    From left, Sheikh Abdullah bin Zayed, Egyptian President Abdel Fattah El Sisi, South African President Cyril Ramaphosa, Indian Prime Minister Narendra Modi, Ethiopian Prime Minister Abiy Ahmed and Brazilian Foreign Minister Mauro Vieira attend the welcoming ceremony. AP
  • Chinese President Xi Jinping, left, Mr Putin, centre, and Mr Modi attend a concert before an informal dinner on the sidelines of the Brics Summit in Kazan. EPA
    Chinese President Xi Jinping, left, Mr Putin, centre, and Mr Modi attend a concert before an informal dinner on the sidelines of the Brics Summit in Kazan. EPA
  • Mr Putin, right, and Mr El Sisi shake hands during their meeting on the sidelines of the summit at Kazan City Hall in Kazan, Russia. AP
    Mr Putin, right, and Mr El Sisi shake hands during their meeting on the sidelines of the summit at Kazan City Hall in Kazan, Russia. AP
  • Iranian President Masoud Pezeshkian attends a welcoming ceremony at Kazan Airport upon his arrival to participate in the summit. Reuters
    Iranian President Masoud Pezeshkian attends a welcoming ceremony at Kazan Airport upon his arrival to participate in the summit. Reuters
  • Mr Putin meets Mr Xi on the sidelines of the event. AFP
    Mr Putin meets Mr Xi on the sidelines of the event. AFP
  • Mr Putin meets Dilma Rousseff, chairwoman of the New Development Bank and former president of Brazil. Reuters
    Mr Putin meets Dilma Rousseff, chairwoman of the New Development Bank and former president of Brazil. Reuters
  • Mr Putin greets South African President Cyril Ramaphosa on the sidelines of the summit. EPA
    Mr Putin greets South African President Cyril Ramaphosa on the sidelines of the summit. EPA

One of the problems with Commonwealth meetings is that they frequently teeter on the brink of failure over deep-rooted clashes that revolve around identity. The Samoa meeting was a textbook example of this.

UK Prime Minister Keir Starmer was there to introduce himself as a new global actor. Courting goodwill as a fresh dose of centrist politics should have been the focus of the nearly weeklong trip. Instead, the Labour leader found himself addressing the issue of reparations for the Atlantic slave trade. The joint discussion of the issue was even adopted as Commonwealth business in clause 34 of the communique.

Mr Starmer said that reparations, both financial and non-financial, are off the table. But he added that he understood the hard, shared history of the Commonwealth meant accepting that there are calls to “face up to the harms of the past”.

However, in fending off the idea of reparations, Mr Starmer had a paradox on his side.

Foreign Secretary David Lammy is the first descendant of slaves to represent the UK abroad. He had justified the call for reparations before he came into office. And now that he is the UK’s top diplomat, it is his mission to make his country a friend of the Global South through dialogue and accommodation. Therein lies the problem.

A report recently published by the conservative Policy Exchange think tank makes a cogent argument that the Labour government’s foreign policy reset persists with building relations with the Global South – a policy that has been described as a pillar of its “progressive realism” platform. In fact, one of the three reviews of the UK’s foreign policy that was announced by Mr Lammy looks into the promotion of soft power within the overall global outlook.

The paper, however, argues that the problem with this thinking is the new government will be compelled by its own definition of a concessions-based diplomatic policy, shying away from openly pursuing its own interests. “This soft power focus circumscribes our strategic engagement with crucial non-aligned regions which are increasingly governed by hard power logic,” the report says.

UK Foreign Secretary David Lammy is doubling down on his government's Global South Agenda. AFP
UK Foreign Secretary David Lammy is doubling down on his government's Global South Agenda. AFP

It is true that the UK isn’t the only western power to give the Global South agenda higher priority in recent years, particularly since Russia launched its full-scale war against Ukraine in 2022.

The West’s strategy to court developing countries was partially based on an understanding that, over time, many of these countries had become more reluctant to support Kyiv as that would have meant prolonging a conflict that could have threatened the breadbasket supplies of wheat and oils to them.

But this panicked embrace of the Global South agenda ignores the fact that lumping together 85 per cent of the global population is necessarily incoherent. That certainly explains why it has appeared to be of little bridging value during last week’s Commonwealth summit.

The question posed by the Policy Exchange paper is: Why would the West play on this field? That is doubly true since it is observable that geopolitical ambushes by China and Russia, perhaps even Iran, are common in this context.

The success of the Brics summit has effectively delivered a bruising week for the West. And with Americans voting for their 47th president next month, the very direction of travel for the western world is at stake.

As Mr Starmer made the long flight home across the Pacific Ocean, it is highly improbable that he had many positive thoughts to cobble together in his head. Perhaps, then, a new approach is in order?

THE BIO

Favourite car: Koenigsegg Agera RS or Renault Trezor concept car.

Favourite book: I Am Pilgrim by Terry Hayes or Red Notice by Bill Browder.

Biggest inspiration: My husband Nik. He really got me through a lot with his positivity.

Favourite holiday destination: Being at home in Australia, as I travel all over the world for work. It’s great to just hang out with my husband and family.

 

 

What can victims do?

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Courtesy: Crystal Intelligence

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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.”

Top investing tips for UAE residents in 2021

Build an emergency fund: Make sure you have enough cash to cover six months of expenses as a buffer against unexpected problems before you begin investing, advises Steve Cronin, the founder of DeadSimpleSaving.com.

Think long-term: When you invest, you need to have a long-term mindset, so don’t worry about momentary ups and downs in the stock market.

Invest worldwide: Diversify your investments globally, ideally by way of a global stock index fund.

Is your money tied up: Avoid anything where you cannot get your money back in full within a month at any time without any penalty.

Skip past the promises: “If an investment product is offering more than 10 per cent return per year, it is either extremely risky or a scam,” Mr Cronin says.

Choose plans with low fees: Make sure that any funds you buy do not charge more than 1 per cent in fees, Mr Cronin says. “If you invest by yourself, you can easily stay below this figure.” Managed funds and commissionable investments often come with higher fees.

Be sceptical about recommendations: If someone suggests an investment to you, ask if they stand to gain, advises Mr Cronin. “If they are receiving commission, they are unlikely to recommend an investment that’s best for you.”

Get financially independent: Mr Cronin advises UAE residents to pursue financial independence. Start with a Google search and improve your knowledge via expat investing websites or Facebook groups such as SimplyFI. 

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Updated: October 29, 2024, 4:04 AM