The Middle East has been in turmoil since October 2023. Missiles have flown in just about every direction, and there is significant concern about what the future might hold. One of the surprises, however, is that Iraq has managed to stay out of the conflict.
For years, many analysts have argued that Iraq has fallen completely under Iran’s shadow partially through control that proxy groups exercise in the country. And yet, these groups have been almost entirely inactive since October 2023, leading to questions as to where exactly the balance of powers lies in Iraq.
The Popular Mobilisation Forces were established following ISIS’s 2014 invasion and occupation of Iraq’s north-west. After the terror group’s defeat, the PMF and affiliated groups sought and obtained direct representation in Parliament and in government. Like all other parties, they used those positions to extract rents and to exercise influence over policy and financial matters. The difference, however, is that the PMF used its status as a paramilitary organisation to impose outcomes in ways that many other groups could not.
Many factions within the PMF were also plainly anti-western in their rhetoric. On occasion, their leaders could be seen directing marches of (relatively small numbers of) followers and openly declaring that their ultimate source of authority was the supreme leader of Iran, Ayatollah Ali Khamenei.
However, since 2003, Iraq has lost its monolithic status and has become a more complicated society. The PMF may have been pushing a specific political line, but much of the state and society have had little to no interest in being involved in regional struggles of any kind.
Formally, the Iraqi government’s position has been to seek to de-escalate tensions in the region and internally. Politically, however, the government is made up of myriad forces, including groups affiliated to the PMF, each of which has its own set of interests and the means to act upon it.
The quietist groups have long been at a disadvantage, however, given that they favour a moderate and dialogue-based approach that shies away from confrontation no matter the circumstances, which more aggressive groups have consistently used to push the limits on a range of issues.
The contrast can most obviously be seen after arriving at Baghdad International Airport, the road to which has been co-opted by the PMF’s efforts to construct a narrative of struggle and resistance. But visitors to Baghdad who drive along that road can look immediately to the left and see the enormous campus of the newly established American University of Baghdad and the thousands of students who now visit every day. English business schools and language academies can be found almost everywhere in the capital, including on streets that sometimes bear the names and faces of Iranian officers and their Iraqi allies who were killed in action by the American military.
Recent developments will probably have an impact on that delicate balance.
Iraqis and outside observers will all have noticed that the PMF did not get involved at all during the recent fighting between Iran and Israel. Analysts have offered different explanations for what was happening in the background. Some have said that Iran was opposed to any involvement by the PMF for fear that this could lead to greater escalation. Others have argued that Iran’s main priority in Iraq is not to seek military support from the PMF but rather to keep the flow of dollars from Baghdad open.
According to that narrative, any direct military involvement by the PMF could threaten that financial lifeline. Others still have noted that the Iraqi government – mainly Prime Minister Mohammed Shia Al Sudani and the security forces – worked tirelessly behind the scenes to keep the country out of the conflict, which has been bearing fruit.
Now that the conflict is over, however, a number of consequences will probably flow.
Regardless of which narrative is the most accurate, the fact that the PMF did not take any action whatsoever will be interpreted by many as a sign of weakness and vulnerability. Political forces that have always been antagonistic to the PMF will seek at least partial realignment on a number of fronts, much of which the PMF will find hard to resist given that it will all be coming at the same time.
Within the Iraqi government itself, and within governing coalitions – including but not limited to the Co-ordination Framework (of which the PMF is a part) – the quietist camp will necessarily feel emboldened. It could be that Iraqi politics will be entering a non-confrontation stage, in which armed skirmishes of any kind will be eschewed in favour of business as usual (including the continued and uninterrupted extraction of rents).
Clearly, however, Iraq’s relationship with Iran will not break entirely. All that is likely to happen is that Iraqi groups will feel less compelled to consult or to defer to Tehran in as many matters as before. Iraqi political groups’ relentless rent-seeking for the past 20 years has always meant that they are economically independent, and many now will feel less politically tethered to Iran as well.
If that does happen, it is altogether unclear whether this will translate into any concrete improvements for ordinary Iraqis. It will probably only mean that political power will gradually slip away from the confrontation camp – not with a bang, but with a whimper – with nothing much to replace it other than Iraq’s decrepit political system.
Iraqi politics is too fractious to coalesce around a concrete strategy, particularly in relation to foreign policy, given the country’s limited regional influence. Thus, it is not that a new strategy is being developed. It is that the previous status quo will probably fray without collapsing altogether.
French business
France has organised a delegation of leading businesses to travel to Syria. The group was led by French shipping giant CMA CGM, which struck a 30-year contract in May with the Syrian government to develop and run Latakia port. Also present were water and waste management company Suez, defence multinational Thales, and Ellipse Group, which is currently looking into rehabilitating Syrian hospitals.
Specs
Engine: Dual-motor all-wheel-drive electric
Range: Up to 610km
Power: 905hp
Torque: 985Nm
Price: From Dh439,000
Available: Now
Singham Again
Director: Rohit Shetty
Stars: Ajay Devgn, Kareena Kapoor Khan, Ranveer Singh, Akshay Kumar, Tiger Shroff, Deepika Padukone
Rating: 3/5
PROFILE
Name: Enhance Fitness
Year started: 2018
Based: UAE
Employees: 200
Amount raised: $3m
Investors: Global Ventures and angel investors
MATCH INFO
Barcelona 4 (Messi 23' pen, 45 1', 48', Busquets 85')
Celta Vigo 1 (Olaza 42')
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.”
Who's who in Yemen conflict
Houthis: Iran-backed rebels who occupy Sanaa and run unrecognised government
Yemeni government: Exiled government in Aden led by eight-member Presidential Leadership Council
Southern Transitional Council: Faction in Yemeni government that seeks autonomy for the south
Habrish 'rebels': Tribal-backed forces feuding with STC over control of oil in government territory
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UAE currency: the story behind the money in your pockets
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The Sand Castle
Director: Matty Brown
Stars: Nadine Labaki, Ziad Bakri, Zain Al Rafeea, Riman Al Rafeea
Rating: 2.5/5
The drill
Recharge as needed, says Mat Dryden: “We try to make it a rule that every two to three months, even if it’s for four days, we get away, get some time together, recharge, refresh.” The couple take an hour a day to check into their businesses and that’s it.
Stick to the schedule, says Mike Addo: “We have an entire wall known as ‘The Lab,’ covered with colour-coded Post-it notes dedicated to our joint weekly planner, content board, marketing strategy, trends, ideas and upcoming meetings.”
Be a team, suggests Addo: “When training together, you have to trust in each other’s abilities. Otherwise working out together very quickly becomes one person training the other.”
Pull your weight, says Thuymi Do: “To do what we do, there definitely can be no lazy member of the team.”
UJDA CHAMAN
Produced: Panorama Studios International
Directed: Abhishek Pathak
Cast: Sunny Singh, Maanvi Gagroo, Grusha Kapoor, Saurabh Shukla
Rating: 3.5 /5 stars
More from Neighbourhood Watch:
UAE currency: the story behind the money in your pockets
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New UK refugee system
- A new “core protection” for refugees moving from permanent to a more basic, temporary protection
- Shortened leave to remain - refugees will receive 30 months instead of five years
- A longer path to settlement with no indefinite settled status until a refugee has spent 20 years in Britain
- To encourage refugees to integrate the government will encourage them to out of the core protection route wherever possible.
- Under core protection there will be no automatic right to family reunion
- Refugees will have a reduced right to public funds
Kathryn Hawkes of House of Hawkes on being a good guest (because we’ve all had bad ones)
- Arrive with a thank you gift, or make sure you have one for your host by the time you leave.
- Offer to buy groceries, cook them a meal or take your hosts out for dinner.
- Help out around the house.
- Entertain yourself so that your hosts don’t feel that they constantly need to.
- Leave no trace of your stay – if you’ve borrowed a book, return it to where you found it.
- Offer to strip the bed before you go.
ABU%20DHABI'S%20KEY%20TOURISM%20GOALS%3A%20BY%20THE%20NUMBERS
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Tailors and retailers miss out on back-to-school rush
Tailors and retailers across the city said it was an ominous start to what is usually a busy season for sales.
With many parents opting to continue home learning for their children, the usual rush to buy school uniforms was muted this year.
“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.”
TOURNAMENT INFO
2018 ICC World Twenty20 Asian Western Regional Qualifier
The top three teams progress to the Asia Qualifier
Thursday results
UAE beat Kuwait by 86 runs
Qatar beat Bahrain by five wickets
Saudi Arabia beat Maldives by 35 runs
Friday fixtures
10am, third-place playoff – Saudi Arabia v Kuwait
3pm, final – UAE v Qatar
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Skoda Superb Specs
Engine: 2-litre TSI petrol
Power: 190hp
Torque: 320Nm
Price: From Dh147,000
Available: Now
Why it pays to compare
A comparison of sending Dh20,000 from the UAE using two different routes at the same time - the first direct from a UAE bank to a bank in Germany, and the second from the same UAE bank via an online platform to Germany - found key differences in cost and speed. The transfers were both initiated on January 30.
Route 1: bank transfer
The UAE bank charged Dh152.25 for the Dh20,000 transfer. On top of that, their exchange rate margin added a difference of around Dh415, compared with the mid-market rate.
Total cost: Dh567.25 - around 2.9 per cent of the total amount
Total received: €4,670.30
Route 2: online platform
The UAE bank’s charge for sending Dh20,000 to a UK dirham-denominated account was Dh2.10. The exchange rate margin cost was Dh60, plus a Dh12 fee.
Total cost: Dh74.10, around 0.4 per cent of the transaction
Total received: €4,756
The UAE bank transfer was far quicker – around two to three working days, while the online platform took around four to five days, but was considerably cheaper. In the online platform transfer, the funds were also exposed to currency risk during the period it took for them to arrive.
Living in...
This article is part of a guide on where to live in the UAE. Our reporters will profile some of the country’s most desirable districts, provide an estimate of rental prices and introduce you to some of the residents who call each area home.