Last week, Lebanon’s Speaker of Parliament, Nabih Berri, announced that an agreement had been reached on a framework for negotiations with Israel to delineate the two nations' maritime boundaries. The agreement, mediated by the US, could allow them to resolve their dispute over offshore gas fields in the Mediterranean.
Mr Berri is a close ally of the militant political party Hezbollah, and the fact that he approved of the framework suggested the party had given him the go-ahead to do so. But it didn’t make the decision any less remarkable. By agreeing to indirect negotiations, Hezbollah implicitly acknowledged that a compromise could be reached when it had argued that Lebanon’s rights to its offshore gas were inviolable. That prior insistence meant, in principle, that there was nothing over which to compromise.
Stark reality, however, has trumped ideology. Lebanon is going through a terrible economic crisis, exacerbated by the resistance of the country’s politicians and parties to introducing reforms that would unlock financial aid from the International Monetary Fund. Such reforms would threaten their networks of corruption and patronage. That is why the prospect of offshore gas reserves represents a valuable lifeline for them, especially when Hezbollah’s and Mr Berri’s supporters are increasingly unhappy with Lebanon's economic situation.
Hezbollah’s acceptance of negotiations between Lebanon and Israel has raised profound questions, too. First, if Lebanon looks to natural gas as an economic lifesaver, this could create dynamics that impose quiet collaboration with Israel – something Hezbollah officially claims to be a nonstarter. But things may not be so simple.
For instance, both countries will need to find a means of exporting natural gas so that the price remains competitive internationally. That means that Israel and Lebanon, along with Cyprus, would benefit from investing in a shared export infrastructure, thereby reducing costs. Lebanon would have an economic incentive to feed its gas into the EastMed Pipeline that those countries, together with Greece, plan to complete by 2025, and which aims to transport natural gas to Italy.
The Lebanese continue to claim that they would not allow their gas to be exported in the same pipeline as Israeli gas. Should Beirut seek to collaborate with the Israelis in exploiting the gas fields, this would put Lebanese officials in a particularly awkward position – claiming that gas has a nationality when it is being exported, but not when it is being extracted.
Competing with the EastMed Pipeline is the Trans-Anatolian Pipeline, which crosses much of Turkey and also reaches Europe. It could represent an alternative path for Lebanese gas. But taking a circuitous route that cuts across northern Anatolia instead of one that is already being planned with two of Lebanon's maritime neighbours would be an odd – and very expensive – move. In other words, should Lebanon want to enter the gas game on the best economic terms, dealing with Israel may be the most sensible option.
Hezbollah's acceptance of negotiations between Lebanon and Israel has raised profound questions
If financial realities are forcing Hezbollah to reconsider Lebanon’s negotiations with Israel over maritime boundaries, then the country’s economic collapse is having more pernicious implications for the party. Hezbollah’s missile arsenal is there as a deterrent to protect Iran and its nuclear programme from Israeli attacks. Yet to what extent is that even conceivable today?
With over 50 per cent of the Lebanese living under the poverty line, and many of them believing Hezbollah to be part of the corrupt political elite, a war with Israel could turn the population decisively against the party. Worse, Lebanon would be so devastated that the very idea of Hezbollah’s “resistance” could be permanently discredited, with the party blamed for acting primarily to benefit Iran instead of Lebanon.
The recent explosion in a Hezbollah arms cache in Ayn Qana in southern Lebanon has led to speculation that it was caused by a surreptitious Israeli military operation. This needs to be confirmed, but people in the south reportedly believe stories of Israeli involvement, and think that Hezbollah declined to react because the party could not afford a conflict with Israel now.
If Hezbollah is unable to retaliate against Israeli or American strikes on Iran because of the domestic repercussions, and if it looks the other way while Lebanon undertakes negotiations Israel, then of what value is its contract with Tehran? The party’s strength was always its ability to impose its agenda on its compatriots, and to threaten those who opposed it. But today, Hezbollah knows that such methods will not work.
That doesn’t meant that Tehran has any intention of giving up on the party. Hezbollah serves many roles besides that of a deterrent against Israel. It is a valuable instrument of Tehran’s influence on the Mediterranean. But it’s also true that Hezbollah’s disregard for the discontent in Lebanon, along with its refusal to help revive the country through economic reform, has meant that it has poisoned its own environment, limiting its margin of manoeuvre on Iran’s behalf.
Iran’s expansion in the Arab world has produced results, but also destruction. Tehran has played on the contradictions in places like Iraq, Yemen, Syria, the Palestinian Territories, and Lebanon in order to advance. But its legacy is fields of ruin. Today, Hezbollah is paying the price for this at home. The party has taken an inflexible position in preserving the mendacious Lebanese political class, thereby collapsing the consensus that had once protected it.
Michael Young is a senior editor at the Carnegie Middle East Centre in Beirut and a columnist for The National
ARGENTINA SQUAD
Goalkeepers: Franco Armani, Agustin Marchesin, Esteban Andrada
Defenders: Juan Foyth, Nicolas Otamendi, German Pezzella, Nicolas Tagliafico, Ramiro Funes Mori, Renzo Saravia, Marcos Acuna, Milton Casco
Midfielders: Leandro Paredes, Guido Rodriguez, Giovani Lo Celso, Exequiel Palacios, Roberto Pereyra, Rodrigo De Paul, Angel Di Maria
Forwards: Lionel Messi, Sergio Aguero, Lautaro Martinez, Paulo Dybala, Matias Suarez
Skoda Superb Specs
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Power: 190hp
Torque: 320Nm
Price: From Dh147,000
Available: Now
At a glance
Fixtures All matches start at 9.30am, at ICC Academy, Dubai. Admission is free
Thursday UAE v Ireland; Saturday UAE v Ireland; Jan 21 UAE v Scotland; Jan 23 UAE v Scotland
UAE squad Rohan Mustafa (c), Ashfaq Ahmed, Ghulam Shabber, Rameez Shahzad, Mohammed Boota, Mohammed Usman, Adnan Mufti, Shaiman Anwar, Ahmed Raza, Imran Haider, Qadeer Ahmed, Mohammed Naveed, Amir Hayat, Zahoor Khan
Desert Warrior
Starring: Anthony Mackie, Aiysha Hart, Ben Kingsley
Director: Rupert Wyatt
Rating: 3/5
Avatar: Fire and Ash
Director: James Cameron
Starring: Sam Worthington, Sigourney Weaver, Zoe Saldana
Rating: 4.5/5
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.”
Company profile
Name: Thndr
Started: October 2020
Founders: Ahmad Hammouda and Seif Amr
Based: Cairo, Egypt
Sector: FinTech
Initial investment: pre-seed of $800,000
Funding stage: series A; $20 million
Investors: Tiger Global, Beco Capital, Prosus Ventures, Y Combinator, Global Ventures, Abdul Latif Jameel, Endure Capital, 4DX Ventures, Plus VC, Rabacap and MSA Capital
The%C2%A0specs%20
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MATCH INFO
Rugby World Cup (all times UAE)
Third-place play-off: New Zealand v Wales, Friday, 1pm
Killing of Qassem Suleimani
Keep it fun and engaging
Stuart Ritchie, director of wealth advice at AES International, says children cannot learn something overnight, so it helps to have a fun routine that keeps them engaged and interested.
“I explain to my daughter that the money I draw from an ATM or the money on my bank card doesn’t just magically appear – it’s money I have earned from my job. I show her how this works by giving her little chores around the house so she can earn pocket money,” says Mr Ritchie.
His daughter is allowed to spend half of her pocket money, while the other half goes into a bank account. When this money hits a certain milestone, Mr Ritchie rewards his daughter with a small lump sum.
He also recommends books that teach the importance of money management for children, such as The Squirrel Manifesto by Ric Edelman and Jean Edelman.
COMPANY%20PROFILE%20
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Racecard
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A list of the animal rescue organisations in the UAE
Diriyah%20project%20at%20a%20glance
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Indoor Cricket World Cup Dubai 2017
Venue Insportz, Dubai; Admission Free
Day 1 fixtures (Saturday)
Men 1.45pm, Malaysia v Australia (Court 1); Singapore v India (Court 2); UAE v New Zealand (Court 3); South Africa v Sri Lanka (Court 4)
Women Noon, New Zealand v South Africa (Court 3); England v UAE (Court 4); 5.15pm, Australia v UAE (Court 3); England v New Zealand (Court 4)
Key findings of Jenkins report
- Founder of the Muslim Brotherhood, Hassan al Banna, "accepted the political utility of violence"
- Views of key Muslim Brotherhood ideologue, Sayyid Qutb, have “consistently been understood” as permitting “the use of extreme violence in the pursuit of the perfect Islamic society” and “never been institutionally disowned” by the movement.
- Muslim Brotherhood at all levels has repeatedly defended Hamas attacks against Israel, including the use of suicide bombers and the killing of civilians.
- Laying out the report in the House of Commons, David Cameron told MPs: "The main findings of the review support the conclusion that membership of, association with, or influence by the Muslim Brotherhood should be considered as a possible indicator of extremism."
Aayan%E2%80%99s%20records
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Other acts on the Jazz Garden bill
Sharrie Williams
The American singer is hugely respected in blues circles due to her passionate vocals and songwriting. Born and raised in Michigan, Williams began recording and touring as a teenage gospel singer. Her career took off with the blues band The Wiseguys. Such was the acclaim of their live shows that they toured throughout Europe and in Africa. As a solo artist, Williams has also collaborated with the likes of the late Dizzy Gillespie, Van Morrison and Mavis Staples.
Lin Rountree
An accomplished smooth jazz artist who blends his chilled approach with R‘n’B. Trained at the Duke Ellington School of the Arts in Washington, DC, Rountree formed his own band in 2004. He has also recorded with the likes of Kem, Dwele and Conya Doss. He comes to Dubai on the back of his new single Pass The Groove, from his forthcoming 2018 album Stronger Still, which may follow his five previous solo albums in cracking the top 10 of the US jazz charts.
Anita Williams
Dubai-based singer Anita Williams will open the night with a set of covers and swing, jazz and blues standards that made her an in-demand singer across the emirate. The Irish singer has been performing in Dubai since 2008 at venues such as MusicHall and Voda Bar. Her Jazz Garden appearance is career highlight as she will use the event to perform the original song Big Blue Eyes, the single from her debut solo album, due for release soon.