The latest allegations that senior representatives of Lebanon's Hezbollah militia met with members of a breakaway Irish terrorist group have highlighted the growing extent of the Iranian-backed organisation's operations in Europe.
For decades, Hezbollah's primary focus has been the Middle East, where the terrorist organisation – working in conjunction with Iran’s Islamic Revolutionary Guard Corps (IRGC) – has been responsible for conducting attacks designed to create political instability and discord. In recent years, however, it has gradually expanded its operations farther afield, with its terror cells operating from locations in Latin America, Africa and Asia.
Now there is fresh evidence that it is investing in its terrorist network in Europe by establishing arms caches in several countries and building links with terrorist and criminal organisations on the continent. The most recent proof of this has emerged after members of an Irish dissident group were arrested on terrorism charges last month following claims they met with Hezbollah officials at Iran’s embassy in Dublin.
A supporter of Lebanon's Hezbollah gestures as he holds a Hezbollah flag in Marjayoun, Lebanon May 7, 2018. Reuters
In 2019, Israel said this was a Hezbollah-dug tunnel under the "blue line", a demarcation line drawn by the UN to mark Israel's withdrawal from southern Lebanon in 2000. AFP
Lebanon's Hezbollah members hold party flags as they listen to their leader Sayyed Hassan Nasrallah. Reuters
A banner depicting Hezbollah leader Sayyed Hassan Nasrallah and an United Nation's post in Lebanon. Reuters
Hezbollah leader Hassan Nasrallah has direct ties with Iran's supreme leader Ayatollah Ali Khamenei. Reuters
The Israeli military claimed that Hezbollah, with Iranian assistance, had been bringing specialised equipment to a weapons factory in southern Lebanon. Screengrab/YouTube
Lebanon's Hezbollah deputy leader Sheikh Naim Qassem gestures as he speaks during an interview with Reuters in Beirut, Lebanon March 15, 2018. Reuters
Hezbollah fighters put Lebanese and Hezbollah flags at Juroud Arsal, Syria-Lebanon border, July 25, 2017. Reuters
Lebanese soldiers try to block Hezbollah supporters as they gesture and chant slogans against anti-government demonstrators, in Beirut. Reuters
A Hezbollah supporter holds a placard of its leader Hassan Nasrallah, during a protest against the US in Beirut. AP Photo
Lebanese soldiers on patrol drive by UN vehicles on the border with Israel on July 28, 2020. AP
A Lebanese police officer gesturing on the site of an explosion in Beirut that killed ex-premier Rafik Hariri in 2005. AFP
Israeli soldiers monitor the country's border with Lebanon near the northern town of Metula, in July 14, 2020. AFP
In this file photo obtained on July 29, 2011 from the Special Tribunal for Lebanon shows a combo of pictures showing four Hezbollah suspects indicted in the assassination case of former Lebanese prime minister Rafiq Hariri. AFP
A car drives past a poster depicting Lebanon's Hezbollah leader Sayyed Hassan Nasrallah in Adaisseh village, near the Lebanese-Israeli border, Lebanon July 28, 2020. REUTERS/Aziz Taher
As The National reported this month, Irish and British security officials believe that former members of the Provisional Irish Republican Army (IRA) sought to revive long-standing contacts with Hezbollah in an attempt to obtain finance and weapons for the New IRA (NIRA), a fanatical offshoot of the Irish republican movement that is bitterly opposed to the Good Friday Agreement between Northern Ireland and the Irish Republic.
Dissident Irish republicans have been waging a militant campaign against the police and security forces in Northern Ireland since 2009, and were held responsible for the killing of Irish journalist Lyra McKee in April last year.
According to officials investigating the Hezbollah plot, Irish dissidents were seeking advanced bomb-making technology previously used by Hezbollah in Lebanon and Iraq. They were in advanced talks with Hezbollah to strike a deal that would have greatly enhanced NIRA’s ability to attack British security forces, including the use of sophisticated improvised explosive devices.
Nine NIRA members have now been arrested following a long-running operation by MI5, the British security service.
Among those detained was Dr Issam Hijjawi Bassalat, a Palestinian, who has been charged with terrorism offences. At least two of those detained are said to have attended a commemoration ceremony at the Iranian embassy in Dublin following the assassination of Iranian general Qassem Suleimani by a US drone strike in January.
From the IRA's perspective, the claims that NIRA members are attempting to link up with terrorist organisations such as Hezbollah should not come as a big surprise. Irish republicans have a long history of associating with global terror groups and rogue regimes. In the past, the IRA received weapons and other forms of support from the Palestine Liberation Organisation, the Libyan regime of Muammar Qaddafi, Colombian insurgents Farc and Basque terrorist group ETA.
According to Nathan Sales of the US State Department, Hezbollah has smuggled and stored explosives across Europe. AFP
The suggestion, however, that senior Irish republicans have been attempting to form a terror pact with Hezbollah is an illustration of the organisation’s growing influence among Europe’s criminal and terrorist networks.
This month, the US State Department accused Hezbollah of storing caches of weapons and ammonium nitrate, the same material responsible for the devastating explosion at Beirut's port last month, at bases throughout Europe. According to Nathan Sales, the State Department's counterterrorism co-ordinator, Hezbollah has been steadily building up its weapons stockpiles on the continent with the aim of preparing for terrorist acts that may be ordered by Tehran.
Describing it as a “clear and present danger to the US” and its allies, Mr Sales said that intelligence reports showed Hezbollah had weapons in Belgium, France, Greece, Italy, Spain and Switzerland, while “significant” ammonium nitrate cashes had either been discovered or destroyed in France, Greece and Italy.
“We have reason to believe that this activity is still under way,” Mr Sales said in a recent video briefing in Washington. “Why would Hezbollah stockpile ammonium nitrate on European soil? The answer is clear. It can conduct major terror attacks whenever its masters in Tehran deem it necessary.”
The threat to European security posed by the growth of Hezbollah's terrorist network was highlighted this week following the conviction of two suspected terrorists for the murder of five Israeli tourists in Bulgaria in 2012.
Meliad Farah, a Lebanese-Australian, and Hassan El Hajj Hassan, a Lebanese-Canadian, were found guilty of helping plan the bombing of an Israeli tourist bus in an operation prosecutors claim was carried out on the orders of Hezbollah. The organisation has denied any involvement in the attack, and the whereabouts of the two convicted men are not known. But European Union officials accepted that there was sufficient evidence to point to its involvement in the attack, and responded by placing its military wing on its terrorism blacklist.
The latest revelations come against a deepening background of tensions between the US and Iran over its controversial nuclear programme. This week, the Trump administration announced it was re-imposing sanctions against Tehran, a move that prompted fierce opposition from other members of the UN Security Council committed to maintaining the nuclear deal struck with Iran in 2015.
But while the European signatories to the deal – Britain, France and Germany – have opposed Washington’s decision, the introduction of fresh sanctions against Iran by the US could provoke Tehran to launch a fresh wave of terror attacks, including against targets in Europe.
Con Coughlin is a defence and foreign affairs columnist for The National
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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
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
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.”
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.