The nuance of Arab identity is still being lost on the West


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Three months ago Thomas Friedman, the New York Times columnist and best-selling pundit, gave his readers a bizarre list of the hidden forces he claimed had spurred revolution in Arab countries.

The list included the fact that the US had voted for an African-American as president; the influence of Google Earth in displaying the unequal distribution of land in Bahrain; the example of Israel in forcing an allegedly corrupt prime minister (Ehud Olmert) to resign and convicting a president (Moshe Katsav) of rape; and the Beijing Olympics, which showed what a once poor country could do when its economy was set free.

The list was widely lampooned at the time as a wild example of a foreign journalist distorting events in the Arab world with some half-baked ideas of his own. The message was that Arabs were incapable of making up their own minds, and could only rely on foreign - mainly American - gifts to rouse them from their lethargy.

Of course Mr Friedman is not the first visiting newspaperman to cast complex events in terms that his readers will relate to. Talking of Google Earth is far more digestible than relating the bitter history of strikes in Egypt and the shocking details of police brutality.

With hindsight it is clear that Mr Friedman's article marked the high point of the period when the Arabs on the street - that perennially sullen force of media cliché - were heroes. A false narrative took hold in the western media in which the whole Arab world was born again. Bearded believers in political Islam were replaced by student blogger types, and the Arab-Israeli conflict was forgotten.

This could not last. This beguiling media construct has collapsed in the face of reality: armed conflict in Libya and Yemen, ferocious crackdown in Syria, and what looks like political drift in Egypt leading to financial crisis.

A more recent column by Mr Friedman returns to the traditional themes of reporting on the Middle East. He laments the lack of education and economic development in the Arab world, and points out that the ill effects of the "bin Laden decade" have pushed the newly liberated Arab states even farther behind. So we are back where we were, now with added bankruptcy.

A more judicious portrayal of these events has to start by avoiding generalisations about the Arab world or the "Arab identity". It is true that satellite television and social media have given a new sense of connectedness to the Arabs, allowing slogans and protest techniques to spread instantly. But this should not hide the deep differences among the Arab states.

Tunisia and Egypt have a long history of popular movements calling for justice, originally directed against their colonial masters, France and Britain. The Tunisian protesters chanted lines from the poet Abul Qassem al Shabi, famous for writing, To the tyrants of the world, and who died in 1934. In Egypt the protesters sang I am the people marching by Ahmed Fouad Negm, the vernacular poet who has spent 18 years in political prisons. This rediscovered tradition of protest is now supplemented by a new sense of connectedness.

As the Iranian-American writer and activist Reza Aslan has pointed out, people of the Middle East have in the course of this year developed a greater awareness of their neighbours, and with it, more complex identities. In the past, the politics of each country used to be in its own separate silo - to borrow a term from management theory - but these silos have been bust open.

The protesters in Cairo are first and foremost Egyptian, but they have a well developed sense of Middle Eastern identity, acknowledging a debt to Tunisia and to Iran, where the Green Movement, though brutally crushed, served as one source of inspiration. In 2009, the Iranian protesters were very much alone. Now they see gestures of solidarity from Arab countries.

Despite the efforts of American commentators to claim paternity of the unrest, the US influence now appears vanishingly small. The protesters had few expectations of the US. As the current saying goes, those over 40 do not trust America, and those under 40 pay no heed to it. The US president, Barack Obama, has a back stage role, emerging to speak but not claiming leadership.

This is a truly remarkable development, and deeply unsettling for Washington's allies. One of the reasons for the drop in US media interest is the lack of any clear American candidate in the struggles going on.

This new sense of connectedness is worrying for the Israelis. Far from being seen as the model for the future, Israel knows it has to face Arab countries where public opinion will be more strongly felt, rather than being bottled up.

This was the message that Mr Obama was trying to get across in his speech last month, but which was drowned out in the uproar orchestrated by Benjamin Netanyahu, the Israeli prime minister, over his mention of the 1967 borders as a basis for a peace agreement with the Palestinians.

The status quo was unsustainable, Mr Obama said, and Israel should act boldly to make peace before it was too late. "A region undergoing profound change will lead to populism in which millions of people, not just a few leaders, must believe peace is possible."

People power is a fantasy. It may be that the governments of the Arab states change far less than the revolutionaries hoped. This is their nightmare. But the experience of connectedness will not drain away so fast. Public opinion will not be silenced as it was in the past.

A comparison with the worldwide student protests of 1968 may be useful. They did not instantly topple European governments, but they did usher in a period of unstoppable social change for years afterwards. To chronicle those changes in the Middle East, which no doubt will be contradictory and confusing, will require a very fine reportorial eye.

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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.”

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

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