Last week, Turkey finally responded to the two-year-old, semi-official Saudi embargo on its imports, investment and tourism. “We just laugh at some countries’ boycotts and move on,” Numan Kurtulmus, deputy chair of the ruling Justice and Development Party (AKP), said in an interview.
The laughter in Ankara must be increasingly nervous these days, as the boycott now stretches far beyond the Kingdom and is starting to bite at the worst possible time.
Turkish contractors in the Middle East have lost an estimated $3 billion in the past year, the head of the Turkish Contractors Union noted last week. Fashion retailers Mango and Zara are looking to move production out of Turkey because Saudis and other Gulf citizens are refusing to buy clothes made there.
In Saudi markets, more goods from Egypt, Morocco and Greece are popping up as Turkish items disappear. Earlier this month officials in Rabat approved an amendment to the Morocco-Turkey Free Trade Agreement that increased tariffs up to 90 per cent on 1200 Turkish goods. Meanwhile, Armenia and Armenians in the diaspora have launched their own "boycott Turkey" campaigns in response to Ankara's military support for Azerbaijan in the South Caucasus.
None of this is doing Turkey's troubled economy any favors. Foreign arrivals fell nearly 75 per cent in the first 8 months of the year. Emre Deliveli, an economist who owns a hotel on the Aegean coast, says his resort has brought in about 30 per cent of last year’s revenue. Last week, Ankara announced a 10bn lira rescue package for the tourism industry, but Mr Deliveli says the interest rates on the loans, up to 14.5 per cent, are too high to be of much help. The Turkish lira is on its worst streak in more than 20 years, regularly hitting record lows against the dollar, and Covid-19 cases are again on the rise, which may explain why economists are predicting an economic contraction of 3.4 per cent in Turkey this year.
Enter Qatar. Turkish President Recep Tayyip Erdogan visited Emir Tamim bin Hamad Al Thani in Doha a fortnight ago, shortly after a Qatari official announced the imminent expansion of bilateral co-operation. Also this month, a pro-government Turkish columnist quoted Sheikh Tamim as saying he views Mr Erdogan as a father to whom he owes undying loyalty, days after Turkey inaugurated a training warship built especially for Qatar's navy. "Both countries act as one heart, one fist in close co-operation and coordination on regional issues," Turkish Defence Minister Hulusi Akar said at the event.
That co-operation traces back to June 2017, when most Gulf states and Egypt severed trade and transport links with Qatar. Turkey swooped in to provide food, supplies and military support. Doha has since been returning the favour. When Turkey faced a sharp economic downturn in 2018, Qatar fast-tracked a $3bn currency swap and $15bn in investment. Trade between the two leapt 85 per cent that year. More recently, Turkey has expanded its military footprint, opening a new base outside Doha last year that hosts 5,000 Turkish troops.
“The Turkish military presence in the Arab Gulf is an emergency,” the UAE's Minister of State for Foreign Affairs, Dr Anwar Gargash, said last week.
It's one of a handful of pressing issues between the rivals. In northeastern Syria, Turkey-backed rebels launched a series of attacks on Kurdish positions this week. Any re-intensification of violence in northeast Syria is unlikely to calm regional waters. As I have written in these pages previously, Egypt last month urged its allies to join forces to counter Turkish aggression, particularly in Syria.
Sheikh Tamim says he views Erdogan as a father
In Libya, where Turkey and Qatar back the Tripoli-based Government of National Accord, Mr Erdogan last week questioned the credibility of the latest ceasefire, suggesting that the civil war there is set to continue for some time. Sudan's allies in the Gulf have sought to counter any Turkish influence there for years, and the recent decision of the transitional military council in Khartoum to normalise relations with Israel suggests that those efforts are proving successful.
Turkey has developed a formidable domestic defence sector over the past decade, and has displayed its weapon-making prowess in Libya and Syria. While it signed a significant defence co-operation deal with Ukraine this month, however, Turkey’s arms exports took a hit this year, falling more than 26 per cent through August as a result of embargoes by European states. And Ankara's position as a puchaser and key figure in the supply chain for US F-35 fighter jets is now in doubt in the wake of its purchase of Russian S-400 missile defences.
Ongoing competition between regional powers in the Middle East and North Africa has taken on greater urgency as US President Donald Trump has drawn down American commitments there. That may or may not continue in the months ahead. But regardless of who wins next week’s US presidential election, Washington in 2021 seems pre-disposed to continue its harsh stance toward Turkey because of the latter's positions on the Muslim Brotherhood and Israel, in addition to its defence procurement from Russia and aggressive moves in the eastern Mediterranean.
In a discussion a year ago on the Turkey-Qatar alliance, King's College lecturer David Roberts explained to me that geography would win out in the end and that the Gulf states would find a way to resolve the crisis, sharply reducing the need for close Turkey-Qatar ties. Yet as 2020 draws to a close, any resolution seems far away. The Turkey-Qatar embrace grows ever tighter, deepening their isolation – and possibly giving their rivals the last laugh.
David Lepeska is a veteran journalist who has been covering Turkey for the past decade
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Honeymoonish
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Scores
Day 2
New Zealand 153 & 56-1
Pakistan 227
New Zealand trail by 18 runs with nine wickets remaining
Guide to intelligent investing
Investing success often hinges on discipline and perspective. As markets fluctuate, remember these guiding principles:
- Stay invested: Time in the market, not timing the market, is critical to long-term gains.
- Rational thinking: Breathe and avoid emotional decision-making; let logic and planning guide your actions.
- Strategic patience: Understand why you’re investing and allow time for your strategies to unfold.
How to watch Ireland v Pakistan in UAE
When: The one-off Test starts on Friday, May 11
What time: Each day’s play is scheduled to start at 2pm UAE time.
TV: The match will be broadcast on OSN Sports Cricket HD. Subscribers to the channel can also stream the action live on OSN Play.
England's all-time record goalscorers:
Wayne Rooney 53
Bobby Charlton 49
Gary Lineker 48
Jimmy Greaves 44
Michael Owen 40
Tom Finney 30
Nat Lofthouse 30
Alan Shearer 30
Viv Woodward 29
Frank Lampard 29
'Outclassed in Kuwait'
Taleb Alrefai,
HBKU Press
RESULTS
Welterweight
Tohir Zhuraev (TJK) beat Mostafa Radi (PAL)
(Unanimous points decision)
Catchweight 75kg
Anas Siraj Mounir (MAR) beat Leandro Martins (BRA)
(Second round knockout)
Flyweight (female)
Manon Fiorot (FRA) beat Corinne Laframboise (CAN)
(RSC in third round)
Featherweight
Bogdan Kirilenko (UZB) beat Ahmed Al Darmaki
(Disqualification)
Lightweight
Izzedine Al Derabani (JOR) beat Rey Nacionales (PHI)
(Unanimous points)
Featherweight
Yousef Al Housani (UAE) beat Mohamed Fargan (IND)
(TKO first round)
Catchweight 69kg
Jung Han-gook (KOR) beat Max Lima (BRA)
(First round submission by foot-lock)
Catchweight 71kg
Usman Nurmogamedov (RUS) beat Jerry Kvarnstrom (FIN)
(TKO round 1).
Featherweight title (5 rounds)
Lee Do-gyeom (KOR) v Alexandru Chitoran (ROU)
(TKO round 1).
Lightweight title (5 rounds)
Bruno Machado (BRA) beat Mike Santiago (USA)
(RSC round 2).
box
COMPANY PROFILE
Company name: Letstango.com
Started: June 2013
Founder: Alex Tchablakian
Based: Dubai
Industry: e-commerce
Initial investment: Dh10 million
Investors: Self-funded
Total customers: 300,000 unique customers every month
Sweet%20Tooth
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UAE currency: the story behind the money in your pockets
The President's Cake
Director: Hasan Hadi
Starring: Baneen Ahmad Nayyef, Waheed Thabet Khreibat, Sajad Mohamad Qasem
Rating: 4/5
WHAT IS A BLACK HOLE?
1. Black holes are objects whose gravity is so strong not even light can escape their pull
2. They can be created when massive stars collapse under their own weight
3. Large black holes can also be formed when smaller ones collide and merge
4. The biggest black holes lurk at the centre of many galaxies, including our own
5. Astronomers believe that when the universe was very young, black holes affected how galaxies formed
Quick pearls of wisdom
Focus on gratitude: And do so deeply, he says. “Think of one to three things a day that you’re grateful for. It needs to be specific, too, don’t just say ‘air.’ Really think about it. If you’re grateful for, say, what your parents have done for you, that will motivate you to do more for the world.”
Know how to fight: Shetty married his wife, Radhi, three years ago (he met her in a meditation class before he went off and became a monk). He says they’ve had to learn to respect each other’s “fighting styles” – he’s a talk it-out-immediately person, while she needs space to think. “When you’re having an argument, remember, it’s not you against each other. It’s both of you against the problem. When you win, they lose. If you’re on a team you have to win together.”
The UAE squad for the Asian Indoor and Martial Arts Games
The jiu-jitsu men’s team: Faisal Al Ketbi, Zayed Al Kaabi, Yahia Al Hammadi, Taleb Al Kirbi, Obaid Al Nuaimi, Omar Al Fadhli, Zayed Al Mansoori, Saeed Al Mazroui, Ibrahim Al Hosani, Mohammed Al Qubaisi, Salem Al Suwaidi, Khalfan Belhol, Saood Al Hammadi.
Women’s team: Mouza Al Shamsi, Wadeema Al Yafei, Reem Al Hashmi, Mahra Al Hanaei, Bashayer Al Matrooshi, Hessa Thani, Salwa Al Ali.
Company%20Profile
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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.”