In political terms, 2019 is going to be a busy year, but there are no guarantees that it will be a happy one.
Today, Jair Bolsonaro will be inaugurated as president of Brazil. The man widely referred to as the “Trump of the Tropics” has promised to “break the system”, but that is more likely to mean undermining democratic norms, political tolerance and moderation than tackling Brazil’s systemic corruption, violent crime and economic stagnation.
January 11 is the date US federal workers should get their first pay cheque of the year. But, at the time of writing, a resolution has not been reached to the partial government shutdown that has furloughed 380,000 federal employees and left 420,000 others working without pay. The impasse began at midnight on December 22 over funding for President Donald Trump's signature campaign pledge to build a wall on the US border with Mexico. Now stretching into its second week and amid fears it could last even longer, the impact on ordinary Americans can only worsen. This is likely to prompt politicians of both the Republican and Democratic parties to look for a solution, weakening Mr Trump.
Then there’s Brexit. Britain’s departure from the European Union is officially set for 11pm GMT on March 29. But now there is little clarity on what form it will take, or whether it will happen at all. The British parliament will vote on Prime Minister Theresa May’s 585-page withdrawal agreement in the week beginning January 14. If that deal is rejected, Brexit could be delayed and a second referendum or general election called. Alternatively, there could be an economically damaging “hard” Brexit, a scenario in which there will be no preferential trading arrangement with the EU.
And finally, game-changing elections are coming up in India, South Africa and Nigeria.
First up is Nigeria, Africa’s biggest economy and the continent’s most populous country. It will hold national and state elections in February and March. Voters will get to choose a president, governors for 29 of the country’s 36 states, and federal and state legislators nationwide. President Muhammadu Buhari will face a stiff challenge from Atiku Abubakar of the People’s Democratic Party, which dominated Nigerian politics for 16 years after the end of military rule in 1999.
But one of the problems with a Nigerian election is the risk of violence. The independent NGO International Crisis Group has pointed out that the last three – held in 2007, 2011 and 2015 – brought about considerable unrest and that 2019 could be as bad or worse. Violence before or after the election has "wider implications", an ICG report states, because it could undermine "the vote's credibility" and become a national crisis. Such an outcome could undermine the gains of the 2015 presidential election, when Nigeria had its first democratic transfer of power.
India is next on this year’s election calendar with polls set to take place in April to May. Until recently, Prime Minister Narendra Modi and his Hindu nationalist Bharatiya Janata Party were seen as unbeatable, but 2018 ended with the party losing three state assembly elections. This suggests that the 2019 election will be hard-fought. Worse, it is likely that hardliners will play up divisive issues such as the building of the controversial Ram temple in Ayodhya, as the BJP veers further to the right to consolidate its base.
In a sense, India’s impending election will be even more significant than that of 2014, when Mr Modi led the BJP to the country's first single-party parliamentary majority in 30 years. Some have said that the vote will be a struggle for India’s soul. Will the nation choose majoritarianism and muscular Hindutva over the secularism enshrined in its constitution? This will have implications for the wider world’s view of the nation as a global political and economic power. According to the London-based Centre for Economics & Business Research, India could overtake the UK to become one of the world's five biggest economies in 2019. But a lurch further to the right could prove offputting to foreign investors.
Then there's South Africa, which is set to go to the polls in May. Since making the transition to post-apartheid democracy 25 years ago, South Africa has placed its trust in the governing African National Congress. Now led by President Cyril Ramaphosa, the party has won all five elections held since 1994, but it has been tarnished by the record of the former president Jacob Zuma, who stepped down in February 2018 in the face of repeated allegations of corruption and a no-confidence motion against him. This may result in a lower share of the vote, pushing South Africa into a new era of coalition government.
Clearly, around the world, 2019 will show the perils and the possibilities of democracy.
Company Fact Box
Company name/date started: Abwaab Technologies / September 2019
Founders: Hamdi Tabbaa, co-founder and CEO. Hussein Alsarabi, co-founder and CTO
Based: Amman, Jordan
Sector: Education Technology
Size (employees/revenue): Total team size: 65. Full-time employees: 25. Revenue undisclosed
Stage: early-stage startup
Investors: Adam Tech Ventures, Endure Capital, Equitrust, the World Bank-backed Innovative Startups SMEs Fund, a London investment fund, a number of former and current executives from Uber and Netflix, among others.
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.”
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Will the pound fall to parity with the dollar?
The idea of pound parity now seems less far-fetched as the risk grows that Britain may split away from the European Union without a deal.
Rupert Harrison, a fund manager at BlackRock, sees the risk of it falling to trade level with the dollar on a no-deal Brexit. The view echoes Morgan Stanley’s recent forecast that the currency can plunge toward $1 (Dh3.67) on such an outcome. That isn’t the majority view yet – a Bloomberg survey this month estimated the pound will slide to $1.10 should the UK exit the bloc without an agreement.
New Prime Minister Boris Johnson has repeatedly said that Britain will leave the EU on the October 31 deadline with or without an agreement, fuelling concern the nation is headed for a disorderly departure and fanning pessimism toward the pound. Sterling has fallen more than 7 per cent in the past three months, the worst performance among major developed-market currencies.
“The pound is at a much lower level now but I still think a no-deal exit would lead to significant volatility and we could be testing parity on a really bad outcome,” said Mr Harrison, who manages more than $10 billion in assets at BlackRock. “We will see this game of chicken continue through August and that’s likely negative for sterling,” he said about the deadlocked Brexit talks.
The pound fell 0.8 per cent to $1.2033 on Friday, its weakest closing level since the 1980s, after a report on the second quarter showed the UK economy shrank for the first time in six years. The data means it is likely the Bank of England will cut interest rates, according to Mizuho Bank.
The BOE said in November that the currency could fall even below $1 in an analysis on possible worst-case Brexit scenarios. Options-based calculations showed around a 6.4 per cent chance of pound-dollar parity in the next one year, markedly higher than 0.2 per cent in early March when prospects of a no-deal outcome were seemingly off the table.
Bloomberg
The biog
Hometown: Cairo
Age: 37
Favourite TV series: The Handmaid’s Tale, Black Mirror
Favourite anime series: Death Note, One Piece and Hellsing
Favourite book: Designing Brand Identity, Fifth Edition
The rules on fostering in the UAE
A foster couple or family must:
- be Muslim, Emirati and be residing in the UAE
- not be younger than 25 years old
- not have been convicted of offences or crimes involving moral turpitude
- be free of infectious diseases or psychological and mental disorders
- have the ability to support its members and the foster child financially
- undertake to treat and raise the child in a proper manner and take care of his or her health and well-being
- A single, divorced or widowed Muslim Emirati female, residing in the UAE may apply to foster a child if she is at least 30 years old and able to support the child financially
From exhibitions to the battlefield
In 2016, the Shaded Dome was awarded with the 'De Vernufteling' people's choice award, an annual prize by the Dutch Association of Consulting Engineers and the Royal Netherlands Society of Engineers for the most innovative project by a Dutch engineering firm.
It was assigned by the Dutch Ministry of Defence to modify the Shaded Dome to make it suitable for ballistic protection. Royal HaskoningDHV, one of the companies which designed the dome, is an independent international engineering and project management consultancy, leading the way in sustainable development and innovation.
It is driving positive change through innovation and technology, helping use resources more efficiently.
It aims to minimise the impact on the environment by leading by example in its projects in sustainable development and innovation, to become part of the solution to a more sustainable society now and into the future.