The ongoing protests against austerity in Tunisia highlight the precariousness of the country's achievement in 2011. Hassene Dridi / AP
The ongoing protests against austerity in Tunisia highlight the precariousness of the country's achievement in 2011. Hassene Dridi / AP
The ongoing protests against austerity in Tunisia highlight the precariousness of the country's achievement in 2011. Hassene Dridi / AP
The ongoing protests against austerity in Tunisia highlight the precariousness of the country's achievement in 2011. Hassene Dridi / AP

Ben Ali anniversary offers a moment for Tunisians to reflect


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Sunday was the seventh anniversary of the fall of Zine Abedine Ben Ali, the former president of Tunisia, from power. Tunisians welcomed the abrupt departure of a man who had ruled their nation for more than two decades as an historic milestone, the culmination of the Jasmine Revolution that had drawn millions of people from the across the country in protest against an unresponsive regime.

Seven years on, Tunisia, a functioning democracy, is in many respects a sterling success story in a neighbourhood where similar mass protests rapidly degenerated into senseless bloodshed. But the ongoing protests against austerity in Tunisia highlight the precariousness of that achievement. As The National's Gareth Browne reported from the ground in Tunis, the capital, on Sunday, a day earmarked to commemorate the triumph of ordinary people against their former ruler became an occasion for the airing of their deep dissatisfaction with the current government.

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What transpired on Sunday was not, Mr Browne wrote, "a demonstration of national unity for which the government might have hoped". A short distance from the official celebrations, people gathered to demand the "fall of the budget" – a slogan reminiscent of the cry for the "fall of the regime" that echoed across the country in 2011. The anger on the streets is the product of the severe austerity measures contained in the government's 2018 budget. As of January 1, the cost of food staples and essential utilities has rocketed, while wages have remained frozen and the subsidies on which so many Tunisians depended to make ends meet have been slashed. The government has responded to the rising anger by announcing a $70 million aid package for the neediest Tunisian families. It has also announced further reforms in the form of free medical care for all Tunisians and social housing for the poor.

These quick fixes seem unlikely, however, to satisfy the protesters, who would like the government to restore the old subsidies rather than apply fresh gloss on austerity. As one protester told The National, the government is "trying to buy us off, and not even for a good price". Of course, the government did not adopt the new financial measures to punish the people, but in the week that Tunisia remembers the revolution that toppled Mr Ben Ali, now might be a good time to listen to them.

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Friday, Sept 26 – UAE won by 36 runs
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Thursday, Oct 2 – Fourth ODI
Sunday, Oct 5 – First T20I
Monday, Oct 6 – Second T20I

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How tumultuous protests grew
  • A fuel tax protest by French drivers appealed to wider anti-government sentiment
  • Unlike previous French demonstrations there was no trade union or organised movement involved 
  • Demonstrators responded to online petitions and flooded squares to block traffic
  • At its height there were almost 300,000 on the streets in support
  • Named after the high visibility jackets that drivers must keep in cars 
  • Clashes soon turned violent as thousands fought with police at cordons
  • An estimated two dozen people lost eyes and many others were admitted to hospital 
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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.”

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Benedict Wells
Translated from the German by Charlotte Collins
Sceptre

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