An Emirati man kisses the picture of Sheikh Zayed bin Sultan al-Nahayan during the Sheikh's funeral in Abu Dhabi 03 November 2004. Nahayan, the president and founding father of the United Arab Emirates, died 02 November 2004 after more than 30 years at the helm of his oil-rich country. AFP PHOTO/RABIH MOGHRABI / AFP PHOTO / RABIH MOGHRABI
An Emirati man mourns Sheikh Zayed during the UAE Founding Father's funeral in Abu Dhabi on November 3 2004. Rabih Moghrabi / AFP

Editorial

Zayed Humanitarian Day embodies the principles of Founding Father

Words and deeds on anniversary symbolise Sheikh Zayed's values

National Editorial

03 June, 2018

On the anniversary of his death in the middle of Ramadan, Sheikh Zayed's legacy is as tangible as ever. Today, on the 19th day of the holy month, it is a time to reflect on and commemorate his extraordinary impact and the values he imbued in the foundation of the UAE, among them the importance of giving and supporting the community. Those founding principles are embodied in Zayed Day for Humanitarian Action, named after him and carrying special resonance as it falls in the Year of Zayed, the centennial anniversary of his birth. Today is a time for a nation built on tolerance to reaffirm its commitment to the values the Founding Father spent his life espousing. When he inaugurated Zayed Day for Humanitarian Action six years ago, Sheikh Mohammed bin Rashid, Vice President, Prime Minister and Ruler of Dubai, said it was a celebration of "Sheikh Zayed's spirit of philanthropy" and "the Emirati culture of giving".

For half a decade, the UAE has been the world's largest aid donor relative to national income. That altruism is especially visible during Ramadan, whether it is through individual acts of kindness, such as donors feeding hundreds of workers through the Ramadan Sharing Fridges initiative, or in the gestures of UAE billionaires who sign away half their wealth to good causes. Sheikh Zayed's legacy lives on in each of these good deeds, both large and small. He treasured equality, treating everyone as a "special soul" and welcoming residents and visitors from across the globe.These timeless principles are woven into the fabric of the UAE today.

Born into hardship in the punishing desert heat, Sheikh Zayed’s early years were characterised by scarcity – yet he went on to build a nation. In 1971 the UAE was born and with it the miraculous story of almost 47 years. Despite its astonishing economic and demographic growth, the country’s leaders have never lost sight of the values that brought it into existence. In a region sundered by violence and conflict, that enduring message of solidarity is a rare one. Above all, Sheikh Zayed bred loyalty so it is little surprise that when he died, there was a national outpouring of grief and emotion. As the nation continues to mourn his death, we can also take comfort from the fortitude of his message, even more relevant now than when it was little more than an aspiration.

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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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