Ambassadors to the UN vote during a United Nations Security Council meeting on North Korea in New York City, U.S., September 11, 2017. Stephanie Keith / REUTERS
Ambassadors to the UN vote during a United Nations Security Council meeting on North Korea in New York City, U.S., September 11, 2017. Stephanie Keith / REUTERS

Reform takes centre stage at the UN as it faces up to its failings



The United Nations is no stranger to political challenges or attempts at reform. And this week, at the 72nd Session of the UN General Assembly, there will be a dose of both. The international organisation is facing continued difficulties in imposing international law, with repeated violations of its Security Council resolutions from countries like North Korea and Israel. Accountability is in short supply. Weeks after a UN body officially announced Syria's government used chemical weapons against its own people, the Al Assad regime will be able to attend the international meeting and claim "victory" over extremists. Challenges, financial and political, from the new US administration, in addition to unresolved crises in Yemen, Libya, Myanmar and beyond continue.

And yet, the UN recognises these failings, especially with Antonio Guterres, its new secretary general, making reform one of his primary goals. Unlike previous years, reform is not a side note. Rather, it is centre stage.

The Monday before the kick off of the general debate has always been a key moment to focus world leaders on the most pressing issue perceived by the UN. This year that moment is dedicated to a high level meeting on UN reform. Issues such as strengthening the UN secretariat, revitalising the General Assembly and expanding the Security Council will be looked at, in addition to reminding members that the UN is ultimately the result of what its membership allows it to be.

This year’s General Assembly is titled "focusing on people – striving for peace and a decent life for all on a sustainable planet". The sustainable development goals, agreed two years ago as a target for a better life for all, are meant to be the vehicle to deliver on this promise. However, without a mechanism to hold those who fail their people or foster conflict it is impossible to envision success.

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The United Nations was born at the end of the Second World War, as the United States emerged as the leading global power. As such, it is only natural that Washington DC has much influence on the UN. In addition to being the largest sole contributor to the UN’s budget.

This year's meeting will be one of many firsts. The first for Mr Guterres but also a first for Donald Trump, the US president. The Trump administration has made it clear that it wants to limit the role of the UN in various areas. It has adopted an official policy to reduce American funding to the UN across the board, from peacekeeping missions to the United Nations Population Fund, in addition to a number of policies to signal disengagement, including reducing the level of participation in the General Assembly.

Mr Trump has highlighted three pillars of his policy towards the UN. In previewing Mr Trump's participation in the General Assembly, H R McMaster, US national security adviser, explained that the American administration believes in the role of the United Nations to promote peace and stability around the world, but that role would require UN reform and protecting the rights of individual states. He explained that "the president's consistent message across all of his engagements throughout the week will emphasise three goals common to all nations who will be gathered there: first, to promote peace. Second, to promote prosperity. And third, to uphold sovereignty and accountability". In what concerns peace and prosperity, this is the stated goal of the UN and its member states. However, issues of sovereignty and accountability are often what lead to controversy. And while Mr Trump has been very critical of the UN, the White House has confirmed that the meeting on reform will be a chance to improve its state.

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The tension between sovereignty and accountability is not new. While nation states in our modern era rest on sovereign rights, the whole principle of accountability and adhering to international law requires strengthening the United Nations and diversifying its ability to impose law. It is under the guise of sovereignty that Myanmar’s leaders can encourage the burning entire villages to the ground and displacement of hundreds of thousands. In a statement last week, Mr Guterres said "the government of Myanmar until now has been completely deaf to our requests". And so the challenge to the UN, and its member states, is how to have the right mechanism to act quickly when the stakes are so high as to displace hundreds of thousands of civilians over a matter of a few days?

Over the last three years, ISIL was deemed the ultimate challenge to sovereignty and international accountability. Rejecting internationally recognised borders, publicly killing civilians and threatening the international order, ISIL was the epitome of what happens with failed governance.

An international coalition has been able to push ISIL back in Syria and Iraq. And yet at this year's General Assembly, there won't be celebrations of stability or peace after ISIL. The UN meetings are set to begin just days after the latest round of Astana talks that are determining the fate of Syria without Syrian presence. Sovereignty at its very weakest. And as UN week unfolds, Iraq faces the unknown outcome of a unilateral decision by the Kurdistan Regional Government to hold a referendum that calls for the dismemberment of one of the founding members of the United Nations. How the UN deals with these challenges will be the ultimate test of whether high level meetings on reform hold any value.

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Install an air filter in your home.

Close your windows and turn on the AC.

Shower or bath after being outside.

Wear a face mask.

Stay indoors when conditions are particularly poor.

If driving, turn your engine off when stationary.

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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