A demonstration of Tehran's clout in the region


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WASHINGTON // While opinion in the United States is divided over the exact significance of the visit to Lebanon of Iran's president, its importance is not in dispute. In public, US officials play down the event, characterising it as a sovereign Lebanese issue. But the US, which yesterday urged its citizens in Lebanon to remain vigilant during the high-profile visit of Mahmoud Ahmadinejad, will be watching.

The official view in Washington is that Iran is a destabilising factor in the Middle East in general, and in Lebanon in particular, especially in view of Iran's strong ties with Hizbollah. The Lebanese Shiite group is part of Lebanon's coalition government, but the United States defines it as a terrorist organisation. Curtailing Iran's nuclear ambitions, meanwhile, remains a top US policy objective.

A state visit to Lebanon of an Iranian president therefore constitutes a "public demonstration" of the Islamic republic's influence in the region, said Robert Kaplan, a senior fellow with the Center for a New American Security, a Washington-based think tank on US national security and defence issues. "That he can travel there and be received as a head of government is a ceremonial demonstration of Iranian influence in Lebanon and how the whole political order there has to acknowledge the geopolitical weight of Iran in the region."

That the United States was unable to prevent the visit, according to Mr Kaplan, is also a sign of continued weakness in US sway in Lebanon. "The US is not powerless to counter Iran's influence in the region. But one thing it can't do is micro-manage Lebanese internal politics." The general assumption is that Iran's influence in the Middle East is negative, pervasive and growing. "We've said many times that Iran's policies in the region increase tension and violence and are antithetical to peace," a State Department official said last week.

But some observers say Iran's regional role has been exaggerated and Hizbollah misunderstood. "Iran becomes important when the US makes mistakes in the region," said Mark Perry, an independent military analyst based in the US capital. He pointed to what he called a long line of such mistakes by the administration under George W Bush as one reason for the perceived growth of Tehran's influence. "Our incompetence undercuts us. But when we are competent, Iran doesn't get that much traction."

US opinions about Iran have to a large degree been shaped in recent years by Mr Ahmadinejad himself, whose public statements are often received by US pundits and the public alike as provocative. Reports indicate that Mr Ahmadinejad may have added to that perception by announcing that during his Lebanon visit he would go to Lebanon's border with Israel and throw stones across, something Mr Kaplan, who characterised Mr Ahmadinejad as "less crazy than many Americans think", dismissed as a public relations stunt.

"Trying to humiliate the US with provocative statements is not helpful," said Mr Perry. He suggested that Mr Ahmadinejad had been built into a bogeyman in the US by people opposed to the Palestinian-Israeli peace process and said US officials also needed to be wary of "inflammatory language. "The US is having difficulties in the region. We need to lower the temperature."

COMPANY%20PROFILE
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The specs
 
Engine: 3.0-litre six-cylinder turbo
Power: 398hp from 5,250rpm
Torque: 580Nm at 1,900-4,800rpm
Transmission: Eight-speed auto
Fuel economy, combined: 6.5L/100km
On sale: December
Price: From Dh330,000 (estimate)
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Timeline

2012-2015

The company offers payments/bribes to win key contracts in the Middle East

May 2017

The UK SFO officially opens investigation into Petrofac’s use of agents, corruption, and potential bribery to secure contracts

September 2021

Petrofac pleads guilty to seven counts of failing to prevent bribery under the UK Bribery Act

October 2021

Court fines Petrofac £77 million for bribery. Former executive receives a two-year suspended sentence 

December 2024

Petrofac enters into comprehensive restructuring to strengthen the financial position of the group

May 2025

The High Court of England and Wales approves the company’s restructuring plan

July 2025

The Court of Appeal issues a judgment challenging parts of the restructuring plan

August 2025

Petrofac issues a business update to execute the restructuring and confirms it will appeal the Court of Appeal decision

October 2025

Petrofac loses a major TenneT offshore wind contract worth €13 billion. Holding company files for administration in the UK. Petrofac delisted from the London Stock Exchange

November 2025

180 Petrofac employees laid off in the UAE

Jetour T1 specs

Engine: 2-litre turbocharged

Power: 254hp

Torque: 390Nm

Price: From Dh126,000

Available: Now

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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.”

The biog

Date of birth: 27 May, 1995

Place of birth: Dubai, UAE

Status: Single

School: Al Ittihad private school in Al Mamzar

University: University of Sharjah

Degree: Renewable and Sustainable Energy

Hobby: I enjoy travelling a lot, not just for fun, but I like to cross things off my bucket list and the map and do something there like a 'green project'.

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