SANAA // With the Al Qaeda black flag raised on its mountain peaks, Azzan is the newest emirate Islamic militants control in southern Yemen. Al Qaeda in the Arabian Peninsula (AQAP) said in a statement issued last week that Azzan would join Zinjibar, Abyan province, as an emirate of their Islamic state.
The police station in Azzan has been turned into the regional headquarters of Ansar Al Sharia, which is affiliated with Al Qaeda, to coordinate attacks and expansion opportunities, said Abdullah Baotha, who escaped Azzab last fall, and current residents, who spoke on condition of anonymity.
Residents are forced to comply with Sharia. Most music is forbidden in public areas, with only Islamic songs with voices and drums given as an alternative.
Shop owners are told to grow their beards the length of a fist. Women are not allowed to work and those who need to leave their homes must be covered in a burqa at all times. Curriculum in schools focuses mainly on Islamic law and Quranic preaching.
"Televisions or magazines are not allowed. We know nothing of what happens around us," said Mr Baotha. "People are scared but cannot express their fear." He said hundreds of residents succeeded in leaving the district, but thousands remain.
Security forces have been replaced with veiled militants who are stationed at checkpoints throughout the district. The militants roam the streets and occupy every building that used to house a government institution.
Foreign fighters see Azzan as a safe haven. Anwar Al Awlaqi, the Yemeni-American cleric killed in a US drone attack in September, made the district a hideout for three months last year. Residents said at least 200 foreign fighters live in the district and train Yemeni militants. Fighters from Saudi Arabia and Somalia can frequently be seen roaming the area.
Located in the heart of southern Yemen, Azzan is near the oil and gas pipelines of Bahlaf, the country's most lucrative investment.
Its mountainous terrain makes it hard for government forces to attack from the ground.
"We understand that residents of Azzan are suffering, and the government has them among its top priorities. We have not forgotten them," said Ali Obaid, the spokesperson of the Yemen Military Committee.
The closest government military presence is in Ataq, the capital of Shabwa, where hundreds of security forces are stationed.
"Al Qaeda has been using Azzan as a stronghold for nearly a year now. They are in control of everything, and residents there are given the choice to obey orders or leave the district," said a senior security official in Ataq, speaking on condition of anonymity.
"Azzan is the launch pad for their attacks. It's their strategic homeland."
President Abdurabu Hadi has vowed to eliminate Al Qaeda in Yemen.
"Fighting Al Qaeda is a priority for the government. Attacks will continue against terror hideouts until they are uprooted," he said on Thursday.
Experts on Al Qaeda question how the militant group took over Azaan without a fight last year. "No one heard of a bullet being used after the militants took over Azzan. One day it was part of Yemen and the next day it was an emirate of Al Qaeda," said Abdul Salam Mohammed, the director of the Sanaa-based Abaad Strategic Center. "Don't expect Azzan to be the last Al Qaeda emirate in Yemen. Many other towns will follow," he said.
foreign.desk@thenational.ae
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Day 2, stumps
Pakistan 482
Australia 30/0 (13 ov)
Australia trail by 452 runs with 10 wickets remaining in the innings
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.”