Adnan Pachachi was a member of the Abu Dhabi Executive Council for 20 years in the early days of the UAE. Mona Al Marzooqi / The National
Adnan Pachachi was a member of the Abu Dhabi Executive Council for 20 years in the early days of the UAE. Mona Al Marzooqi / The National

Sheikh Zayed shaped rise of modern Abu Dhabi



An Iraqi who served in the emirate’s first cabinet, Adnan Pachachi recalls the Founding President’s approach to local governance and unity in the Gulf.

ABU DHABI // Adnan Pachachi experienced first hand the founding and growth of the Abu Dhabi Government.

A former diplomat and foreign minister in Iraq, he first arrived in Abu Dhabi in May 1969 as part of a tour of the Arabian Gulf that Sheikh Sabah Al Ahmad Al Sabah, the current emir of Kuwait, had suggested he undertake.

Sheikh Sabah and Mr Pachachi first met when they served as their respective countries’ foreign ministers.

Now 93, Mr Pachachi can clearly recall his first meeting with Sheikh Zayed in Qasr Al Hosn. “He was very interested in explaining to me the efforts being made to establish a union among the nine Arabian Gulf states, the two additional ones were Qatar and Bahrain,” Mr Pachachi said.

At the time Dr Wahid Raafat, an Egyptian legal scholar, was asked to draw the constitution.

“Sheikh Zayed was interested in setting up a new system of government in Abu Dhabi,” Mr Pachachi said. “He wanted to move from the traditional tribal system to a modern system in which the responsibilities of government are clearly defined”.

Mr Pachachi was also asked to assist in that process. So a group of them “sat down and proposed a new law, it was called the law for government reorganisation for the Abu Dhabi emirate”, he said.

They decided that the Ruler would have ultimate authority but there would be a council of ministers to advise him. This would be under the chairmanship of the crown prince at the time, Sheikh Khalifa.

The council was renamed the Abu Dhabi Executive Council ­after the founding of the UAE “to avoid confusion”.

Mr Pachachi later became a minister of state and was a member of the Abu Dhabi Executive Council for 20 years.

“This was the first Abu Dhabi government,” he said, pointing to a photo of himself with council members on July 1, 1971.

“As you can see I was the only non-Abu Dhabian in the government, which was a great privilege and honour.”

Despite his years of political experience, Mr Pachachi said he learnt a lot about governance from Sheikh Zayed. “He advised me rather than I advised him. He is the one who thought about these things,” he said. “For him the individual is the main objective of the reforms. He wanted to make sure that every individual in this country should have a good life and all the necessary services, like education and health.

“Besides making the individual the main theme of his reforms, he opened the country to all other religions besides Islam, so there is a kind of religious tolerance in this country, which is quite noticeable.”

He believes the third main principle that Sheikh Zayed based the state on was “the maintenance of peace and security for all those who are living in this country and I think he succeeded quite remarkably”.

Introducing taxes was never on the agenda because the revenue from oil was more than enough to pay for all these services and to build the infrastructure.

“And there was always a surplus, and that is why we had the Abu Dhabi Investment Authority (Adia). It invests the surplus from the oil revenues ... so there will not be an exclusive dependence on oil,” said Mr Pachachi, who was on the executive boards of Adia, the Abu Dhabi National Oil Company and the Abu Dhabi Fund for Development.

“I think we succeeded more than all other oil-producing countries. We were able to withstand the economic crisis better than all other countries because we had a good solid basis.”

In the early days of the Government, the UAE was gaining recognition for its efforts to gain regional support for the union of the nine Arabian Gulf states.

“There were some problems and difficulties and Sheikh Zayed wanted to get as much Arab support as he could for this union,” Mr Pachachi said. “He asked me to go to Cairo to meet the president, Anwar Sadat, at that time in 1971, and he [Sadat] said he would support [the union].”

Mr Pachachi said that although some countries felt “it would be wiser to postpone the union until the outstanding frontier differences were settled – the frontiers were not clearly defined – we said ‘no, the people of these states are eager to have a union and we can’t wait too long’.”

He also described how Sheikh Zayed transformed Bedouin life in the UAE. The Bedouin led nomadic lives in the country during summer and winter, but Sheikh Zayed built proper houses for them and provided them with medical care, mosques and schools. “So the Bedouin life, which was the majority, came to an end,” said Mr Pachachi.

He also recalls a humorous moment with Sheikh Zayed.

“We went to visit him and he started laughing, and asked us: ‘Do you know why I am laughing? A Bedouin came to me with a cheque worth 1 million dirhams and asked me ‘what is this million? I don’t know what it is’.”

_____

Read more:

From handshakes to a new state: How Sheikh Zayed built a nation

Former FNC member tells of Sheikh Zayed's generosity even before the UAE was formed

Sheikh Mohammed marks Abu Dhabi government's 50th anniversary

Graphic: How Abu Dhabi has developed, 50 years since its government was formed

hdajani@thenational.ae

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When to go: Florida is best experienced during the winter months, from November to May, before the humidity kicks in.

How to get there: Emirates currently flies from Dubai to Orlando five times a week.
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Install an air filter in your home.

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Shower or bath after being outside.

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Based: Dubai, UAE
 
Sector: Entertainment 
 
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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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Remaining fixtures
  • August 29 – UAE v Saudi Arabia, Hazza bin Zayed Stadium, Al Ain
  • September 5 – Iraq v UAE, Amman, Jordan (venue TBC)