NEW YORK // The search for a diplomatic solution to the conflict in Libya appeared stalled yesterday as coalition powers seeking to enforce the UN-sanctioned no-fly zone considered the case for arming insurgent forces fighting Col Muammar Qaddafi's better-equipped troops.
The UN Security Council, which authorised military action against the regime, was scheduled to debate the crisis again late last night after hearing a first-hand report from its special envoy to Libya, Abdelilah al Khatib.
Mr al Khatib spoke to rival leaders in Tripoli and rebel-held Benghazi against a background of scepticism that air strikes alone would force Col Qaddafi out of office. There was also concern about the rising human cost of the conflict.
Britain said yesterday that it would send telecommunications equipment to insurgents to help them withstand attacks by government forces. William Hague, the British foreign secretary, described the supplies as "non-lethal equipment which will help with the protection of civilian lives and the delivery of humanitarian aid".
Any plan to arm the rebels, who have struggled to counter Col Qaddafi's military muscle, would probably run into further opposition from Russia and China, which abstained in the first vote on the resolution.
Earlier, Libya's former colonial ruler, Italy, became the latest country to give formal diplomatic support to the rebels, announcing that it was following the lead of France and Qatar in recognising the national transitional council as Libya's only legitimate governing body.
The Italian foreign minister, Franco Frattini, dismissed attempts by the Qaddafi regime to open diplomatic channels in talks between Abdul-Ati al Obeidi, Libya's deputy foreign minister, and political leaders in Greece, Turkey and Malta.
Mr Frattini said after meeting the rebel council's foreign envoy, Ali al Essawi, that the only way to resolve the conflict was for Col Qaddafi to stand down and leave the country.
That message is thought to have been underlined in a telephone conversation between the British prime minister, David Cameron, and his Greek counterpart, George Papandreou.
The Italian minister's comments also ruled out any prospect of success for reported attempts by two or more of Col Qaddafi's sons to broker a negotiated settlement that would leave them in charge.
"Any solution for the future of Libya has a precondition: that Qaddafi's regime leaves ... that Qaddafi himself and the family leave the country," Mr Frattini said.
Mr al Obeida's statement, made on the Greek leg of his mission, that the regime was seeking an agreement with Britain, France and the US was "not credible" because it failed to deal with that precondition, he added.
The New York Times had reported that Saif al Islam Qaddafi and his brother Saadi could act as interim leaders if their father stepped aside. Rebel leaders were quoted yesterday as rejecting the suggestion outright.
As the UN prepared to receive its envoy's report, coinciding with yesterday's expiry of the extended deadline for US involvement in the air strikes, coalition states were pondering how the insurgents could be helped in trying to gain an upper hand against regime forces.
The UN resolution permitted "all necessary measures" to protect Libya's civilian population, but ruled out any occupation.
From the outset, some military analysts have argued that the wording of the resolution gave something approaching total flexibility to nations opposed to the regime's suppression of the rebels. But the coalition is under no illusion about the diplomatic risks of any widening of the military operation's aims and means.
While unanimous in imposing an arms embargo and sanctions, the 15-nation Security Council passed the resolution endorsing military intervention with five abstentions. Russia and China, each possessing the right to veto, have openly criticised the alliance of western and Arab nations behind the action against the Qaddafi regime.
As loyalist forces have repelled the rebel advance, the US, Britain and France have suggested arming the rebels, an ill-equipped mix of protesters and renegade soldiers who lack the experience, command structure and military hardware of Col Qaddafi's forces.
The US secretary of state, Hillary Clinton, has said there "could be a legitimate transfer of arms" into Libya - despite a UN embargo that prohibits moving weapons into the North African oil producer - if such a move would ultimately save civilian lives.
The US has reportedly sent in small CIA units to contact rebel leaders, but arming insurgents remains a divisive topic within the council and has been rejected by Portugal's UN ambassador, Jose Filipe Moraes Cabral, who chairs the Libyan sanctions committee.
Nestor Osorio, the UN ambassador for Colombia, which holds the Security Council's rotating presidency this month, said there were "different interpretations" of whether the arms embargo prohibited arming Libya's rebels and that the debate had yet to play out in the Manhattan-based chamber.
A senior UN diplomat said arming rebels needed a "clear legal basis" and warned against "embarking on a tricky route" of sending weapons without first having a "thorough sense" of the political forces that shape the insurgency. Analysts refer back to US support for rebels fighting Russian forces in Afghanistan who later formed al Qa'eda.
Reports from areas where rival forces are fighting for control of Libyan cities are mixed, but it is clear Qaddafi forces have made ground in key locations.
Government troops have besieged the city of Misurata, witnesses to the fighting reporting widespread death and injury caused by days of shelling from tanks and artillery.
One doctor said Qaddafi troops were in control of the port and a major street, while rebels held the centre of the city.
The humanitarian crisis continues to grow as residents clamour to leave the city. A Turkish ship picked up about 250 wounded people under the protection of Turkish warplanes was forced to leave hurriedly when thousands pressed forward on the dock.
Libya denies targeting civilians in the city and says it has attacked only "armed gangs" it claims are linked to al Qa'eda.
* Additional reporting by Reuters and the Associated Press.
Groom and Two Brides
Director: Elie Semaan
Starring: Abdullah Boushehri, Laila Abdallah, Lulwa Almulla
Rating: 3/5
Ten tax points to be aware of in 2026
1. Domestic VAT refund amendments: request your refund within five years
If a business does not apply for the refund on time, they lose their credit.
2. E-invoicing in the UAE
Businesses should continue preparing for the implementation of e-invoicing in the UAE, with 2026 a preparation and transition period ahead of phased mandatory adoption.
3. More tax audits
Tax authorities are increasingly using data already available across multiple filings to identify audit risks.
4. More beneficial VAT and excise tax penalty regime
Tax disputes are expected to become more frequent and more structured, with clearer administrative objection and appeal processes. The UAE has adopted a new penalty regime for VAT and excise disputes, which now mirrors the penalty regime for corporate tax.
5. Greater emphasis on statutory audit
There is a greater need for the accuracy of financial statements. The International Financial Reporting Standards standards need to be strictly adhered to and, as a result, the quality of the audits will need to increase.
6. Further transfer pricing enforcement
Transfer pricing enforcement, which refers to the practice of establishing prices for internal transactions between related entities, is expected to broaden in scope. The UAE will shortly open the possibility to negotiate advance pricing agreements, or essentially rulings for transfer pricing purposes.
7. Limited time periods for audits
Recent amendments also introduce a default five-year limitation period for tax audits and assessments, subject to specific statutory exceptions. While the standard audit and assessment period is five years, this may be extended to up to 15 years in cases involving fraud or tax evasion.
8. Pillar 2 implementation
Many multinational groups will begin to feel the practical effect of the Domestic Minimum Top-Up Tax (DMTT), the UAE's implementation of the OECD’s global minimum tax under Pillar 2. While the rules apply for financial years starting on or after January 1, 2025, it is 2026 that marks the transition to an operational phase.
9. Reduced compliance obligations for imported goods and services
Businesses that apply the reverse-charge mechanism for VAT purposes in the UAE may benefit from reduced compliance obligations.
10. Substance and CbC reporting focus
Tax authorities are expected to continue strengthening the enforcement of economic substance and Country-by-Country (CbC) reporting frameworks. In the UAE, these regimes are increasingly being used as risk-assessment tools, providing tax authorities with a comprehensive view of multinational groups’ global footprints and enabling them to assess whether profits are aligned with real economic activity.
Contributed by Thomas Vanhee and Hend Rashwan, Aurifer
LIVING IN...
This article is part of a guide on where to live in the UAE. Our reporters will profile some of the country’s most desirable districts, provide an estimate of rental prices and introduce you to some of the residents who call each area home.
New schools in Dubai
Libya's Gold
UN Panel of Experts found regime secretly sold a fifth of the country's gold reserves.
The panel’s 2017 report followed a trail to West Africa where large sums of cash and gold were hidden by Abdullah Al Senussi, Qaddafi’s former intelligence chief, in 2011.
Cases filled with cash that was said to amount to $560m in 100 dollar notes, that was kept by a group of Libyans in Ouagadougou, Burkina Faso.
A second stash was said to have been held in Accra, Ghana, inside boxes at the local offices of an international human rights organisation based in France.
ONCE UPON A TIME IN GAZA
Starring: Nader Abd Alhay, Majd Eid, Ramzi Maqdisi
Directors: Tarzan and Arab Nasser
Rating: 4.5/5
Cherry
Directed by: Joe and Anthony Russo
Starring: Tom Holland, Ciara Bravo
1/5
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Power: 390bhp
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Company profile
Name: Back to Games and Boardgame Space
Started: Back to Games (2015); Boardgame Space (Mark Azzam became co-founder in 2017)
Founder: Back to Games (Mr Azzam); Boardgame Space (Mr Azzam and Feras Al Bastaki)
Based: Dubai and Abu Dhabi
Industry: Back to Games (retail); Boardgame Space (wholesale and distribution)
Funding: Back to Games: self-funded by Mr Azzam with Dh1.3 million; Mr Azzam invested Dh250,000 in Boardgame Space
Growth: Back to Games: from 300 products in 2015 to 7,000 in 2019; Boardgame Space: from 34 games in 2017 to 3,500 in 2019
The specs
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The Florida Project
Director: Sean Baker
Starring: Bria Vinaite, Brooklynn Prince, Willem Dafoe
Four stars
Dubai works towards better air quality by 2021
Dubai is on a mission to record good air quality for 90 per cent of the year – up from 86 per cent annually today – by 2021.
The municipality plans to have seven mobile air-monitoring stations by 2020 to capture more accurate data in hourly and daily trends of pollution.
These will be on the Palm Jumeirah, Al Qusais, Muhaisnah, Rashidiyah, Al Wasl, Al Quoz and Dubai Investment Park.
“It will allow real-time responding for emergency cases,” said Khaldoon Al Daraji, first environment safety officer at the municipality.
“We’re in a good position except for the cases that are out of our hands, such as sandstorms.
“Sandstorms are our main concern because the UAE is just a receiver.
“The hotspots are Iran, Saudi Arabia and southern Iraq, but we’re working hard with the region to reduce the cycle of sandstorm generation.”
Mr Al Daraji said monitoring as it stood covered 47 per cent of Dubai.
There are 12 fixed stations in the emirate, but Dubai also receives information from monitors belonging to other entities.
“There are 25 stations in total,” Mr Al Daraji said.
“We added new technology and equipment used for the first time for the detection of heavy metals.
“A hundred parameters can be detected but we want to expand it to make sure that the data captured can allow a baseline study in some areas to ensure they are well positioned.”
The Vile
Starring: Bdoor Mohammad, Jasem Alkharraz, Iman Tarik, Sarah Taibah
Director: Majid Al Ansari
Rating: 4/5
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.”