ISLAMABAD // Pakistan's leaders have authorised the government to complete an agreement to reopen overland Nato supply routes to Afghanistan that Pakistan closed six months ago after 24 of its soldiers were killed by accident in a Nato air strike.
Islamabad had risked being excluded from a Nato summit in Chicago this weekend if it failed to reopen the routes.
Shortly before Pakistan's Defence Committee of the Cabinet announced its decision on Tuesday night, Nato invited Asif Ali Zardari, the Pakistani president, to attend the summit. Qamar Zaman Kaira, the information minister, told a news conference yesterday that Mr Zardari would attend.
Speaking to a cabinet meeting yesterday, the prime minister Yusuf Raza Gilani said Pakistan's relations with the United States and Nato were passing through a "delicate phase" and the government had to take "critical decisions".
Pakistan is an important US ally in the war against terrorism but relations deteriorated after the US special forces raid that killed Osama bin Laden in a Pakistani town in May last year and the Pakistani soldiers' deaths in the air raid last November.
Pakistan retaliated by closing the supply routes through which Nato transports 40 per cent of its non-lethal supplies to Afghanistan.
Pakistan's parliament last month recommended that the government should seek an unconditional apology from the US for the air-strike deaths. The US has said it regrets the incident but has refused to apologise.
Mr Gilani's office said in a statement that military authorities had been asked to negotiate "fresh border ground rules" to avoid incidents such as the one in November.
The reopening of supply lines is a sensitive issue in Pakistan where anti-American sentiment runs high. But analysts said Pakistan could not afford to be excluded from international efforts to stabilise Afghanistan. Moreover, Pakistan depends on billions of dollars in US aid to keep its economy afloat.
"They made the point by closing routes for six months that there are certain red lines," said the retired general turned security analyst, Talat Masood. "But they have to show the flexibility in the larger interest of the country because they thought they would be internationally isolated if they did not open it … it's a wise decision."
However, the opposition called the move a "sell-out".
"It's a shame," Nisar Ali Khan, an aide to the former prime minister Nawaz Sharif and the opposition leader in the National Assembly, told Geo television. "They have done it for the sake of just an invitation" to the Chicago summit.
Despite the imminent opening of the supply routes, the troubles between Washington and Islamabad are far from over.
Pakistan's parliament has called for an end to US drone strikes against militants operating in Pakistan.
Pakistan also complains about slow payments from the Coalition Support Fund, which reimburses Pakistan for the use of its infrastructure in the war on terrorism.
The US, in turn, has been demanding that Pakistan acts decisively against militants.
US officials also suspect that Pakistan's main spy agency, the Inter Services Intelligence, maintains ties with militant groups in a bid to use them as a bargaining chip in the political settlement of the Afghan issue.
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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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Dubai Rugby Sevens
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Runners up: Bahrain
West Asia Premiership
Winners: Bahrain
Runners up: UAE Premiership
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UAE Division One
Winners: Abu Dhabi Saracens
Runners up: Dubai Hurricanes II
UAE Division Two
Winners: Barrelhouse
Runners up: RAK Rugby
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