MANCHESTER, ENGLAND - OCTOBER 02: Prime Minister Boris Johnson delivers his keynote speech on day four of the 2019 Conservative Party Conference at Manchester Central on October 2, 2019 in Manchester, England. The U.K. government prepares to formally submit its finalised Brexit plan to the EU today. The offer replaces the Northern Irish Backstop with border, customs and regulatory checks lasting until 2025. (Photo by Jeff J Mitchell/Getty Images)
MANCHESTER, ENGLAND - OCTOBER 02: Prime Minister Boris Johnson delivers his keynote speech on day four of the 2019 Conservative Party Conference at Manchester Central on October 2, 2019 in Manchester, England. The U.K. government prepares to formally submit its finalised Brexit plan to the EU today. The offer replaces the Northern Irish Backstop with border, customs and regulatory checks lasting until 2025. (Photo by Jeff J Mitchell/Getty Images)
MANCHESTER, ENGLAND - OCTOBER 02: Prime Minister Boris Johnson delivers his keynote speech on day four of the 2019 Conservative Party Conference at Manchester Central on October 2, 2019 in Manchester, England. The U.K. government prepares to formally submit its finalised Brexit plan to the EU today. The offer replaces the Northern Irish Backstop with border, customs and regulatory checks lasting until 2025. (Photo by Jeff J Mitchell/Getty Images)
MANCHESTER, ENGLAND - OCTOBER 02: Prime Minister Boris Johnson delivers his keynote speech on day four of the 2019 Conservative Party Conference at Manchester Central on October 2, 2019 in Manchester,

Brexit deal is Boris Johnson's alternative to no-deal exit


Damien McElroy
  • English
  • Arabic

Britain's new deal for Brexit is all about Ireland.  

Boris Johnson has honed in on the trading arrangements for the Irish border contained in his predecessor's Withdrawal Agreement. Instead of a permanent tie-up for the Northern Ireland economy, he proposes making this arrangement outside a traditional customs union and renewable every four years. The catch is that the devolved government in Belfast would be the gatekeeper to a rollover and it has been dissolved since 2017.

The European reaction is shock and suspicion.

Despite weeks of talks between officials on how to surmount their differences the reaction has been a sharp intake of breath by Brussels and the Irish in particular. Briefings throughout the day sought to allay concerns and explain how the radical revision of the Withdrawal Agreement would work in practice.

Britain could still crash out of the EU without a deal on October 31 

The next days are crucial. If the EU agrees between its remaining 27 member states to engage in detailed talks on the proposal there is a chance of closing a new agreement in the next two weeks. Since Mr Johnson has repeatedly said he will not ask the EU for an extension to the current Brexit deadline, he maintains he is ready for a no-deal exit at the end of the month regardless.

His domestic opponents are preparing fresh attempts to block him.

Time is too short for a general election to usher in a new government. Anyway parliament has refused to take this option. According to a rebel bill passed last month, Mr Johnson must request an extension to the deadline if he cannot secure a deal. The prime minister's political rivals from the opposition Labour party to Conservative MPs expelled by Mr Johnson have opened talks on how to replace him with a temporary government of national unity. The idea is this could prevent a no-deal Brexit before triggering a fresh election in weeks or months.

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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​​​​​​​Scribe

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Hoopoe

Naga
%3Cp%3E%3Cstrong%3EDirector%3A%C2%A0%3C%2Fstrong%3EMeshal%20Al%20Jaser%3C%2Fp%3E%0A%3Cp%3E%3Cstrong%3EStarring%3A%C2%A0%3C%2Fstrong%3EAdwa%20Bader%2C%20Yazeed%20Almajyul%2C%20Khalid%20Bin%20Shaddad%3C%2Fp%3E%0A%3Cp%3E%3Cstrong%3ERating%3A%20%3C%2Fstrong%3E4%2F5%3C%2Fp%3E%0A