A man holds up an information pamphlet about new Austrian restrictions that ban the wearing of burkas and other face coverings in public places and buildings, in Vienna on September 29, 2017. Joe Klamar / AFP
A man holds up an information pamphlet about new Austrian restrictions that ban the wearing of burkas and other face coverings in public places and buildings, in Vienna on September 29, 2017. Joe KlamShow more

'Burka Ban' law signals rightward political turn in Austria



A law prohibiting any kind of full-face covering takes effect on Sunday in Austria, where strong support for the ban signals potential political upheaval in the upcoming national election.

Parties campaigning on an anti-migrant message are poised to win on October 15 and to form a coalition government. Such a rightward swing in a country that's had centrist governments almost consistently since World War Two could have repercussions across Europe, emboldening politicians who take a hard line on Islam and immigration.

Last week, the right-wing, anti-migrant Alternative for Germany party won seats in Germany's national parliament for the first time after featuring posters with the slogan "Burkas? We prefer bikinis" in its campaign.

The Austrian law — officially called "Prohibition for the Covering of the Face" but better known as the "Burka Ban" — forbids off-slope ski masks, surgical masks outside hospitals and party masks in public. Violations carry a possible fine of 150 euros (Dh651) and police are authorised to use force with people who resist showing their faces.

But its popular name reflects the most prevalent association. Burkas are rare in Austria but support for the law is strong nonetheless, reflecting anti-Muslim attitudes in the predominantly Catholic country.

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"It's not right that those living here don't show their faces," said Emma Schwaiger, who expressed support for the ban on the streets of Vienna.

Five in seven of those who said they backed the law also said they will vote for the two parties that critics link to anti-Muslim sentiment — the traditionally xenophobic Freedom Party and the People's Party. The People's Party avoids the Freedom Party's inflammatory talk, but has swung radically from the centre under new leader, Sebastian Kurz, to echo that party's positions on migration.

The Social Democratic Party, currently the majority partner in the government coalition with the People's Party, has been left struggling.

Under chancellor Christian Kern, the Social Democrats are focusing on social topics and claiming credit for Austria's recent economic upturn. But Mr Kern's message is not coming across well.

A Unique Research poll of 1,500 respondents published on Thursday showed the Social Democrats with 27 per cent support, ahead of the Freedom Party at 25 per cent but trailing the People's Party with 34 per cent. The poll had a margin of error of 2.5 percentage points.

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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.

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“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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