Mario Draghi waves to photographers in Rome before his appointment was confirmed. EPA
Mario Draghi waves to photographers in Rome before his appointment was confirmed. EPA
Mario Draghi waves to photographers in Rome before his appointment was confirmed. EPA
Mario Draghi waves to photographers in Rome before his appointment was confirmed. EPA

Mario Draghi names rainbow coalition to spend Italy’s coronavirus billions


Simon Rushton
  • English
  • Arabic

Mario Draghi took charge of Italy's new government and unveiled a political rainbow with a splash of technocrats on board to tackle Italy's route out of coronavirus chaos.
So far, he has the wind in his sails -- almost all of Italy's main parties are behind him, the stock market is up, borrowing costs have fallen to record lows and his personal popularity is soaring.
Mr Draghi, 73, was previously head of the European Central Bank, where he is widely credited with saving the euro currency.
"Mario Draghi is probably the best, the best, the best man to serve as prime minister in this moment," said former prime minister Matteo Renzi.

Following a week of consultations, almost all the main parties from across the political spectrum have endorsed Mr Draghi and he has named a number of prominent figures from these various groups as ministers to cement their support.
One of the reasons so many parties have joined forces in the ruling coalition is that they all want to have a say in how Italy spends the more than 200 billion euros ($242.56bn) it is set to receive from a European Union economic recovery fund.

"When there is a problem, he studies it very carefully, he listens to a wide range of opinions, but when he makes his decision, he leaves it to others to follow up," said Alessandro Speciale, a journalist and Draghi biographer.
Mr Draghi earned a doctorate from the prestigious Massachusetts Institute of Technology (MIT) in the United States and taught economics in several Italian universities.
After spending six years at the World Bank from 1984 to 1990, he led the treasury department at the Italian Ministry of Economy and Finance for a decade, working under nine separate governments.
Luigi Di Maio, a leader of the Five Star Movement, will remain foreign minister, while Giancarlo Giorgetti, a senior figure in the Lega Nord, will be industry minister. Andrea Orlando, from the centre-left Democratic Party, will be labour minister.

Among the non-affiliated technocrats in the new line-up are Daniele Franco, director general of the Bank of Italy, who was named as economy minister, and Roberto Cingolani, a physicist and IT expert, who was handed the new role of minister for green transition.

Draghi speaks after a meeting with Italy's President Sergio Mattarella. ANSA
Draghi speaks after a meeting with Italy's President Sergio Mattarella. ANSA

The new team will be sworn in on Saturday, opening the way for debates in both houses of parliament early next week, where Mr Draghi will unveil his policy plans and face votes of confidence -- a formality, given his cross-party backing.

Mr Draghi received a boost on Thursday when the largest group in parliament, the Five Star Movement, agreed to support the government, meaning it will have such a large majority that no single party will have the numbers to bring it down.

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.”

German intelligence warnings
  • 2002: "Hezbollah supporters feared becoming a target of security services because of the effects of [9/11] ... discussions on Hezbollah policy moved from mosques into smaller circles in private homes." Supporters in Germany: 800
  • 2013: "Financial and logistical support from Germany for Hezbollah in Lebanon supports the armed struggle against Israel ... Hezbollah supporters in Germany hold back from actions that would gain publicity." Supporters in Germany: 950
  • 2023: "It must be reckoned with that Hezbollah will continue to plan terrorist actions outside the Middle East against Israel or Israeli interests." Supporters in Germany: 1,250 

Source: Federal Office for the Protection of the Constitution

UAE players with central contracts

Rohan Mustafa, Ashfaq Ahmed, Chirag Suri, Rameez Shahzad, Shaiman Anwar, Adnan Mufti, Mohammed Usman, Ghulam Shabbir, Ahmed Raza, Qadeer Ahmed, Amir Hayat, Mohammed Naveed and Imran Haider.

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%3Cp%3E%3Cstrong%3EDirectors%3A%3C%2Fstrong%3E%20Amit%20Joshi%20and%20Aradhana%20Sah%3C%2Fp%3E%0A%3Cp%3E%3Cstrong%3ECast%3A%3C%2Fstrong%3E%20Shahid%20Kapoor%2C%20Kriti%20Sanon%2C%20Dharmendra%2C%20Dimple%20Kapadia%2C%20Rakesh%20Bedi%3C%2Fp%3E%0A%3Cp%3E%3Cstrong%3ERating%3A%3C%2Fstrong%3E%204%2F5%3C%2Fp%3E%0A
The specs: 2018 Mazda CX-5

Price, base / as tested: Dh89,000 / Dh130,000
Engine: 2.5-litre four-cylinder
Power: 188hp @ 6,000rpm
Torque: 251Nm @ 4,000rpm
Transmission: Six-speed automatic
​​​​​​​Fuel consumption, combined: 7.1L / 100km