Algerian President Abdelmadjid Tebboune on Sunday ordered an investigation into what the government called planned action to destabilise the country after a lack of bank liquidity, huge forest fires and power and water cuts.
Elected in December, Mr Tebboune has been trying to bring stability after mass protests last year toppled his predecessor, Abdelaziz Bouteflika, and prompted authorities to jail officials on corruption charges.
The government is keen to contain social unrest amid financial pressure caused by a sharp fall in energy earnings, the main source of state finances in the Opec member.
Citizens in the capital, Algiers, and other cities suffered cuts to power and drinking water over the past days, mainly during the Eid Al Adha holidays on Friday and Saturday.
Some banks and post offices had long queues of people seeking to get their money for Eid, causing health problems despite instructions to practise social distancing and limit the spread of the coronavirus.
At the same time, huge forest fires ravaged hundreds of hectares throughout the country, with high summer temperatures.
Prime Minister Abdelaziz Djerad said it was strange that all of those problems hit in the same month.
Mr Djerad said the water shortage was caused by sabotage at a desalination plant that supplies Algiers and neighbouring provinces.
He said the fires were deliberate and several people were caught setting them, while some electricity poles were vandalised.
"There are organised actions aimed at creating discord and instability in the country," Mr Djerad said.
On Thursday, Mr Djerad set up a monitoring unit to track forest fires and efforts to prevent and control them.
The blazes peaked late last month with 66 fires reported on July 27, and civil defence helicopters were called in to extinguish them, the forestry service said.
Algeria has repeatedly experienced forest fires in recent years, but the results of a 2019 enquiry that sought to establish causes were never released.
A study by the geography journal Mediterranee found that a lack of forests and creeping desertification were making the fires particularly disastrous.
The authorities are looking for calm after last year's mass marches demanding political reforms and better living standards.
Mr Tebboune is preparing amendments to the constitution to increase freedom and give Parliament a greater role.
The protests were banned this year to limit coronavirus infections.
Mr Tebboune has also vowed to diversify the economy away from oil and gas, create jobs and provide help for the poor.
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.”
