New Iraq: thieves, killers and sectarians


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The social uproar that followed the recent holdup of a government bank in Baghdad, which left seven people dead and earned the armed robbers the equivalent of $6 million, has not abated as yet, wrote Basheer M Nafei in the opinion pages of the pan-Arab daily Al Quds al Arabi. According to diverse reports, two or four of the gang members worked as bodyguards for Adel Abdul Mahdi, the Iraqi vice-president who is a prominent figure of the major Shiite Supreme Council party. The security forces later retrieved part of the stolen money from the offices of the Adala newspaper, which is affiliated with the party.

"The amazing thing is some of the thieves, a few of whom hold the rank of officer, have fled to Iran seeking apolitical cover." In a state other than Iraq, such a scandal would lead to the downfall of all the political actors involved. "But the new Iraq is not like that. The new Iraq is where millions of dollars disappear just like that, where civilians are killed on the street, where people are abducted by official or semi-official security forces, and where ruling political parties own armed militias."

Now that the Israeli prime minister Benjamin Netanyahu has declared that the "big mistake" Israel made in Gaza -the 2005 Unilateral Disengagement Plan whereby Israeli forces pulled out from Gaza and vacated the settlements - will never made in the West Bank, "what exactly are the bettors still betting on" as a way out of the Arab-Israeli conflict? asked the Emirati daily Al Khaleej in its leading article.

"If Netanyahu is not enough, take the foreign minister Avigdor Lieberman who has threatened to bomb Egypt's High Dam and who publicly pledges to evict the Palestinians of 1948." On the ground, settlement activity is ongoing and evictions of Palestinians from their homes in Jerusalem are relentless, coupled with daily acts of harassment against civilians. "All of which, had it been committed by any party other than Israel, would have prompted the UN Security Council to hold an emergency meeting, denounce the acts and approve a series of sanctions, or even perhaps mobilisie troops to wage a pre-emptive war." Mr Netanyahu and Mr Lieberman are "pouring cold water" over those who took the liberty of thinking that the efforts of a new administration in Washington will rein in Israeli violations.

In contrast to reports made by international organisations, Arab regional reports are still listing Arab economies under the same category, noted Mohammed al Assoumi in the comment section of the Abu Dhabi-based newspaper Al Ittihad.

"Listing all Arab economies as part of the same pool may have been accurate some twenty years ago, but over the last several years key changes have occurred on the economic and social structures of these countries, leading to proportional discrepancies." Thus, some Arab countries, oil-rich countries topping the list, have seen a significant improvement in living standards, a wider reliance on modern technology and a higher GDP. In the meantime, many Arab states have remained practically unchanged, not merely due to lack of natural resources but also because of bad governance. The classification standards adopted by some regional Arab organisations must be revised because their reports do not heed the key criterion of "development management", hence the simplistic divisions of "either poor or rich" Arab countries. For the sake of accuracy, the social and economic achievements of some countries that fall under the poor cluster must be given their true worth.

"The sixth Fatah convention in Bethlehem has, indeed, been Mahmoud Abbas's convention par excellence; he was unanimously reappointed leader of the movement, president of the National Palestinian Authority and head of the Palestinian Liberation Organisation," commented Hammad Mazen in the Qatari daily Al Watan.

Even the "fresh new blood" that has been injected into Fatah is not that removed from the convictions of its leader, most importantly, clinging fast to the option of negotiations with Israel.

But, at heart, the Fatah convention was no challenge to Israel. It was rather a re-confirmation of a host of conciliatory bids that are still coldly waiting on the Israeli backburner. "We could say, without reservations, that this sixth convention has put an end to the legitimacy of the revolution only to reinstate the legitimacy of the Palestinian Authority. Likewise, we could say that the convention has once again adopted the 'diplomatic method', championed by Mahmoud Abbas, despite its virtual ineffectiveness in the face of renewed Israeli ambitions."

The Palestinian Authority needs start working towards reconciliation with Hamas and toughen its stance against "outrageous Israeli proposals". * Digest compiled by Achraf A El Bahi aelbahi@thenational.ae

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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.”