Obama's comments underscore the diplomatic challenges ahead



An "appalled" and "outraged" Barack Obama "needed to say those words" about the violent crackdown on protesters in Iran, Mark Rozell wrote in an e-mail. The public policy professor at George Mason University in Virginia added that critics of the US president "will applaud that he spoke in such clear terms in his opening statement [of a Tuesday night press conference] and in response to a question from an Iranian citizen". "The United States and the international community have been appalled and outraged by the threats, the beatings and imprisonments of the last few days," Mr Obama said. "I strongly condemn these unjust actions, and I join with the American people in mourning each and every innocent life that is lost." Prof Rozell, and others who follow Washington politics for a living, also pointed out how Mr Obama's comments will play out in the days ahead: "The vocal Obama critics who want some direct US action will not be satisfied by a mere strong statement in a press conference." Mike Brown, dean of George Washington University's Elliott School of International Affairs, wrote: "Some critics are just trying to score political points; some genuinely believe that a stronger stance is needed; some are motivated by all of the above." The Republicans were quick to hold a press conference and go on the Sunday TV news denouncing Mr Obama's measured tone in the immediate aftermath of the Iranian presidential election June 12. They called for stronger actions, but they did not outline what the president should specifically do.

"I find the conservative criticisms of Obama's approach to be incredibly wrong-headed. Given the US's past actions in Iran, from the coup in 1953 to supporting Saddam in the war that devastated that country," Prof Rozell wrote. "Can anyone seriously believe that a strong US action now would be seen as motivated by wanting to help the interests of Iranians?" Prof Brown said he believes that what Mr Obama said in his Tuesday afternoon press conference, that "this is not about the United States or the West; this is about the people of Iran, and the future that they - and only they - will choose" - is the reality that must not be ignored. "I wish the US had more influence over the situation in Iran, but we are where we are," he said. "I think President Obama is handling Iran right. The Iranian leadership will claim that the United States is meddling and that the reformers are US agents, no matter what Obama says, but it doesn't help to play into the regime's hands. Some Republicans are using this to score domestic points, but it isn't helping them domestically and it isn't helping the Iranians. "I recall that the first President Bush urged the Shiites in Iraq to rise up against Saddam in 1991, and then he let Saddam crush them. It's irresponsible to urge people to take to the streets and put them in greater danger if you're not able to help them, and the reality is that the US can't do much in Iran. The president has to walk a fine line, and I think he has done so."

Larry Sabato, director of the Center for Politics at the University of Virginia and author of the book The Year of Obama, said: "Hot air from [Washington] DC isn't going to solve anything on the streets of Iran, and could actually make things worse." But he mentioned that at first there was some "validity to the criticism, in that Obama has seemed almost too tentative, maybe a little too uncertain ? Obama is caught in a vice grip on Iran. The right wing wants Obama to give a Reagan-like 'tear down this wall' speech, but of course it would boomerang and give the hardliners a victory and revive the traditional rallying cry of 'Death to America'. "At the same time, it is in the nation's interests to support the Iranian reformers, and he's trying to do so gently. Every day he has to recalibrate. Is he being too easy? Too tough? And this is also a story about the limits of America's power. We are not going to determine who wins the power struggle in Iran, and we have to leave ourselves room to influence the winner by not permanently alienating anyone except the hopeless hardliners ? But on the whole, I don't see how Obama could be doing anything much different."

Said Prof Rozell: "I just cannot fathom what Obama's critics think he should do. Cut off contacts? Economic sanctions? Send in the military? Any direct action would be seen as yet more American meddling and would play right into the hands of the current Iranian leadership. It would backfire hugely." Not all academics agree. Dale Herspring, a distinguished professor of political science at Kansas State University and author of Rumsfeld's Wars: The Arrogance of Power, said: "The biggest problem facing Obama is credibility. He has played up his Chicago background - his charismatic personality will win over these bad guys ... somehow hoping that his low-key response on Iran will win the mullahs over when it comes to negotiations. I don't think either will work, and if they don't he will look like a very naive liberal whose policies go nowhere."

rpretorius@thenational.ae

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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