BEIRUT // Syria’s regime and rebels are likely to ratchet up military pressure on the ground after the failure of peace talks, setting the scene for a grim escalation of fighting, analysts say.
Barely a day after a second round of peace talks in Geneva broke down on Saturday, the rebel Free Syrian Army fired its military chief Selim Idriss, citing “the paralysis within the military command these past months”.
A source inside the Syrian opposition said that Mr Idriss — who was appointed to the role in December 2012 — had faced criticism for failings on the battlefield.
The timing of Mr Idriss’s replacement by another senior military commander is significant, with analysts predicting that the most likely outcome of the peace talks stalemate will be a renewed focus by both sides on military operations.
“I fear that the failure of the Geneva talks will lead to military escalation — it will probably get worse before it gets better,” said Volker Perthes, director of the German Institute for International and Security Affairs.
“Both sides will try to show that they can change the balance on the ground in their favour, and that they aren’t forced to negotiate out of weakness.”
Aron Lund, editor of the Carnegie Endowment’s Syria in Crisis website, echoed that position.
“Neither side seems to believe in a negotiated solution at the moment,” he said.
“Even if they want one in the longer run, they’ll both want to improve their positions first. So, more war.”
Even during the talks, there was little let-up in military operations by both sides that are estimated to have killed more than 140,000 people since the conflict began in March 2011.
Throughout the first round of discussions, held in January in Switzerland, the regime unleashed a fierce aerial assault involving the use of explosive-packed barrel bombs in the northern city of Aleppo.
And during the latest round, it began an operation to capture Yabrud, the last remaining rebel stronghold in the Qalamun region of Damascus province.
The town lies on a strategic motorway linking Damascus and the country’s third city Homs.
It is also near the border with Lebanon, and the offensive — including multiple air strikes — has already pushed hundreds of residents across the border into the Lebanese town of Arsal.
Mr Lund said scepticism about the value of negotiations could also extend to foreign nations backing the Syrian rebels, who pushed the opposition to attend.
He said rebel forces aligned with the foreign-based political opposition could now be “rewarded” with new military supplies.
“Even those states that ultimately believe in renewed talks might want to show that torpedoing the UN’s negotiations will carry a cost for Assad,” he said.
Karim Emile Bitar, a senior fellow at the Institute for International and Strategic Relations, said an upcoming visit by US President Barack Obama to Saudi Arabia “might prove decisive”.
Like Washington, Saudi Arabia backs the opposition, and has reportedly stepped up its supplies of advanced weapons to rebel forces despite US hesitation.
“Either the Saudis successfully pitch him (Obama) on another sustained military effort towards regime change in Syria, or Obama convinces the Saudis to rein in the rebels,” he said.
* AFP
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West Asia rugby, season 2017/18 - Roll of Honour
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UAE Premiership - Winners: Dubai Exiles; Runners up: Abu Dhabi Harlequins
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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