Canada will honour a non-binding motion in the House of Commons and halt all future military exports to Israel.
The decision comes after a back-and-forth parliamentary session that stretched into the late hours of Monday night, with the Liberal government making several amendments to a motion led by the New Democratic Party that called for tougher action on the Israel-Gaza war.
The original motion called for Canada to "suspend all trade in military goods and technology with Israel and increase efforts to stop the illegal trade of arms, including to Hamas".
After several hours of back-channel debate, the motion was watered down to “cease the further authorisation and transfer of arms exports to Israel to ensure compliance with Canada’s arms export regime and increase efforts to stop the illegal trade of arms, including to Hamas".
Canada has not sent lethal aid to Israel since the war started after October 7, a senior government source told The National.
On that date, Hamas militants stormed southern Israel and killed about 1,200 people, kidnapping another 240.
"The situation in Gaza is evolving so rapidly that it has impacted our ability to assess the permits to Israel and so, because of that, we have not approved any export permits since January 8," the source said.
While the source would not disclose exactly what kind of equipment Canada supplied to Israel, they said it tended to be telecommunications equipment and defensive equipment such as body armour and night-vision goggles.
Kelsey Gallagher, a researcher at Project Ploughshares, an organisation that focuses on peace and disarmament, said that Canada sent about $21 million worth of equipment to Israel in 2022.
"The vast majority of what Canada exports to Israel is not what we would refer to as full systems but instead parts and components," Mr Gallagher told The National.
"So these are the pieces of equipment that comprise full systems. And when we say full systems, we are thinking of things like tanks or military aircraft."
Canada's decision to adhere to the motion was rebuked by Israel.
"It's regrettable that the Canadian government is taking a step that undermines Israel's right to self-defence against Hamas terrorists, who have committed terrible crimes against humanity and against innocent Israeli civilians, including the elderly, women and children," Israel's Minister of Foreign Affairs, Israel Katz said on X.
"History will judge Canada's current action harshly."
Parliament passed the non-binding motion 204-117, as it gained widespread support among Liberals, New Democrats and members of the Bloc Quebecois.
The motion more broadly focused on calling for efforts towards a two-state solution in Palestine and Israel.
Countries globally have expressed worries as Israel's war of retaliation to the deadly Hamas attack in October has resulted in more than 31,800 deaths, according to the Gaza Health Ministry.
Mr Trudeau also "shared his concern around Israel's planned offensive in the southern Gaza city of Rafah and the severe humanitarian implications for all civilians taking refuge in the area", his office said on Monday.
The senior source said the government would now have to review the motion more carefully and to see how it pertains to permits passed before January 8.
UAE currency: the story behind the money in your pockets
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.”
The Laughing Apple
Yusuf/Cat Stevens
(Verve Decca Crossover)
