A letter from two members of the US House of Representatives is urging the Biden administration to take action on Tigray. Getty
A letter from two members of the US House of Representatives is urging the Biden administration to take action on Tigray. Getty
A letter from two members of the US House of Representatives is urging the Biden administration to take action on Tigray. Getty
A letter from two members of the US House of Representatives is urging the Biden administration to take action on Tigray. Getty

Congressional committee calls for sanctions against Ethiopia if Tigray crisis continues


Joyce Karam
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  • Arabic

Congress increased pressure on the Biden administration over the humanitarian situation in the Tigray region of Ethiopia this week, urging it to move more forcefully and impose sanctions on the involved parties, including Addis Ababa.

A letter from Gregory Meeks, Democratic chairman of the House foreign affairs committee, and Republican member Michael McCaul was sent on Tuesday to US Secretary of State Antony Blinken and Secretary of Treasury Janet Yellen.

The two called for sanctions to be imposed on those fuelling the fighting in Tigray.

Fighting since November between Ethiopian troops and the Tigray People's Liberation Front has killed more than 50,000 and displaced hundreds of thousands, Ethiopia's three opposition parties say.

The UN estimated on Tuesday that 2.2 million people are in need of humanitarian assistance, while human rights organisations have reported atrocities including rape and extrajudicial killings.

Last week, Ethiopia's Prime Minister Abiy Ahmed admitted to the presence of Eritrean troops in Tigray fighting on the side of his government and committed to withdraw them from the region. This has yet to happen.

Congress is urging the Biden administration to do more to end the fighting.

“We condemn in the strongest possible terms reported atrocities and gross violations of human rights committed against civilians, including rape, torture, forced displacements and disappearances, acts of ethnic cleansing, extrajudicial killings, the looting and destruction of medical facilities and restricted access to aid,” Mr Meeks and Mr McCaul wrote.

“We urge the administration to utilise all available tools, including Global Magnitsky authorities and other targeted sanctions, to hold parties accountable for their actions and bring an end to this crisis."

Sanctions can be used to punish human rights abuses under the Magnitsky Rule of Law Accountability Act passed by Congress in 2012.

The letter implicates all sides in the abuses and says “additional targeted accountability measures cannot wait”.

It also threatens problems for the future of relations between the US and Ethiopia if the situation did not improve.

“While we remain committed to the important bilateral relationship between the United States and Ethiopia, this conflict jeopardises shared political, economic and security priorities,” Mr Meeks and Mr McCaul wrote.

In February, the Biden administration unlinked a suspension of $272 million in aid to Ethiopia for the Nile dam crisis and tied it instead to current "developments", including the Tigray conflict.

Speaking to Congress in March, Mr Blinken described the situation in Tigray as “ethnic cleansing”.

On Tuesday he made reference to sexual assaults and continued killings in the region.

“The report we’re releasing today shows that the trend lines on human rights continue to move in the wrong direction," Mr Blinken said at the launch of the State Department's annual human rights report.

"We see it in the killings, sexual assaults and other atrocities credibly reported in Ethiopia’s Tigray region."

Cameron Hudson, a senior fellow with the Atlantic Council’s Africa Centre, said Washington was following a gradual approach in increasing pressure on Ethiopia.

“We [the US] have already suspended our development assistance and our security assistance," Mr Hudson said.

"Those moves seem to have very little impact in changing [Addis Ababa's] approach to the conflict in Tigray. The next level of pressure is clearly going to be direct punitive measures."

The letter is an indication of possible sanctions by the departments of State and Treasury.

“This likely will translate into sanctions unless Washington starts to see greater movement on the key issues it is asking for changes on, namely the withdrawal of Eritrean and Amhara [ethnic group] forces, the launch of the international human rights investigation, unhindered humanitarian access and some sort of domestic political dialogue,” Mr Hudson said.

He saw the possibility of the US Treasury delaying or denying third-party aid to Ethiopia.

“The Treasury does two big things that affect US policy on Ethiopia," Mr Hudson said.

"It administers US sanctions and it controls the US vote at the World Bank and International Monetary Fund.

"The US has leverage in denying or delaying Ethiopia multilateral financing and assistance and not just bilateral assistance.”

In its report on Tuesday, the UN Office for the Co-ordination of Humanitarian Affairs said about “1.3 million children need protective services and safe education­ in Tigray and neighbouring areas”.

The UN agency expressed concern over reports of rape and other breaches of human rights in the Tigray region.

“There are more than 500 self-reported rape cases so far,” it said.

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UAE currency: the story behind the money in your pockets

The Outsider

Stephen King, Penguin

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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