UNITED NATIONS // A UN drive to drastically reduce global poverty by 2015 is foundering, with high food and oil prices fuelling an economic downturn that could leave key targets unmet, a new report warns.
In advance of this month's world leaders summit, Ban Ki-moon, the UN secretary general, called for an "aggressive push" to get the so-called Millennium Development Goals back on track. Sheikh Abdallah bin Zayed, the UAE's foreign minister, will join George W Bush and his French counterpart, Nicolas Sarkozy, when nearly 100 heads of state and government converge on New York for the annual UN General Assembly.
Launching a midway report on MDG progress last week, Mr Ban asked world leaders to make firm pledges at the summit, which begins on Sept 25.
"We must really galvanise political will and mobilise necessary resources, and I count on the leadership of developed countries," Mr Ban said. "I expect all participants to announce specific initiatives or commitments and lay out plans for them.
"By the close of the meeting, we hope to be in a very different place from where we are today."
In Sept 2000, the UAE and 188 other countries endorsed the Millennium Declaration, aiming to halve the number of people living on less than Dh3.67a day, reverse the spread of HIV/Aids and deliver universal primary education among a set of eight goals.
The upcoming meeting will be the first high-level summit on the goals since that declaration, and feature philanthropists, celebrities and businessmen, including Bill Gates, Bono and Ratan Naval Tata, the chairman of India's Tata Group.
A 52-page document made public on Thursday, the Millennium Development Goals Report 2008 said the number of people living in extreme poverty fell to 1.4 billion from 1.8 billion between 1990 and 2005, and that the global poverty rate of 1990 is likely to be halved by 2015.
Most of the decline, however, has taken place in China and other parts of eastern Asia, while the number of poor in sub-Saharan Africa and the former Soviet Union increased between 1990 and 2005.
The prevailing high food prices are likely to reverse some of the gains that have already been made, pushing many across south Asia and sub-Saharan Africa into poverty, researchers said.
Featuring new data from the World Bank, the report also warns that progress across the Arabian peninsula, the Levant and Egypt has been slow. The proportion of people living below the revised poverty line of $1.25 a day in this region increased during the 1990s and then only marginally decreased between 1999 and 2005.
Although the region has benefited from improved access to clean water and lower infant mortality rates, 28 per cent of school-age children remain deprived of primary education.
The situation for women remains poor, the report adds. Expectant mothers receive poor hospital care during childbirth and "remain trapped in insecure, low-paid positions, with only 20 per cent of wage employees outside agriculture being women".
The UN has already warned that traditional donors, including the United States, Japan and some European Union members, have reneged on aid pledges, creating a funding gap of more than $30bn.
Mr Ban urged rich countries to deliver on promises and donate the target figure of 0.7 per cent of Gross National Income, even while they combat myriad financial woes, including oil and food price hikes.
"I appreciate and understand the economic difficulties in many developed countries, let alone many poor countries, so there may be some political resistance in locating 0.7 per cent of GNI by 2015. But this requires some political leadership and some political prioritising," Mr Ban said.
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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.”
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Price, base: Dh201,153
Engine: 2.0-litre turbocharged four-cylinder
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Fuel economy, combined: 6.7L / 100km
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Roger Federer's 2018 record
Australian Open Champion
Rotterdam Champion
Indian Wells Runner-up
Miami Second round
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Halle Runner-up
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Fuel economy, combined 16.8L / 100km
Tour de France
When: July 7-29
UAE Team Emirates:
Dan Martin, Alexander Kristoff, Darwin Atapuma, Marco Marcato, Kristijan Durasek, Oliviero Troia, Roberto Ferrari and Rory Sutherland
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The Vile
Starring: Bdoor Mohammad, Jasem Alkharraz, Iman Tarik, Sarah Taibah
Director: Majid Al Ansari
Rating: 4/5
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Groom and Two Brides
Director: Elie Semaan
Starring: Abdullah Boushehri, Laila Abdallah, Lulwa Almulla
Rating: 3/5
The biog
Marital status: Separated with two young daughters
Education: Master's degree from American Univeristy of Cairo
Favourite book: That Is How They Defeat Despair by Salwa Aladian
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