A view of the Capitol among different buildings in the historic centre of Havana, Cuba, in December. EPA
A view of the Capitol among different buildings in the historic centre of Havana, Cuba, in December. EPA
A view of the Capitol among different buildings in the historic centre of Havana, Cuba, in December. EPA
A view of the Capitol among different buildings in the historic centre of Havana, Cuba, in December. EPA

Trump returns Cuba to US list of state sponsors of terrorism


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The Trump administration on Monday said it was returning Cuba to the US list of state sponsors of terrorism, complicating any efforts by the Biden administration to revive the Obama-era detente with Havana.

Nine days before President Donald Trump leaves office, Secretary of State Mike Pompeo said Cuba was being blacklisted for "repeatedly providing support for acts of international terrorism", by harbouring US fugitives and Colombian rebel leaders.

Mr Pompeo said communist-ruled Cuba's security support for Venezuelan President Nicolas Maduro was another reason for the listing.

He said Cuba allowed the socialist leader to maintain his grip on power and create "a permissive environment for international terrorists to live and thrive within Venezuela".

"With this action, we will once again hold Cuba’s government accountable and send a clear message: the Castro regime must end its support for international terrorism and subversion of US justice," Mr Pompeo said.

Returning Cuba to the list is a further weakening of the detente that Democratic former president Barack Obama orchestrated between the old Cold War foes.

Mr Obama's decision to formally remove Cuba from the terrorism list in 2015 was an important step toward restoring diplomatic ties that year.

The terrorism list decision followed months of legal review, with some administration experts questioning whether it was justified, a source said.

It would require more long legal deliberations for president-elect Joe Biden to reverse the designation.

Mr Trump has clamped down on Cuba since coming to power in 2017, tightening restrictions on US travel and remittances, and imposing sanctions on shipments of Venezuelan oil to the island.

His hard-line Cuba policy was popular among the large Cuban-American population in South Florida, helping him win the state in November although he lost the election to Mr Biden, who was Mr Obama's vice president.

Mr Biden said during the election campaign that he would promptly reverse Mr Trump's policies on Cuba, which “have inflicted harm on the Cuban people and done nothing to advance democracy and human rights".

But Mr Trump's move could make it more difficult for Mr Biden to resume rapprochement when he takes office. Syria, Iran and North Korea are other countries on the list.

"I denounce Secretary of State Pompeo's manoeuvres to include Cuba in the list of states sponsoring terrorism to please the anti-Cuban minority in Florida," Cuban Foreign Minister Bruno Rodriguez tweeted on December 30.

Mr Trump has kept up a steady stream of 11th-hour sanctions, announcements and other action against targets including Cuba, Venezuela and Iran.

Mr Biden's aides have said some appear designed to tie the president-elect's hands when he is sworn in on January 20.

"We’ve taken note of these last-minute manoeuvres," one official said. "The transition team is reviewing each one."

Patrick Leahy, a Democratic senator and a staunch supporter of Mr Obama's rapprochement with Cuba, condemned Mr Pompeo for a "blatantly politicised designation".

"Domestic terrorism in the United States poses a far greater threat to Americans."

The relisting of Cuba has heavy symbolic meaning for Havana, which was under the US designation for decades, although it is unclear how much practical impact there will be.

It carries a ban on US economic aid and arms exports, controls on "dual-use" items with military and civilian applications, and a requirement that the US oppose loans to Cuba by international financial institutions such as the International Monetary Fund and the World Bank.

But many of those restrictions are already in place or have been tightened by Mr Trump, and the decades-old US economic embargo can only be lifted by Congress.

In Monday's announcement, Mr Pompeo singled out, among others, the case of Joanne Chesimard, the most prominent US fugitive in Cuba.

Chesimard fled there after escaping a New Jersey prison following her conviction for killing a New Jersey state trooper in 1973. She changed her name to Assata Shakur.

Mr Pompeo also condemned Cuba's refusal of Colombia's request to extradite leaders of the National Liberation Army rebel group after it claimed responsibility for an attack at a Bogota police academy in January 2019, which killed 22 people.

The leaders of the largest active guerrilla group in Colombia travelled to Havana as part of peace talks that collapsed after the attack.

Cuba has received broad praise in the past for hosting the successful peace talks between the Colombian government and the former Revolutionary Armed Forces of Colombia (Farc) rebels.

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HIV on the rise in the region

A 2019 United Nations special analysis on Aids reveals 37 per cent of new HIV infections in the Mena region are from people injecting drugs.

New HIV infections have also risen by 29 per cent in western Europe and Asia, and by 7 per cent in Latin America, but declined elsewhere.

Egypt has shown the highest increase in recorded cases of HIV since 2010, up by 196 per cent.

Access to HIV testing, treatment and care in the region is well below the global average.  

Few statistics have been published on the number of cases in the UAE, although a UNAIDS report said 1.5 per cent of the prison population has the virus.

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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