David Hale speaks at the Pakistan Stock Exchange in Karachi, Pakistan, July 26, 2016. Reuters
David Hale speaks at the Pakistan Stock Exchange in Karachi, Pakistan, July 26, 2016. Reuters
David Hale speaks at the Pakistan Stock Exchange in Karachi, Pakistan, July 26, 2016. Reuters
David Hale speaks at the Pakistan Stock Exchange in Karachi, Pakistan, July 26, 2016. Reuters

Under secretary of state nominee adds diplomatic heft, Middle East expertise


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A decade ago Hezbollah shot down a Lebanese army helicopter provided by an American-run programme supervised by nominee to be undersecretary of state for political affairs David Hale.

Seven years later in 2015 Hezbollah’s ranking parliamentarian Nawaf Mousaoui threatened Mr Hale, then ambassador to Lebanon, following his criticism of the Iran-backed organisation. “The days of our enemies are numbered,” said Mr Mousaoui. Unfazed, Mr Hale continued with his Beirut mission before moving to Islamabad later that year.

Then, on Tuesday, the White House announced that President Donald Trump had nominated the ambassador to Pakistan to be under secretary of state for political affairs.

Those who know him refer to Mr Hale, 57, as a “diplomats' diplomat”.

One Middle East politician who worked with the nominee described him as patient, strategic, capable of navigating hostile territory and thinking outside the box.

His past experience speaks to decades of knowledge of issues and players in the Middle East. Mr Hale served as an ambassador to Jordan and Lebanon, as Special Envoy and Deputy Special Envoy for Middle East Peace, and former Executive Assistant to the Secretary of State from 1997 and 1998.

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Read more:

The split dynamic between the White House and State Department means Trump's tough talk on Iran could be hot air

Pakistan summons US ambassador after Trump's 'lies and deceit' tweet

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His nomination as number three at the State Department to replace Thomas Shannon should be credited to Mr Pompeo who picked him for the position, argued Danielle Pletka, the vice-president for foreign and defense policy studies at the American Enterprise Institute.

"Kudos to Mike Pompeo for getting this done" Ms Pletka told The National.

With more than two decades in US diplomacy, she called Mr Hale “a seasoned, serious foreign service officer (FSO). And it’s right to have an FSO at the top of the Department,” she said. “The foreign service is our diplomatic corps. Their voice should be clear at the top of the organisation.”

The other candidate for the job whose name was floated in May was Paula Dobriansky, a former political appointee during the George W Bush years.

Firas Maksad, the director of the Arabia Foundation, met Mr Hale when he was nominated ambassador to Lebanon in 2013. He calls him “a respected career diplomat who knows the complexities of the middle east and is not an ideologue.”

The new nominee was also a “decision taker not a decision maker as ambassador” said Mr Maksad. In that capacity Mr Hale implemented different policies for different US administrations through out the Bill Clinton, George W Bush and Barack Obama years.

Mr Hale’s nomination, which requires confirmation by the Senate foreign relations committee, brings back diplomatic gravitas to the position.

The post was previously held by Mr Shannon, William Burns and Wendy Sherman, whose role was critical during in negotiations with Iran, the six party talks with North Korea, and handling the US-Russia relations.

It is unclear who will replace Mr Hale as ambassador to Pakistan, but the Senate is expected to move quickly on his nomination in the coming weeks.

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2. Filippo Ganna (ITA) Ineos Grenadiers, at 7s

3. Tom Dumoulin (NED) Jumbo-Visma, at 14s

4. Tadej Pogacar (SLO) UAE-Team Emirates, at 18s

5. Joao Almeida (POR) UAE-Team Emirates, at 22s

6. Mikkel Bjerg (DEN) UAE-Team Emirates, at 24s

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Houthis: Iran-backed rebels who occupy Sanaa and run unrecognised government

Yemeni government: Exiled government in Aden led by eight-member Presidential Leadership Council

Southern Transitional Council: Faction in Yemeni government that seeks autonomy for the south

Habrish 'rebels': Tribal-backed forces feuding with STC over control of oil in government territory

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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