US Congressional committee passes bill to boost military support for Ukraine

The US Senate Foreign Relations Committee unanimously voted on Wednesday to authorise up to $300 million of annual military aid to Ukraine, including lethal assistance, as Washington looks to ratchet up pressure on Russia.

The committee passed the Ukraine Security Partnership Act sponsored by a bipartisan group of senators including Democrat Bob Menendez and Republican Jim Risch.

The bill authorises up to $300m per year of foreign military financing to Ukraine, subject to certifications, including the authority to provide it with lethal military assistance and $4m per year to train its military officers.

Mr Menendez said he spoke with Ukrainian Foreign Minister Dmytro Kuleba before the vote. The two discussed "the massive Russian troop build-up along the eastern border and aggression in the Black Sea and Sea of Azov".

The bill requires a report on US diplomatic support for Ukraine over the next five years, and another from the Department of Defence and State Department on the capability and capacity requirements of Ukraine's armed forces, as well as a plan to supply US security assistance to Ukraine.

It also calls to rapidly send excess hardware to Ukraine, and to encourage partner nations to do the same.

Since 2014 when Russia annexed Crimea, the US has provided more than $1.5 billion in security aid. Last month, the Pentagon announced $125m in aid for Ukraine.

The bill now is on its way to the Senate floor for a full vote.

President Joe Biden's administration recently rolled out sanctions against Russia for its military threat to Ukraine and annexation of Crimea. In the last month, Moscow has amassed more than 100,000 troops along Ukraine's border, according to EU estimates, increasing fears of a possible incursion into the Donetsk and Luhansk regions of Ukraine.

On Wednesday, Politico reported the White House is weighing requests from the Ukrainian government to send it heavier weaponry, including the possible deployment of Patriot missiles as a means to deter Russia.

The Senate Foreign Relations Committee also moved forward on Wednesday the nomination of Victoria Nuland for the position of undersecretary of state for political affairs.

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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US Congressional committee passes bill to boost military support for Ukraine

Bill passed by Senate Foreign Relations Committee authorises up to $300m in annual military aid to Ukraine

The specs: Audi e-tron