UK Prime Minister Rishi Sunak on Thursday trumpeted a new accord with Japan to deepen Britain's economic and defence ties with the host of this year's G7 summit.
Amid growing concerns about China, Mr Sunak has promised to send a naval battle fleet to the Indo-Pacific region in 2025 and to double UK troop numbers in coming joint exercises.
Before attending the G7 summit in Hiroshima, he will also agree to a partnership with Japan on semiconductors to reduce reliance on Beijing for supply of microchips.
Mr Sunak is hosting a business reception for companies such as Nissan and Toshiba with Japanese investors committing almost £18 billion ($22.4 billion) of investment, the UK government said.
Toshiba is expected to expand its operations at a laboratory in Cambridge, England, while Sumitomo Electric Industries is planning to make high-voltage electric cable in the Scottish Highlands.
Mr Sunak touted the investments as a "massive vote of confidence in the UK’s dynamic economy, from some of Japan’s top firms".
The so-called Hiroshima Accord was negotiated before a meeting between Mr Sunak and Japanese Prime Minister Fumio Kishida ahead of the meeting of world leaders.
The business reception was taking place in the Roppongi Hills of Tokyo.
Mr Sunak will share talks with world leaders including Joe Biden during the summit, which is expected to focus on economic security and support for Ukraine.
He will not hold personal bilateral talks with Mr Biden, but will with Mr Kishida, French President Emmanuel Macron and Indian Prime Minister Narendra Modi.
Mr Sunak will be joined by his wife Akshata Murty, who will join the G7’s “partners’ programme” on her first official foreign visit since they entered No 10 Downing Street.
Rishi Sunak through the years - in pictures
Under the agreement with Japan, Mr Sunak is committing to sending the Navy’s carrier Strike Group to the Indo-Pacific.
Including an aircraft carrier and fighter jets, the fleet will work with the Japanese military and other allies to defend peace and stability in the region.
A fourth UK-Japan “vigilant isles” military exercise taking place in Japan this year is being billed as the biggest yet and will include about 170 UK service personnel.
The UK and Japan are also expected to commit to consulting each other on key regional and global security issues and to consider measures in response.
The aim of the semiconductors partnership is to make use of British expertise and Japanese materials to bolster supplies.
A new cyber partnership will be announced, as will plans to accelerate the use of clean energy.
On the plane to Tokyo, Mr Sunak told reporters one of his priorities for the summit was ensuring “we as G7 allies, are aligned in our approach to protecting ourselves against the risks and challenges that China poses”.
Rishi Sunak greets world leaders ahead of King Charles III coronation - video
“It is a privilege to be visiting Tokyo and Hiroshima at this historic moment in the United Kingdom’s relationship with Japan," he said in a statement.
“Prime Minister Kishida and I are closely aligned on the importance of protecting peace and security in the Indo-Pacific and defending our values, including free and fair trade.
“The Hiroshima Accord will see us step up co-operation between our armed forces, grow our economies together and develop our world-leading science and technology expertise.
“It marks an exciting next phase in the UK and Japan’s flourishing partnership.”
The trip takes place as Mr Sunak struggles with Tory infighting heightened by the party’s large-scale losses in local elections.
At the G7 summit starting on Friday, Mr Sunak will discuss shoring up support for Ukraine and holding Russia to account for its actions among his priorities.
He will reflect on the “sombre reminder of the human cost of all-out war” while visiting Hiroshima, where he will plant a tree to remember victims of the atomic bomb in 1945.
“The visit is a crucial opportunity to build our relationship with Japan, already one of the UK’s strongest and most important partners," Mr Sunak’s official spokesman said.
“The summit is an opportunity for the G7 to demonstrate unified resolve and action in the face of threats from autocratic states – threats to global prosperity, security and sovereignty.”
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Company profile
Name: Tratok Portal
Founded: 2017
Based: UAE
Sector: Travel & tourism
Size: 36 employees
Funding: Privately funded
In the Restaurant: Society in Four Courses
Christoph Ribbat
Translated by Jamie Searle Romanelli
Pushkin Press
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Who's who in Yemen conflict
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
Intercontinental Cup
Namibia v UAE Saturday Sep 16-Tuesday Sep 19
Table 1 Ireland, 89 points; 2 Afghanistan, 81; 3 Netherlands, 52; 4 Papua New Guinea, 40; 5 Hong Kong, 39; 6 Scotland, 37; 7 UAE, 27; 8 Namibia, 27
The major Hashd factions linked to Iran:
Badr Organisation: Seen as the most militarily capable faction in the Hashd. Iraqi Shiite exiles opposed to Saddam Hussein set up the group in Tehran in the early 1980s as the Badr Corps under the supervision of the Iran Revolutionary Guards Corps (IRGC). The militia exalts Iran’s Supreme Leader Ali Khamenei but intermittently cooperated with the US military.
Saraya Al Salam (Peace Brigade): Comprised of former members of the officially defunct Mahdi Army, a militia that was commanded by Iraqi cleric Moqtada Al Sadr and fought US and Iraqi government and other forces between 2004 and 2008. As part of a political overhaul aimed as casting Mr Al Sadr as a more nationalist and less sectarian figure, the cleric formed Saraya Al Salam in 2014. The group’s relations with Iran has been volatile.
Kataeb Hezbollah: The group, which is fighting on behalf of the Bashar Al Assad government in Syria, traces its origins to attacks on US forces in Iraq in 2004 and adopts a tough stance against Washington, calling the United States “the enemy of humanity”.
Asaeb Ahl Al Haq: An offshoot of the Mahdi Army active in Syria. Asaeb Ahl Al Haq’s leader Qais al Khazali was a student of Mr Al Moqtada’s late father Mohammed Sadeq Al Sadr, a prominent Shiite cleric who was killed during Saddam Hussein’s rule.
Harakat Hezbollah Al Nujaba: Formed in 2013 to fight alongside Mr Al Assad’s loyalists in Syria before joining the Hashd. The group is seen as among the most ideological and sectarian-driven Hashd militias in Syria and is the major recruiter of foreign fighters to Syria.
Saraya Al Khorasani: The ICRG formed Saraya Al Khorasani in the mid-1990s and the group is seen as the most ideologically attached to Iran among Tehran’s satellites in Iraq.
(Source: The Wilson Centre, the International Centre for the Study of Radicalisation)
Dubai Bling season three
Cast: Loujain Adada, Zeina Khoury, Farhana Bodi, Ebraheem Al Samadi, Mona Kattan, and couples Safa & Fahad Siddiqui and DJ Bliss & Danya Mohammed
Rating: 1/5
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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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What sanctions would be reimposed?
Under ‘snapback’, measures imposed on Iran by the UN Security Council in six resolutions would be restored, including:
- An arms embargo
- A ban on uranium enrichment and reprocessing
- A ban on launches and other activities with ballistic missiles capable of delivering nuclear weapons, as well as ballistic missile technology transfer and technical assistance
- A targeted global asset freeze and travel ban on Iranian individuals and entities
- Authorisation for countries to inspect Iran Air Cargo and Islamic Republic of Iran Shipping Lines cargoes for banned goods