Pierre Krahenbuhl, director general of the United Nations Relief and Works Agency since 2014, has been suspended. Ravindranath K / The National
Pierre Krahenbuhl, director general of the United Nations Relief and Works Agency since 2014, has been suspended. Ravindranath K / The National
Pierre Krahenbuhl, director general of the United Nations Relief and Works Agency since 2014, has been suspended. Ravindranath K / The National
Pierre Krahenbuhl, director general of the United Nations Relief and Works Agency since 2014, has been suspended. Ravindranath K / The National

UN suspends head of Palestinian refugees agency


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The head of the UN agency for Palestinian refugees was suspended on Wednesday after the initial investigation into alleged misconduct by him and others identified evidence of management failings.

Pierre Krahenbuhl, director general of the United Nations Relief and Works Agency since 2014, is to be replaced by his deputy, Christian Saunders, on an interim basis, officials said.

The decision was taken by UN Secretary General Antonio Guterres.

“Mr Saunders will lead the implementation of a management plan to strengthen the agency, particularly in the areas of oversight and accountability,” said a statement from Mr Guterres's office in New York.

Mr Krahenbuhl, a Swiss national, is among senior managers subject to a report by the UN Office of Intrernal Oversight Services, prompted in July after an internal ethics report raised accusations of sexual misconduct, nepotism and discrimination.

“The preliminary findings of this OIOS report exclude fraud or misappropriation of operational funds by the Commissioner-General. There are, however, managerial issues that need to be addressed,” said the statement.

It gave no details on the substance of the allegations or other individuals who are implicated.

However it said Mr Krahenbul would be placed on administrative leave while issues raised “are further clarified so that a final determination can be made, and any appropriate action can be taken”.

The probe is widely seen as having caused damage to UNRWA at a time when its operations are under financial pressure principally caused by the US deciding to end its annual support.

The Netherlands, Switzerland and Belgium, who are major donors, said soon afterwards that they were suspending or limiting their contributions pending the outcome of the investigation.

The White House, under President Donald Trump, and Israel have criticised UNRWA's methods and effectiveness, with some officials calling for its abolition, despite the political process between the Palestinian leadership and Israel being at an all-time low.

Mr Saunders was appointed as UNRWA's deputy commissioner-general on August 1 following the revelations about inappropriate conduct.

When the ethics report was leaked in late July Mr Guterres said he was “committed to acting swiftly” to address “credible and corroborated” allegations of serious ethical abuses, including some involving Mr Krahenbuhl.

Senior management engaged in “sexual misconduct, nepotism, retaliation, discrimination and other abuses of authority, for personal gain, to suppress legitimate dissent, and to otherwise achieve their personal objectives”, the report said.

UNRWA provides services to more than five million registered refugees in the West Bank, Gaza Strip and East JerusalemUN announces new deputy for Palestinian refugees agency, as well as in Jordan, Lebanon and Syria.

Mr Krahenbuhl was notified as far back as March that an investigation was under way by the UN Secretariat in New York “based on allegations received against UNRWA personnel relating to unsatisfactory conduct”, an UNRWA spokeswoman said.

Prior to heading the refugees agency Mr Krahenbuhl was director of operations at the International Committee of the Red Cross.

Wednesday's announcement drew concern from Gaza's Islamist rulers Hamas, which said it could play into upcoming debates in the UN General Assembly over renewing UNRWA's operational mandate, which comes up for avote every three years. UNRWA's current mandate expires on June 30, 2020.

Israel's Ambassador to the UN Danny Danon said that “charges related to the agency's conduct makes it clear that there is no other solution except to close it”.

More than half of the two million Palestinians in the Gaza Strip, which is under Israeli blockade, receive food aid from UNRWA.

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Education: Mr Al Bahar was born in 1979 and graduated in 2008 from the Judicial Institute. He took after his father, who was one of the first Emirati lawyers

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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.

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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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KEY DEVELOPMENTS IN MARITIME DISPUTE

2000: Israel withdraws from Lebanon after nearly 30 years without an officially demarcated border. The UN establishes the Blue Line to act as the frontier.

2007: Lebanon and Cyprus define their respective exclusive economic zones to facilitate oil and gas exploration. Israel uses this to define its EEZ with Cyprus

2011: Lebanon disputes Israeli-proposed line and submits documents to UN showing different EEZ. Cyprus offers to mediate without much progress.

2018: Lebanon signs first offshore oil and gas licencing deal with consortium of France’s Total, Italy’s Eni and Russia’s Novatek.

2018-2019: US seeks to mediate between Israel and Lebanon to prevent clashes over oil and gas resources.

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