US President Joe Biden's administration has imposed new sanctions on Iran, targeting its ballistic missile programme and a Revolutionary Guard unit linked to it.
The US Treasury Department on Wednesday said the sanctions were in response to a series of attacks this month by Iran and its proxies – in particular, a missile strike on Erbil in northern Iraq.
But Iran's foreign ministry said on Thursday the US sanctions are a breach of a UN resolution that enshrines a 2015 nuclear deal between Iran and world powers.
A Houthi missile attack on a Saudi Aramco depot last week and other strikes by Iranian proxies against Saudi Arabia and the UAE also informed the American decision.
The sanctions focus on Iran-based procurement agent Mohmmad Ali Hosseini and his network of companies.
The Treasury Department said these businesses “procured ballistic missile propellant-related materials for the Islamic Revolutionary Guard Corps Research and Self Sufficiency Jihad Organisation (IRGC RSSJO), the IRGC unit responsible for the research and development of ballistic missiles, as well as Iran’s Parchin Chemical Industries (PCI), an element of Iran’s Defence Industries Organisation (DIO)".
Brian Nelson, under secretary of the Treasury for Terrorism and Financial Intelligence, said Washington was committed to preventing Iran’s development and use of advanced ballistic missiles, even as it seeks to return to the 2015 nuclear deal.
“While the United States continues to seek Iran’s return to full compliance with the Joint Comprehensive Plan of Action, we will not hesitate to target those who support Iran’s ballistic missile programme," Mr Nelson said.
"We will also work with other partners in the region to hold Iran accountable for its actions, including gross violations of the sovereignty of its neighbours."
As part of its conditions to return to the nuclear deal signed in 2015, Iran has requested the removal of the Revolutionary Guard from Washington's list of foreign terrorist organisations. The US designated the force as a terrorist group in 2019.
Asked about the delisting on Sunday, US Secretary of State Antony Blinken did not give a clear answer. The IRGC, he said, “is probably the most designated organisation – in one way or another – in the world among organisations that we designate, including the foreign terrorist organisation designation".
After the attack on Saudi Arabia last week, Mr Blinken called his Saudi counterpart, Prince Faisal bin Farhan. Mr Blinken “reiterated the US commitment to bolstering Saudi Arabia’s defences against threats in the region and emphasised the importance of protecting civilians in Yemen”, the State Department said.
Iran says move is 'a sign of malice'
"This move is another sign of the US government's malice towards the Iranian people, as it continues the failed policy of maximum pressure against Iran," said foreign ministry spokesman Saeed Khatibzadeh.
UN Security Council Resolution 2231 enshrines the 2015 nuclear deal that Iran and world powers have sought to revive through negotiations in Vienna.
The talks were close to agreement in early March until Russia made last-minute demands of the US.
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.”
