The other evening I was at a dinner party where I met a former British officer who is helping to train the Lebanese army. I asked him how he rated our soldiers.
"They are absolutely super guys", he said with the typical can-do enthusiasm that Sandhurst has been instilling for generations. "Really professional and better than most people give them credit for. But it's all give and take. You guys are natural businessmen. What we can teach you about soldiering, you can teach us about business. You know it like no other nation. This, your charm and your love of life, is what makes you shine."
So why aren't we the Singapore of the Middle East, a nation run by bon viveurs with Excel sheets?
The irony is that for a country that is so dexterous with money, we actually do very little to encourage prosperity for the common good and everything to ensure that interests - political and financial - are protected … and to hell with everything else.
The current civil marriage furore is a case in point and, dare I say it, a uniquely Lebanese affair. Opposed by the religious authorities on moral grounds, the battle is really over protecting a very plump cash cow. All Lebanon's religious institutions derive much of their income from religious ceremonies - marriage, divorce, funerals, baptisms and the like. Allowing Lebanese to marry in the eyes of the state and thus be subject to a civil marriage law is a red line.
The grand mufti was so agitated that he issued a mini fatwa, accusing Muslim officials who backed civil marriage, even as an option, of apostasy. Few took him seriously but it was enough to convince the former prime minister Saad Hariri, who has been in self-imposed exile in Paris for nearly two years, to give a one-on-one interview with the Lebanese Broadcasting Corporation on the matter.
Would that he cared as much about the economy, which remains in a tailspin. Local businesses continue to fold; the top five Lebanese banks barely broke even last year, while activity on the comatose Beirut Stock Exchange in January dropped by 50 per cent year-on-year, with only a measly US$15 million (Dh55m) - what the London Stock Exchange can do in one minute - in shares traded in the whole month.
The government is also under pressure from the unions to raise the salary scale, something the central bank has warned will cause both inflation and unemployment to rise.
They said we'd never "do a Greece". Never say never.
The prognosis of our more chronic ailments is equally bleak. The energy ministry announced last week that the country would have to wait two more years before it could enjoy 24-hour electricity.
In the meantime, the government is paying a fuel import bill that represents 10 per cent of GDP and makes annual transfers to Electricité du Liban that are equivalent to 4 per cent of GDP. Oh, and let's not forget the $360m the government has agreed to pay a Turkish firm to lease three generator ships to make up the shortfall until 2015.
And for those who believe that we will soon be pumping the revenues from our own natural oil and gas into the state coffers, think again.
Citigroup analysts predicted that "divisive politics" and "traditional institutional bickering" would mean that it would be 2020 at the earliest before we can start extracting our natural oil and gas resources.
So last week, it was heartening to hear Lebanese customs announce that exports of Lebanese wine to the United Kingdom rose 33 per cent, all as a result of a $150,000 a year generic marketing campaign, devised by a one-woman PR operation that is run from a small office in Bath in south-west England.
Maybe the government could also do with a few cool-headed foreigners to take care of business as well.
Michael Karam is a writer based in Beirut
Specs
Engine: Duel electric motors
Power: 659hp
Torque: 1075Nm
On sale: Available for pre-order now
Price: On request
'Cheb%20Khaled'
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At a glance
Global events: Much of the UK’s economic woes were blamed on “increased global uncertainty”, which can be interpreted as the economic impact of the Ukraine war and the uncertainty over Donald Trump’s tariffs.
Growth forecasts: Cut for 2025 from 2 per cent to 1 per cent. The OBR watchdog also estimated inflation will average 3.2 per cent this year
Welfare: Universal credit health element cut by 50 per cent and frozen for new claimants, building on cuts to the disability and incapacity bill set out earlier this month
Spending cuts: Overall day-to day-spending across government cut by £6.1bn in 2029-30
Tax evasion: Steps to crack down on tax evasion to raise “£6.5bn per year” for the public purse
Defence: New high-tech weaponry, upgrading HM Naval Base in Portsmouth
Housing: Housebuilding to reach its highest in 40 years, with planning reforms helping generate an extra £3.4bn for public finances
COMPANY%20PROFILE
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PROFILE BOX:
Company/date started: 2015
Founder/CEO: Rami Salman, Rishav Jalan, Ayush Chordia
Based: Dubai, UAE
Sector: Technology, Sales, Voice, Artificial Intelligence
Size: (employees/revenue) 10/ 100,000 downloads
Stage: 1 ($800,000)
Investors: Eight first-round investors including, Beco Capital, 500 Startups, Dubai Silicon Oasis, Hala Fadel, Odin Financial Services, Dubai Angel Investors, Womena, Arzan VC
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.”
Other promotions
- Deliveroo will team up with Pineapple Express to offer customers near JLT a special treat: free banana caramel dessert with all orders on January 26
- Jones the Grocer will have their limited edition Australia Day menu available until the end of the month (January 31)
- Australian Vet in Abu Dhabi (with locations in Khalifa City A and Reem Island) will have a 15 per cent off all store items (excluding medications)
Key facilities
- Olympic-size swimming pool with a split bulkhead for multi-use configurations, including water polo and 50m/25m training lanes
- Premier League-standard football pitch
- 400m Olympic running track
- NBA-spec basketball court with auditorium
- 600-seat auditorium
- Spaces for historical and cultural exploration
- An elevated football field that doubles as a helipad
- Specialist robotics and science laboratories
- AR and VR-enabled learning centres
- Disruption Lab and Research Centre for developing entrepreneurial skills
Real estate tokenisation project
Dubai launched the pilot phase of its real estate tokenisation project last month.
The initiative focuses on converting real estate assets into digital tokens recorded on blockchain technology and helps in streamlining the process of buying, selling and investing, the Dubai Land Department said.
Dubai’s real estate tokenisation market is projected to reach Dh60 billion ($16.33 billion) by 2033, representing 7 per cent of the emirate’s total property transactions, according to the DLD.
Race card
6.30pm: Al Maktoum Challenge Round-3 Group 1 (PA) US$100,000 (Dirt) 2,000m
7.05pm: Meydan Classic Listed (TB) $175,000 (Turf) 1,600m
7.40pm: Handicap (TB) $135,000 (T) 2,000m
8.15pm: Handicap (TB) $135,000 (D) 1,600m
8.50pm: Nad Al Sheba Trophy Group 2 (TB) $300,000 (T) 2,810m
9.25pm: Curlin Stakes Listed (TB) $175,000 (D) 2,000m
10pm: Handicap (TB) $135,000 (T) 2,000m
10.35pm: Handicap (TB) $175,000 (T) 1,400m
The National selections
6.30pm: Shahm, 7.05pm: Well Of Wisdom, 7.40pm: Lucius Tiberius, 8.15pm: Captain Von Trapp, 8.50pm: Secret Advisor, 9.25pm: George Villiers, 10pm: American Graffiti, 10.35pm: On The Warpath
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Most F1 world titles
7 — Michael Schumacher (1994, ’95, 2000, ’01 ’02, ’03, ’04)
7 — Lewis Hamilton (2008, ’14,’15, ’17, ’18, ’19, ’20)
5 — Juan Manuel Fangio (1951, ’54, ’55, ’56, ’57)
4 — Alain Prost (1985, ’86, ’89, ’93)
4 — Sebastian Vettel (2010, ’11, ’12, ’13)
COMPANY%20PROFILE
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