Who will bear the burden of VAT in the UAE? Evidence suggests consumers will take the lion's share, with the advice to do a big grocery shop on December 31.  Asmaa Al Hameli / The National
Who will bear the burden of VAT in the UAE? Evidence suggests consumers will take the lion's share, with the advice to do a big grocery shop on December 31. Asmaa Al Hameli / The National

Consumers will always have to bear the burden of VAT



To answer to your question Who will bear the burden of VAT in the UAE? (October 11), consumers will naturally be the ones most affected by VAT. This is how VAT works. It is a tax on consumers, collected by the companies on behalf of the state. Tourists should be refunded when they leave the country and this will require further clarification in the law. Prices will surely increase by more than five per cent, as consumers will also have to indirectly pay implementation costs.

Frederic Beaugrand, Dubai

This tax will only rise over time. Of course consumers will take the full brunt of the tax. It will be business as usual for companies.

Logan Delafish, Dubai 

The world needs more brave people

Your online story Dubai police officer's strong arm of the law as he pushes broken down car along busy motorway (October 10) was heartwarming. It is great to see that good deeds do not go unnoticed and that there are still people who work for the greater good.

Name withheld by request

This was a job well done and the world needs more people like this police officer.

Joe Lee Brown, Washington

Women would take on the world for their children

The battles some women have to wage for their children can be challenging (Woman wins nine-year battle to get visa for her son, October 11). Answering this mother's plea was a grand gesture on the part of Ajman's Crown Prince. Some gestures can go a long way.

Name withheld by request

Ms Al Zaher's story is indeed a sad one. I wish the lady good luck. Eyesight is our most precious gift.

Ann Cambridge, UK

Will Trump review his position on the Iran nuclear deal? 

In reference to your online article Britain's May urges Trump not to end Iran nuclear pact (October 11), it is clear that the international community is increasingly opposing the recent Iran US nuclear deal. If Trump agrees to maintain the nuclear deal, the international community - all but Britain's Theresa May - feels the region's security will be put in peril  and many other problems could arise. Will Mr Trump reconsider his strategy with Iran. Let's wait and see.

Ragavan Krishnamachary, India

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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.”

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.

The specs

AT4 Ultimate, as tested

Engine: 6.2-litre V8

Power: 420hp

Torque: 623Nm

Transmission: 10-speed automatic

Price: From Dh330,800 (Elevation: Dh236,400; AT4: Dh286,800; Denali: Dh345,800)

On sale: Now

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Ain Dubai in numbers

126: The length in metres of the legs supporting the structure

1 football pitch: The length of each permanent spoke is longer than a professional soccer pitch

16 A380 Airbuses: The equivalent weight of the wheel rim.

9,000 tonnes: The amount of steel used to construct the project.

5 tonnes: The weight of each permanent spoke that is holding the wheel rim in place

192: The amount of cable wires used to create the wheel. They measure a distance of 2,4000km in total, the equivalent of the distance between Dubai and Cairo.

Ziina users can donate to relief efforts in Beirut

Ziina users will be able to use the app to help relief efforts in Beirut, which has been left reeling after an August blast caused an estimated $15 billion in damage and left thousands homeless. Ziina has partnered with the United Nations High Commissioner for Refugees to raise money for the Lebanese capital, co-founder Faisal Toukan says. “As of October 1, the UNHCR has the first certified badge on Ziina and is automatically part of user's top friends' list during this campaign. Users can now donate any amount to the Beirut relief with two clicks. The money raised will go towards rebuilding houses for the families that were impacted by the explosion.”

COMPANY PROFILE
Name: Kumulus Water
 
Started: 2021
 
Founders: Iheb Triki and Mohamed Ali Abid
 
Based: Tunisia 
 
Sector: Water technology 
 
Number of staff: 22 
 
Investment raised: $4 million