DUBAI // Very ambitious plans are being drawn up for Emirati companies to increase civil and defence engineering in the UAE, a UK cabinet member says.
Philip Dunne, the British minister for defence equipment, support and technology said at the Dubai Airshow on Monday that if the UAE decided to buy Eurofighter Typhoons, it would benefit through training.
Discussions involving military collaboration, training and exercises between Britain and the UAE are still under way, with talks about the UK drafting a deal to help the Emirates’ military technology companies sell goods to the European Union.
A Eurofighter Typhoon deal would also lead to marketing of the UAE’s military products in the UK.
The minister said the UAE would need to employ more skilled engineers.
“Attracting young Emirati nationals to go into engineering as a career requires having training regimes in place, colleges, qualified personnel to train them, the right kind of certification and career options,” Mr Dunne said.
“That’s a clear need that the nation has and, if through offset arrangements some help could be provided in that area, that would be very welcome to the Emiratis.
“There are some very ambitious plans to expand the scope of civil and defence engineering activity here in the UAE.”
He said the UK had “a big interest” in trying to promote the Eurofighter Typhoon to all countries in the region.
“We are pleased to have been invited by the UAE to participate in a competition,” Mr Dunne said. “We’re actively engaged in it.
“We’re encouraged that things have been moving positively for some time but we can’t put any timeline on it and we can’t put a certainty on it as to whether it’s going to come about.
“Any fast-jet competition is a very lengthy process. Fast jets are complicated pieces of equipment. They require very significant negotiations over both initial purchase and through-life support arrangements for aircraft.”
He said if the deal happened, it would be positive for military relations between the countries.
“We expect these aircraft to be in service for a couple of decades from now, which would give lots of opportunities for our respective air forces to work together, which would have major industrial benefits for both countries,” Mr Dunne said.
“It would sustain thousands of jobs in the UK and other countries in Europe, and it would also open up supply chain opportunities for companies here in the UAE.”
He said there were some various packages under consideration as part of the proposals that the UK was making and discussing over the Typhoon competition.
Mr Dunne said the 150 British companies at the airshow made it the UK’s largest presence at the event.
“It’s a reflection of the increasingly close relationships that have been formed between companies involved in both civil and military aerospace based in the UK, with counterpart companies here in the UAE,” he said.
“One of the exciting things … is opportunities for UAE companies to get into the supply chains of the major manufacturers and I think this is a trend that’s only going to continue.”
The UK defence secretary, Philip Hammond, confirmed a number of discussions with the UAE were making progress.
Mr Hammond said they were part of building a strong and deep-rooted partnership with the countries in the region.
cmalek@thenational.ae
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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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
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