Government

Joint venture between Enec and Korean energy firm secures UAE’s nuclear future

The head of the Emirates Nuclear Energy Corporation tells The National that a deal establishing a long-term partnership with a Korean electricity company will ensure safe nuclear energy for a long time.

Caline Malek

October 28, 2016

ABU DHABI // The latest joint venture between the UAE’s nuclear operator and its prime contractor from South Korea demonstrated the strong commitment towards Abu Dhabi’s nuclear programme, Enec’s chief executive said.

Mohammed Al Hammadi said the deal would bring a lot of nuclear expertise to the UAE.

“We have the backing of 40 years of Korea’s experience,” said the head of the Emirates Nuclear Energy Corporation.

“There will be more staff coming from Korea to work here and we will always make sure to bring their top experts, firms and companies.”

Enec and the Korea Electric Power Corporation (Kepco) signed a joint venture agreement last week establishing a long-term partnership, including the set-up of Barakah One PJSC, an independent subsidiary owned by both companies, to represent the commercial and financial interests of the nuclear power plant project.

The agreement entitles Kepco to an 18 per cent stake in Enec’s subsidiary, Nawah Energy Company, which was established in May to operate and maintain Barakah units 1 to 4.

“This is a new era,” Mr Al Hammadi said.

“This gives good credibility to the UAE that it has been doing what it pledged in its nuclear policy in 2008.”

Park Kang-ho, Korean ambassador, said the UAE’s nuclear power plant was the starting point from which both countries would open their new strategic partnership for the next 100 years.

“It will bring a true partnership to Enec and Kepco, which is much more advanced than the previous vendor-supplier relationship,” he said.

“I also think that it would not have been made possible without the UAE’s clear vision and firm assurance on nuclear power generation.” The investment by Kepco moves it from being the principal constructor to one of the owners of the UAE’s nuclear power plant at Barakah in the Western Region.

“This makes it more closely aligned with the UAE programme and shows its confidence in the long-term sustainability and success of the peaceful nuclear power plant,” said Barbara Judge, former head of the UK atomic energy authority and a member of the international advisory board for the development of nuclear energy in the UAE.

“It’s important to know that this is one of the largest single instances of foreign investments in the history of the UAE, which is good not just for the nuclear programme, but also demonstrates the confidence of the Koreans in the success of the UAE economy,” Lady Judge said.

“So it shows they are investing a serious amount of money in the UAE and draws them even closer economically.”

cmalek@thenational.ae

* This article has been amended to rectify an inaccuracy.

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

Formula Middle East Calendar (Formula Regional and Formula 4)
Round 1: January 17-19, Yas Marina Circuit – Abu Dhabi
 
Round 2: January 22-23, Yas Marina Circuit – Abu Dhabi
 
Round 3: February 7-9, Dubai Autodrome – Dubai
 
Round 4: February 14-16, Yas Marina Circuit – Abu Dhabi
 
Round 5: February 25-27, Jeddah Corniche Circuit – Saudi Arabia

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.”

UAE Tour 2020

Stage 1: The Pointe Palm Jumeirah - Dubai Silicon Oasis, 148km
Stage 2: Hatta - Hatta Dam, 168km​​​​​​​
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Stage 4: Zabeel Park - Dubai City Walk, 173km​​​​​​​
Stage 5: Al Ain - Jebel Hafeet, 162km​​​​​​​
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  • 400m Olympic running track
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  • 600-seat auditorium
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Libya's Gold

UN Panel of Experts found regime secretly sold a fifth of the country's gold reserves. 

The panel’s 2017 report followed a trail to West Africa where large sums of cash and gold were hidden by Abdullah Al Senussi, Qaddafi’s former intelligence chief, in 2011.

Cases filled with cash that was said to amount to $560m in 100 dollar notes, that was kept by a group of Libyans in Ouagadougou, Burkina Faso.

A second stash was said to have been held in Accra, Ghana, inside boxes at the local offices of an international human rights organisation based in France.

The National's picks

4.35pm: Tilal Al Khalediah
5.10pm: Continous
5.45pm: Raging Torrent
6.20pm: West Acre
7pm: Flood Zone
7.40pm: Straight No Chaser
8.15pm: Romantic Warrior
8.50pm: Calandogan
9.30pm: Forever Young

The specs: 2018 Nissan 370Z Nismo

The specs: 2018 Nissan 370Z Nismo
Price, base / as tested: Dh182,178
Engine: 3.7-litre V6
Power: 350hp @ 7,400rpm
Torque: 374Nm @ 5,200rpm
Transmission: Seven-speed automatic
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