Heightened tensions between the US and Iran has raised concerns that Tehran could organise Houthi attacks on merchant ships passing through strategic trading routes in the Gulf.
“There will be concern over the potential of Iran being in a position to threaten maritime traffic through the Bab el Mandeb,” said Jon Lee, an analyst at Dorian Risk Consulting.
“Tensions between Iran and the US in the Straits of Hormuz are likely to increase. By extension, those tensions are also a concern for Saudi Arabia, the Gulf States, and western nations who rely on the region for energy supplies. Iran could in the near future use the Houthi as surrogates to threaten the Bab el Mandeb as well, giving Tehran the ability to control or influence maritime traffic through two of the most important chokepoints in the world,” said Mr Lee.
Read more: Policed maritime corridor will protect merchant ships passing through Gulf from prirates
High volumes of petroleum and other products are shipped through the vulnerable, narrow straits, making their protection all the more critical.
“Any disruption would have an economic impact, so the new Maritime Security Transit Corridor makes even more sense as a means of mitigating this risk.”
The Combined Maritime Forces, the international naval coalition, has set up an expanded corridor to protect merchant vessels transiting the Gulf of Aden and Bab el Mandeb.
World oil chokepoints are narrow channels along sea routes, some so narrow that navigation restrictions apply.
Only 18 miles wide at its narrowest point, the Bab el Mandeb connects the Red Sea to the Gulf of Aden and the Arabian Sea. An estimated 4.8 million barrels of oil flowed through this waterway daily in 2016 toward Europe, the US and Asia, according to the US Energy Information Administration.
The Strait of Hormuz is one of the world’s most important chokepoints with an oil flow of 17 million barrels a day in 2015, accounting for 30 per cent of maritime oil trade. This rose to a high of 18.5 million barrels daily last year.
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Vigilance and intelligence gathering has always been critical off the UAE coast because of the Houthi rebels in Yemen threatening maritime movement with mines and missiles, plus concerns about a revival of Somali piracy.
“The CMF has to keep merchant vessels safe from events in Yemen. Given the constricted waters this is very difficult, especially on the entrance to the Red Sea,” said Mr Lee, who has also been part of hostage negotiations with Somali pirates in the past.
“The corridor avoids as much as possible Yemeni territorial waters, at least until the Bab el Mandab where the constrictions make this impossible. Complicating the mission are the allegations that Iran is arming the Houthi with sea mines and anti-ship missiles,” he said.
The US Central Command Chief General Joe Votel told the US House Armed Services Committee in March about concerns the rebels had deployed mines, explosive boats, coastal defence missiles that threatened ships and commerce in the area.
Iran has repeatedly denied accusations that it sends weapons to the Houthi rebels.
The International Maritime Bureau too said the newly established corridor will help naval deployment and address risks not covered by the existing Internationally Recommended Transit Corridor in the Gulf of Aden and Indian Ocean.
“The MSTC is an extension of the IRTC through the Bab el Mandab and into the Southern Red Sea. It follows the same principle of the IRTC which is to enable the naval forces in the region to efficiently deploy their assets in an effort to provide a more secure transit route for merchant vessels,” said Cyrus Mody, IMB’s assistant director.
“It helps to cover some of the risks to shipping in the Southern Red Sea not covered by the IRTC.”
Slow moving cargo and oil tankers are a target of both Houthi rebels in armed speedboats and pirates in fast-moving skiffs.
The IMB’s second quarter piracy report too warned that Somali pirates remained a risk for merchant ships.
In April, an Indian dhow was hijacked, three other vessels came under fire and a bulk carrier was boarded by pirates in the Gulf of Aden, indicating that “Somali pirates still retain the skills and capacity to attack merchant ships far from coastal waters,” the IMB’s July report said.
The first successful hijacking of a merchant ship by Somali pirates since 2012 occurred in March when an oil tanker was seized off the coast of Somalia.
Incidents off Yemen this year included a small boat that exploded in May after a foiled attack on a tanker. Another oil tanker being targeted by three rocket-propelled grenades fired from a boat in June and a suspected Houthi rebels attacked a Saudi frigate off the Yemen coast in January.
The rules on fostering in the UAE
A foster couple or family must:
- be Muslim, Emirati and be residing in the UAE
- not be younger than 25 years old
- not have been convicted of offences or crimes involving moral turpitude
- be free of infectious diseases or psychological and mental disorders
- have the ability to support its members and the foster child financially
- undertake to treat and raise the child in a proper manner and take care of his or her health and well-being
- A single, divorced or widowed Muslim Emirati female, residing in the UAE may apply to foster a child if she is at least 30 years old and able to support the child financially
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
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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Election pledges on migration
CDU: "Now is the time to control the German borders and enforce strict border rejections"
SPD: "Border closures and blanket rejections at internal borders contradict the spirit of a common area of freedom"
How to apply for a drone permit
- Individuals must register on UAE Drone app or website using their UAE Pass
- Add all their personal details, including name, nationality, passport number, Emiratis ID, email and phone number
- Upload the training certificate from a centre accredited by the GCAA
- Submit their request
What are the regulations?
- Fly it within visual line of sight
- Never over populated areas
- Ensure maximum flying height of 400 feet (122 metres) above ground level is not crossed
- Users must avoid flying over restricted areas listed on the UAE Drone app
- Only fly the drone during the day, and never at night
- Should have a live feed of the drone flight
- Drones must weigh 5 kg or less
