ANKARA // Iran and Turkey on Monday pledged to work together to stop extremism and bloodshed in the Middle East despite their deep differences over Syria’s civil war.
“Iran and Turkey, the two important countries in the region, are determined to fight against extremism and terrorism,” Iran’s President Hassan Rouhani said at a news conference in Ankara.
Mr Rouhani arrived in Turkey on Monday for a two-day visit – a first by an Iranian president since 2008.
He said the instability in the region benefited neither countries, nor the world, and said Turkey and Iran agreed to work together.
Turkish president Abdullah Gul commended Mr Rouhani’s policies since taking office in August last year, saying they were helping Iran open up to the world.
Iran and Turkey have found themselves on opposite sides of the political fence over a Syrian civil war that has killed 160,000 people and sent hundreds of thousands of refugees streaming into Turkey.
Shiite Iran has backed Syrian president Bashar Al Assad since the start of the uprising while Turkey has been one of his fiercest critics, supporting his opponents and providing refuge to rebel fighters. Ankara has described Mr Assad’s forces as using terrorist methods while Tehran has used similar language in criticising opposition groups.
“Instabilities exist in our region ... Iran and Turkey are determined to increase their cooperation to establsh stability in the region,” Mr Rouhani said after talks with President Abdullah Gul in Ankara.
“The fight against violence, extremism, sectarian conflicts and terrorism is Iran’s major objective,” he said.
Mr Gul said that Syria was discussed during his meeting with Mr Rouhani, but did not give details. It was unclear whether the two countries were approaching any concrete steps to help scale down a conflict that holds perils for both.
Despite deep divisions between Ankara and Tehran over Syria, the potential of an Iranian market of 76 million people with some of the world’s biggest oil and gas reserves is a magnet for Turkish companies.
Turkey depends on imports for almost all of its natural gas needs and is keen to increase oil and gas imports from Tehran in anticipation of easing sanctions against Iran’s huge energy sector.
A senior Turkish official said that Ankara will repeat its demand for a discount on the price of natural gas from Iran, which Ankara says is too expensive compared with other suppliers like Russia and Azerbaijan.
Under a contract signed in 1996, Turkey imports 10 billion cubic metres per year of gas from Iran. The contract came into force in 2001.
Turkey’s state-owned Petroleum Pipeline Corporation (Botas) applied to an international court of arbitration in 2012 for a ruling on Iran’s gas pricing. The case is still pending.
“The Iranian side demanded dropping of the legal case and it was discussed during the talks,” said a Turkish official on condition of anonymity.
Iran has so far dismissed Turkish demands it drop the price of gas under the current agreement.
Mr Rouhani’s visit to Turkey takes place as Iranian, US and European Union officials hold talks about Tehran’s disputed nuclear programme in Geneva in an effort to break a logjam in wider negotiations over Tehran’s nuclear program.
Nuclear talks between Iran and six major powers in Vienna last month to reach a final deal ran into difficulties, with each side accusing the other of having unrealistic demands in negotiations.
A preliminary deal was penned in Geneva in November between Iran and six major powers, under which Iran accepted to halt some sensitive nuclear activities in exchange for partial easing of sanctions. It went into effect in January 20.
* Agence France-Presse and Reuters
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Tentative schedule of 2017/18 Ashes series
1st Test November 23-27, The Gabba, Brisbane
2nd Test December 2-6, Adelaide Oval, Adelaide
3rd Test Dcember 14-18, Waca, Perth
4th Test December 26-30, Melbourne Cricket Ground, Melbourne
5th Test January 4-8, Sydney Cricket Ground, Sydney
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.”