NEW YORK // Afghan election officials declared Hamid Karzai president for another five-year term yesterday, ending two months of political uncertainty highlighted by voting fraud and violence.
Mr Karzai emerged as the sole candidate after the withdrawal of his only rival, Abdullah Abdullah, on Sunday, gaining the incumbent a hard-won presidency amid mounting concerns over his credibility.
The two men were due to compete in a second round of voting on Saturday after the independent election commission threw out about one million fraudulent votes from the first round ballot of August 20.
The UN-backed commission's chairman, Azizullah Lodin, announced Mr Karzai as the victor during a news conference in Kabul after the UN secretary general, Ban Ki-moon, touched down for an unscheduled visit to the Afghan capital.
The UN chief described the elections as "among the most difficult" ever to involve the world body and lamented the "insecurity, poor infrastructure, fraud, and weak or partial institutions" that blighted the vote.
"This has been a difficult election process for Afghanistan and lessons must be learnt," Mr Ban said. "Afghanistan now faces significant challenges and the new president must move swiftly to form a government that is able to command the support of both the Afghan people and the international community."
The election commission previously cut the share of Mr Karzai's vote to just under the 50 per cent threshold needed for outright victory, declaring almost one-third of the incumbent's votes as fakes.
His challenger, Mr Abdullah, won nearly one-third of the valid votes cast, but dropped out of the race last weekend, saying the run-off would not be free or fair following the fraud-marred first round.
Officials said they scrapped the November 7 ballot to save money and because of security concerns. Taliban insurgents were expected to continue a campaign of election violence that included the killing of five UN foreign staff during a raid on a guesthouse in Kabul last week.
Installed after the Taliban were toppled by US-backed Afghan forces in 2001, a weakened Mr Karzai can now expect to come under increased pressure to reform an administration seen by many in the West as riddled with corruption.
Although the US Embassy in Kabul released a statement congratulating Mr Karzai and saying it looked "forward to working with him, his new administration, the Afghan people and our partners", many still have concerns about the incumbent.
"The credibility of the Karzai government is not going to be simply decided by this election, it will now be decided by the actions the president takes over the coming days," a western official in Kabul said.
"The first test will be the formation of his cabinet. If he is serious about reform we need to see that."
Daniel Markey, a regional expert from the US-based Council on Foreign Relations, said Mr Karzai should select ministers, police chiefs and other senior officials who will be acceptable to Afghanistan's backers in the West.
"There needs to be some overture, even if it's symbolic, that breaks this pattern of deterioration of confidence and increased frustration," said Mr Markey, a former US state department official.
"There needs to be an injection of momentum into the process to shift the tide against this resurgent Taliban and convince members of the international community that there are benefits to staying engaged in Afghanistan, even if the leader of that country is tarnished."
Mr Karzai's support base is mainly among the Pashtun, the country's largest ethnic group, who are predominant in the south and east, meaning he may come under pressure to strike a deal with his former rival, who is backed by Tajiks in the north.
Mr Abdullah campaigned strongly and emerged as a figurehead among what had in the past been a fractured opposition.
Even though talks on a power-sharing deal broke down last week, according to western diplomats in Kabul, Mr Karzai will need to give up some key cabinet positions to Mr Abdullah's camp to make the government more representative.
"Karzai has lost his legitimacy; he is a very weak president and he cannot govern without reaching out to Dr Abdullah," Haroun Mir, a Kabul-based political analyst, said. "So the ball is in Dr Abdullah's court."
While the conclusion to the election process means western countries with troops in Afghanistan will not have to risk more casualties securing another round of voting, Mr Karzai's victory presents new problems for the US administration.
The US president, Barack Obama, has already been criticised for taking too long to decide whether to send as many as 40,000 more troops to Afghanistan.
The success of Mr Karzai, who is seen as illegitimate by many in the United States, may make it more difficult to convince the US public of the wisdom of suffering ever more casualties in the war.
Mr Markey said it remains unclear whether Mr Obama will unveil a new policy towards Afghanistan now that the election process is over.
@Email:jreinl@thenational.ae
* With additional reporting by Reuters
UAE squad
Ali Kashief, Salem Rashid, Khalifa Al Hammadi, Khalfan Mubarak, Ali Mabkhout, Omar Abdelrahman, Mohammed Al Attas (Al Jazira), Mohmmed Al Shamsi, Hamdan Al Kamali, Mohammad Barghash, Khalil Al Hammadi (Al Wahda), Khalid Eisa, Mohammed Shakir, Ahmed Barman, Bandar Al Ahbabi (Al Ain), Adel Al Hosani, Al Hassan Saleh, Majid Suroor (Sharjah), Waleed Abbas, Ismail Al Hammadi, Ahmed Khalil (Shabab Al Ahli Dubai) Habib Fardan, Tariq Ahmed, Mohammed Al Akbari (Al Nasr), Ali Saleh, Ali Salmeen (Al Wasl), Hassan Al Mahrami (Baniyas)
COMPANY PROFILE
Name: Kumulus Water
Started: 2021
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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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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
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Killing of Qassem Suleimani
Killing of Qassem Suleimani
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Name: Hassan Mohsen Elhais
Position: legal consultant with Al Rowaad Advocates and Legal Consultants.
