World

Q&A about the Arab joint force

Arab League member states have agreed in principle to form a joint inter-Arab military peacekeeping force. Here’s a look at some of the questions surrounding the plan:

CAIRO // Arab League member states have agreed in principle to form a joint inter-Arab military peacekeeping force. While details of how such a force would actually operate remain thin, the agreement is a telling sign of a new determination among Saudi Arabia, Egypt and their allies to intervene aggressively in regional hotspots, whether against militants or spreading Iranian power.

Here’s a look at some of the questions surrounding the plan:

How will the joint force work?

Senior officials from participating countries have been dispatched to collectively examine the issue and report back within about a month. Egyptian president Abdel Fattah El Sisi, a strong proponent of the idea, has described the force as an absolute necessity. Egyptian military and security officials have said the proposed force would be made of up to 40,000 elite troops and will be headquartered in either Cairo or Riyadh. The force would be backed by jet-fighters, warships and light armour.

Who will lead it?

Saudi Arabia will likely take a leadership role. Egypt, which boasts the Arab world’s largest standing army, will also be a major player. However Egypt is heavily dependent on financial aid from Saudi Arabia and other Gulf Arab nations who have donated billions to bankroll the country’s struggling economy. The combination of common concerns between Riyadh and Cairo and economic dependence will probably mean that the specific concerns and fears of the Gulf monarchies will hold sway.

Is there any precedent for this?

Creation of such a force has been a longtime goal that has eluded Arab nations in the 65 years since they signed a rarely used joint defence pact. Gulf nations, under the umbrella of the Gulf Cooperation Council joined forces to defeat a number of destabilising Arab Spring protests in 2011 by the Shiite majority in Sunni-ruled Bahrain.

Will the joint force be deployed in Yemen?

All indications from participants in the Arab League summit in the Egyptian resort town of Sharm El Sheikh are that the force could take months to truly come together. That is most likely too long for it to play a meaningful role in the current Yemeni crisis. However, the current Saudi-led coalition that is conducting airstrikes against Shiite rebels who have conquered most of Yemen could serve as a template for what the force will eventually become.

Will the force represent all 22 Arab League nations?

Unlikely, since there are already indications in Sharm El Sheikh that joining the force will be optional. The force, as currently envisioned, would essentially be a Sunni Muslim Arab force representing the interests of Sunni nations like Saudi Arabia and Egypt. In addition to potentially combating radical forces like Al Qaeda and the ISIL group, it may also be deployed in ways designed to counter the influence of Shiite regional powerhouse Iran. Arab countries like Iraq, where Iran wields significant influence over the government, have already expressed public reservations about the plan.

* Associated Press

The White Lotus: Season three

Creator: Mike White

Starring: Walton Goggins, Jason Isaacs, Natasha Rothwell

Rating: 4.5/5

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.”

NO OTHER LAND

Director: Basel Adra, Yuval Abraham, Rachel Szor, Hamdan Ballal

Stars: Basel Adra, Yuval Abraham

Rating: 3.5/5

Specs

Engine: Duel electric motors
Power: 659hp
Torque: 1075Nm
On sale: Available for pre-order now
Price: On request