An agreement between Iran and the P5+1 can be reached if Tehran realises the first step it took in Geneva, in its present form, doesn’t fulfil its ambitions with regard to lifting economic sanctions, observed the columnist Abdul Wahab Badrakhan in the Abu Dhabi-based daily Al Ittihad.

“Iran couldn’t hope to lift the restrictions on the oil and banking sectors without offering clear and tangible concessions that prove to negotiators that it is indeed serious about responding to their demands,” the writer said.

A slight change can be perceived in Iran’s negotiating strategy, but it remains insufficient to persuade Western powers that Iran will alter its nuclear programme to preclude any possibility of it possessing a nuclear weapon.

In fact, Iran didn’t provide viable answers to requests such as halting uranium enrichment at 20 per cent and shutting down the Fordo nuclear reactor, among other pressing issues.

The Iranian proposal at the second round of talks in Geneva was too ambitious for this early phase of the process. Western approval to remove all economic sanctions would have meant a blatant disparity between concessions and the price required for them.

The Western side suggested unfreezing $50 billion of Iranian assets and postponing discussions about reducing sanctions until it can verify Iran’s true intentions.

Iran’s foreign secretary’s statements and insinuations following the stalled talks this week suggest that he was able to achieve a breakthrough. Rather than show frustration, Iran’s top diplomat Mohammad Javad Zarif seemed optimistic that an agreement will be signed at the upcoming third round of talks.

The breakthrough here was the rift that transpired in the western powers’ positions and caused the interruption of an agreement that seemed within reach. But he forgets that these nations are working towards a common priority: to finally sign a preliminary political agreement in which Iran commits to stop its nuclear programme in exchange for lifting economic sanctions.

Implementation will surely be progressive, but Iran’s commitment must be unequivocal from the start.

“The P5+1 no doubt have a vested interest in supporting president Hassan Rouhani, but their main concern is about the nuclear programme continuing to advance,” noted Badrakhan.

They don’t want the negotiations game to drag on too long, giving the Iranian side sufficient time to produce a nuclear weapon. Both sides are hasty, each for its own reasons, and especially the US that needs the approval of the congress to proceed with any agreement. This means dealing with Israel’s objections and fears.

“Rouhani’s team would be well-advised to look into the first proposal that was put forward and not attempt to benefit from the other team’s divisions,” the writer concluded.

.

Close Egypt-Russia ties are a blow to US

One of the best, yet least recognised, outcomes of Egypt’s June 30 revolution is that it helped Egypt break out of 40 years of being a client state of the United States, wrote Ashraf El Ashry, managing editor of the Cairo-based newspaper Al Ahram.

The editor wrote his column ahead of a landmark visit to Cairo today by the Russian foreign affairs and defence ministers.

The visit is said to be the first of its kind since the collapse of the Soviet Union.

Under the title “Egypt-Russia rapprochement is a blow to the US”, El Ashry said that, since President Anwar Sadat decided in the 1970s that “99 per cent of the deck of cards is in the hands of the US”, Egypt has “put all of its eggs in the American basket”.

“Since that time, in 1972, Egypt’s relations with the Soviet Union have been broken,” he wrote.

“Egypt has turned westward ever since, for years stripping Egyptians of independent decision-making.”

Conversely, in an editorial opposite El Ashry’s column yesterday, Al Ahram described as “somewhat radical” recent declarations by the Egyptian foreign minister, Nabil Fahmy, who suggested that Egypt deliberately intends to expand areas of collaboration with Russia after Cairo’s recent divergences with Washington over the ouster of the Egyptian president, Mohammed Morsi, last July.

.

Palestinian unity died with Yasser Arafat

On the ninth anniversary of Yasser Arafat’s death, the worst fears about what would happen appen after he was gone – Palestinian division – has, indeed, happened, Amjad Arar wrote in a column yesterday in the Sharjah-based newspaper, Al Khaleej.

The week before the ninth anniversary, Swiss experts issued a report suggesting the Palestinian leader had been poisoned but even if that had not happened, Arafat would have died eventually anyway, he wrote.

But what Palestinians and sympathisers feared most when Arafat’s health deteriorated was disunity within Palestinian ranks.

During Arafat’s lifetime, when the Palestinian Liberation Organisation fought Israel from exile, PLO factions used to have their differences.

“Sometimes the differences would be very deep, but would never go below a certain bottom-line of national unity,” the author said.

Yet three years after Arafat’s death, the two main factions of the Palestinian struggle for independence, Fatah and Hamas, fought each other over power, and Palestinian blood was spilled by Palestinian hands, he noted.

Causing this kind of scenario is what led the killers of Arafat to poison him while he was already becoming frail, the writer suggested.

* Digest compiled by The Translation Desk

translation@thenational.ae

Leap of Faith

Michael J Mazarr

Public Affairs

Dh67
 

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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