Raghida Dergham is the founder and executive chairwoman of the Beirut Institute, and a columnist for The National
November 07, 2021
Europe and America seem to have an understanding. US President Joe Biden is lobbying the continent, as well as Nato, to get behind his vision of a transatlantic political and security partnership that focuses on China’s rise. In exchange, Europe as a collective is seemingly doing Iran’s bidding in the nuclear negotiations involving the five permanent members of the UN Security Council – namely China, France, Russia, the UK and the US – plus Germany.
On Iran, Mr Biden has deferred to Europe’s leaders by following their lead, instead of them following his, in what is an unusual shift in the Euro-American dynamic. This is likely to be a bug, not a feature, in the long-term relations between these allies, as it would be difficult to imagine Washington sitting in the backseat of a car driven by a continent that, after all, doesn’t speak with one voice on the world stage.
Unfortunately, Europe has been less beholden to the liberal values that it claims to espouse by attempting to bring Iran in from the cold, starting with the nuclear talks. The continent’s main powers have decided that their interests are best served by making concessions to Iran in these negotiations, even as the latter undermines the sovereignty and dignity of several Arab countries with whom individual European member states claim to maintain strong relations, such as Lebanon.
By now, it is clear that the P5+1 countries have fully agreed to Iran’s demand of excluding any discussion regarding its regional behaviour from the Vienna talks being held with the purpose of reviving the 2015 nuclear deal. The European powers are still hoping to convince the regime to include aspects of its ballistic missile programme in the talks. Clearly, they are more concerned about its long-range missiles, which the continent could be vulnerable to in the event of an attack from Tehran, than they are about its short and intermediate-range missiles, which threaten Middle East security.
Lebanon, in particular, is bearing the brunt of this emollient approach, with Tehran being the primary force behind its proxy Hezbollah’s seizure of the levers of the state and its siege upon the country's judiciary. Having given in to Iran's diktats means that the Europeans' stated concern for Lebanon's state of affairs has only rung hollow.
Thanks to their efforts, the Biden administration has agreed to re-launch talks with Iran in Vienna on November 29. The US president is said to have discussed the Iranian question with his European counterparts at the recent G20 meeting in Rome and during the ongoing Cop26 climate summit in Glasgow.
In all likelihood, the JCPOA – as the all-but-dead 2015 deal is known – will be revived before the year ends and serve as a farewell gift to German Chancellor Angela Merkel, given her determination to secure a deal. The negotiations are likely to intensify also because of Tehran’s urgent need for the US-led sanctions to be lifted and Europe’s rush to benefit from the windfall.
Iranian women walk past an anti-US wall painting last week. Tensions between Iran and the US over 2015 nuclear deal persist. EPA
This week’s local election in the US, the results of which are a damning referendum on Mr Biden’s 10 months in office, could be seen as another reason for the renewed urgency. The president is in need of a foreign policy victory and increased co-ordination with Europe will only help, particularly after his administration’s chaotic withdrawal of US-led troops from Afghanistan in August.
Some in Washington, including those within the military establishment and the opposition, have begun resisting Europe’s bidding on behalf of Iran over concerns it is undermining American interests and giving Tehran a blank cheque to escalate its aggressive behaviour against Lebanon and other Arab countries.
Lebanese Prime Minister Najib Mikati, who came to power in September with Hezbollah’s support, has been fed up of the obstructionism and unilateralism being unleashed on his government from “within”. He is pushing back against the sort of “interference by the cabinet in the work of the judiciary” being pursued by Hezbollah and the Amal Movement.
Lebanese Prime Minister Najib Mikati attends a press conference in Beirut last week. Mikati has renewed his call for his information minister to resign. AP Photo
Western powers are betraying their own values
Mr Mikati’s government is so weak, he has been unable to either dismiss or rein in Information Minister George Kordahi for his inflammatory remarks over the war in Yemen that sparked a diplomatic rift between Lebanon and the Gulf countries. But, then, Mr Kordahi can get away with holding hostage Lebanon’s national interests because he knows no European state, or the Biden administration for that matter, will intervene.
What these western powers are doing by turning a blind eye to Iran’s activities in Lebanon and elsewhere is that they are betraying their own values.
The West’s duplicity means that the Vatican City is required to intervene in Lebanon’s affairs and help to stop the terrifying political, humanitarian and legal freefall in the country. With Christians making up roughly one-third of its population, the Holy See has a strong enough reason to do so. Crucially, it also has leverage that it must, therefore, use to pressure the global powers – particularly the US, Russia and, yes, its fellow European states – to hold Tehran’s feet to the fire.
Indeed, the Vatican can and must offer more than prayers in its assistance to Lebanon.
The internal combustion engine is facing a watershed moment – major manufacturer Volvo is to stop producing petroleum-powered vehicles by 2021 and countries in Europe, including the UK, have vowed to ban their sale before 2040. The National takes a look at the story of one of the most successful technologies of the last 100 years and how it has impacted life in the UAE.
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.”
Ten tax points to be aware of in 2026
1. Domestic VAT refund amendments: request your refund within five years
If a business does not apply for the refund on time, they lose their credit.
2. E-invoicing in the UAE
Businesses should continue preparing for the implementation of e-invoicing in the UAE, with 2026 a preparation and transition period ahead of phased mandatory adoption.
3. More tax audits
Tax authorities are increasingly using data already available across multiple filings to identify audit risks.
4. More beneficial VAT and excise tax penalty regime
Tax disputes are expected to become more frequent and more structured, with clearer administrative objection and appeal processes. The UAE has adopted a new penalty regime for VAT and excise disputes, which now mirrors the penalty regime for corporate tax.
5. Greater emphasis on statutory audit
There is a greater need for the accuracy of financial statements. The International Financial Reporting Standards standards need to be strictly adhered to and, as a result, the quality of the audits will need to increase.
6. Further transfer pricing enforcement
Transfer pricing enforcement, which refers to the practice of establishing prices for internal transactions between related entities, is expected to broaden in scope. The UAE will shortly open the possibility to negotiate advance pricing agreements, or essentially rulings for transfer pricing purposes.
7. Limited time periods for audits
Recent amendments also introduce a default five-year limitation period for tax audits and assessments, subject to specific statutory exceptions. While the standard audit and assessment period is five years, this may be extended to up to 15 years in cases involving fraud or tax evasion.
8. Pillar 2 implementation
Many multinational groups will begin to feel the practical effect of the Domestic Minimum Top-Up Tax (DMTT), the UAE's implementation of the OECD’s global minimum tax under Pillar 2. While the rules apply for financial years starting on or after January 1, 2025, it is 2026 that marks the transition to an operational phase.
9. Reduced compliance obligations for imported goods and services
Businesses that apply the reverse-charge mechanism for VAT purposes in the UAE may benefit from reduced compliance obligations.
10. Substance and CbC reporting focus
Tax authorities are expected to continue strengthening the enforcement of economic substance and Country-by-Country (CbC) reporting frameworks. In the UAE, these regimes are increasingly being used as risk-assessment tools, providing tax authorities with a comprehensive view of multinational groups’ global footprints and enabling them to assess whether profits are aligned with real economic activity.
Contributed by Thomas Vanhee and Hend Rashwan, Aurifer
UAE: Mohammed Naveed (captain), Rohan Mustafa, Ashfaq Ahmed, Shaiman Anwar, Mohammed Usman, CP Rizwan, Chirag Suri, Mohammed Boota, Ghulam Shabber, Sultan Ahmed, Imran Haider, Amir Hayat, Zahoor Khan, Qadeer Ahmed
Zimbabwe: Peter Moor (captain), Solomon Mire, Brian Chari, Regis Chakabva, Sean Williams, Timycen Maruma, Sikandar Raza, Donald Tiripano, Kyle Jarvis, Tendai Chatara, Chris Mpofu, Craig Ervine, Brandon Mavuta, Ainsley Ndlovu, Tony Munyonga, Elton Chigumbura
Your UK residence status is assessed using the statutory residence test. While your residence status – ie where you live - is assessed every year, your domicile status is assessed over your lifetime.
Your domicile of origin generally comes from your parents and if your parents were not married, then it is decided by your father. Your domicile is generally the country your father considered his permanent home when you were born.
UK residents who have their permanent home ("domicile") outside the UK may not have to pay UK tax on foreign income. For example, they do not pay tax on foreign income or gains if they are less than £2,000 in the tax year and do not transfer that gain to a UK bank account.
A UK-domiciled person, however, is liable for UK tax on their worldwide income and gains when they are resident in the UK.
