The former governor of Iraq's central bank who was removed from his job amid allegations of financial impropriety has vowed to clear his name.
Sinan Al Shabibi was suspended from his post following allegations that the central bank had manipulated the Iraqi currency against the US dollar.
But he claims that the charges against him are cover for a political manoeuvre by the government to use the central bank's reserves.
"We had conflicts with the government. They wanted to use the central bank's reserves to finance some electricity projects and part of the (public) budget, but we told them they cannot touch the reserves," Mr Shabibi said.
Mr Al Shabibi said the move was a "violation" of the country's constitution, and contravened the independence of the central bank. Only parliament can make such decisions.
Anthony Skinner of the risk analyst firm Maplecroft said the move suggests that prime minister Nouri Al Maliki was trying to take control of the central bank.
"We have seen this tactic by Maliki in the past, to remove potential opponents or awkward political figures," Mr Skinner said.
He cited the removal of trade minister of Falah Al Sudani, vice president Tarek Al Hashemi and more recently communications minister Mohammed Tawfiq Allawi. "This is a continuous trend of removing individuals that rub against political figures who hold the reigns of power," the analyst said.
Mr Shabibi was in Tokyo for IMF meetings last month when an arrest warrant was issued against him and dozens of staff at the central bank for allegedly weakening the dinar against the dollar.
Iraqi authorities allege that there was not enough oversight of capital outflows under Mr Al Shabibi's watch.
Upon notification of the charges, he left Japan for Switzerland.
He said he planned to return to Baghdad "soon" to defend himself and the central bank in court.
The cabinet ordered a judicial inquiry into the bank after a committee including representatives from the integrity committee cited violations in procedures that led to the weakening of the dinar earlier this year.
Iraqi authorities issued an arrest warrant for Mr Al Shabibi and 30 others, shortly before the appointment of Abdelbasset Turki, the head of the board of supreme audit, to succeed him.
"The government shouldn't have handled it in that way, there should have been another route of negotiations and discussions, rather than arrest warrants and making it a big public affair," the ex-governor said.
"We could have dealt with this in a much better way, through prolonged discussions with the finance ministry, the fiscal committee, the economic committee and realise their needs without touching the reserves," he said.
The cabinet recently approved a draft budget of 138 trillion Iraqi dinars (Dh435.6 trillion) for next year. However, the proposal still needs approval from parliament.
Mr Al Shabibi claims the "root" of the dispute surrounded the use of the central bank's reserves for this budget, which would have had a negative affect on the currency.
Mr Al Shabibi said he has been in discussions with various government officials to resolve the dispute and added that he hopes that the judiciary will maintain its independence from government.
Demand for dollars in the central bank's weekly currency auction doubled to US$300 million (Dh1.1 billion) from November to April, putting pressure on the nation's foreign reserves of about $63bn.
In April, the central bank introduced new regulations to govern currency auctions after demand for US dollars ballooned amid suspicions that some of the cash was being smuggled to Iran and Syria.
In August, the US president Barack Obama banned Elaf Bank, based in Baghdad, from any dealings with the US banking system for allegedly functioning as a conduit to Iran.
Mr Al Shabibi became the governor of the central bank shortly after the US-led war on Iraq, and was one of the main architects of the Paris Club agreements that dealt with Saddam-era debt. Before the war, he spent time in Geneva as a senior economist at the United Nations Conference on Trade and Development.
halsayegh@thenational.ae
Asia Cup Qualifier
Venue: Kuala Lumpur
Result: Winners play at Asia Cup in Dubai and Abu Dhabi in September
Fixtures:
Wed Aug 29: Malaysia v Hong Kong, Nepal v Oman, UAE v Singapore
Thu Aug 30: UAE v Nepal, Hong Kong v Singapore, Malaysia v Oman
Sat Sep 1: UAE v Hong Kong, Oman v Singapore, Malaysia v Nepal
Sun Sep 2: Hong Kong v Oman, Malaysia v UAE, Nepal v Singapore
Tue Sep 4: Malaysia v Singapore, UAE v Oman, Nepal v Hong Kong
Thu Sep 6: Final
Asia Cup
Venue: Dubai and Abu Dhabi
Schedule: Sep 15-28
Teams: Afghanistan, Bangladesh, India, Pakistan, Sri Lanka, plus the winner of the Qualifier
THE%20SWIMMERS
%3Cp%3E%3Cstrong%3EDirector%3A%20%3C%2Fstrong%3ESally%20El-Hosaini%3C%2Fp%3E%0A%3Cp%3E%3Cstrong%3EStars%3A%20%3C%2Fstrong%3ENathalie%20Issa%2C%20Manal%20Issa%2C%20Ahmed%20Malek%20and%20Ali%20Suliman%C2%A0%3C%2Fp%3E%0A%3Cp%3E%3Cstrong%3ERating%3A%20%3C%2Fstrong%3E4%2F5%3C%2Fp%3E%0A
Key facilities
- Olympic-size swimming pool with a split bulkhead for multi-use configurations, including water polo and 50m/25m training lanes
- Premier League-standard football pitch
- 400m Olympic running track
- NBA-spec basketball court with auditorium
- 600-seat auditorium
- Spaces for historical and cultural exploration
- An elevated football field that doubles as a helipad
- Specialist robotics and science laboratories
- AR and VR-enabled learning centres
- Disruption Lab and Research Centre for developing entrepreneurial skills
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.”
Abaya trends
The utilitarian robe held dear by Arab women is undergoing a change that reveals it as an elegant and graceful garment available in a range of colours and fabrics, while retaining its traditional appeal.
So what is Spicy Chickenjoy?
Just as McDonald’s has the Big Mac, Jollibee has Spicy Chickenjoy – a piece of fried chicken that’s crispy and spicy on the outside and comes with a side of spaghetti, all covered in tomato sauce and topped with sausage slices and ground beef. It sounds like a recipe that a child would come up with, but perhaps that’s the point – a flavourbomb combination of cheap comfort foods. Chickenjoy is Jollibee’s best-selling product in every country in which it has a presence.
MATCH INFO
Chelsea 0
Liverpool 2 (Mane 50', 54')
Red card: Andreas Christensen (Chelsea)
Man of the match: Sadio Mane (Liverpool)