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The art of listening
IBQ DISTINGUISHES ITSELF THROUGH ITS DEEP UNDERSTANDING OF ITS HOME MARKET, ACCORDING TO CHAOUKI DAHER, GM - HEAD OF PRIVATE BANKING
MOTORING F1 CULT HERO JEAN ALESI 36 Cover 40.indd 24
LUXURY TRAVEL THE MONTAGE BEVERLY HILLS 46
HNWI INTERVIEW BOLLYWOOD SUPERSTAR ALIA BHATT 40 4/13/17 4:22 PM
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CONTENTS
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OPINION
06
Finding common ground
Editor's
LETTER
Greetings, all
Welcome to the 40th issue of WEALTH Arabia. I hope you enjoy what is certainly our finest issue yet. In this current economic landscape, I’m sure you all have a lot on your mind. We’ve got some of the world’s leading voices in the investment world talking about a lot of what I’m sure you’re most interested in—how Brexit and Trump are affecting the investment landscape. From there, we have some great pieces on an external legal threat to UAE assets, some great long-term investment possibilities, and more. Once you’ve digested all of that, there are some lifestyle pieces in the back of our publication. An exclusive interview with Bollywood superstar Alia Bhatt, who currently has around 12 million followers on Instagram, as well as an exclusive with a ‘cult hero’ of Formula One, Jean Alesi. Beyond that, there’s still much to explore. I hope you enjoy it. Till next time,
William Mullally 4
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NEWS & ANALYSIS
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The latest analysis from the investment world
COVER INTERVIEW
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ibq: The art of listening
PRIVATE BANKING
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Navigating a Trump presidency
INVESTMENT
20 23 30
Brexit cliff: the scale ahead and the descent next Cybersecurity stocks set for huge growth A commodity bull market coming in 2017?
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LEGAL FOCUS
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Are UAE assets untouchable?
WEALTH MANAGEMENT
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Sink or swim
MOTORING
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Jean Alesi: A Formula One cult hero
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Chairman Saleh F. Al Akrabi Chief Executive Officer ROBIN AMLÔT Managing Editor GEORGINA ENZER Sales Director OMER HUSSAIN
EDITORIAL editorial@cpifinancial.net Editor, WEALTH Arabia WILLIAM MULLALLY William@cpifinancial.net Tel: +971 4 391 3718 EDITORS MATT AMLÔT matt@cpifinancial.net Tel: +971 4 391 3716
44 GOOD TALK
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The sublime Alia Bhatt
LUXURY TRAVEL
44 46 48
The perfect luxury weekend in Los Angeles Montage Beverly Hills
LUXURY PRODUCTS The wrist review…
HNWI CHAT
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Sitting down with an Emirati stand up comic
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ADVERTISING sales@cpifinancial.net Business Development Manager WEALTH Arabia DANIEL BATEMAN daniel@cpifinancial.net Tel: +971 4 3752526
JESSICA COMBES jessica@cpifinancial.net Tel: +971 4 364 2024
Business Development Managers NIKHIL MATHUR nikhil@cpifinancial.net Tel: +971 4 391 3717
NABILAH ANNUAR nabilah.annuar@ cpifinancial.net +971 4 391 3718
MOHAMED MAKSOUD mohamed@cpifinancial.net Tel: +971 4 391 5320
Contributors Norman Villamin Mihir Kapadia Fabiano Vallesi Byron James David Donora Mario Camara Chief Designer BUENAVENTURA R. JALUAG, JR. jun@cpifinancial.net
SIMON MOTWALI simon.motwali@ cpifinancial.net +971 4 4335321 London Bureau ISLA MACFARLANE isla@cpifinancial.net Tel: +44 7857 429476
Senior Designer FLORANTE MAGSAKAY florante@cpifinancial.net
Finance Manager SHAIS MEMON, ACCA, CMA Shais.memon@ cpifinancial.net Tel: +971 4 391 3727
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Head Office P.O. Box 502491, Dubai Media City Dubai, UAE Fax: +971 4 390 9756
ISSUE FORTY - APRIL - MAY 2017
www.cpifinancial.net WEALTH WARNING! The art of listening
IBQ DISTINGUISHES ITSELF THROUGH ITS DEEP UNDERSTANDING OF ITS HOME MARKET, ACCORDING TO CHAOUKI DAHER, GM - HEAD OF PRIVATE BANKING
MOTORING F1 CULT HERO JEAN ALESI 36
LUXURY TRAVEL THE MONTAGE BEVERLY HILLS 46
HNWI INTERVIEW BOLLYWOOD SUPERSTAR ALIA BHATT 40
Remember, if you wish to act on any of the information you read in WEALTH Arabia, consider taking independent advice first. WEALTH Arabia is written for a general audience and the information contained herein may not be appropriate for your personal circumstances.
Registered at the Dubai Media City Printed by United Printing & Publishing – Abu Dhabi, UAE © 2017 CPI Financial FZ LLC All rights reserved. No part of this publication may be reproduced or used in any form of advertising without prior permission in writing from the Managing Editor.
Don’t miss your copy of WEALTH Arabia. Subscribe now, full details at: www.wealtharabia.net and on Twitter @wealtharabia. ISSUE FORTY - APRIL - MAY 2017
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OPINION
FINDING COMMON GROUND
I
n our last issue, we featured my CPI Financial-exclusive interview with HRH Prince Khaled Alwaleed bin Talal, the founder of KBW Investments, about the establishment of Crestmount Capital and the launch of its inaugural fund. What made this story notable is that though KBW is firmly established in the investment landscape of the GCC, this was their first venture into the world of Islamic investment. So why was this choice made? Besides the appealing ethical and religious reasons that Islamic finance offers, there was one huge take home— “From a personal perspective, it’s also about meeting new investors who I previously had no interaction with in a business respect,” said Prince Khaled. Though there is huge overlap in what conventional investors and Shari’ahcompliant investors actually put their
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money in, what is most surprising is how the two rarely interact. KBW wanted to meet new HNWI investors, an entirely different base from whom he’d interacted with before. So the next question becomes, was it successful? Well, in Prince Khaled’s words, “We were very comfortable going to market and privately circulating Crestmount Fund I. The response was a very quick and simple confirmation of our initial findings: there is interest in Islamic investment instruments.” Crestmount Fund I was a huge success for KBW Investments. In this volatile time, success stories cannot go ignored. There needs to be more interaction between Shari’ah-compliant investors and their conventional counterparts. Because with so much in common, it’s worth accommodating each other’s needs to reap huge returns in this uncertain market.
William Mullally
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NEWS & ANALYSIS
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rivate equity firms continue to post strong returns and attract investors, but there is a risk of complacency that could prove detrimental in the long run.
Khaled Sifri, CEO of Emirates Investment Bank
Markus Massi, Partner and Managing Director of BCG Middle East
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n the 2017 Wealth Insight Report, results found that regional HNWIs are keeping a positive attitude towards the future, despite current volatility.
From a global perspective, 2016 was marked by heightened volatility across a range of markets and asset classes. This was certainly felt here in the GCC and, despite governments implementing structural reform plans and steady gains in the price of oil, liquidity remained relatively tight. It is, therefore, no surprise that this year’s GCC Wealth Insight Report shows that investors are expecting a flat or, possibly, declining economic performance in 2017—both at a regional and international level. It was particularly interesting to see 18 per cent of respondents say they had discontinued projects due to local economic conditions. However, over a three to five year horizon, there is a greater sense of optimism, with HNWIs expecting of a more favourable oil price and for the region’s economies to show strength and growth. The report does suggest a bit more caution concerning the medium-term outlook compared to previous years but my view is that this is more realistic given the nature of the global economic and political climate.”
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The current economic conditions are favourable in so many ways, but there are also a number of challenges looming ahead. We think top managers will use this as an opportunity—or even an imperative—to sharpen their thinking, improve their discipline, and be bold in several dimensions of their businesses. Specifically, local PE funds in the Middle East need to focus their efforts on enhancing their business models to cater for local investors’ appetite for international exposure.”
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STAY AHEAD is not just a statement.
It’s our way of exceeding expectations.
At Dubai First we continuously strive to ‘Stay Ahead’ by offering innovative financial solutions combined with world-class customer service. Industry recognition for our service, products and campaigns is testament to this commitment and our position as one of the leading consumer finance companies.
2016 Best Consumer Finance Company
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CHAOUKI DAHER
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COVER INTERVIEW
The art of listening IBQ DISTINGUISHES ITSELF THROUGH ITS DEEP UNDERSTANDING OF ITS HOME MARKET, ACCORDING TO CHAOUKI DAHER, GM–HEAD OF PRIVATE BANKING
What have been the main lessons you've learned about how to take care of HNWIs (high net worth individuals) and UHNWIs (ultra high net worth individuals) in your years of private banking? Since the Bank’s establishment in 1956, ibq has served several generations of high net worth and ultra high net worth Qatari families. While I believe there is no one-sizefits-all approach when it comes to taking care of a client’s wealth, there is indeed one key lesson I have learned from my 20 years of experience in private banking: transparency and honesty always win. Only full transparency and honesty can lead to a smart, highly personalised wealth management service offering that is 100 per cent aligned with a client’s long-term financial goals and aspirations. The second lesson I have learned, and that I am passing on to my team at ibq, is the art of listening—an art that every private banker should master. Our mission as private bankers is to get a deep understanding of our clients’ needs in order to make sure we have a clear picture of their goals, aspirations and dreams for them and their family. There is no space for interpretation in private banking
that is why we have to ask the right questions and first and foremost carefully listen to the answers. I truly believe that the “art of listening” is what distinguishes ibq and our team apart from the market. Therefore we spend a great deal of time and effort in devising the financial road map/framework i.e. the asset allocation that will achieve their goals and aspirations. Tell me about your private banking offerings. At ibq, our private banking services are extensive and are one of the main competitive advantages of the bank. In terms of wealth management, we offer the full range of the ‘services and products that are essential for our client base such as: asset management, private equity investment, real estate investment, structured products, tax advisory services, estate planning, securities and commodities. The Bank also offers family governance advisory services: our team of banking experts work with families across generations organising workshops and implementing “Best practices” to help every family develop their own unique solutions. ...cont. overleaf
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In addition, we offer offshore banking, where we set up offshore bank accounts on behalf of our clients, in collaboration with one of our strategic partners in selected locations worldwide. More importantly we advise our clients on how and where to diversify their wealth by deploying a portion of their assets outside of the region and act as their family office by having a global overview of their worldwide assets and actively managing their assets deposited with multiple financial instiutions. Our services go beyond the classic offerings. We thrive to offer unparalleled opportunities that customers do not come across often by having the right international network that gives ibq access to privileged investment opportunities coupled with the necessary expertise to evaluate the suitability of these investments for our client base therefore coming up with highly personalised wealth management solutions that fulfils the predefined goals of our UHNW families. At ibq we say that life is a journey; our private bankers stand by their customers throughout every step of this journey. This is our personal promise to all our customers. What differentiates ibq Private Banking from the competitors? ibq’s key differentiator is very clear: our longlasting relationships with our customers and the trust we built over time with them. Let me explain. ibq is one of the oldest banks in Qatar—we recently celebrated our 60th anniversary! As the Bank has been investing in building relationship with local families (Qatari and non-Qatari) for 60 years, we know all the most influential families on a very personal level. Our ‘human’ size allows us to get very personal with our customers and it’s the most compeling competitive advantage. There is a ‘moment of truth’ in a long-term bank-customer relationship— that moment when the professional relationship turns into a friendship. As an example, one of our private bankers recently spent eight hours in a meeting with a single client. We are also very often invited to our clients’ family celebrations at their home, and our clients spontaneously pass ...cont. overleaf
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CHAOUKI DAHER
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COVER INTERVIEW cont. from page 13
by the bank for a chat over coffee. This is how personal we get with them. Our wealth managers are available to our clients 24/7 for any kind of request, from the most basic to the most complex ones. Our brand’s positioning states that “our customers are not just account numbers, they are personal relationships”; we really mean it. Some of our customers have been banking with us for over 30 years where the Bank has been taking care of three generations of families. Loyalty over time is the strongest sign of trust from our clients— securing and cherishing this trust is ibq’s number one priority. Complementing the trust and deep understanding of our clients, I believe that our continuous efforts in developing and enhancing our wealth management service and product offering provides our clients with a great value proposition that is unmatched in the market. I can confidently state that this unparalled offer is a strong competitive advantage to attract a demanding HNWIs and UHNWIs clientele. We are proud to have received various international accolades which are testaments to ibq’s first-class customer service, such as “Best Private Bank” and “Private Banker of the Year” and “Best Customer Services in Qatar” awards from Banker Middle East. We at ibq firmly believe and take pride in that one of our core compentencies and differentiating factor from the competition is the level of knowledge and expertise of our people and and our significant investment in our human resources. Therefore we allocate a substantial portion of our budgets on developing our Relationship Managers and Investment Advisors to be able to offer the best solutions and services to our UHNW families. Tell me about the landscape for private banking in Qatar. How has it changed since you began? The field of private banking in Qatar is continuously evolving with the emergence of new technology. Banks are now offering online Corporate Internet Banking channels,
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I am particularly proud of the recent Banker of the Year award from Banker Middle East. Peer recognition from such a prestigious organisation is a strong reward and a testament that we are going into the right direction. – Chaouki Daher
new biometric technology, mobile banking services, and various digital services. More specifically, technology has enabled easy access to information without geographical borders, which changed the way we operate as banks. This is a major change I have seen over the last 20 years of my career. The scope of products and investment has also grown tremendously. The geographical scope of investment also changed: while in the past HNWIs and UHNWIs invested locally in Qatar only, now they are very interested in investing overseas, which opens up an ocean of new opportunities for our customers. What are the main challenges that private banking is facing in Qatar? The challenges, threats and opportunities that private banking is facing in Qatar are not different from any other market in the world: an evolving geopolitical and economic landscape, an aggressive competition, compliance challenges, business uncertainty, costs, fast-changing customer demands, digitalisation, privacy, etc… All those issues are keeping wealth managers awake at night, regardless of where the Bank is operating. Private banks always need to have this flexibility to change the way they operate when needed; those who can master change will be in a position to lead the industry, not only in Qatar but also on a global scale.
What initiatives do you have planned for 2017? ibq is constantly looking for new opportunities and exploring growth areas, allowing us to be ahead of the competition and securing customers loyalty. As explained earlier, the women segment has a strong growth potential: research shows that they are largely underserved and are less exposed to financial knowledge. ibq is receiving an increased interest from HNWIs and UHNWI women, which is why we are now offering financial literacy workshops tailored to women’s needs. We also recently launched an initiative to host international real estate investment workshops with a renowned London-based financial expert who came to Qatar to train VIP female customers. We will continue to organise tailored workshops and trainings based on special demands from customers. What investments are your clients most interested in? What investments do not get enough attention, but should clients be looking more at? In the last few years, we have seen a grown interest in real estate investment, in diversifying their investment portfolios, and in offshore banking. Offshore banking is still an area that deserves more attention considering its massive opportunities if managed smartly. We work with strategic
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partners in selected locations worldwide such as UBS, allowing ibq to expand a client’s holdings outside the region. By acting as a family office ibqhas a long-term, risk-averse and a holistic approach in designing wealth management and is ideally positioned to establish the right balance between domestic and international investments because of our global overview and deep understanding of our customers total wealth. What's your personal management philosophy? I truly believe in nurturing partnerships with my team of Wealth Managers. My management culture is mainly focused on sharing key learnings from my 20 years of experience in private banking in Qatar and overseas. Our most important asset in private banking are our people: they are the ones who build and maintain relationship with our customers. ibq has a strong talent retention programme offering regular trainings and workshops in private banking and wealth management, ensuring all bankers are up to date on what is best on the market. We really thrive to empower our staff in coordination with human resources and talent management teams. Last but not least, my golden rule is that my door is always open to both my colleagues and clients! Tell me about your recent win of Banker of the Year at the Banker Middle East Industry Awards. What does this win mean for you? I am particularly proud of the recent Banker of the Year award from Banker Middle East. Peer recognition from such a prestigious organisation is a strong reward and a testament that we are going into the right direction. As we are building on 60 years of private banking and wealth management in Qatar, ibq is the number one customer-centric bank that takes a particular pride in the formulation of lasting relationships—I should say ‘partnership and friendship’—with its clients. These relationships are founded on trust, loyalty, integrity and transparency. Our strength as a bank resides our deep understanding of the local and regional markets. Unmatched customer service is what we will continue to offer in the years to come.
CHAOUKI DAHER
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Navigating a Trump presidency TRUMP'S CONTROVERSIAL STYLE HAS TURNED ALL EYES TO THE US.
NORMAN VILLAMIN, CIO PRIVATE BANKING AND HEAD OF INVESTMENT SERVICES, UNION BANCAIRE PRIVÉE (UBP), SHEDS LIGHT ON HOW THE TRUMP ADMINISTRATION SHOULD AFFECT MARKETS MOVING FORWARD 16
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PHOTO:SHUTTERSTOCK/DENPHUMI
N
ow that the initial shock and surprise around the election of President Donald Trump has begun to fade it makes good sense to begin to focus more closely on the policy agenda of his administration and how this might influence international markets. The health of the US economy has a profound global impact and it is clear that the new President is seeking to build on his key election themes of "Making America Great Again" and "America First".
PRIVATE BANKING
What might these promises actually mean in practise and how should investors position themselves for the months and years that lie ahead? After what was clearly a hugely divisive election, there seems little point in raking over all the arguments which so comprehensively split the US electorate during the campaign. Instead it is time to deal with a President who communicates in new ways (especially on social media) and who is quite prepared to implement policy moves quickly via a rush of Executive Orders. It is an approach which is certainly less consensual than in the past and is indicative of a profound change to the overall political process. There will clearly be economic consequences too making it even more important for investors to have plans in place to adapt to the changes taking place at such a pace. President Trump has set out a bold plan to pursue tax reform and to repeal the Affordable Care Act (Obamacare). By doing so he seeks to build up his fractious Republican base ahead of the crucial 2018 congressional elections where he will seek to cement his political legitimacy. If he delivers on his pledges, there is likely to be a strong boost to the existing strong global growth momentum and this should be the nearterm focus for investors. In terms of capturing this growth, equities stand out at the moment in sharp contrast with the fixed income side of the market where investors are not receiving sufficient reward for taking on interest rate or credit risk. There is also scope to profit from investing in gold and following risk premia strategies as a useful means of hedging against medium-term policy uncertainty. A START-STOP APPROACH TO GOVERNMENT? The new President takes a brisk approach to the job and frequently makes a point of highlighting those core promises that formed the cornerstones of his campaign. This "start" phase of
his administration shows a President seemingly getting on with the repeal of Obamacare, outlining his tax reforms and starting the debate in the areas of trade and immigration reform. He wants to build on his mandate and ‘America First’ emphasis and so broaden his support ahead of the 2018 congressional elections. An initial burst of energy may well not carry on too far for the new administration. As Trump begins to confront the reality of translating his rhetoric into action on trade protectionism and immigration there is the chance that the presidency may enter a "stop" phase. While this may pose risks for investors in the medium term, any pause taking place will be against a strengthening global backdrop and a successful "start" phase heightening the prospects of an upside earnings surprise from equities. THE POLICIES THAT MAKE TRUMP TICK There was something of an expectation around an election victory effectively "taming" Donald Trump. Some seasoned political commentators and financial analysts argued that the contentious proposals set out in the campaign would quickly and quietly be watered down with a more moderate programme emerging from the Oval Office. However, this assessment does not fit the real context of the Trump election win where he failed to secure the popular vote compelling him to focus on rewarding his supporters by delivering on campaign promises. He also wishes to lay the groundwork for Republican success in the 2018 elections. In policy terms, this means little likelihood of any shift away from much of the divisive campaign plans creating an expectation that the President really does "mean business". So how might this turn out in policy terms over the next few weeks and months? The first two weeks alone of the Trump administration provide a stark ...cont. overleaf
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PRIVATE BANKING
illustration of just how the President sticks to his campaign script. With an extensive use of Executive Orders he appears quite prepared to bypass US congressional approval. He announced a freeze on new regulations and a plan to take steps to begin weakening those financial regulations enacted since 2008 including those designed to underpin a stronger banking system following the crash of 2008. The President's burst of initial activity continued with the formal announcement of US withdrawal from the Trans Pacific partnership and the order to begin building a border wall between the US and Mexico. He also instructed US agencies to waive fees/ grants exemptions from Obamacare regulations "to the maximum extent permitted by the law". Rapid additional policy followed with the blocking of admission of nationals from seven "countries of concern" for a 90-day period and a halting of permission for
refugees to enter the US for four months. While the courts have challenged this tightening of immigration, the President's intent in this area seems to be clear. TRUMP'S STIMULATION STEPS FOR THE US ECONOMY Much of the excitement in US markets has revolved around the President's strong emphasis on boosting the success of the US economy. While some of the language he uses around free trade, protectionism and a US infrastructure programme is more about intention than clear policies he can quickly move on to address the specifics about tax reform (including actual cuts in personal and corporate taxation) and the repeal of Obamacare. Yes, there is a lot of noise about trade in particular, and to a lesser extent immigration policy. However, in terms of practical measures and outcomes there is a definite emphasis on tax
reform and the end of Obamacare as a way of laying the groundwork for the 2018 Republican campaigns for the US Congress. IMPLICATIONS AND OUTLOOK FOR US GROWTH There are already clear signs of acceleration in the US economy backed up by strong rebounds in both business and consumer confidence. While fourth quarter GDP disappointed at a lower than expected 1.9 per cent due to a negative net export contribution, there was still a 2.5 per cent improvement in domestic demand driven by sustained consumption, a lively housing market and a sharp pick-up in capex. All of this supports an upwards revision in the growth outlook should the range of key economic indicators continue to show signs of improvement. However, there is a need to balance broad optimism with a measure of caution. As the slack in the US economy
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declines still further, there is an upside risk to inflation and wages driven by an increasing shortage of available workers across both specialised and nonspecialised parts of the economy. CAN TRUMP REALLY DELIVER ON HIS FOUR PER CENT GROWTH TARGET? After all the years of disappointment following the global financial crisis how realistic is Trump's four per cent US GDP growth target? With an emphasis on Ronald Reagan style supply side reforms through lower taxation and reduced regulation, the new President is committed to driving up US growth. An economy that is already on the move is likely to benefit still further from the effect of lower personal taxation. This should boost consumers' disposable income and propensity to spend while any cuts in corporate tax rates will provide additional support for their profits and future spending. A further potential turbo charge to the US growth story comes from the deregulation process for banks, energy and the healthcare sector. A drive to "set these markets free" could well provide further support for corporate profits and spending. Some analysts see hope for US corporate taxation actually falling below the OECD average and reduced regulation helping to restore the competitiveness of the US manufacturing sector. With this contributing 11.5 per cent of GDP any improvement will quickly energise US growth prospects. Again it is worth remembering the consequences of growth that becomes unsustainable. This presents a risk of the US economy overheating with the Federal Reserve's two per cent inflation target coming under pressure. There is already an expectation of the Fed dipping into its monetary toolbox with at least two interest rate hikes expected.
Any surprise around additional rate increases could well take the sheen of the US recovery story. What's more, any renewed dollar strengthening against major trading partners could provide a meaningful headwind to US corporate profitability. THE FUTURE FOR FREE TRADE With so much protectionist rhetoric during the election campaign, there is considerable concern around the ability of the global economy to take the necessary steps to free up markets and grow the volume of cross-border trade. President Trump talks about an aggressive pursuit of trade reform to correct what he perceives as a complete lack of balance between the US and key trading partners such as China and Mexico. Any talk of tariffs or new 'border taxes' could potentially distort costs and pricing power for American and international firms operating in the US. The extent of this varies according to sector and business model but the consequences could well be significant and create a drag on profits plus an acceleration of inflation. Discussions around trade link closely with Trump's concerns about levels of immigration. His populist approach may appeal to his supporters but raises questions about the longterm sustainability of the US economy given the ageing "native born" population and its ability to fill the jobs market. WHERE NOW FOR GLOBAL GROWTH? Investors should always prepare for uncertainty but also be ready and able to exploit opportunity. Dramatic shifts in policy whether in the US or elsewhere could yet inject instability into global markets during 2017. However, there is a real global growth story that is going on right now and extending across major economies all around the world.
With this positive backdrop, investors should seek to participate in the recovery taking place but still ensure that they manage risks potentially arising from any radical policy changes announced by President Trump. Although global equities are by no means cheap they do still compare well with bond markets (both government and corporate) where investor return prospects do not fully reflect the credit risks and interest rate volatility faced by investing in debt. There is scope for a higher exposure to high yield and emerging market debt but a need to be mindful in the light of today's shifting risk-reward prospects. A shift away from bonds towards equities is one that potentially boosts the prospect of an enhanced return. The Japanese market is also set to be a primary beneficiary from corporate reform and global recovery given its export led economy. As a result, earnings expectations are going up and there does at last seem to be something of a recovery in the Japanese corporate sector. Discussion of Europe so often focuses on problems with political instability and concerns around Brexit and the single currency. However, there is a risk of overstating these and Europe may well also benefit from the brighter international outlook. Combining this with scope for profitable stock picking in the US market in 2017 and it becomes clear that opportunities exist for investors ready to ride the wave of global growth. However, it is still true that risk mitigation counts. With this in mind, gold may well merit its "safe haven" status if political events surprise and it is also worth considering some exposure to the alternatives space through appropriate risk premia strategies. President Trump has energised the US political scene. Global markets show clear signs of having their own energy too and offer real opportunities for the informed investor.
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SHUTTERSTOCK/MERC67
ARE THINGS AS GLOOMY AS THEY SEEM? LIKELY NOT, WRITES KAPADIA.
BREXIT CLIFF the scale ahead and the descent next
MIHIR KAPADIA, CEO AND FOUNDER OF SUN GLOBAL INVESTMENTS SHEDS LIGHT ON THE IMPLICATIONS OF THE BREXIT VOTE AND ITS PROSPECTS FOR INVESTMENTS IN THE MENA REGION 20
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THE MARKETS
The very development of the European Union as a political and economic partnership began after World War II with the belief that countries which worked together and traded together are more likely to avoid going on to war with each other. While the UK has been a member of the single market, it was considerably fairly autonomous with its own currency and significant independence from the EU parliament. However, in the same sense it was also disadvantaged by the fact that it was bound by EU regulations as well as requiring EU approvals for any trade pact or socio-economic, and to a fair extent political relations it wanted to forge. The larger effects of Brexit can only be speculated at the moment, however it is clear that once outside of the union, the UK would be free to engage trade pacts on its own terms, instead of being directed through Brussels. This is one of the main perceived benefits for bravely leaving the EU.
THE CURRENT SCENARIO
Having clocked a year on year growth of 2.2 per cent, the UK is actually the
fastest growing economy amongst the G7 countries in 2016, very different from the gloomy forecasts given during the Brexit vote. In fact, since the first six months of the Brexit vote, the UK experienced an annualised growth rate of 2.5 per cent without any evidence of slowing down as we begin the process of leaving the EU. Strong consumer spending, supported by the financial and services sectors, has been doing much of the heavy lifting for the economy, countering a slump in production, construction and agriculture. Though Britain’s economy continues to defy the experts, we will be going into 2017 with caution as more clarity emerges on the path ahead for UK, away from the shadows of the EU. There certainly will be changes in the way businesses operate, but overall the economy should be able to recalibrate. The challenge would be to prevent this familiarity turning into complacency— sluggish wage growth and rising inflation may mean we no longer may be able to depend on consumers for keeping the economy buoyant. ...cont. overleaf
B
ritain is on the verge of undertaking phenomenal change, the likes of which no country from the EU has had experience in handling. As the UK prepares to break free from the union, opponents are wary of what they see as a step towards its isolation. Historically, the UK has been one of the global powers, economically and politically for a reason—if the world ever was reduced to a roundtable—you would most certainly find Britain right in the centre of it having a significant voice or vote. The fear amidst them is that the UK would now be excluded from the executive member club, and would be left alone to fend for itself. Source: Dubai Tourism and Commerce Marketing , Emirates NBD Research ISSUE FORTY - APRIL - MAY 2017
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THE MARKETS
Source: Office of National Statistics, Emirates NBD Research cont. from page 21
THE SCALE AHEAD
The ideal situation is for the UK to leave the EU exactly two years after triggering Article 50. However, since the negotiations will be between the UK and 27 other countries, we have to act quickly to be on course with the target. Sticking to the timeline of negotiations is really important as the UK will be in a state of limbo until everything is settled. As this is the first time a country is leaving the EU there is no precedent to go on. It is now up to the politicians on all sides to amicably resolve the breakup.
LOOKING EAST INTO MIDDLE EAST
While the UK is yet to provide a formal notification of exiting the EU by
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triggering the Article 50, the country has already set its sights on potential and prospective partners outside the EU. Prime Minister, Theresa May has undertaken visits to countries like India, Bahrain, UAE, US and Turkey. While there have not been any concrete agreements yet (EU rules prohibit countries from negotiating trade relations before leaving) the UK did receive reciprocal interest for free trade partnership. The MENA region is one of the key focus areas for the UK, with British exports to the region reaching $18 billion in 2014, apart from cooperation in defence, security and development. The region possesses among the best scope for mutual partnership
with a faster and robust growth rate, outpacing the developed markets in Europe and US. Countries including the UAE, Qatar, Kuwait and Bahrain are rapidly transforming their economy and expanding market dynamics to make it easier for foreign investments and partnerships. The most important factor is that the region has also recognised and commenced working on a post oil economy and diversified the market structure. The growth rate and the scope in the region, combined with the UK’s new post-Brexit future mean that the Middle East and Britain have a new era waiting ahead. We are certainly in an interesting period and are sure to witness phenomenal change.
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INVESTMENTS
Cybersecurity stocks set for hyper-growth FABIANO VALLESI, NEXT GENERATION ANALYST AT BANK JULIUS BAER, OUTLINES HOW THE IMPORTANCE OF CYBERSECURITY AND ITS IMMATURITY AS AN INDUSTRY PUT IT IN LINE FOR HUGE INVESTMENT RETURNS FOR HNWIS
C
ybersecurity has become a top concern among corporate executives and national leaders. Events such as the hacking of the US Democratic National Committee, and also multiple high-profile data breaches over the last few years (e.g. Target, Sony, Home Depot, Yahoo, etc.), have raised a whole new set of issues. Furthermore, the pace of malware growth has been accelerating over the past few years. The average time it takes to detect these attacks can be several hundred days, and lack of rapid discovery could significantly hurt the corporate earnings and reputations of the affected enterprise. A study by Allianz estimates that cybercrime costs the global economy $445 billion annually. The mitigation needs for cyberrisk led to a spending boom for IT security in 2014/15, with growth accelerating from 2.5 per cent in 2013 to nine per cent in 2015. The surge in spending lifted most boats, but the aftermath was a deceleration in growth in 2016. Now, we think we are seeing a stabilisation of growth. Cybersecurity spending is estimated to grow at a lower but steadier rate of 7.5 per cent a year through 2020E, to reach $114 billion, still more than twice the rate of overall IT spending. Near-term, several third-party research surveys highlight that security software
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ranks as top priority for CIOs (chief information officers), as well as the most defensive area of technology spending. The current key debate is whether the slowdown in growth seen across the cybersecurity market in 2016 was due to cyclical (digestion after a period of
‘binge’ spending in 2014/15) or secular factors (the move to public cloud computing reducing the demand for onpremise security solutions). We believe that the slowdown was mainly due to cyclical factors, as the high spending period needed to be digested.
CORPORATES ARE CONSTANTLY UNDER ATTACK
Source: Ponemon Insitute, Wall Street Journal, Julius Baer
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We see three factors driving growth in IT security going forward, such as: 1) cloud computing, 2) growing complexity and impact of cyberattacks due to increased connectivity (mobility, internet of things, etc.), and 3) new regulation and public spending initiatives. 1) Cloud computing will transform cybersecurity The increase in cloud computing adoption will have meaningful technical and economic ramifications on most areas of software, including the cybersecurity market. The shared nature of the public cloud is driving demand for unique security and data encryption needs. Naturally, security software vendors are adapting their offerings to this growing field with bespoke solutions. However, the shift to the cloud is also creating new potential long-term competitive dynamics and consolidation potential among security vendors. Then, the more homogenous nature of cloud architecture makes it less vulnerable to attacks, compared to systems that have a number of different products from different vendors tied together. Nevertheless, cybersecurity vendors are currently benefiting more as cloud computing is increasing IT security consumption. In addition, public cloud companies are also partnering with security software companies to provide greater protection and ease customer concerns on security matters. 2) Growing threat complexity and rising connectivity The continuing evolution of threats and attacks on IT systems is another major factor driving the need for cybersecurity. Cybercriminals are becoming more sophisticated and well-resourced. Unique malware discoveries in 2015 jumped 36 per cent over the previous year, to over 430 million new pieces of malicious software,
while instances of stolen identities increased 23 per cent, according to Symantec. Though malware, spam and phishing attempts have grown in number, such attacks have usually been controllable from a security perspective. What’s new is the increasing number of threats which are unknown at discovery (so-called ‘zero day threats’ exploitations), and make it challenging for enterprises to proactively fight them. Furthermore, increased adoption of internet of things (IoT) devices is creating millions of new network endpoints, spawning fresh risks. These devices, from webcams to wearables to internet-connected cars, are expected to reach almost 21 billion by 2020, versus six billion in 2016, according to Gartner. Looking forward, IoT attacks are set to increase, as vulnerable and poorly-secured
IoT devices might be infected with malware and be used in a botnet. More concerning is the fact that with increasing sophistication of malware, it will be even more difficult to know when a smart refrigerator or internetconnected baby-phone, camera, or toaster is part of a “zombie” botnet. 3) Regulation and government spending initiatives Enterprises in the US have increased cybersecurity spending partly due to regulatory pressure over the last years. Data protection laws that have already been introduced, and ones that will be implemented over the upcoming years in Europe and the Asia Pacific region are expected to accelerate spending on IT security solutions in these parts of the world as well.
CYBERSECURITY TO CONTINUE ITS STRONG GROWTH PATH
Source: Gartner, IDC, Forrester, Citigroup, Jefferies, Julius Baer; Note: market includes IT security services such as consulting; E=estimate
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Are UAE assets untouchable?
GCC HNWIS SHOULD BE CONCERNED THAT ORDERS OBTAINED ABROAD MAY NOW BE ENFORCEABLE IN DUBAI WRITES BYRON JAMES, IN-HOUSE COUNSEL, AL ROWAAD ADVOCATES 26
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LEGAL FOCUS
THE LEGAL WORKINGS AROUND THE GLOBE CAN BE COMPLICATED, BUT CANNOT BE IGNORED.
T
he efficacy of a court order or judgement is only as good as the ability to enforce it. As the influence and relevance of the UAE grows on the international stage, the world increasingly wants to interact with the UAE in a number of ways that are legalistic as well as commercial.
Inherent in this is the enforceability in, say, Dubai of an order obtained somewhere else in the world. There is a growing trend, perhaps reflecting the more long term, settled plans of expatriates in the UAE, of purchasing property and using the country as a base for their self-run businesses. Consequently there is a lot of
individuals' and families' money finding its way to the UAE. The ability to rely upon the local jurisdiction to recognise and enforce international orders would provide fairer and more cost efficient routes for expatriates in a variety of contexts, from personal to commercial. It was with this in mind that there was a degree of interest in the decision of DNB Bank ASA v Gulf Eyadah [CA-007-2015] (25 February 2016) which appeared to confirm that parties would be able to have a foreign order recognised in the DIFC court and then use this recognition to obtain enforcement in the Dubai court. The case involved a banking dispute, where an English order was made in the Chancery Division and the DNB bank wanted to enforce that order in the Dubai court. The decision at first instance held that there was jurisdiction in the DIFC court for the application to enforce to be made but that it would not be possible to take the next step in the process of seeking enforcement through to the Dubai court. The first instance judge stated what many had understood the position to be for some time: that foreign arbitral awards were recognised (under the New York Arbitration Convention on the Recognition of Foreign Arbitral Awards) but foreign judgments were not. The successful applicant bank brought the appeal on the ground that the barrier to enforcement from DIFC to Dubai court would undermine their ability to enforce the English order effectively, and ultimately undermine the order obtained in the DIFC court. The appellant bank argued that halting the progress from DIFC court to the Dubai court on the ground that the order obtained was a recognised foreign judgement was wrong because once the English order had been ratified in the DIFC court then it would progress thereafter as an order ...cont. overleaf
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PHOTO:SHUTTERSTOCK/ FOTONIUM
IT SEEMS YOUR UAE ASSETS MAY BE VULNERABLE TO INTERNATIONAL ORDER.
cont. from page 27
of that court rather than as a foreign one. This argument succeeded and the Appellate Court upheld the appeal on this basis—creating what some have termed 'a conduit jurisdiction'. There was thereafter a clear route to overcome the inability to enforce foreign judgments in the Dubai court, by filtering them first through the DIFC court and enforcing that order in the Dubai court removing the foreign judgement label. There is no "forum non conveniens" test applicable between courts based within the UAE and therefore one can choose to apply freely in the first instance to the more commercial and globally minded DIFC court. This decision had the potential to be very significant and, whilst applicable in a banking case, clearly had a wider reach: if an
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any international court made a money order against a person, and that person only had assets in the UAE, there was now a possible route available to have that judgement debt enforced against them. It had the potential to open the door to enforcement against a wide array of persons who had previously them considered their UAE assets beyond the touches of international courts. However these 'open doors' caused concern; consequentially, on 9 June 2016, the Ruler of Dubai established the Judicial Tribunal for the Dubai Courts and DIFC Courts. The specific purpose of this Tribunal is stated as being to resolve any conflict of jurisdiction that might arise between the DIFC courts and the Dubai courts. The dynamic between the two courts is complex and interesting.
There is therefore a continued uncertainty as to the extent to which international orders will be capable of enforcement in Dubai/UAE through the conduit jurisdiction, although it is now closer to a reality than ever before. The legal advice now to clients will be to adopt a wait and see approach, to see how the Tribunal itself will respond to future such attempts to achieve enforcement and recognition. It remains however that some clients face little choice where agreements both as to substance and to arbitrate remain unforthcoming. These two mechanisms, binding agreements and arbitration, continue to provide the safest means of achieving certainty in legal cases involving the UAE and another country. They remain the clearest, unimpeded route to recognition and enforcement within the UAE courts.
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Untitled-1
SPONSORED BY:
I N THE PURSUIT OF E XCELLENCE
I NDUSTRY A WARDS 2017
SAVE THE DATE 11th
THURSDAY
MAY 2017
The Godolphin Ballroom, Emirates Towers Hotel, Dubai 7pm cocktail reception followed by dinner and the awards ceremony
www.cpifinancial.net
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29/03/2017 09:37
PHOTO:SHUTTERSTOCK/ SNEHIT
SPOILER ALERT: DON'T HOLD YOUR BREATH FOR A BULL MARKET.
A commodity bull market coming in 2017? AFTER COMMODITY PRICES BOTTOMED IN EARLY 2016, DEMAND IS OUTSTRIPPING SUPPLY ONCE AGAIN, SUGGESTING THE NEXT BULL MARKET MAY BE APPROACHING, WRITES DAVID DONORA, HEAD OF COMMODITIES, COLUMBIA THREADNEEDLE INVESTMENTS
D
uring an 2016 was the year when the commodities bear market ended. It capitulated in January
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when crude oil fell below $30 a barrel and a number of commodity-producing companies in the energy and metals
sectors were in a battle for survival, selling off assets and desperately restructuring their balance sheets.
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INVESTMENT
As commodity prices fell below the cost of production, these companies were losing money at a rapid rate. If oil stayed below $40, then 20 per cent of global capacity would have gone out of business. Similarly, major mining companies Glencore and Anglo American were forced to liquidate significant parts of their overall businesses to reduce debt and to shore up their balance sheets. The market recognised that prices were unsustainably low and there was a small bounceback. As we enter January 2017, prices are rising further. This is because, although prices fell in 2015 and the beginning of 2016, demand for commodities continued to increase; not at an extremely strong rate but fairly consistently. And so the requirement for increased production over the medium term remained. The Bloomberg Commodities Index rose 11.8 per cent in 2016.
That does not signal a bull market. In my view, a commodity bull market is when we experience a doubling or tripling of commodity prices. In the bull market of 2000-2008, the index tripled in value. That was a full commodity bull market. 2016’s rise is just bouncing along the bottom. So, prices have risen, significantly in base metals and in energy. In oil, OPEC countries and a number of non-OPEC countries led by Russia have agreed to take 1.8 million barrels per day of production off the market to reduce excess inventories more quickly than they would otherwise have been depleted.
DEMAND OUTSTRIPS SUPPLY
The question for 2017 is whether the market bounces along the bottom or prices increase significantly. My view for 2017 is that we will have significantly higher prices for a number of reasons: Firstly, the supply side is not in a position to respond to significant demand growth.
While commodity producers have spent the last three years dealing with very low prices, focusing on balance sheet restructuring and saving cash, they have not brought on new projects. Also, in mining they have been ‘high grading’ (only producing the highest grade ore) to just stay cash-neutral or cash-positive. Secondly, I expect there will be significant demand growth. Emerging markets demand will be greater than the market expects, especially in Asia. China has been going through economic restructuring for a number of years. We believe that it is coming through that and there will be stronger consumerled demand from China and all Asian emerging markets. Thirdly, we think that in the developed and emerging markets, consumers have enjoyed low food and energy prices for two years, and that has shored up their finances and now they are also receiving ...cont. overleaf
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INVESTMENT
cont. from page 31
higher wages. So, we expect consumer demand for commodities to increase. For example, for two years the oil price has been around $50 rather than $110. That halving in the price of oil was worth $2 trillion per year to the benefit of consumers, at the expense of oilproducing companies and countries. Fourthly, governments of both developed and emerging countries are signalling a shift in focus from monetary policy to fiscal policy and fiscal stimulus. They recognise that quantitative easing has not materially helped consumers and consider that fiscal stimulus is more likely to do so. We expect to see the US, Europe and Japan turning to fiscal stimulus, while China continues to deploy it. That will increase demand for commodities.
A WIDESPREAD TREND
The increase in demand is likely to be most acute in base metals. Copper, zinc, nickel and aluminium should benefit from a substantial increase in consumer demand for metals. We think the growth rate for oil demand will continue to be strong in 2017. The return of supply discipline will keep the
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oil price on an upward trajectory. It is worth noting that there is very little spare capacity globally. If the OPEC agreement holds and 1.8 million barrels are taken off the table globally, that accounts for almost all surplus inventory, leaving the world vulnerable to a supply disruption. We have concerns about this given the security situation in the Middle East. The new US administration is unlikely to want to be the region’s peacekeeper. And while the Russians have become more involved, it is not clear whether this will contribute to stability or not. It is likely that the boundaries drawn up in the Sykes-Picot Agreement 100 years ago will be redrawn. Longer term we are bullish about precious metals as well. Gold is likely in the short term to continue to be weak while bond yields are rising. Commodities, in general, are negatively correlated with bonds but gold at the moment is behaving more like a low-yield reserve currency and less like a commodity. Gold will be weak when bond yields are going up and bond yields have some way to go. Once bond yields plateau we would expect to see gold strengthen again.
Turning to agricultural commodities, there have been two years of abundant harvests as the El Niùo weather cycle’s stable weather pattern has prevailed. But this has ended, so weather is likely to be more variable in growing regions and so crop yields are likely to fall. Our view is that despite having two great years to rebuild stocks, they are only adequate. If the next Northern Hemisphere harvest is compromised, we will see upward pressure on agricultural prices.
START OF THE BULL MARKET?
Across the commodity markets as a whole, we expect 2017 to be another positive year. Inventories are tightening. Commodity curves are flattening, which supports prices and returns for investors. Producers are likely to have difficulty keeping up with demand over the next couple of years. We have had the end of the bear market, after which there is normally a period of bouncing along the bottom. While this historically has persisted for two to five years, we think that a focus on improving the lot of consumers could bring this forward to 2017.
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Wealth H
NOVEMBER 2017 Wealth House Ad 2017.indd p30-32_Investment.indd 33 6
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WEALTH MANAGEMENT
Sink or swim
NEW TECHNOLOGIES ARE CRITICAL TO THE SURVIVAL OF WEALTH MANAGEMENT FIRMS, WRITES MARIO CAMARA, HEAD OF SAXO BANK DUBAI
F
intechs are disrupting many aspects of the financial services industry and wealth management is no exception. These new entrants can provide scale and greater customisation at a much lower cost than traditional wealth management models, many of which are heavily dependent on human resource and have highly manual processes. So, what will be the impact of this trend—will the new guard succeed in transforming the wealth management business to the extent that it sweeps away the traditional incumbents or will they simply bring more commoditisation to an industry which is already suffering from low margins? If it is the former and fintechs begin to threaten existing wealth management providers to near extinction, the incumbents have two choices. They either continue the trend as a full stack business where they own the complete value chain, which has proven to be profitable, but battle it out
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against the increased cost and complexity to run and maintain such a business model, or they pivot to a platform business model, where they would sit on top of a vast third party supply system and focus their capital expediture on their relationship with the digital user. We believe that the platform business will be the more successful model. This view is informed by what we have seen with the technology disruption in consumer industries such as leisure and travel with Airbnb and Uber, respectively. A key feature of this digital revolution has been the growth of business models that rely on service aggregation to build a superior user experience, rather than wringing more value from owned assets by offering an ever widening range of products and services.
In short, an enormous amount of value has been generated by companies that build the layer (i.e. the user experience or digital relationship) that sits on top of a vast system of suppliers (the products and/or services of others). Many people believed—and some still do—that wealth management is impervious to tech disruption due to the extent of highly customised services and deep personal relationships which most providers offer to their high net worth clients. But it is the attitudes of the high net worth clients which are changing. The digital revolution has infiltrated many aspects of their daily lives, whether it is
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previous technologies which were aiming to achieve this level of interoperability. So how should wealth management firms adopt successful open banking strategies and become platform businesses? Many of them already offer supplementary services provided by third parties such as execution brokers and performance analytic specialists as part of the client experience but such services are often subject to complex agreements that take time to upgrade or replace. The benefit of APIs is that they enable third parties to access each others’ systems and platforms more easily. Wealth managers who embrace the API model will have new opportunities to select
and regularly review the value derived from the various supporting building blocks on which they construct their own proposition to customers. This increasingly important form of unbundling and re-bundling is a critical differentiator between simply ‘improving’ a product/service or fundamentally ‘changing’ the establishment for the better with a completely new re-bundled proposition. Thus far, the changes wrought in the wealth management sector have been witnessed in the client experience rather than a reconfiguration of the competitive landscape, but the latter is on its way. In order to be successful in this new world, not only do wealth managers need a deep understanding of evolving client needs but also an understanding as to how new technologies can meet these needs. In short, if wealth managers do not embrace technology and adopt an effective digital strategy, their very existence may be threatened.
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SHUTTERSTOCK/FRANTISEK CZANNER
online shopping or high end travel, and they want this level of convenience, control and high touch experience in the management of their wealth. The combination of new powerful technologies is enabling this digital revolution in financial services. In particular, the proliferation of open banking architecture is being driven by the increasing use of APIs which enable incumbents and new entrants to create best of breed propositions which draw on the services of multiple third parties. Furthermore, the use of APIs enables the customer experience to be more personable and user friendly creating greater cost effectiveness, agility and flexibility than
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A FORMULA ONE
CULT HERO Jean Alesi’s legacy in racing endures to this day. WEALTH Arabia caught up with him exclusively to talk about his car collection, the industry today, and his new watch
I
n the world of Formula One, Jean Alesi always set himself apart, in both style and substance. Though he may have never been one to rack up championships, he was a star all over the
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world, racing for such big names as Ferrari (1991-95). He was known for his passion, his aggressive style, and his skill in difficult conditions. Formula One’s own website honours him as a cult hero, describing him
as a tenacious, enigmatic underdog who seemed destined for greatness from his first major race. Even after he left Formula One, he continued driving, even becoming the oldest professional driver to perform
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PHOTO: PHOTO: FLICKR.COM/PHOTOS/KEMEKO FLICKR.COM/PHOTOS/KEMEKO
JEAN ALESI DRIVING FOR FERRARI IN 1992.
the rookie test to enter the Indianapolis 500 in 2012. In France, he was named a Knight in the Legion of Honour, the highest distinction in the country. Now living in his hometown of Avignon, Alesi refuses to call the cars he has a ‘collection’ as “there are some really amazing collections out there,” but he keeps in his garage a Rolls Royce Phantom
II, a Porche 356, and a Mercedes Benz SLR McLaren 722. Which does he like best? Well, Alesi doesn’t play favourites. “I love all of them, it depends on the time. I do not want to have a car in my garage that I do not use. They all work very well. It’s like when you go to dinner, you wear different shoes depending on the weather and the destination.”
He does seem to have a special eye for his Rolls Royce from the 1920s. “When we talk about the Rolls Royce, it looks like something very old, but the way the car starts, the way you use it, it’s not very practical because it’s very big, but it’s so nice. It’s like having an office moving around with you. I have to drive because no one else can drive this car—it’s dangerous! ...cont. overleaf
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The sparks, the fuel mixture—it’s as careful as a formula one! For the people in the back, it’s very comfortable. So I like to go around Avignon for coffee in this car. It’s great.” Since Alesi left Formula One, a lot has changed without him. In Alesi’s mind, a lot of those changes are for the worse. “What is very different now is the technology and the rules. In my time, we had lots of different types of engines.
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When I drove for Ferarri I had a V12 engine, before that V8. Before that, a V10. Everyone had a different philosophy on driving the car. I think it was more fun in my time. A lot of drivers are complaining about that—the cars are too standardised. When someone has a more competitive car, they win every race because nobody can beat them, because there is no testing anymore, and to operate the car and
develop it, you compare one race to the other one. You cannot go out on the track and test the specific conditions. They have no possibility to do testing on the track anymore.” Becoming a driver, too, is a huge challenge if you do not have the funds to do so. “For my son, every year of preparation to become a driver, just as a beginner, costs almost EUR 1 million. So you need to invest EUR 1 million
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MOTORING “If I take the example of Italy, in the past, the average was six million viewers for the Grand Prix. Now, they’re struggling to get over 700,000 viewers. More people now are going for football. And regarding promotion, when a company such as Coca Cola wants to sponsor sport, they no longer choose Formula One because it doesn’t have the audience.” Drivers like Jean Alesi play a huge part in making young people excited about motoring culture. Let’s hope that Formula One can fix its issues, for the sake of car lovers everywhere. What is Alesi working on now? He has a new watch out with Montegrappa, of which he is a shareholder. According to Alesi, The Alesi Limited Edition WaterResistant Chronograph is a tribute to his love of chronographs, as well as his love of cars. “We set to make a watch and we talked about it, of course, the new technology of the Formula One is electronic, hybrid systems, and we made a watch with that spirit. We worked on making things light but strong at the same time.”
ALESI IS KNOWN FOR HIS STYLE ON AND OFF THE TRACK.
for something you’re not sure of. And when you reach the Formula One, you have to pay maybe EUR 5-10 million just to participate, when you’re not sure about sponsors. Now there are kids coming in with a lot of money for whom it is possible to have this budget, but when you are an average guy from France, or from Italy, you have no chance.” There isn’t just a problem on the track—it’s harder for fans as well.
“Accessibility is less possible these days because the price of the ticket is too high. Also, on TV, most of the channels are pay TV, so there is less accessibility for a normal fan to watch Formula One and that is a shame.” The lack of accessibility ultimately hurts the ability to make new fans, and hurts the viewership of big events compared to the huge audiences they used to find.
MONTEGRAPPA JEAN ALESI WATCH.
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GOOD TALK
The sublime Alia Bhatt FRESH OFF THE RELEASE OF HER LATEST HIT BADRINATH KI DULHANIA, THE BELOVED BOLLYWOOD SUPERSTAR TALKS EXCLUSIVELY WITH WEALTH ARABIA ABOUT THE HIGHS AND LOWS OF HER CHARMED LIFE
Where would you like to go next in your career? Honestly I’m still looking for that one film. I’ve signed on for two films that I will be doing towards the end of the year, and I have some time off, and I thought that I might squeeze in a film in that time but I’ve been unable to find something that’s really got me going crazy. I’ve been quite distant with my choices because I constantly change my mind—I always want to do different things. Either I want to do an out-and-out comedy or a true story, maybe a period film. Something completely different.
BHATT SHOWS OFF HER MOVES IN 2017'S BADRINATH KI DULHANIA
What are you most proud of? I don’t really feel proud very often. There’s little things that do it for me, sometimes I randomly bump into little girls and they talk about how a character has been an inspiration for them, how a character moved them to talk about their life like the way I did in that film. That makes me happy, because that means the character has stayed with them. It’s not about me, it’s about the story. At the end of the day, we all, or at least I do, react to movies like they actually exist. If you can kind of make the audience believe that these characters actually existed— when I talk about Friends the sitcom, I really feel like these people actually exist. ...cont. overleaf
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H
RESPE
GOOD TALK
Live and let live. I don’t really take myself too seriously. I don’t take other people too seriously. There should not be conditions applied to a situation in anybody’s life, especially girls’. That’s something I really abide by.
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I wish that people have the same reaction when they watch my films—these are the moments that mean a lot. What’s your personal life philosophy? Live and let live. I don’t really take myself too seriously. I don’t take other people too seriously. There should not be conditions applied to a situation in anybody’s life, especially girls’. That’s something I really abide by. Does acting fulfil you the same way it did early in your career? More and more. I just can’t get enough of it. The more I cant, the more I want to. It fulfils me a lot. I love being in front of the camera, and talking about the filmmaking part—that’s the best part of being an actor. Would you ever want to move behind the camera? Not at all! I don’t think I would be able to direct anybody. It’s very difficult! All the onus is on you and you have to take all the shots—I can’t do that!
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What are your top three material possessions? As of now, first and foremost is my house. I just moved in, and for me that’s very prized. Second, all the music systems in my house and the ones I travel with— my speakers, are very important because music is a very important part of my life. I listen to music every day in the makeup chair and I can’t be without it. I want to say my phone as my third, and I’m a little scared that that matters so much to me, so I’m going to say my television instead, because with that I can watch beautiful movies and TV shows. Where do you like to travel? London is my all time favourite. I went to Amsterdam recently and I thought that was fabulous as well. I’m a European girl, so anywhere around Europe I’ll be very happy. Where would you like to go that you haven’t been? Greece is at the top of my list, and Italy as well. Italy for the food—Greece because it’s Greece.
What’s your favourite restaurant? Whenever I’m in London, I always make sure I go to this restaurant called Carluccio’s. It’s comfort food. Whenever I travel to Thailand, I visit a place called Din Tai Fung. It’s all dim sum. Chipotle! That’s my go-to place for Mexican food. I love Chiptole! Oh and Nobu as well. I can go on and on talking about food, I just want to let you know, William. We could go on for hours! What’s the most challenging part of celebrity life? I think the need to always be correct. And I don’t mean correct in terms of morals, I mean looking correct in terms of looking perfect, doing the right thing. Not making any big mistakes, not having a bad hair day, I think that’s my biggest problem with it—the vanity part of it. I don’t mind dressing up and dolling up—I love it. I’m a girl at the end of the day. But I like to be just casual in my pyjamas, in my tracksuit, not have to do my make up and hair. But that’s the only part that bothers me. I’m not really giving into it. I do my own thing and try to be comfortable, because that’s most important to me.
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BHATT'S ACCESSIBLE CHARISMA HAS ENDEARED HER TO BOLLYWOOD FANS WORLDWIDE.
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THE PERFECT LUXURY WEEKEND IN LOS ANGELES
Here are two perfect days in the city of stars, one of the GCC’s favourite American destinations
RAPHONG
Take a walk down Rodeo Drive, popping into the high-end shops and art galleries—especially the TASCHEN bookshop, and pick up a gorgeous art book for your coffee table.
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Arrive at LAX Intern private Rolls Royce ational Airport and take the hotel’s finest luxury hotel to the Montage Beverly Hills, the in the city.
Make your way back towards Beverly Hills to visit Nerano, which tries to capture the modern spirit of Italy’s Amalfi Coast. Try the handmade pasta.
Go for a hike in the Hollywood Hills, peek into the famed Griffith Observatory as an homage to Rebel without a Cause (or La La Land! ) and then make your WWW.WEALTHARABIA.NET way towards the Hollywood sign to watch the sunset.
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Have lunch at the sushi is fresh, bu buzzy Sugarfish, where the strict. Be sure tot Chef Nozawa’s rules are listen carefully to order the ‘Trust Me’, but the waiter’s instru ctions!
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DAY1
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LUXURY TRAVEL
Have breakfast at the Montage, and be sure to have the specially prepared Middle Eastern menu if you’re missing home, or the huevos rancheros to feel like a local!
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RAPHONG
Take a 60 minute biplane ride for a unique experience from the air—seeing the whole city in a ride like no other.
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CK/ VISIONSI
DAY2
Have lunch at WP2 4 by Wolfgang Puck, the famed chef’s Asian-fusion destin ation.
Monica, lisse Restaurant in Santa Spend your evening at Me gem, where the tro gas an eric Am w -Ne Josiah Citrin’s French ptuous. meals are creative and sum prices are fixed and the
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Walk from Venice Beach to the Santa Monica pier, stopping to see the local colour. Pop into a book shop, grab a snack, and watch the skateboarders attempt tricks worth of the X-Games.
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LUXURY TRAVEL
FRONT DRIVE HOTEL ENTRANCE
LA’s best luxury hotel THE MONTAGE BEVERLY HILLS OFFERS EXACTLY WHAT GCC HNWI TRAVELLERS ARE LOOKING FOR ON THEIR NEXT STAY TO THE CITY OF STARS
T
he GCC has always had a strong relationship with Los Angeles. Los Angeles is a city built (from
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nothing in the desert) by pure will, powered by the wealth of talent and ambition that flocked to the city, so it’s
easy to see why those coming from cities like Doha and Dubai might see the City of Angels as a kindred spirit.
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ROOFTOP POOL
GUEST ROOM WITH A VIEW
For those looking for a luxurious experience, the crown jewel of the Los Angeles hotel world is the Montage Beverly Hills, located just off the legendary Rodeo Drive. The hotel features 201 guestrooms, which include 55 suites and 20 private residences. The rooms offer private balconies when requested, mosaic-tiled oversized tubs, an LCD television with international programming tailored to the global elite, a bedside control panel for lighting and draperies, in-room tablets with access to the hotel’s amenities, and bedding that features a 500-thread count and monogrammed pillows. But while WEALTH Arabia can attest that the suites are an extremely comfortable home-base for your journey from the Middle East, the Montage offers much more than just beautiful rooms. Topping its restaurant offerings is its newest venture, a partnership with chef
THE GARDEN BAR TERRACE
Geoffrey Zakarian, the Georgie, which offers modern American cuisine for breakfast, lunch and dinner, run by chef Freddy Vargas. The Rooftop Grill offers panoramic views of the famed Hollywood Hills, and in-room dining is available 24 hours a day, with dishes far better than you’d expect from room service, from Executive Chef Patrice Martineau. Want to explore the area? The house car is a Rolls Royce Ghost and it will take you anywhere in the direct vicinity. As hard as it may be to pull yourself from the premises, it’s worth exploring the surrounding area. If you’d like to spend the afternoon in, do try the Spa Montage. Need convincing? For one, it’s the largest spa in the Los Angeles area, capping off at an astounding 20,000 square metres, with men’s and women’s lounges featuring
large lockers, full showers, a steam room, sauna, whirlpool, as well as dedicated relaxation lounges where guests have the ability curl up next to a fire under a blanket while still in their spa robes before meeting with their esthetician or therapist. On the ground level, a co-ed lounge offers the opportunity for couples, friends and families to enjoy their spa day together if they so choose. A co-ed mineral pool infused with hand-harvested salts is designed to be heated to 41 degrees Celsius, to relieve the body of fatigue, soreness and tension. Beyond this, there are 17 treatments on offer. The Kim Vō Salon is an excellent choice after your spa day for further me-time. For your next stay in Los Angeles, WEALTH Arabia can fully recommend the Montage Beverly Hills as your destination of choice.
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LUXURY PRODUCTS
THE WRIST review...
A ROUND UP OF THE BEST HIGHEND WATCHES FOR YOUR WRIST THIS MONTH
CORUM GOLDEN BRIDGE RECTANGLE The new refined rectangular look of the classic Golden Bridge was created by renowned designer Dino Modolo, who enhanced the engraved and finished inline movement by adding 18-karat gold structures representing six Roman numerals around the completely visible calibre, to give the feel of the architecture of a bridge.
THE CITIZEN ECO DRIVE FD203352W LADIES WATCH From the Swarovski Collection, it features rose gold tones cover the case and dial, while sparkling Swarovski elements add luxury to the refined beauty.
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SCAFOGRAF GMT The model is an an automatic steel similar to its predecessor the Scafograf 300. The bidirectional rotating bezel is made of steel with a ceramic insert and is available in black or blue depending on the version of the dial, which is proposed in the same colours. The finish is galbĂŠ with curved, luminescent applied indices.
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THE ORIS HAMMERHEAD LIMITED EDITION Crafted by the pioneers of the diving watch, it is based on the second generation Aquis 2017 collection, offering a uni-directional rotating bezel with a black ceramic inlay, and water resistance to 50 bar (500 metres). Beyond its style, the watch that will help raise funds for a shark conservation project run by the nonprofit organisation Pelagios Kakunjá.
RAYMOND WEIL Freelancer Chronograph: Inspired by the legendary Gibson Les Paul guitar, the body of the 43.5 mm case is made of steel and its tachymeter bezel is enhanced with black PVD inspired by the lacquer on the “Black Beauty”–a guitar renowned for its electrifying performance. The board features circular guilloché motif featuring six chords studded by fret-shaped hour markers. Only 300 made.
CONCORD SPECIAL EDITION DELIRIUM LADY The latest model was made as a tribute to the legendary collection that established Concord as the creator of the thinnest watch in the world. A silver–toned dial with a choice of painted roman and contrasting gold baton hands is offset by a black alligator strap, it also appears in a still dainty yet subtly sturdier 3.3 mm iteration.
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HNWI CHAT
Sitting down with an Emirati stand up comic ALI AL SAYED, CO-FOUNDER, DUBOMEDY, JUST CO-HOSTED THE UAE’S FIRST STAND UP COMEDY SERIES COMEDY CENTRAL PRESENTS FOR OSN
What’s your favourite travel destination? Aaaaah! Too many to pick! Ok, New York is the first thing that comes to mind. What is your favourite restaurant in Dubai? Tent Jumeirah. Do you think there are people that are secretly robots living among us? Yes, I am one of them. And we prefer the term ‘machine beings’, keep your racism to yourself. What is the best condiment in all the land? Turmeric of course. You have to spend $20 million on something frivolous by tomorrow. What do you spend it on? An Iron Man suit—I'm done with traffic. What purchase do you most regret? The Iron Man suit, that stuff is tight. Who’s the strongest celebrity you could beat in an arm-wrestling match? Vin Diesel... if you don't believe me, set it up. Which movie star would play you in the movie of your life, and why? George Clooney, it's obviously the handsome thing. What candy flavour do you find better than the fruit from which it was inspired? Orange, I'm allergic to orange and not allergic to candy—your move orange. What is your proudest memory? Making people laugh.
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Second Nationality?
CS Global Partners is an industry-leading legal advisory firm specialising in citizenship by investment and investor immigration solutions. The firm is comprised of an expert global team committed to assisting international businesspersons and their families in achieving increased mobility, security, and protection through second citizenship. Dubai Office: 3504, Burlington Tower, Business Bay, Dubai T: +971 4 226 1704 • M: +971 56 892 9303 • @: dubai@csglobalpartners.com Farsi speakers, please contact: +971 54 3455 833 www.csglobalpartners.com LONDON • ZURICH • HONG KONG • BEIJING • DUBAI • NEW DELHI • LAGOS • WINDHOEK • ST KITTS & NEVIS • SINGAPORE
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