Dubai - When coming again?

Yes, indeed it is challenging time in Dubai. This is a city with no oil, but it engineered its phenomenal growth through massive investment. As such, when the credit crunch hit, many developers are in trouble. While 60% of the Dubai real estate projects are stalled, the remaining 40% is still a very big market compared to Singapore. The reaction on the ground is loud, but I see that is because they have started from a stratosphere level of activities in the first place. So when things are coming back to “normal” in Dubai, the fall seems great. But even this “normal” is still a lot of building activities compared to Singapore!

Abu Dhabi and Qatar are cities with real oil and money, and I believe they are waiting at the side to see when they can come and buy Dubai at a cheap price. Yes indeed. Today paper reported that Abu Dhabi Central Bank has issued a US$20B bond to finance Dubai government, and this has lifted the market close to 8%. More funds may be needed.

Moving ahead, the world is seeing an unprecedented economic recession. Every market is hit. More bad news is expected. The Middle East IB market is no longer an easy gold mine. We just have to work harder and smarter. There are little alternatives.