Saturday, November 7, 2009

An Updated Tale of One Market: Dubai

A bit of an update to my earlier post "A Tale of Two Markets" as well as to the "GCC Business Confidence Survey".

  1. Japanese contractors owed billions by Dubai firms.  The fact that the usually polite Japanese are going public means that they have been stiffed for quite a while and are really hurting.  You'll also note that this appeared in an Abu Dhabi paper not a Dubai one.
  2. Nakheel offering purchasers in The Palm Jebel Ali the option to move to other developments.  The project is delayed no doubt to conserve cash.  See #1 above.
  3. Dubai debt levels as percentage of GDP versus other GCC States.  Perhaps, an explanation for #2 and #3.  On an aggregate basis, Dubai Inc (both sovereign and publicly owned companies) has something in excess of US$80 billion in debt with US$50 billion coming due over the next three years.

There is also a bit of flash news on a Moody's estimate of US$25 billion in bad debt in Dubai. 

When and if  I get access to more details, I will update this post.

All of the above may explain the depressed business sentiment in the UAE. 

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