An IMF outlook report commended the Gulf nations for “sound policies” in response to global economic crisis but prophesied the region’s $400 billion surplus will transform into a $10 billion deficit. Forecasted contractions: Saudi Arabia (the Arab world’s largest economy), 0.9%; the UAE, 0.6%; and Kuwait, 1.1%. While recession will occur, non-oil GDP will grow by 3.7% in the region. Bahrain’s labor minister boasted of “an efficient insurance umbrella” that limited the kingdom’s unemployment growth to 0.2%.
The American private equity firm KKR received a license to operate in the Dubai International Finance Centre. KKR’s MENA director: “The turnaround is bound to happen, so it’s better to start early.” In the same week it confirmed plans to raise $4 billion for investment in MENA and South Asia, Dubai-based private equity group Abraaj Capital donated $10 million to educating 1,200 Palestinian orphans. Saudi Arabia, home to 550,000 Sri Lankans, vowed its help in post-conflict development in Sri Lanka.
Qatari investors were poised to purchase the historic Polish Gdynia shipyard, where strikes in the 1970s helped bring down communism, for gas transport projects. Abu Dhabi-based Masdar led a $3 billion investment in the world’s largest offshore wind farm, which will prevent 1.9 million tons of annual carbon emissions. The Abu Dhabi National Energy Company signed on to boost generating capacity at its coal-fired power plant in Morocco by 50%; Abu Dhabi’s International Petroleum Investment Company has approved plans to invest 5USD billion in a new refinery project in Morocco. Saudi Arabia and France neared finalizing a civil nuclear cooperation pact. “It is time to bring the World Cup to the Middle East,” said Sheikh Mohammed bin Hamad, son of Qatar’s Emir, in announcing the country’s ambition to play host in 2022.
Director General of the Association of the European Rail Industry: “The Middle East is expected to be the fastest-growing region for the mass transit business in the world.” Canadian Bombardier, the world’s largest passenger train maker, expressed it was eyeing $5.4 billion worth of rail contracts in the Gulf region, $1.3 billion alone in Qatar. Foster & Partners won a $40 million contract to design 4 stations for the new high-speed Haramain railway linking Meccah and Madinah with Jeddah.
Saudi Arabia’s sovereign wealth fund announced the kingdom’s new cities are developing ahead of schedule: “The global economic slowdown has presented a great deal of opportunities including depressed prices of building materials.” Saudi tourism and antiquities officials said they were considering a loan program to save the quickly dilapidating historic buildings of Jeddah’s center. Al Khobar Municipality (Saudi Arabia) claimed the problem of swelling groundwater, which threatens the city’s older buildings, does not fall under its purview. Saudi Arabia plans to spend $60 billion over the next 20 years to meet its water needs.
Muthanna, the Iraqi province 280km south of Baghdah, completed $2.5 million worth of infrastructure projects, and the Thi-Qar province, 360 km south of Baghdad was promised $43.6 million for the implementation of new projects. The Baghdad Mayoralty signed $100.2 million worth of road and bridge contracts to ease traffic congestion. Transparency International ranked Iraq the third most corrupt country in the world. Iraq’s deputy prime minister: “The most important thing is that we admit the existence of the problem.”
Consumer confidence in the UAE dropped 21 points, more than any other country except Russia, but still managed to rank 10th out of 51 countries surveyed. Nielsen’s director: “This drop is more of an acceptance of the reality.” About 50% of UAE residents say they are concerned about their jobs, compared with 17% six months earlier.
Emaar promised to create over 1,600 new retail and hospitality jobs over the next 3 months, almost doubling its Dubai staff. Bonyan International announced its Dubai Gate 2 project is “witnessing unhindered progress.” Jumeirah Golf Estates’ master developer offered contractors overdue payments in return for a 30% discount. Master developer Nakheel announced a “prompt payment scheme” for five of its projects, one week after receiving a bailout. The Dubai government gave assurances that its largest development project, Dubai World Central, was on schedule to open its first phase in June, 2010. His Highness Sheikh Ahmed bin Saeed Al Maktoum on the project: ”Our vision for Dubai is to be an unparalleled global commercial, trade and transportation hub … which will change all known air, land and sea transportation parameters.”
Thirty property buyers collectively approached the Ajman Real Estate Agency regarding project delays in a 200-tower development project. One buyer: “I have paid already over $40,000. That was all my savings. Nothing has started and nobody can get in touch with the developer.” A member of the newly formed Jumeirah Beach Residence Association: “People came to Dubai and bought with billions and billions of dollars…. Look, 99% of us want this place to succeed. Dubai’s Land Department prepared to cancel 27 development projects.
The first freehold residents of Qatar moved into their new homes at The Pearl, dubbed the Arabian Riviera. A recent consultant report named Doha an emerging global real estate hub, vying with regional rival Dubai.
The Tree of Life, a 400-year old mesquite tree in an area of Bahrain without water, ranked fourth in the New Seven Wonders of Nature campaign. The Sharjah Biennial ended after welcoming more than 21,000 visitors during its two-month run, almost double compared with two years ago.
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