Tag Archives: business
UAE, Gulf markets remain bearish on Syria flare-up
UAE, Gulf markets remain bearish on Syria flare-up Issac John / 5 September 2013 Stock markets in the UAE and other Gulf countries continued to plunge on fears of an imminent attack on Syria. Dubai’s benchmark DFM index tumbled to an eight-week low of 3.7 per cent to close at 2,397 points, its lowest finish since July 11, as retail investors cut risk after the United States moved a step closer to launching military action against Syria. Across the Gulf, markets declined in volatile trading as investors opted for short-term trades amid mounting tensions. Abu Dhabi’s benchmark fell 2.3 per cent to 3,648 points, Kuwait’s bourse declined 2.6 per cent to 7,268 points and Qatar’s measure slipped two per cent to 9,348 points. Saudi Arabia’s index was 1.7 per cent lower at 7,697 points. Crude oil held above $115 a barrel on Wednesday as US lawmakers’ support for military action against Syria revived concerns that Middle East oil supplies might be disrupted if the conflict widens. While Syria is not a big oil producer, investors are worried that a strike by Western forces against the country could spread unrest in the Middle East and disrupt supply from the region that pumps a third of the world’s crude. Shares in Emaar fall 3.2 per cent to Dh5.3 although small and mid-cap stocks were among the biggest fallers on Wednesday. Air Arabia and Dubai Financial Market slumped 6.2 per cent, with Arabtec Holdings and Dubai Investments down 5.6 and 5.3 per cent respectively. issacjohn@khaleejtimes.com Continue reading
Fundamentals seen driving Dubai’s property rally: Report
Fundamentals seen driving Dubai’s property rally: Report (Issac John) / 5 September 2013 Driven by strong demand and much-improved economic fundamentals rather than speculation, housing prices in Dubai are on the ascent, Standard Chartered bank said. The bank said in a report released on Wednesday that over the past 12 months, residential prices have increased by 38 per cent for apartments and 24 per cent for villas, with rents increasing by 20 per cent and 17 per cent, respectively. “Slowly but steadily, confidence has returned to the market. Second quarter marks the fourth consecutive quarterly increase in residential prices,” according to a report titled ‘Dubai housing: Fundamentals not speculation.’ The report said at the moment, the market seems to be driven primarily by fundamentals rather than speculation. Although there is a risk that this could change, it is encouraging that regulators are drafting laws to curb excessive speculation in off-plan properties. Subdued mortgage growth, low off-plan sales and increasing housing regulation differentiate this price rally from the one in 2008, the report said. “We expect housing-market supply to grow at the same pace as demand, with new projects being launched in a more planned and controlled manner than in the past. Dubai’s housing market is comprised of 417,900 apartments and 62,000 villas. Residential supply has been growing at an average compound rate of around eight per cent, with apartments increasing by nine per cent and villas by four per cent,” said the report. By the end of 2013, supply should increase by 19,400 apartments and 3,400 villas, assuming there are no delays in construction schedules. The largest proportion of future stock from 2013 to 2015 will be delivered in the sub-markets of Dubailand (7,900 units); Business Bay (3,800 units); and Dubai Sports City (3,800 units). “We expect the city to expand, with a focus on new developments outside central Dubai, in areas to the south and east,” the bank said. The bank expects Expo 2020 to be a meaningful contributor to the sustainability of the housing market, in the event of a positive bid result in November 2013. According to the report, Dubai’s chances of winning have increased. “In the event it does, close to 300,000 more jobs could be created with 25 million people visiting Dubai. 90 per cent of the job opportunities would occur from 2018 to 2021, with most of the jobs created in the travel and tourism sector. This indicates a good chance that a high percentage of these will be converted into permanent jobs, which would benefit the expanded economy in the post-Expo period.” The report recalled that the sharp increases in property prices in 2008 were driven by excessive short-term speculative activity, especially on off-plan properties. “For these properties, buyers only had to put down 10 per cent deposits (rather than the full price), so the market became highly leveraged. Many buyers never had the intention (or the funds) to pay the future installments as they planned to flip the property before any payments were due. This turned the housing market into an unsustainable, highly leveraged derivatives market. We pointed out these problems in our On the Ground, ’A tale of two housing markets’, published in July 2008. It was therefore no surprise to us that in 2009 there was a sharp correction in housing prices, accompanied by a rapid decline in property transactions,” said the report. The bank observed that Dubai’s housing market is influenced by broader economic trends. “Dubai’s economy has experienced solid and sustainable rates of growth over the past three years. The key drivers are logistics, hospitality and retail. This looks set to continue, particularly when it comes to logistics, which contributes 14 per cent to the GDP. We expect trade to increase in the years to come on the back of the increased spending plans of most governments in the region, including Abu Dhabi, Qatar and Saudi Arabia.” Tourism is also expected to grow at an average of 6.5 per cent per annum between 2011 and 2021, pushing up employment growth for the sector by 4.1 per cent per year, report said quoting a Dubai Chamber of Commerce and Industry study. Dubai’s population growth is another driver of housing demand surge, said the report. The city’s population is the second largest in the country, after the capital Abu Dhabi, and is largely comprised of expatriates. “The population increased from 2.0 million in 2011 to 2.1 million in 2012, according to the Dubai Statistics Center. We expect it to reach 2.2 million in 2013,” the bank said in its report. issacjohn@khaleejtimes.com Continue reading
Welfare of citizens top priority: Shaikh Mohammed
Welfare of citizens top priority: Shaikh Mohammed (Wam) / 5 September 2013 His Highness Shaikh Mohammed bin Rashid Al Maktoum, Vice-President and Prime Minister of the UAE and Ruler of Dubai, has affirmed that the UAE, under the leadership of the President, His Highness Shaikh Khalifa bin Zayed Al Nahyan, is making steady progress in terms of all development indices. His Highness Shaikh Mohammed bin Rashid Al Maktoum, Vice-President and Prime Minister of the UAE and Ruler of Dubai, arriving to watch the world premiere of the documentary, Ultimate Airport – Dubai, featuring the emirate’s aviation sector, at Meydan Imax Theatre. It was shown by the National Geographic Channel’s global network. – KT Photo by Mukesh Kamal “The UAE government is continually following up these indices issued by prestigious international corporations, because retreat is not an option in our government,” Shaikh Mohammed said while commenting on the results of the Global Competitiveness Report issued by the World Economic Forum (Davos) for 2013-2014, in which the UAE advanced five positions in the total competitiveness of its economy in one year, from 25 th last year to the rank of 19 th this year, thereby coming ahead of such countries as France, Ireland and Australia. “Thanks to the federal and local teams who are jointly working in line with a vision, the term of which extends to the year 2021, as well as with agendas and plans that are continuously being revised and assessed as per our growing ambitions in all sectors… our economy is continuously developing, and the indices for security and stability are the best globally. The welfare of our citizens is at the top of our priorities,” Shaikh Mohammed said. Overall, the UAE’s competitiveness reflects the high quality of its infrastructure, where it ranks a solid fifth, as well as its highly efficient goods markets which ranks fourth. Continue reading
