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Etisalat makes landline calls across UAE free of charge
Etisalat makes landline calls across UAE free of charge Amanda Fisher / 2 June 2013 In a move that is set to scale up the competition in the UAE’s telecom sector, etisalat is to make landline calls anywhere in the UAE free. The move will apply from July 1, with only local landline calls within each emirate currently free for subscribers. Having been the first telecom service provider in the UAE, etisalat is now upping the ante following the 2006 arrival of du. Both service providers are eyeing a stronger market share by offering new services. KT illustration by Rajendran Etisalat’s new initiative was welcomed by residents, though some said the offer would not make much difference to their telephone bills. “I make most of my calls on my mobile phone, so where is the value I get from free landline calls?” asked Raghav Varma, a sales manager, based in Dubai. “It is not even of use to my family because they use the landline to call me on my mobile, which again is charged.” Reena D’Silva, an Indian living in Dubai, disagreed: “I have several friends in Abu Dhabi, as well as relatives. This is a value deal for people who stay at home or those who monitor their landline usage well. The UAE authorities are giving a great opportunity with this new offer.” Ahmed Khan, a Pakistani entrepreneur, said he would not find much value from the new service. “I won’t be making my calls from home, so I don’t stand to benefit from it. It would have been of use if they made calls from landlines to mobile phones free, but I don’t think they will ever do that. They should also consider making the calls free for commercial establishments too, which will benefit small businesses like ours.” Etisalat said the free national landline calls across the UAE would be applicable for both standalone and eLife subscribers. The company is also launching the region’s first high definition voice for eLife landlines, with a new lineup of High Definition telephones to be introduced in July. Mathew Kuruvila, an Indian finance professional, said the new services took the UAE’s telecom sector to world-class levels. “The two moves — to make national landline calls free and to introduce HD landlines — are complementary. I think there is a concerted effort by the authorities to encourage more landline usage.” While the new service is set to make landline usage more popular, the question is how it will affect mobile phone usage. According to estimates, the UAE has some 14 million mobile phone users — almost two mobile phones for every resident. This fact was instrumental in the country launching its mGovernment initiative recently, where all government services are to be provided by mobile phone within two years. “I appreciate the gesture of making landline calls within the country free, but I wish there were more such initiatives in the mobile scene, because obviously that is the future direction the government also wants to take,” said an analyst, who did not wish to be identified. Etisalat Home Services vice-president Rashed Al Abbar said the new service was a “tribute to our nation’s great leaders and the spirit of unity that binds all residents”. Etisalat said the new services would be provided to eLife customers without any change in monthly rental charges. “The charge for standalone landline customers, who are not elife subscribers, will be revised to Dh39 per month,” it said in a statement. Etisalat is also offering subscribers a “favourite country plan” which helps save money for customers who make frequent calls to a specific country. – news@khaleejtimes.com Continue reading
Economy to benefit as Enoc and Eppco cut diesel prices
Economy to benefit as Enoc and Eppco cut diesel prices Amanda Fisher / 2 June 2013 Dubai’s transport sector is in line for a boon with expectations savings could be passed on to consumers, after the emirate’s petrol stations announced a 20 fil reduction per litre of diesel — though costs in other parts of the country remain much lower. Emirates National Oil Company announced the price of diesel at its more than 100 Enoc and Eppco petrol stations would drop from Dh3.7 a litre to Dh3.5, effective from Saturday. An Al Khail Road pump showing the revised price. KT photo by Rahul Gajjar The prices of both petrol and diesel in the country are heavily subsidised, with diesel in Abu Dhabi and Al Ain Adnoc petrol stations retailing for Dh2.35 a litre. Prices were at a record Dh4.56 per litre in 2008, during a volatile period when diesel prices fluctuated heavily. However, the price has been climbing steadily with little respite ever since, with transport companies such as Dubai-based Euro Movers International feeling the pinch, according to director Khurram Abdulla. “The last five years the fuel costs have been going up, so any reduction is obviously very welcome, so it will have a positive impact on our bottom line.” Abdulla said his company spent about half-a-million dirhams each year on fuel for their local and international transport companies, which relied on seven vans and trucks using diesel. “I think this is the first time it’s actualy coming down. Normally we’re used to it just going up.” He said he was optimistic the price reduction would remain in place for some time, in which case the company could look to pass on savings to customers. “It’s very competitive (in) our industry and Dubai in general is very competitive, so whatever we can do to make ourselves more competitive (we will). We’ll definitely pass that on…We’ll wait for a month to see how much we can pass on…we might be able at the end of the month to see a reduction of five per cent,” Abdulla said after doing a few calculations based on the new lowered price. While fuel costs only amounted to about 10 per cent of the company’s overall costs, Abdulla said the company would hope to see secondary savings in their international arm, if shipping companies they contracted also passed the savings from the lowered international price of diesel. Enoc retail managing director Burhan Al Hashemi said Enoc had revised the price of diesel in line with the international price trends for crude and refined products. “The recent decline in international prices has provided us an ideal window of opportunity to pass on the price benefits to diesel users. The price decrease will have a positive impact on the overall economy, given the vital role that diesel plays in the logistics sector,” he said in a statement. Al Hashemi said the price revision should benefit the manufacturing sector and other supply companies with large fleets that use diesel. However, economic advisers Nasser Saidi and Associates founder Nasser Saidi said the price reduction would have just a minor impact. “Diesel, of course, is important for transport so to that extent it will lower the cost…and it will effectively mean at a consumer level, although to a very marginal level, (product prices) will decline.” However, that needed to be put “in perspective”. “Transport costs are important but not the main determinate of consumer prices…at best this will have a marginal effect. Clearly the people who use diesel in the cars will see the effect but that’s a minority of people.” Saidi also warned the reduction would be temporary as international prices would rise again. He attributed the fall in global prices to seasonal patterns, with the diesel used for heating major northern hemisphere markets of the United States and Europe not needed as they headed into summer. Saidi put out a plea to the government to instead of passing on the “negligible” savings to consumers, that they be reinvested in the sector to develop renewable energy. amanda@khaleejtimes.com Continue reading
Dubai realty may see double-digit growth
Dubai real estate buoyant Abdul Basit (INTERVIEW) / 1 June 2013 Property prices and rentals in Dubai are expected to increase by double-digit numbers this year while the decision on the emirate’s bid for World Expo 2020 will set the trend for years ahead, according to an industry specialist. “The real estate market this year is buoyant and I think it will continue to remain buoyant. Investors have to remain careful to see signs of flipping,” Sameer Lakhani, managing director of Unitas Consultancy, told Khaleej Times in an interview. “I think this year, both in terms of commercial prices as well as residential prices [breaking down into villa and condominium segments], we are looking at a double-digit increase both in terms of rentals and prices.” At present and for the last few months, the real estate market has been quite buoyant and it had resurgent activity based on certain factors, he said, adding that external factor is the World Expo 2020 bid and other major developments, including Mohammed Bin Rashid (MBR) City and major projects on the Shaikh Mohammed bin Zayed Road (the former Emirates Road) corridor. The revival of business activity is partly as a result of global economic recovery and the Arab Spring, Lakhani added. The World Expo bid will act as a catalyst for growth, creating thousands of jobs, and stimulating growth as residents move to communities surrounding Shaikh Mohammed bin Zayed Road. The UAE is bidding to host Expo 2020 in Dubai and competing with four other countries. The winner will be announced in November 2013. The World Expo has never been held in the Middle East, Africa and South-east Asia. “In Dubai, we had a revival for about a year now and it began with the residential sector, specifically in villa space. Since the last quarter we have witnessed a significant revival of activities in prices,” he said. Talking about active buyers in the market, he said that statistics released by Dubai’s Land Department indicate that they are South Asians and mostly Indians, in addition to those Pakistan, Iran and Arab countries. “Our analysis indicates that mostly end users are buying properties and now they account for one in four,” he said, adding that in 2007 and 2008 there were less end-users and lot of off-plan properties were bought due to lose credit. He agreed that “flipping” is still in the market but at very less degree. Lakhani said that Jumeirah Lakes Towers and Emirates Living are expected to outperform as end-user ownership in 2013. “A migratory effect will take place to areas such as Jumeirah Village and Sports City as tier-one markets start pricing out middle income families. Rental rates in these areas are expected to rise by 15-20 per cent this year.” He believes that the trend of home ownership in Dubai will continue, fuelled by the creation of new jobs. Dubai World Central and Al Maktoum International Airport will be the magnet for more jobs and communities, and Dubai’s World Expo bid will act as a fillip to this. Responding to a question, he said that nobody knows about new mortgage rules, but it’s better if there are some curbs for mortgage lending. Giving Hong Kong and Singapore as examples where property buyers face strict rules for a second home, Lakhani said curbs limit speculative activity in the market that’s the reason the UAE Central Bank showed concern about it and is planning to introduce new rules and a cap. “I think check-and-balance is healthy,” he said. Quoting Land Department statistics, Lakhani said more than one out of four transactions is still mortgages. Overall, 30 per cent of transactions are mortgage which is a good sign, he added. “I think right now the challenge is to come up with more supply and we know the bulk of the additional supply is coming on the Shaikh Mohammed bin Zayed Road corridor,” Lakhani said. He added that occupancy level at the moment is between 80 to 95 per cent based on specific locations and that’s the reason developers are going south. He explained that the Marina area’s occupancy level is above 90 per cent while in Jumeirah Lakes Tower it’s above 95 per cent, and in most of these areas enough land is not available. So developers are going to Shaikh Mohammed bin Zayed Road as there is land available in areas like Jumeirah Village, MBR City, Arjan, Majan and Falcon City. Lakhani believes that there’s no bubble at the moment. To characterise the bubble, there are three or four factors. One of the factors is valuation, he said, adding that it’s rental yields, which was below four and five per cent in 2007 and 2008, respectively, and now rental yields on villas is at 5.5 per cent and six per cent, and for apartments, it’s seven per cent. Offices are even higher, he added. So for a valuation perspective, prices indicate that there is an upside potential especially compared to the rest of the world. The second indicator of a bubble is losing credit or having too much money. In 2007 and 2008, mortgages were given at zero down payments and today it’s not existing because of very prudent and conservative lending policies. The central bank is very closely monitoring mortgage lending activities. The third indicator is the amount of speculation that’s known as off-plan projects. In 2007 and 2008, one out of every three transactions was off-plan, while today it’s only at one out of less than eight. “If you consider all these three indicators, I believe around this time there is no bubble,” Lakhani said. abdulbasit@khaleejtimes.com Continue reading
