Dubai begins to fight back

source Arabian Business

In light of worsening economic conditions, Dubai appoints an advisory body to steer the Emirate through stormy waters.

As Dubai's real estate sector feels the mounting strain from the global economic crisis, many are asking whether the authorities have done enough to protect the Emirate against the effects of the slowdown.

However, HH Sheikh Mohammed has now stepped in to address those issues by creating the Dubai Advisory Council - a high-level economic body that is working to address the issues facing the finance, real estate, banking and equity market sectors.
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Meeting on a minimum monthly basis, one of the team's first tasks will be to manage current and future flows of new projects on to the market, in order to maintain equilibrium and demand within the sector.

It's easy to forget that it was only three months ago, in October, that Nakheel launched their world's tallest tower project to an excited and confident Cityscape; it could be argued that the sheer pace of the turnaround inevitably caught both authorities and developers by surprise. However, the Nakheel Tower was launched into a climate that was witnessing multinationals fold, Wall Street crashing and a whole handful of the US' biggest names in banking bombing dreadfully.

Speaking at the opening of the DIFC Forum, HE Mohamed Alabbar, who has been nominated to lead the Council, made it clear that he was not blinkered to the severity of the current situation. "I will not mince words. I am here to state facts," he began, before describing the crisis as "without precedent."

The wealth of Dubai - like that of other Gulf countries - provided a buffer to many of the problems for a long time. But fail to prepare and you prepare to fail, said Benjamin Franklin.

"Let me assure you that we have our finger on the pulse of the real estate sector. Today, the real estate sector is witnessing a healthy correction. This is a consequence of global financial conditions and is inherent to the very nature of the market.

As we all know, real estate is cyclical."

Alabbar went on to dispel widespread rumours and confusion regarding Dubai's debt obligations, stating that the figure currently stands at AED 37 billion; however, key sovereign assets - excluding infrastructural support such as airports, bridges and roads - are estimated at AED 330 billion. Obligations, he said, can and would be met.

For some, the creation of the Advisory Council may have come too late, but it is undoubtedly a positive step. And, drawing on the example of the recently announced merger of Amlak Finance and Tamweel under the umbrella of the UAE Real Estate Bank, it is equally indubitable that the Council is able, and determined, to take effective action.

"Will the Government step in and help associated and affiliated companies if an when the need arises? Yes, we will. And I hope this statement is clear."

Reporting directly to HH Sheikh Mohammed, the Dubai Advisory Council will play an influential role in securing the health and future of Dubai's real estate sector. Meet the men tasked with that challenge.

Mohamed Alabbar

Nominated to head the Council, Alabbar is Director General of Dubai's Department of Economic Development and a member of the Dubai Executive Council. As chairman of Emaar, he has also been at the centre of the development of real estate in the Emirate.
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Mohammed Al Gergawi

Minister of State for Cabinet Affairs for the UAE, chairman of The Executive Office and chairman of the Mohammed Bin Rashid Al Maktoum Foundation, Gergawi has experience and influence across a wide range of industries as he also serves as executive chairman and CEO of Dubai Holding.

Mohammed Al Shaibani

A senior advisor to HH Sheikh Mohammed in matters of finance, Shaibani serves as director general to His Highness the Ruler's Court, Chief Executive of the Investment Corporation of Dubai, Chairman of Dubai Bank and Chairman of the National Bonds Corporation.

Sultan bin Sulayem

One of Dubai's leading business figures, as chairman of Dubai World, Sulayem will bring expertise in a number of sectors and, in particular, real estate, as Dubai World manages Nakheel, Dubai Maritime City, Istithmar World, Kerzner, One & Only, Limitless, Discovery Gardens and Tamweel.

Dr Omar Bin Sulaiman

With an exceptional track record, Sulaiman served as CEO of Dubai Internet City, director general of the Dubai International Financial Centre Authority and launched the DIFE before being appointed Governor of the Dubai International Financial Centre and VC of the UAE Central Bank.

Nasser Bin Hassan Al-Shaikh

If anyone is ideally positioned to address the financial issues that the real estate industry now faces, it's Al-Shaikh. He straddles both sectors as director-general of the Dubai Department of Finance and chairman of Deyaar - a property developer, manager and brokerage.

Essa Kazim

Having risen from the position of senior analyst at the Research and Statistics Department of the United Arab Emirates Central Bank, Kazim will add some genuine economic know-how and experience to the Council

Last year, he was elected to NASDAQ OMX's board of directors and serves as chairman of the board of the Dubai Statistics Centre, director of the Dubai International Financial Centre Authority, member of the Dubai Council for Economic Affairs, director of the Dubai International Financial Exchange, member of the Economy & Trade Committee in Dubai, director of Noor Islamic Bank and director of the General Pension and Social Security Authority.

Abdul Aziz Al Muhairi and Marwan bin Ghalita

Completing the ranks of the Dubai Advisory Council will be Muhairi, managing director of the Investment Corporation of Dubai, and Marwan bin Ghalita, CEO of RERA - Dubai's Real Estate Regulatory Authority.