UAE | General
Losses could be more than Dh432m
Dubai's economy may have suffered a loss of more than Dh432 million as a result of the shutdown caused by US President George W. Bush's visit, according to estimates based on the emirate's gross domestic product.
- Gulf News Report
- Published: 01:22 January 15, 2008
- Image Credit: Ahmed Ramzan/Gulf News
- Dubai Creek's usually bustling waterways were devoid of dhows.
Dubai: Dubai's economy may have suffered a loss of more than Dh432 million as a result of the shutdown caused by US President George W. Bush's visit, according to estimates based on the emirate's gross domestic product.
Dubai's GDP in 2006 reached Dh157 billion (nearly $43 billion). If trade comes to a standstill, then the emirate, the Gulf's largest trading hub and the major supply line, might have just lost Dh1 billion in export, import and re-export business for the day.
Dubai's first-quarter trade crossed Dh91.71 billion last year, translating to a total annual trade volume of Dh366.85 billion.
While the financial loss due to suspension in business activities may be quantifiable, it is difficult to put a value on lost opportunities, business analysts said, speaking on condition of anonymity.
Public and private sector activity in the region's business and tourism hub was severely curtailed as the city's major roads were blocked to allow unhindered movement for the US leader and his entourage.
"Today being Monday, we had so many conference calls and meetings. We could not do anything," said a senior official of an international accounting firm.
"Because it was an emergency shutdown, there was not enough time for companies to reorganise their schedules. It must have been planned in advance and opportunity losses could have been avoided had the announcement come earlier," he added.
Offices at the Dubai International Financial Centre (DIFC) were closed and the Dubai International Financial Exchange did not trade. Although people working there were not barred from being in their offices, it was hard to get to work because of the blocked roads.
There are about 500 companies operating at the DIFC who employ 7,000 to 10,000 "knowledge workers" or professionals.
More than 5,000 companies are currently under operation in Jebel Ali Free Zone, that was shut down.
According to the Dubai Chamber of Commerce and Industry, the number of companies registered with it, crossed 100,000 last year - almost all were partially shut down, except for some neighbourhood stores and shops.
One chartered accountant said the shutdown could also be looked at in a "positive" way as any untoward incident during Bush's visit could have a long-term impact on the country's economy.
"Everybody is losing money, factories have lost production and services are shut. But let's look at the positive side also. We could not afford anything going wrong with this visit. In the coming days some of the losses can be recouped from increased business activity," he said.
Hotel guests had a difficult time trying to figure out what was going and were not sure whether taxis were running.
Paradoxically, when other businesses suffered, food and beverage outlets at Dubai's expensive beach hotels made more money.
With cloudy skies not even allowing them to get a suntan, guests at these hotels were busy eating and drinking indoors.
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