On Agenda: Region has a stake in Dubai's success
There was a time when happenings in Dubai were mainly a concern of people in the emirate. Although the outside world showed interest in what happened here, it was perhaps out of curiosity aroused by Dubai's readiness to innovate and experiment.
Today, however, the outside world, particularly the region, has reason to be more than curious. For it too has a stake in the success of Dubai.
The tryst began with individual investments in the emirate's thriving real estate sector in the wake of GCC citizens getting property ownership rights. A good number bought properties for their commercial potential. With Emaar pioneering its premium developments, followed by other players such as Nakheel, the luxury of a weekend holiday home turned into an irresistible temptation for a larger number of GCC investors along with those from the rest of the world.
And yet, things were very much at the retail level, until a series of new initiatives in the past few months brought a sea change in the pattern of foreign investments. Nakheel's Palm islands, which, with its promise of extraordinary experience, attracted the world's rich and famous, also saw a steady stream of high-profile development investment from across the world.
Kuwait's IFA, a consortium of four international real estate companies, has committed a total investment of $400 million for the development of its proposed five properties on Palm Jumeirah. The company plans to link its five Palm Jumeirah projects with its properties in Europe, creating a tourist link between Mideast and Europe.
New dimension
Similarly, Emaar's waterfront developments have been a big hit with regional investors. Only a couple of days ago, Kuwait's Al Ahlia Investment Co announced plans to "share the vision" by investing Dh100 million to develop a residential tower in district nine of the Dubai Marina development. Emaar is also testing the regional waters with the proposed launch of a $50 million Ijara Sukuk facility in the form of five-year notes, to be issued on the Bahrain Stock Exchange.
And with the launch of Dh20 billion Dubailand project, a new dimension has been added to the foreign investment scenario in Dubai. Billed as the Middle East's biggest ever development project, Dubailand offers 45 main and sub-projects involving an investment of Dh18 billion. The infrastructure is expected to cost over Dh2 billion, which will be borne by the government, while the private sector concentrates on the main and sub projects.
Dubailand is conceptually different from the projects of the past, as it is to be executed through a government-private sector partnership, under which the government creates the infrastructure for the private sector to build on. The concept was successfully tried out in the expansion phases of Dubai Internet City and Media City.
A private consortium of three businessmen has already announced the first project of Dubailand a Dh2.7 billion Sports City. The remaining projects are expected to attract significant foreign investment and Dubai is leaving no stone unturned to ensure that the large sums of Arab money aimlessly floating around in the wake of discomforting uncertainty in Western assets find a direction. Some of the recent Dubai projects do provide viable investment areas that can absorb such funds.
General Sheikh Mohammed bin Rashid Al Maktoum, Crown Prince of Dubai and UAE Defence Minister, has been quoted as assuring the investors that the Dubai Government will guarantee investments made in projects in the emirate and that losses will be compensated.
The Dubai Development and Investment Authority, which is launching the Dubai Tourism Development Company to manage all the Dubailand projects, has promised a single-window service to investors as an expression of the government's commitment to facilitate their work and provide the right environment for success.
Such are the stakes that success is, indeed, imperative which, when achieved, can ensure a place for Dubai in the pinnacle. And that's what makes these initiatives truly visionary.
The writer is a UAE-based journalist
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