Dubai's Dangerous Debt
Dubai has grown at a rapid pace....but at what cost? Human rights groups point to Dubai's exploitation of workers who suffer from fatal accidents and low salaries. But now the Wall Street Journal has pointed the finger at Dubai's financial stability. Here's the growth.
Dubai in 1991.
Dubai today.
The Wall Street Journal reports that international "financial analysts are starting to wonder about the amount of debt the city-state is racking up." The article paints a picture of a city with dwindling oil revenues but a limitless appetite for growth. It places Dubai's debt, relative to gross domestic product, at about 42%. That's pretty high compared to Abu Dhabi's debt of 2.9% of GDP. More from WSJ.
The Wall Street Journal reports that international "financial analysts are starting to wonder about the amount of debt the city-state is racking up." The article paints a picture of a city with dwindling oil revenues but a limitless appetite for growth. It places Dubai's debt, relative to gross domestic product, at about 42%. That's pretty high compared to Abu Dhabi's debt of 2.9% of GDP. More from WSJ.Duabi's debt load is four times the average among other Persian Gulf states. Credit-rating companies are asking for more information to determine how sound the government really is.
In the end, if Dubai gets into financial trouble it would take its neighbours with it. Or perhaps they're counting on a regional bailout.
posted by UAE Students at 3:59 PM
3 Comments:
We should always remember that investments should be in people not buildings.Dubai should wake up and realize that other developed countries reached to what they are, slowly and through culture and human factor, not through fancy hotels and malls only. Dubai should learn from Abudhabi, which is still in touch with UAE's reality.
I'm learning from your entries. I love it, it's very resourceful and indeed, knowledgeable. =) You really deserve to be nominated.
UAE has a very rich, very beautiful culture. Just today I happened to be driving around the outskirts of Dubai, near Khawaneej, where a lot of the landscape is still mostly desert, dotted with a few villas and not a single multi storey building in sight. It's such a heavenly sight seeing trees, animals, and a laid back lifestyle. So much peace. Immediately I thought about the stark contrast in which the main city stood to this peaceful place. I was headed from Sharjah to Sheikh Zayed Road through Khawaneej. Here's what it sounded like: jarringly loud traffic - peace & tranquility - jarringly loud traffic. I've been in the UAE for almost all my life. It's always been such a beautiful place. Of late though it's all changed. I agree completely with the earlier post. Too many fancy hotels, too many malls, too much congestion, stress. Slow down Dubai please, dont throw away your most true natural beauty.
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