| Editor’s
Desk
The party’s still on…
The US has sent a shiver down many a spine. Many experts including
HSBC have been speculating that a de-linking of the dollar
peg would take place sooner than later. However, Central Bank
Governor Sultan Bin Nasser Al Suwaidi has set at rest any
immediate plans for such a move. This then brings the spectre
of inflation to the fore. But the UAE government has come
to the rescue once again. Vice President and Prime Minister
of UAE and Ruler of Dubai His Highness Sheikh Mohammed bin
Rashid Al Maktoum has issued a ministerial resolution exempting
cement and reinforced steel from custom duties with immediate
effect until further notice all over the country. His move
underlines the leadership’s commitment to stabilise
the local real-estate market, maintain the momentum of the
construction boom, and ease the burden on contractors, landlords
and consumers. With this move, contractors and property owners
will be allowed to import these two items without any restriction
in order to allow them to overcome the soaring prices. Annual
cement consumption has increased from 2.6 million tonne in
1992 to 17 million tonne in 2007. Most of the steel used in
the UAE is imported, with much of it coming from Turkey.
Further, the UAE lowered its interest rate after the Fed
slashed interest rates from 3 per cent to 2.25 per cent, the
sixth US rate cut since September to bolster money supply
amid a credit crunch. Economists say such rate cuts do not
serve the economies of the UAE and other Gulf countries that
have their currencies pegged to the dollar. In fact, they
will likely fuel further acceleration in the growth rate of
private-sector credit and domestic liquidity, and may ultimately
push inflation rates further into the double-digit range.
Projects all over the Middle East are taking off. Airport
developments, particularly, have reached a new high at $ 68
billion. The Gulf countries account for $ 43 billion of this
growth with $ 21 billion worth of development now underway
in the UAE. Other important airport developments in the region
include Bahrain International Airport at $ 815 million, Kuwait
International Airport at $ 2.1 billion and Queen Alia International
Airport in Jordan at $ 600 million.
Following airports is the tourism industry which has $ 70
billion of investment committed to hotel and tourism-related
developments. The number of hotel rooms in the UAE is projected
to increase tremendously in order to accommodate the upsurge
of 15 million tourists expected to visit the country by 2010.
The boom in hotel construction in the UAE will create immense
business opportunities for lighting designers, suppliers and
manufacturers of lighting equipment. The number of hotel rooms
in Dubai will increase by 50 per cent by the end of this year.
Currently there are 40,000 rooms across 415 hotels in Dubai.
While economies the world over grapple with the economic
challenges, the Gulf in general and the UAE in particular
is set to benefit from the advantages emerging from the cooling
in the commodity prices that will follow the slowdown in the
US. Looks like the construction party is still on! And CW
is celebrating by giving you a new-look magazine with an international
size. The digital version of the magazine is also available
on www.GulfConstruction.com Enjoy.
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