Thursday, October 15, 2009

The Debts of the Lenders: Is Dubai Recovering?

Earlier this year I discussed the economic woes afflicting Dubai.

Well, how are things a few months later? Months of coordinated government liquidity sloshing have improved the macro situation but things are not back to normal. Indeed, employers are still viciously slashing jobs.

There has also been much talk about turning Dubai into a logistics center. Industry analysts love to talk up the benefits of a central location between Europe, Africa, and Asia. However, their figures tend to emphasize the addition of warehouses instead of dedicated port facilities and hard figures from the Jebel Ali free trade zone. Jebel Ali's growth really picked up with the deterioration of the security situation in Lebanon, the former logistics hub of the Middle East.

I am cautiously optimistic about Dubai's prospects for growth - particularly that fueled by the entrance of large, foreign NON-WESTERN players such as the Chinese. Here is more information on an upcoming industry event that may shed more light on the situation.
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