Recession

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Private Sector asked to create 20,000 jobs for the Emiratis

jobless in dubaiPrivate sector of UAE, already struggling with global recession and downturn, has been asked to create at least 20,000 jobs a year to cater for the jobless Emiratis.

According to Saqr Gobash, Minister of Labour, Chairman of the Board of Trustees of the Development and Employment Authority of National Human Resources (Tanmia), there are at least 35,000 unemployed Emiratis in the UAE. Out of which only 8,000 Emiratis are currently enrolled with Tanmia.

There is already a law in place that makes it virtually impossible for employers to fire Emirati employees.

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Multi-billion Dirhams Infrastructure Projects Defy Recession in Dubai

Amidst the rumors of recession and global downturn, multi-billion dirhams infrastructure projects are on full swing in Dubai.

Three major road projects worth Dh2.9 billion were approved recently by His Highness Shaikh Mohammed Bin Rashid Al Maktoum, Vice-President and Prime Minister of the UAE and Ruler of Dubai.

Also, work has begun to expand the combined passenger capacity at Dubai’s two airports – Dubai International and Dubai World Central – to 240 million, from the 190 million initially planned.

The RTA projects, approved by Shaikh Mohammad, include upgrades of Al Wasl Road, Al Khail Road and Umm Suqeim Road.

New underpasses will be built on Al Wasl Road and the number of lanes on Al Khail Road will be increased from the existing four to six in each direction, in addition to roundabouts being replaced by interchanges. The Trade Centre roundabout will also be replaced by flyovers and a signalized intersection to ease congestion.

Meanwhile, Dubai International Airport’s Concourse 3 – the last major project at the region’s biggest aviation hub – will be completed by the end of 2011, which will help increase its passenger handling capacity to 80 million from the initially planned 70 million.

When completed, the airport will have three terminals and three concourses, two mega terminals for cargo, an airport free zone, an expo centre with three exhibition halls, a major aircraft maintenance hub and a dedicated flower centre to handle perishable goods movement.

The Dubai Government is investing Dh15 billion for the expansion of Dubai International, and the initial cost for the development of Dubai World Central – the world’s largest integrated aviation hub – has been estimated at Dh30 billion.

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Law to ban private sector companies from sacking Emiratis

It has now been confirmed that what was quoted by Dubai Police Chief was not a mis-interpretation, as suggested by some media articles, but something that has been considered to be implemented as a Law in Dubai.

National Human Resource Development and Employment Authority (Tanmia) has submitted a draft proposal to the Ministry of Labour under which cases pertaining to the termination of Emiratis working in the private sector are to be evaluated.

The proposal suggests that the termination of Emiratis in private sector companies is to be considered arbitrary unless the employee has violated the labour law.

The Tanmia proposal also stipulates that any company in the private sector forced to terminate Emiratis as part of restructuring policies aimed at increasing competitiveness, review of production costs in tough times, or in cases involving mergers between companies should duly inform the ministry of labour about such a move before any decision.

Also, as per the proposal, no company will be allowed to sack an Emirati before it has exhausted all avenues to find a suitable solution.

The proposal outlines a number of steps that a company should mandatorily satisfy before terminating Emiratis such as implementing a part-time system, repackaging salaries on the condition that they don’t go below the minimum wage for Emiratis (which is between Dh3,000-Dh5,000 – depending on the qualifications), relocating them within the company or training them to handle other positions in the company.

Additionally, an employer in the private sector will also not be allowed to terminate an Emirati on the pretext that he/she does not have the required qualifications and skills, if the employee has completed her/his probation period.

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Banks raising loan limit in wake of credit defaults and recession

Banks in Dubai are now acting up to control losses accumulated due to easy lending policies. In the wake of expats unable to pay their loans, dumping their cars, and fleeing Dubai, banks are raising credit limits for car and home loans.

Arabian Business reports Emirates NBD, the largest bank in the Middle East, has hiked the minimum salary limit for expatriates seeking a mortgage by more than 200 percent and doubled the threshold for locals. Emirates NBD is only considering expatriate customers for a home loan if they earn a minimum of 25,000 dirhams ($6,800) a month, up from a previous limit of 8,000 dirhams. Emiratis must now earn 20,000 dirhams a month, up from 10,000 dirhams.

In November, Lloyds TSB had raised the monthly salary limit for a personal loan from 12,000 dirhams to 25,000 dirhams.

In the same month, HSBC doubled the minimum salary someone must earn to qualify for a mortgage from 10,000 dirhams to 20,000 dirhams.

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Expats dumping cars, flying back home to dodge credit crunch

While the media in Dubai (and UAE) follows strict protocol of not revealing information that might harm the reputation of “glowing economy” of UAE, some bits and pieces of “real” news slip out of the net.

Khaleej Times referred to a recent incidents where scores of expats dumped their vehicles in Dubai and flew back home to escape from credit card, bank loans and other financial liabilities, in the wake of recent job cuts in Dubai.

It is also reported that Sharjah Police has beefed up security, especially in labour camps, to prevent crimes that could take place as a result of current and expected job losses.

Moreover, the names of people who owe money to the banks are listed in the system and they wouldn’t be able to leave the country until they settle their debts. Their names will remain in the system until the banks request removal of their names from the blacklist. In order to tackle such issues, police patrols have been increased and undercover policemen have been deployed.

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Villa prices in Dubai fall by 45% amid real estate slump

Villa prices at Jumeirah Park and Jumeirah Islands, Nakheel’s exclusive residential developments in Dubai, have plunged up to 45 percent in the last four months.

Brokers across the UAE said speculators were desperately scrambling to off-load property before prices fell further.

Imran Aslam, agent at Dubai-based property broker AAA said completed three to four bedroom villas on Jumeirah Islands were now on the market for as low as six million dirhams, down from 10.5 million dirhams four months ago.

“It’s a big difference now. Investors are quickly reducing prices. They are also finding they have got too many [properties], so they want to sell. At the moment there is no stable price in the market.”

Aslam said off-plan villas at Jumeirah Park, a 350 hectare planned residential community due for completion in the next few months, have fallen in price by 40 percent.

Distressed investors are fleeing Dubai’s once red hot real estate market as the global credit crunch hits demand, sending values tumbling.

Lack of mortgage availability exacerbated by a regional liquidity squeeze is also hampering would be buyers, agents said.

Adriana Kapostikova, broker at Dubai Waterfront Properties said: “It [the market] is going down. This is the problem. There are people putting prices down and down because they want to sell. It’s cheap now.”

Up-market villas on Jumeirah Islands, a smart residential enclave consisting of a series of man-made islands near Emirates Golf Club, have come down in value from 12 million dirhams to nine million dirhams, a reduction of 30 percent, Kapostikova said.

Abu Dhabi-based broker Ocean View said real estate values at Jumeirah Park had slipped 40 to 50 percent in the last few months.

Private developer Nakheel completed Jumeirah Islands in 2006. Villas at Jumeirah Park, which is a family orientated development with a number of open spaces and parks, range from three-five bedroom villas.

From Arabian Business

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Lost Your Job? Arabian Park Hotel in Dubai Offers Free Food

free food in recessionArabian Park Hotel in Dubai is offering free food to UAE residents who have recently lost their jobs. This free services for the victims of the credit crunch is available from Dcember 15, 2008 to January 15, 2009,

General Manager Mark Lee said: “To remind people of our value for money we’re launching this special offer. Anyone who has lost their job simply needs to bring along their redundancy notice and their food is completely free.”

The complimentary dinners will be offered in the hotel’s Brasserie restaurant.