I Started a Joke

dubai-frameFollowing their 2011 joint announcement, it seems that the Investment Corporation of Dubai-Brookfield real estate fund will soon become a reality. Both entities have agreed to seed the US$ 1 billion fund and will primarily invest in the local market and especially in development opportunities. This could be an excellent time to start such a venture as Q1 figures from Dubai Land Department indicate a 63% rise in transactions totalling US$ 12.0 billion.

A sign of the burgeoning population in Dubai can be gleaned from the fact that enrolments in the emirate’s private schools rose by 8.7% last year to almost 225,000. No wonder then that their 2012 total revenue was US$ 1.09 billion (up a staggering 16.3%). There is no doubt that the cost of education is sky-rocketing and causing much concern among the expat population. Although the average annual tuition fee is put at almost US$ 5k, the top end of the market charges in excess of US$ 26k.

The retail sector received a further boost with news of luxury retailer, Chalhoub Group, announcing a 20% growth last year in the UAE. It is planning to open a further fifty stores here this year, as part of its 150-store expansion in the region, bringing its total outlets to 600.

This week’s launch by property developer Emaar will not cause the usual Dubai chaos. The Address Residence Sky View II will only be open to residents of London, Doha and Riyadh in an on-line sale. Construction of the 50-storey hotel and residential apartments will start in Q3 and is slated for completion by the end of 2016.

Palm Jumeirah will be the location for yet another luxury hotel with SKAI Holdings announcing plans for a US$ 1 billion project to be managed by the Viceroy Group. This will be the operator’s first Dubai venture and the 481-room hotel, with 221 apartments, will be ready within three years.

A good indicator of the current confidence in the realty sector is the fact that the recently launched Damac’s Paramount- branded development has already sold 40% of the US$ 680 million project.

The Dubai-based investment bank, Shuaa Capital, is still in the red with Q1 losses at US$ 1.6 million but an improvement on the US$ 2.3 million loss recorded over the same period in 2012. There was a 34.2% fall in Revenue to US$ 9.9 million as well as a 7.1% drop in Total Assets to US$ 354 million.

Although there are still six months until the host city for Expo 2020 is announced, a recent report has outlined the benefits for Dubai if their bid were successful. They include the addition of 280,000 new jobs of which 53% would in the travel and tourism sector, as well as the prospect of a massive inflow of 25 million visitors.

One visitor attraction, highlighting both old and new Dubai, will be completed within twelve months. The US$ 32.7 million completely transparent Dubai Frame – a 150 meter tall window frame, located in Zabeel Park – will feature a museum and will have elevators so that visitors can view the emirate from the top of the structure.

The Dubai Financial Market Index is still heading north with a massive weekly 5.4 % rise from 2178 to 2296 points. What has become the fastest growing exchange in the world has seen a 48.45% rise in 2013 and 64.29% surge in the past year. The other local bourse, Nasdaq Dubai, started the week with only two companies trading – Depa and DP World. It ended the week with only the latter as shares in Depa were suspended on Tuesday following their AGM at which its largest shareholder, Arabtec, with 24% holding, attempted to gain more board representation.

Rather surprisingly to many, Dubai’s April inflation rate was a paltry 0.1% whilst nudging up to 0.9% for the year. Rising rents and other price hikes have yet to impact on the emirate’s CPI.

Dubai’s non-oil trade expanded in Q1 by 16.3% from US$ 76.3 billion in 2012 to US$ 88.7 billion – and this despite regional unrest, a reduction in trade with Iran and an on-going global economic slowdown.

As the Reserve Bank of Australia cut interest rates to 2.5% – and with inflation at 2.25% – the Australian dollar is hovering below parity against  the greenback for the first time in over a year. Political uncertainty and a tentative economic climate, as mining sector revenues fall, were the background for what was probably Treasurer Wayne Swan’s sixth and final budget.

Following a US$ 17 billion hit to his revenue forecast, Tuesday’s patchwork budget saw the start of a four-year US$ 43 billion spending cut which will see this year’s US$ 19.4 billion deficit return to a supposed surplus by 2018. There seems little to support the country’s ailing retail and tourism sectors and even less to revive its competitiveness on the world stage.

Despite all this, Australia is still the lucky country when compared to most nations in Europe where recession in the eurozone continues for the sixth straight quarter. Q1 saw the 17-country bloc contract by a further 0.2% with Germany just managing a very weak 0.1% growth. Add to this the rising unemployment problem, with over 19 million looking for work, then it is reasonable to assume that there is worse to come. A good example is Tata Steel which has just written off US$ 1 billion of the value of its operations as it saw steel European steel demand fall 8% last year (and 30% since 2008).

Over the past few years, major scams have been unearthed – and they have usually involved individuals. Now there seems to be a tendency for institutions to become embroiled in fraudulent activities with many putting their corporate snouts into the trough. Just look at sporting organisations, big business, banks and the oil industry.

The fraudulent shenanigans at FIFA, headed by the roguish-looking Sepp Blatter, seem to be a regular occurrence whilst the Thursday’s IPL scandal is the latest to tarnish the game of cricket. Meanwhile Monsanto is once again apparently attempting to gain exclusive control of what many would consider to be everyday fruit and vegetables. Banks have shown their true colours with their disgraceful fat cat bonuses, Libor rate fixing, money laundering and now, potentially their biggest faux pas, price rigging interest rate swaps.

Joaquin Almunia, the EU’s antitrust commissioner, is investigating allegations of oil price fixing by some of the world’s biggest energy companies. There are concerns that, for many years, companies have colluded in reporting distorted prices which resulted in the end consumer paying more at the pump. (Maybe they can also look at other markets such as gold and currency).

Finally, Amazon’s UK subsidiary had sales of US$6.5 billion in 2012 and received government grants in the region of US$ 3.8 million. The on-line retailer employs 4,200 and has a tax bill of just 0.1% or US$ 3.7 million. Their theme song has to be I Started a Joke and the joke is on the UK taxpayers!

Following their 2011 joint announcement, it seems that the Investment Corporation of Dubai-Brookfield real estate fund will soon become a reality. Both entities have agreed to seed the US$ 1 billion fund and will primarily invest in the local market and especially in development opportunities. This could be an excellent time to start such a venture as Q1 figures from Dubai Land Department indicate a 63% rise in transactions totalling US$ 12.0 billion.

 

A sign of the burgeoning population in Dubai can be gleaned from the fact that enrolments in the emirate’s private schools rose by 8.7% last year to almost 225,000. No wonder then that their 2012 total revenue was US$ 1.09 billion (up a staggering 16.3%). There is no doubt that the cost of education is sky-rocketing and causing much concern among the expat population. Although the average annual tuition fee is put at almost US$ 5k, the top end of the market charges in excess of US$ 26k.

 

The retail sector received a further boost with news of luxury retailer, Chalhoub Group, announcing a 20% growth last year in the UAE. It is planning to open a further fifty stores here this year, as part of its 150-store expansion in the region, bringing its total outlets to 600.

 

This week’s launch by property developer Emaar will not cause the usual Dubai chaos. The Address Residence Sky View II will only be open to residents of London, Doha and Riyadh in an on-line sale. Construction of the 50-storey hotel and residential apartments will start in Q3 and is slated for completion by the end of 2016.

 

Palm Jumeirah will be the location for yet another luxury hotel with SKAI Holdings announcing plans for a US$ 1 billion project to be managed by the Viceroy Group. This will be the operator’s first Dubai venture and the 481-room hotel, with 221 apartments, will be ready within three years.

 

A good indicator of the current confidence in the realty sector is the fact that the recently launched Damac’s Paramount- branded development has already sold 40% of the US$ 680 million project.

 

The Dubai-based investment bank, Shuaa Capital, is still in the red with Q1 losses at US$ 1.6 million but an improvement on the US$ 2.3 million loss recorded over the same period in 2012. There was a 34.2% fall in Revenue to US$ 9.9 million as well as a 7.1% drop in Total Assets to US$ 354 million.

 

Although there are still six months until the host city for Expo 2020 is announced, a recent report has outlined the benefits for Dubai if their bid were successful. They include the addition of 280,000 new jobs of which 53% would in the travel and tourism sector, as well as the prospect of a massive inflow of 25 million visitors.

 

One visitor attraction, highlighting both old and new Dubai, will be completed within twelve months. The US$ 32.7 million completely transparent Dubai Frame – a 150 meter tall window frame, located in Zabeel Park – will feature a museum and will have elevators so that visitors can view the emirate from the top of the structure.

 

The Dubai Financial Market Index is still heading north with a massive weekly 5.4 % rise from 2178 to 2296 points. What has become the fastest growing exchange in the world has seen a 48.45% rise in 2013 and 64.29% surge in the past year. The other local bourse, Nasdaq Dubai, started the week with only two companies trading – Depa and DP World. It ended the week with only the latter as shares in Depa were suspended on Tuesday following their AGM at which its largest shareholder, Arabtec, with 24% holding, attempted to gain more board representation.

 

Rather surprisingly to many, Dubai’s April inflation rate was a paltry 0.1% whilst nudging up to 0.9% for the year. Rising rents and other price hikes have yet to impact on the emirate’s CPI.

 

Dubai’s non-oil trade expanded in Q1 by 16.3% from US$ 76.3 billion in 2012 to US$ 88.7 billion – and this despite regional unrest, a reduction in trade with Iran and an on-going global economic slowdown.

 

As the Reserve Bank of Australia cut interest rates to 2.5% – and with inflation at 2.25% – the Australian dollar is hovering below parity against  the greenback for the first time in over a year. Political uncertainty and a tentative economic climate, as mining sector revenues fall, were the background for what was probably Treasurer Wayne Swan’s sixth and final budget.

 

Following a US$ 17 billion hit to his revenue forecast, Tuesday’s patchwork budget saw the start of a four-year US$ 43 billion spending cut which will see this year’s US$ 19.4 billion deficit return to a supposed surplus by 2018. There seems little to support the country’s ailing retail and tourism sectors and even less to revive its competitiveness on the world stage.

 

Despite all this, Australia is still the lucky country when compared to most nations in Europe where recession in the eurozone continues for the sixth straight quarter. Q1 saw the 17-country bloc contract by a further 0.2% with Germany just managing a very weak 0.1% growth. Add to this the rising unemployment problem, with over 19 million looking for work, then it is reasonable to assume that there is worse to come. A good example is Tata Steel which has just written off US$ 1 billion of the value of its operations as it saw steel European steel demand fall 8% last year (and 30% since 2008).

 

Over the past few years, major scams have been unearthed – and they have usually involved individuals. Now there seems to be a tendency for institutions to become embroiled in fraudulent activities with many putting their corporate snouts into the trough. Just look at sporting organisations, big business, banks and the oil industry.

 

The fraudulent shenanigans at FIFA, headed by the roguish-looking Sepp Blatter, seem to be a regular occurrence whilst the Thursday’s IPL scandal is the latest to tarnish the game of cricket. Meanwhile Monsanto is once again apparently attempting to gain exclusive control of what many would consider to be everyday fruit and vegetables. Banks have shown their true colours with their disgraceful fat cat bonuses, Libor rate fixing, money laundering and now, potentially their biggest faux pas, price rigging interest rate swaps.

 

Joaquin Almunia, the EU’s antitrust commissioner, is investigating allegations of oil price fixing by some of the world’s biggest energy companies. There are concerns that, for many years, companies have colluded in reporting distorted prices which resulted in the end consumer paying more at the pump. (Maybe they can also look at other markets such as gold and currency).

 

Finally, Amazon’s UK subsidiary had sales of US$6.5 billion in 2012 and received government grants in the region of US$ 3.8 million. The on-line retailer employs 4,200 and has a tax bill of just 0.1% or US$ 3.7 million. Their theme song has to be I Started a Joke and the joke is on the UK taxpayers!

 

 

 

 

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