Following their impressive Q3 financial results last week, Emaar Properties has announced a US$ 3 billion Iraqi project in Erbil, Kurdistan. Comprising 15k residences, three 5-star hotels, 715k sq mt of office space and a shopping mall, the development will cover 541k sq mt. Downtown Erbil will create 45k new jobs.

The company also announced this week the launch of its luxury Sky Collection residences in Downtown Dubai. The Address Residence Fountain Views III – with 76 storeys – is a major component of Emaar’s three-tower dedicated serviced apartment project. So far this year, the company sales have almost tripled to US$ 2.5 billion.

This week, Dubai was selected to host the 2014 World Islamic Economic Forum – over two thousand Muslim political and economic leaders are expected to be in Dubai for the conference next November. Recently HH Sheikh Mohammed declared his keenness to make Dubai the world’s Islamic economic capital but the emirate has some ground to make up to catch up with Kuala Lumpur and London.

Dubai Holding, owned by the Ruler, confirmed that it would repay a US$ 1 billion bond due for maturity in January that would then leave the Dubai Holding Commercial Operations Group with one outstanding US$ 805 million bond, due for repayment in 2017. The group, with 2012 profits of US$ 327 million, has assets such as the hospitality-based Jumeirah, TECOM, Dubai Properties Group and Emirates International Telecommunications. This week Jumeirah announced it had raised a five-year $1.4 billion unsecured syndicated loan; this would be used to fund its expansion and also, in part, for the general corporate business of DHCOG. The operator, with 22 managed hotels, also confirmed an agreement with IFG Basis Project to manage a 74-room luxury St Petersburg hotel, due to open within three years; this will be the operator’s first foray into Russia.

Sunday saw the first official commercial flight into Al Maktoum International Airport with the arrival of Hungarian-based Wizz Air. The facility has been opened for freight carriers since June 2010 but an increasing amount of international carriers is expected to use the airport, which is destined to become the world’s largest super aviation hub.

Meanwhile passenger traffic at Dubai International increased by 13.1% in September, with a total of 5.4 million passengers, whilst year to date traffic was up 16.0% to 49.4 million. Air freight volumes rose 1.9% in September, on volumes of 197k tonnes, with YTD totalling 1,786k tonnes – up 6.6%.

Also on the transport theme, Serco Group has just signed a new five-year US$ 575 million contract with Dubai’s Road and Transport Authority (RTA) to maintain and operate the Metro. The world’s largest fully automatic transit system was inaugurated in September 2009 and is expected to carry over 127 million passengers this year. There are 49 stations on the Red and Green lines, covering 75 km.

DP World announced that Q3 gross container volumes were up 2.4%, on a like-for-like basis, handling 14.2 million TEUs (20’ equivalent units). Of this total, the UAE had a record quarter with 5.4% growth to 3.6 million TEUs – and exceeding 10 million TEUs, for the first time, in the first nine months of 2013. It is interesting to note that the company has a further four million TEU capacity coming on line within the next year.

The latest company to report on Q3 earnings was Etisalat with a 20.0% jump in revenue to US$ 2.61 billion negated by a 17.2% drop in profit to US$ 499 million, as staff expenses grew. International operations, which have increased by 41.0% this year, now account for 35.4% of its total revenues; however, however, in Egypt, there was a 14.0% reduction in revenue to US$ 300 million mainly because of the weak Egyptian pound.

With a current customer base of 6.9 million mobile subscribers and 587k fixed line users, Du, the Dubai-based telco, saw its Q3 revenue up 8% to US$ 719 million, whilst net profit after royalty payment surged 45% to US$ 129 million. Its growth is limited by the fact that Etisalat has the monopoly over Abu Dhabi’s fixed-line networks and further liberalising of the country’s broadband would benefit Du’s expansion plans.

The Dubai-based schools operator, GEMS Education, is planning to raise US$500 million from a sale of hybrid Islamic bonds to finance its future plans. The company has 11k staff and operates around one hundred private schools globally of which seventy are in the region.

Work is well under way on the 14km long corniche which will stretch from the Burj Al Arab to the Dubai Marine and will be ready by the end of 2014. The new walkway and jogging track – known as the Jumeirah Corniche Development Project – will link with the Dubai Canal Project.

Latest figures from the Dubai Economic Council show that the emirate continues with its impressive growth trend – with Q2 GDP up by 4.7% – allied with a reduction in the emirate’s fiscal debt by 15.7% to US$ 409 million. Next year, there is a forecast 7.2% rise in public revenue to US$ 8.9 billion and a smaller 5.8% hike in spending to US$ 9.3 billion. The major sectors that contribute to Dubai’s GDP toal are wholesale and retail (29%), manufacturing (16%), transport (14%), real estate (13%), finance (12%) and construction (8%).

The report also highlighted that more than 5 million tourists arrived in Dubai in H1 with visitors from neighbouring Saudi Arabia up by a massive 32%. On a quarter to quarter basis, returns show occupancy rates up by 5.3% to over 80%. Rather surprisingly, there were only fourteen new hotels and two hotel / apartments opened in the year bringing the total inventory to 406 and 197 respectively. August hotel occupancy figures rose 7.8% whilst year on year RevPar has surged 25.8% to US$ 149, following an 11.7% rise in the ADR (average daily rate).

Mashreq reported a 34.0% profit jump for the nine months of 2013 to US$ 354 million, as its total operating income grew by 19.2% to US$ 954 million. During the period, deposits rose by 11.7% to US$ 14.4 billion whilst total provisions for loans and advances reached US$ 790 million, constituting 87.9 per cent coverage for non-performing loans.

Further good news for the bank came in a US court case confirming that Mashreq has a claim against ING Groep involving the loss of over US$ 60 million. The case arose when the Dubai-based bank claimed that a 2007 US$ 108 million investment went sour with ING allegedly placing more than two thirds of the investment into “toxic, illiquid structured securities”. Unfortunately, New York law precludes Mashreq from pursuing punitive damages and can only claim what it is actually owed.

HH Sheikh Mohammed bin Rashid Al Maktoum chaired the latest cabinet meeting that approved the 2014-2015 federal budget. The planned US$ 12.5 billion spending package was up 3.1% on last year, with more than half allocated for development and welfare and a further 21% and 8% for the education and health sectors respectively.

At long last, the Central Bank has issued new regulations in relation to property sales, basically restricting home loans to 75% for expatriates and 80% to locals for property valued at under US$ 1.36 million and 65% and 70% for values above that sum. Second property purchase will be further restricted to 60% for expats and 65% for nationals. The main provision to stop “flipping”, and slow down the booming market, is that all off plan mortgages will be limited to 50%. The new rules will become applicable by December.

For a change, the Dubai Financial Market General Index had a lacklustre week closing on Thursday 12 points up at 2922. Over the month, the market has risen a further 6.0% and over the first ten months of 2013 it has climbed 88.38%.

As governments around the world battle with lower tax receipts and increased expenditure demands, it is difficult to have any sympathy with the likes of Amazon, DHL and Google who seem to go out of their way to make a mockery of the system. Recent reports indicate that the Google funneled US$ 12 billion of royalty payments to Bermuda which slashed its overseas tax rate to a about 5%. The company earns most of its foreign income in Ireland (already with a low tax regime) thus paying little tax in the countries where its customers are based. Furthermore it makes use of what is called a ‘Dutch sandwich’ – a structure that routes its profits via the Netherlands to avoid withholding taxes.

With Christmas fast approaching, it seems that the price of chocolate is set to rise, as costs have surged 31% this year, mainly because of huge increases in cocoa butter (70%), milk powder (50%) and cocoa (21%).  The situation is expected to worsen in the coming months.

There will be little festive cheer in the eurozone despite the bloc exiting six quarters of recession.The recovery is weak and fragile with major problems of low productivity, high unemployment, anaemic and uneven growth and an ever expanding north / south divide still to be surmounted. The banks have to start lending and unblocking the credit lines and, if they fail to do so, the eurozone will once again sink into inevitable recession.

As the Federal Reserve decided to continue with its stimulus package for the foreseeable future, it seems odd that  US stocks are trading at historic highs, despite recent indicators, such as private-sector jobs growth, housing starts and consumer spending, being more than disappointing. The fact that the Fed has been pumping in US$ 85 billion of ‘easy’ money a month (and probably more than US$ 3 trillion since the QE process began), allied with low interest rates and a falling bond market, has resulted in the total return for October alone (including dividends) from the S&P 500 companies to be 5.5%. Now is the time to get out of this market – you do not want to be The Lonely Bull (El Solo Torro)!