Billions of Rs. Drown in Dubai Real Estate

[LRE]

'Pak investors lose billions in Dubai real estate downturn'



Sunday, December 07, 2008
ISLAMABAD: Pakistan Economy Watch on Saturday said a host of Pakistani businessmen have lost billions of dollars of investments in speculator-oriented Dubai real estate property downturn.

"Those who lured Pakistanis by showing them golden dreams of rich returns by investing in the oil-poor emirates have walked away silently, leaving the Pakistani businessmen in the lurch. These include salesmen, so-called developers, intermediaries and bankers, etc who must be brought to book," said a report issued by the Pakistan Economy Watch.

The report, titled "Overseas Risk Report", added that the shares of top property giants in Dubai have fallen as much as 85 per cent bringing many mega projects to a halt. "Many local and foreign companies have opted for mergers to avoid bankruptcy.

The giants are cutting expenses, plans and number of employees," the report added.

It said the losses in the realty sector were roughly equal to that of the GDP of Dubai. The government of United Arab Emirates UAE) is pumping billions to avoid the failure and $30 billion have been pumped in to the banking system and selling of some highly acclaimed assets is under serious consideration.

Dubai is facing losses to the tune of hundreds of billions of dollars and risk of defaults. The situation has resulted in stock exchange crash, dried up credit and shaky wealth funds. Banks have minimised limit of credit cards and mulling their ability for foreclosures.

"UAE has already lost $100 billion in the global crunch and it has $500 billion of assets," said Dr Murtaza Mughal, President Economy Watch said while unveiling the report, adding that it was already under stress due to some 60 per cent slide in oil prices.

The plans to make Dubai a hub of financial activities may not realise as attempts for unnatural growth result in such a situation, he added.


http://www.thenews.com.pk/daily_detail.asp?id=151059