Over the last few months we have seen more and more threads covering Dubai and the economic situation which is developing out there. Dubai is a subject which seems to stir very high emotions and often very different views and perceptions of what exactly is going on at the moment. However, there does seem to be one general link throughout thread, the fact that the Dubai economy has taken something of a hit over the last few months.
The Dubai economy
As a number of posters have suggested, the Dubai property market is a vital element of the Dubai economy as a whole. As a consequence the downturn in the property market, caused by a mixture of reduced finance and a worldwide economic slowdown, has had a significant impact upon the immediate prospects for Dubai and those looking to move there for employment.
It would appear that the construction and property markets have been hardest hit although there is no mention of how the tourist industry is fairing at the moment, where there must be potential in the short to medium term for a difficult period to say the least. It has also been noted that a number of foreign companies who moved to the area over the last few years appear to have retrenched back to their homeland leaving something of a hole in the Dubai economy.
Recruitment agencies
Sadly it would appear that many people have still not noticed that the Dubai economy has slowed of late with many being taken in by promises of employment by various recruitment agencies. While it would be wrong to say that these agencies are deliberately misleading people, it would appear that more and more people are left very disappointed with the options available when they move to Dubai.
There is also potential for the government to look favourably upon local employees rather than overseas employees if the downturn continues for some considerable length of time. The government has a reputation for swift action on a number of issues and the landscape can literally change overnight.
Media influence
As we have covered on some of our other posts there have long been suggestions of media bias both for and against Dubai which appear to be coming more to the fore in these difficult times. There are a number of suggestions that the Middle East media are making light of the difficult economic environment while the Western media is conveying a doom and gloom scenario for the region. The truth is that the real scenario is probably somewhere in between the middle of these two very different views but it can be difficult to see the woods for the trees.
Are the streets of Dubai paved with gold?
There is no doubt that Dubai, backed by the local property market and substantial foreign investment, has been one of the better performing property markets and economies in the world over the last few years. Unfortunately the area has not been able to avoid the ongoing worldwide economic downturn which is not only affecting the region directly but has forced many overseas investors and visitors to Dubai to retrench back to their homeland.
However, while the current economic climate is very rare and having a major impact in many countries around the world the long-term picture for Dubai is still very positive although the short to medium term situation, like so many around the world, could get worse before it gets better. The current situation in Dubai has also been exacerbated by the so-called “hot spot” status which the area attracted when the property market was in full flow. The cooling of the “hot spot” has not assisted the local economy in any way and this may be something which the authorities will look at in the future.
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