After three weeks off work, lying around in Dubai doing not very much, I came back to the office last Tuesday feeling rather different. Having prided myself on being one the region’s biggest cynics when it comes to the economy, I am sensing a change. I might, by the end of next month, even stick my neck out and suggest that the worst of the recession — including the beleaguered property market — really could be over.
As I write this, the Dubai Financial Market is on 1655 points. Compare that to 1352 on 31 December 2011. That’s a rise of nineteen percent. It is, by any measure — and this figure is not a one-week wonder – quite staggering. The Saudi Tadawul is sitting on 7518, a rise of — and wait for this — 31 percent since the turn of the year.
As for Europe, the centre of all doom and gloom, well the figures there don’t look too bad either. On 22 September last year the FTSE 100 recorded its biggest fall in 30 years, as fears of a double dip recession began to grow. Since then it has risen seventeen percent, including a six percent jump since 1 January this year.
But surely the property market remains flat? Not according to the figures. Data from the Dubai Land Department showed 448 deals were recorded in January and February this year, a rise of 84 percent compared to the same period in 2011.
Every CEO I have spoken to in the last month — from media and aviation to construction and textiles — has told me the same thing: slowly, but surely, we are coming out of the woods.
Some weeks back I wrote that “sentiment” is everything. By the end of last year, sentiment was strongly negative, with considerable fears that a second recession was being created in Europe and blowing fast this way. There was a “wait and see” approach.
“We waited and we saw,” the CEO of one of the UAE’s largest companies told me last week. “And we saw nothing happened. That is why Dubai can forecast a growth of maybe more than four percent this year, regardless of what happens anywhere else in the world.”
Six weeks ago, when we held the annual Arabian Business Think Tank lunch, our own editorial team made some bold predictions — namely that the worst was yet to come. In commodities, currencies and equities, we forecast a largely downward spiral. So far we are being proved spectacularly wrong.
Down and out in Doha
Is there a bigger fool in football than English Premier League chairman Sir Dave Richards? I always thought that title belonged exclusively to FIFA boss Sepp Blatter, though Sir Dave has certainly been making a good case for himself. At a conference in Qatar earlier this month, he claimed: “England gave the world football. Then, 50 years later, some guy came along and said, you’re liars, and they actually stole it. It was called FIFA.”
If that wasn’t enough, he warned the Qataris that they better change their drinking laws before the 2022 World Cup, explaining: “In our country and in Germany, we have a culture. We call it, ‘We would like to go for a pint’, and that pint is a pint of beer. It is our culture as much as your culture [in Qatar] is not drinking. There has to be a happy medium. If you don’t do something about it, you are starting to bury your head in the sand a little bit because it needs addressing.”
As anyone who followed this story will know, Sir Dave completed his disastrous trip to Qatar by then stumbling into a water feature as he departed the conference hall.
Given such a humiliation, how can this man still be in a job? Having lived in this region for eight years now, one of the things that impresses me most about business here is that non-performing bosses are booted out quickly. Sacked. Dismissed. History. As both Sir Dave and Sepp Blatter have shown, in the West the biggest fools often get to run the biggest businesses.
Anil Bhoyrul is the Editorial Director of Arabian Business.