By Andrew White
Dr Habib Al Mulla says financial centre ‘more of a shopping centre’ than business hub.
The founding chairman of Dubai’s financial regulator has said that the original vision for the Dubai International Financial Centre (DIFC) “has been lost” in the six years since its launch.
“It’s more of a shopping centre and more of a real estate project [than a financial centre],” Dr Habib Al Mulla told Arabian Business in an interview.
“There was a clear vision with the first blueprint for the DIFC… [However] it has moved away from the path we set out on, which was to build a financial centre with high standards, to attract the 500 top companies in the region, to become a hub for doing business for the whole region,” he continued.
“That initial direction, particularly when it comes to the exchange, but also the DIFC as a whole, has been lost.”
Al Mulla was responsible for the drafting of the regulatory regime of the DIFC upon its inception in September 2004. He stepped down as head of the Dubai Financial Services Authority in June 2007.
Since then, the financial centre has been beset by scandal after a high-profile crackdown on corruption initiated by the Ruler of Dubai, Sheikh Mohammed Bin Rashid Al Maktoum. It has also been forced to revise its retail strategy following the closures of four top-end designer stores at the Gate Village, which houses the DIFC.
The purge led to the arrest last year of DIFC governor Dr Omar bin Sulaiman, on embezzlement allegations. Bin Sulaiman has since been released after he agreed to repay $14m in bonuses. And Bisher Barazi, the former managing director of the DIFC, is also being sued by the institution over the payment of unauthorised bonuses.
Earlier this month, the boutiques of designers Vivienne Westwood, Jill Sander, Issey Miyake and Nina Ricci, closed their doors in Gate Village. In a statement, the DIFC said new retailers that would better suit the financial district were set to fill the vacant units.
Al Mulla said that the store closures were “always going to happen, with the way the DIFC has been run these last three years”. However, he said he believed the current management team at the DIFC, led by former finance minister Ahmad al-Tayer, was capable of putting the centre “back on track”.
“I think the fundamentals are there but we need to have a correction, and I think what the current administration is doing is hopefully going to put the DIFC back in the right direction,” he said.
“From what I read and what I hear from the current governor and people who are in charge, I think they understand what happened to the DIFC, and I think they know they need to get back on track to the initial goals of the DIFC.”
The full interview with Dr Habib Al Mulla will be published in the next issue of Arabian Business magazine, available July 25.
I have great respect for an individual who faces the facts and is not following the ongoing policies of denial. Dubai can only get the right investors back if they seriously find all together a solution instead of making believe everything is fine.
Most other zones are not different. They are all doing mainly "real estate" business only! Look at DIC, Silicon Oasis City ... What are they really doing?
I believe any one making such accusation about any one should also express their relationship with current head of DIFC. More so it is unprofessional to bash former employees without arrival of proper judgement.
A centre where you could buy jewellery, fashion and flowers for the wife, but you can't even get foreign exchange before a business trip - go figure!
Couldnt have agreed more to this. I had been following the development of the DIFC from its conceptualisation in Nov 2002. They had the opportunity to really develop a business environment that would manage the 'time zone' gap and the 'serviceability' factor that exists between London and Singapore/HK. Unfortunately, since 2005 DIFC has become more a realty developer. Instead of working on developing the 'building blocks' of a financial marketplace; it has focused only on 'building blocks'. I can only hope that they have gone back to the drawing board and start focusing on all the bare fundamentals of a financial marketplace.
You can get Forex at the airport. It always worried me when I seen executives sending the office boy out to get forex the day before a business trip. Where is the road warrior in you?
Regardless of anything, Dubai is still the best city of the Middle East, and possibly one of the best in the world to live and DIFC is an amazing place to work and make business. Problems come and go, every where all the time, we are here to stay.
Actually, I was trying to send my nephews and nieces money for their birthdays, Christmas etc, and couldn't get the money changed at DIFC - it's not about sending anyone to do anything for me - I was trying to do something nice for those nearest and dearest to me. The airport was no use as I live too far away, and eventually ended up somewhere else, but it would have been nice to be able to put money in the card that I bought at DIFC, and was able to post at DIFC. The point I was making was I can get my hair done, buy a new dress, or some flowers, pick up some jewellery, have a suit tailored for my husband, get my perscription filled, rent a car, have a gelato, buy a magazine, get my business cards printed, browse for a new book, have a coffee, pay my etisalat bill, buy the latest mobile phone, or a pair of shoes, but I can't get FOREX in a financial centre - just strikes me as all shades of wrong.
Well done Arabian Business for some great journalism & covering key issues of national importance ! Dr Habib Al Mulla thank you for the valuable insights. I am confident you will inspire the required action & make things happen. While Dubai's growth has been exemplary there is always room for continuous improvement, raising the bar & re-alignment to the changes in the global arena. A review of the progress made, lessons learnt & review & realignment of strategy & plans is a great step in the right direction. If there are no issues / problems one should be worried because nothing is happing. "More work - more mistakes, No work - no mistakes" :) If there is something that can be improved or done better - Lets embrace the opportunity & do it now !
Stop your blabla about improvement, instead read the words of this man: THE VISION HAS BEEN LOST! Get it?