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.
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