By Daniel Shane
Successful bid would see major investment in metro and roads infrastructure
Authorities in Dubai will invest €6bn ($8.1bn) in new infrastructure if it is successful in its bid to host Expo 2020, Sheikh Ahmed bin Saeed Al Maktoum told Bloomberg.
Speaking to the news agency on the sidelines of the Dubai Air Show, the emirate’s top finance official said that financing the required costs would not be problematic as it “makes sense” and has a “business case”, without elaborating.
“We need to extend maybe the metro, the road infrastructure to the site and doing a lot on the site itself,” the head of Dubai’s Supreme Fiscal Committee said.
Dubai will discover on November 27 if it has been successful in its bid to host the event. It is competing with Izmir in Turkey, Sao Paolo in Brazil and Ekaterinburg in Russia.
Expo 2020 would increase Dubai’s economic growth by 0.5 percentage points per year and 2 percentage points in 2020, an earlier report by Bank of America Merrill Lynch said.
The same report put the total cost of financing the Expo at $8.4bn, or 8.9 percent of GDP.
The event would also create more than 277,000 jobs in the Gulf emirate, 40 percent of which would be in the hospitality sector and 30 percent in construction.
Dubai anticipates that more than 25m would visit the event over six months, including 70 percent from outside the UAE.
The $8.1 Billion is what it would cost the Government if they were to pay these contractors to build what they need to have ready for the EXPO. Question is though if they will pay for all this up front for the contractors or if the Contractors will be left trying to collect like they were with Dubai Holdings for Billions of Dollars of which they still have not collected on.
Weren't they still negotiating and talking about receiving some partial interest payment after something like 7-8 years from now.??
Andy every country faced the same issue and by time we hope Dubai base entity will pay all his dues. We can see change in the market and economy condition by time all amount will be paid. For running the country you need to extend the work with the control of expenditure and they are doing well.
Many of the contractors who helped build Dubai are still trying to collect interest alone on what they are owed. I believe collecting the actual amount owed is another story because I doubt they will be able to collect on that. Those that received pardons of which pardoned from jail and were supposed to have their debts paid as well were also not paid until now.
The question is though is who is willing to pay for all this and pay past debts and dues? Will the government pay these contractors up front this time? I think they will need to find new contractors this time around as the last ones still have not collected or been paid. There has been no news in the media about settlements with those contractors or their dues being paid off.
The announcement of this $8.1 spending plan sounds great and is great news only if the government pays these contractors up front this time and they actually get paid. This would then be a form of injecting money into the local economy.
Go Go Duabi, all tne best in the bidding and hope to hear the good news
This Kind of arrangement needs more than money, something called NATIONAL SPIRIT, unfortunately Duabi, despite all its advantages does not offer that at mass level, because people who will be given the task to organize and execute this event will not be UAE nationals, (except a handful of them).
We all support Dubai and consider it our home but as a business owner ( unfortunately 49% another mistake that needs to be corrected) it would be a great help if the various government departments would stop thinking up and applying every possible fee (READ INDIRECT TAX) they can come up with on a continual and immediate basis. It makes it very difficult to plan. Add to that scenario,non payment and very limited practical options to get your money within a reasonable time frame, it gives you an unfriendly business climate. That is the reality not what the surveys say. You have a lot of companies that were bitten in the past and suffered badly, they will be very wary to invest again in this planned growth if they have to bear all the cost and burdens.
well done dubai