A few thoughts on: Politics, and Foreign ownership in UAE

I've more or less kept blogger up as a running experiment on my thoughts, but to be clear I keep my one-liners off-line and like to have discourse on the topics I bring up instead of a monologue.

But sometimes, when its late at night, and I have nothing better to do I get lost in thought and come back to this blog.

Its fitting that a few posts back I talked about Iran, and these days thats a tense topic.

Iran and the USA have been going through dialogue to remove sanctions, which I believe is (still) in everyones best interests.

At the same time, Saudi has launched a second assault on Houthi's in Yemen to stem Shia influence in the area... I am of two minds on this.

The first is that "war is the failure of politics"; this isn't an outright war yet, but its heading there. In the UAE we have a mandatory draft of which I'll be heading to hopefully this December. The UAE is taking a more active stance in this regional conflict and we are preparing and even tagging along with Saudi Arabia.

We as a people (regionally-speaking) need to politic more. Open trade is around the corner, and yet the drums of war are banging?

This may sound a bit biased as a draftee, but I think the logic of tense trade suits us better than a cold-war-esque MAD scenario.

Second I think that turning politics into religious arguments in this case is kindling a flame. Time and time again we have seen wars fought on religious grounds that weren't really that religious, and this seems to be heading that way too. This is the more dangerous aspect of the conflict, and one that is harder to resolve... Keeping it political is likely the solution yet again, and Im holding out hope that it heads that direction.

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On foreign ownership in the UAE, this is something thats been debated a few times already, and a new company law has been set that likely paves the way for it.

I have serious concerns on the rise of debt-equity swaps in our economy, and the new company law does provide provisions for that. I believe that both traders and the legal system needs to seriously prepare for a shock, and careful regulation is needed to ensure it doesn't wipe out local trade.

Pushing for FDI is fine, and the DED is taking some good steps, but the way they are going about it is  downright scary. Enfranchising foreign companies is one thing, but simultaneously allowing debt-equity swaps which may allow for distressed investing firms to take root here in traditional trade sectors... Not really a good thing.

The BBC interview, and a new Dubai

A quick post:

Sheikh Mohamed has always been in my eyes someone that had Emirati interests at heart. Despite what I feel is a wall of PR that has been built around him, there haven't been too many instances where I've heard him speak about foreign policy issues that could affect me. I was pleasantly surprised when I heard of an interview he had on BBC talking about a wide-range of topics, including foreign policy.

 Part of the interview can be found here.

His views on Iran, though I've heard them before from the minister of economy, were refreshing. "Remove the sanctions and everyone will benefit". Dubai has had its fair share of hardship in dealing with the sanctions. Our neighbor, and one of our top trading partners with a population of 80m people basically disappeared. A simple statement that remained unsaid for far too long.

His other views on helping alleviate suffering but not interfering in regional politics made me proud to be an Emirati, and had me feeling ever-so-slightly safer.

As an average joe (or Ali in this case), isn't it in my best interests to be less like Qatar, and more like Switzerland when it comes to regional politics?

I could go on about the rest of the interview, but I think I've made my point. I stand tall with a leader like him looking after my people.

Blue waters

via Tumblr http://dxbnight.tumblr.com/post/66669184268/blue-waters

Critical thinking and Dubai

It's been quite awhile since I last posted, and I've missed writing... So here I go:

In the past few months, the local news papers have been full of articles on improving economic conditions locally, a double-edged sword in my opinion.

The articles I chose to focus on where on new property launches from Emaar, the omnipresent developer, and a new bond issued by the government of Dubai.

Emaar's new project, a multi-use residential development named Mira, comes on the back of similar launches by government of Dubai linked entities. The project is just the first phase of many, in what i see as a concerted push for the real estate market's diversity. The list of new developments are in nearly every area of Dubai, from the historic creek area, to the deserts beyond Barsha.

Naturally with mega-projects the scale of Mira, with an estimated 25,000 units being introduced over the projects lifespan, the marketing campaigns are equally gigantic, sometimes with disastrous results. A quick search on YouTube on the Mira launch will show multiple camera angles of a fistfight happening at the launch. The hype generated from Mira, and these other projects is something that isn't to balked at, but embraced.

Real estate prices have steadily shot up in the past 8 months, which is a good sign for these developers... Right?

The sins of 2008-2009 are too easily forgotten, when Dubai had a massive real estate rally, and an equally massive crash. But to say that we have ignored this, would probably be a lie.

Debt is what caused the crash, and despite the best projections, it is debt that can wipe it all away.

There is nothing wrong with building new projects, as long as your underlying demand remains robust enough to do so. The troubles in the surrounding Arab states have proved to be a boon for the developers as money started flowing into the country. A casual stroll around the Dubai mall is now an exercise in picking out the different dialects of the GCC, and the mall has flourished with its new visitors.

Up to now, All is well, but I think of how transparency on debt could be our undoing. Despite assurances by various developers that prudence and cash reserves are in high supply, and that debt financing is only at 50%, I for one, can't figure out how much these projects will rely on banks. Nor will I ever.

It only takes one wrong turn in the market's direction for banks to come calling, and I hope it doesn't come to that.

The story of Deira

The heart of the spare parts souk isn't what many people might think of as magical... Deira, Dubai, isn't Cupertino, CA, where IPads and other revolutions are created.

And no, it's not the oppressive 3rd world sewer that other people think of either. It's a place like no other.

In the course of my everyday analysis of metals markets, I was unexpectedly given an assignment in the heart of Deira.

The assignment had me driving down to rundown building in the heart of the souk, with characters such as Raju, Ahmed, and Mohamed...

Raju was the suspected "jack-of-all-trades". He was at once, a pimp, a conman, anda  bootlegger. He was the former watchman, and knew the building well. Then there was Mohamed, who used an office meant for 5 people to house 30 workers. Like the Jews lost for 40 years, he was similarly lost trying to keep all 30 in the cramped office, and his modern-day slaves were put into a concrete box.

Ahmed was the sweaty accountant, who supposedly kept tabs on all accounts. He worried me the most, because he rented out the boxes, and knew about the building. But complacency, and perhaps want of a better life had him leave the building in disrepair. But he was the one I blamed first, then the building owner.

But despair wasn't the theme of this building:

Downstairs the shops had a different feel to them: The Awazi (Iranian) trader mentioned that the building he was in had more baraka (blessing) than the others, and it was a sentiment shared by other shops.

The offices on the mezzanine had a colorful character named Godsown... Who traded textiles, and ready-made garments with a smile. His role was the opposite of Raju's; he was at once a tenant, A community leader of the Nigerian's in the area, and a middle-man for other traders.

With the banter of deep-voiced Nigerians at the door-way, you'd see white-robed indian Ghora's pass by you to the mosque, as evening prayers called through the alleyways.

Hope was the theme of the building.

Hope is the theme of Deira.

A post for tomorrow

A few months into marriage, and I sit here thinking about how little I knew. And how little I still know.

I'm truly blessed to have been able to marry, as it isn't an easy feat. It also isn't easy to be a good husband... surprisingly.

Like with all things in life, it requires effort... And it's the little things that make it matter. Like a smile.

So keep smiling... And hopefully after 20 years you still will be... And I will be idling with you.

A few notes on twitter

News that Shk. Khalifa ordered that children born to non emirati father but emirati mothers be granted citizenship is great news, and combined with Shk. Abdullah's interesting twitter posts deserve praise for new thinking in the federal govt.

Shk. Abdulla recently tweeted that to call someone's wife by her name (which is deliberately avoided by some men) isn't a taboo, and men should call their wives by their names, and not some vague reference.

Now, being recently married, this issue hits home with me. If I ever get a daughter, I'd be proud that these thoughts introduced by The Sheikhs, are addressing and protecting my daughter's dignity, and developing her rights as a member of society.

And maybe it's time to get active on twitter to see what else is being said...