2008. 10. 27. 23:00:00
If there is a place in the world that would be able to emerge relatively unscathed from the global financial crisis, it is Dubai and countries like it - most of us would have thought.
But according to a recent study published by Morgan Stanley, property prices could fall by 10 percent in Dubai by 2010. What could have happened in this country, which has shifted its focus away from oil revenues, and more toward property developments and tourism? (See NAPI Real Estate, issue 3)Speculators burned
The simplest explanation is probably that the room for rising demand is not infinite even in the Emirates - which can shock companies used to easy profits. Meanwhile, simultaneously to the publication of the report, a significant amount of speculative or "hot" money has exited Dubai as well, writes The Economist. This was because some investors had betted on the United Arab Emirates de-pegging its currency from the dollar in order to combat its double-digit inflation rate, and had hoped to profit from such a move. However, when they realised that this wasn't going to happen, they withdrew their money - as a result of which, there is currently significantly less money to be spent going around in the country's economy.
For more on this article, please click on the following link: Clouds could gather even above Dubai: Napi Online
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