ABU DHABI // Regional stock markets are reeling as the global credit crunch pins the once-booming Gulf between tumbling oil prices and evaporating credit.
Oil prices fell yesterday below $37 a barrel, while shrinking liquidity around the world raises concerns that local property markets will join a worldwide downturn in real estate, draining profits and jobs from developers, builders and the banks that finance them.
Stocks in Dubai led declines yesterday, with the benchmark index falling about 5 per cent to its lowest since September, 2004. Stocks in Dubai have lost nearly 11 per cent so far this week. But Dubai's declines were less dramatic than those in Oman, where the benchmark stock index dropped 6.5 per cent, capping a 12 per cent slide since Sunday.
"I think we will see more consolidation in the corporate world, mainly in the financial and real estate sector," said Nasser bin Hassan al Shaikh, the director general of the Dubai Department of Finance, in a meeting of the Abu Dhabi Chamber of Commerce and Industry yesterday.
Standard & Poor's (S&P) joined fellow ratings agencies Fitch and Moody's Investors Service in expressing concern about the creditworthiness of some UAE banks. S&P cut its ratings on debt owed by the Dubai Islamic Bank and lowered its outlook for ratings on the Sharjah Islamic Bank, as well as the Emirates Bank International and the National Bank of Dubai, which still have separate debt despite having merged into Emirates NBD.
Shares in the Dubai Islamic Bank dropped to a five-year low. S&P reaffirmed its rating, however, on the Mashreqbank, one of the UAE's few private banks.
The agency said the revisions reflected the impact of a dimming global economic outlook and more difficult financing. "Plunging oil prices, an economic slowdown, the falling stock market and pressure on real estate prices are raising major hurdles for Dubai-based banks," said Emmanuel Volland, an analyst at S&P.
Demand for property in Dubai was slowing, S&P said in its announcement, raising the possibility of a sharp drop in prices. With property accounting for almost 50 per cent of the emirate's economy, it said, the impact could be significant.
The Central Bank moved yesterday to alleviate the liquidity shortage still afflicting local banks, announcing a dirham-US dollar swap facility that bankers say will enable it to push down the cost of funds for banks and arrest a rapid decline in the amount of credit available to the economy.
Under the terms of the new facility, the Central Bank will buy US dollars for dirhams, but sell US dollars for dirhams to be paid at a later date, effectively lending dirhams out at a rate of its choosing.
"These facilities shall be provided to all banks operating in the UAE, regardless of whether or not they have a shortfall in their dirham net positions," the Central Bank said after a board meeting.
S&P warned that, after a year in which credit growth exceeded 35 per cent a year, UAE banks had extended more loans than deposits and were therefore forced to find cash in the wholesale market, where the cost of funding was rising.
Investors were also not encouraged by news that Emaar, the UAE's largest publicly traded property developer, had ended a share buyback by purchasing only 200,000 shares, equivalent to only 0.003 per cent of its outstanding stock. The company had been cleared by regulators to buy up to 10 per cent of its shares. Emaar's stock fell by more than 6.6 per cent to 2.25 dirhams, its lowest price in more than four years.
Emaar's stock has fallen 85 per cent so far this year.
Tougher conditions for banks and falling prices for oil are intertwined, according to experts. Jassim al Mannai, the director general and chairman of the Arab Monetary Fund, warned the Abu Dhabi Chamber of Commerce and Industry yesterday that if oil prices remained low through next year, regional property developers and construction companies could suffer along with overall economic activity.
shamdan@thenational.ae
tpantin@thenational.ae
Key facilities
- Olympic-size swimming pool with a split bulkhead for multi-use configurations, including water polo and 50m/25m training lanes
- Premier League-standard football pitch
- 400m Olympic running track
- NBA-spec basketball court with auditorium
- 600-seat auditorium
- Spaces for historical and cultural exploration
- An elevated football field that doubles as a helipad
- Specialist robotics and science laboratories
- AR and VR-enabled learning centres
- Disruption Lab and Research Centre for developing entrepreneurial skills
GRAN%20TURISMO
%3Cp%3E%3Cstrong%3EDirector%3A%3C%2Fstrong%3E%20Neill%20Blomkamp%3C%2Fp%3E%0A%3Cp%3E%3Cstrong%3EStars%3A%3C%2Fstrong%3E%20David%20Harbour%2C%20Orlando%20Bloom%2C%20Archie%20Madekwe%2C%20Darren%20Barnet%3C%2Fp%3E%0A%3Cp%3E%3Cstrong%3ERating%3A%3C%2Fstrong%3E%203%2F5%3C%2Fp%3E%0A
MWTC info
Tickets to the MWTC range from Dh100 and can be purchased from www.ticketmaster.ae or by calling 800 86 823 from within the UAE or 971 4 366 2289 from outside the country and all Virgin Megastores. Fans looking to attend all three days of the MWTC can avail of a special 20 percent discount on ticket prices.
Test
Director: S Sashikanth
Cast: Nayanthara, Siddharth, Meera Jasmine, R Madhavan
Star rating: 2/5
A MINECRAFT MOVIE
Director: Jared Hess
Starring: Jack Black, Jennifer Coolidge, Jason Momoa
Rating: 3/5
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The specs
Engine: 1.5-litre turbo
Power: 181hp
Torque: 230Nm
Transmission: 6-speed automatic
Starting price: Dh79,000
On sale: Now
The Lowdown
Kesari
Rating: 2.5/5 stars
Produced by: Dharma Productions, Azure Entertainment
Directed by: Anubhav Singh
Cast: Akshay Kumar, Parineeti Chopra
NO OTHER LAND
Director: Basel Adra, Yuval Abraham, Rachel Szor, Hamdan Ballal
Stars: Basel Adra, Yuval Abraham
Rating: 3.5/5
The%20specs%20
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The smuggler
Eldarir had arrived at JFK in January 2020 with three suitcases, containing goods he valued at $300, when he was directed to a search area.
Officers found 41 gold artefacts among the bags, including amulets from a funerary set which prepared the deceased for the afterlife.
Also found was a cartouche of a Ptolemaic king on a relief that was originally part of a royal building or temple.
The largest single group of items found in Eldarir’s cases were 400 shabtis, or figurines.
Khouli conviction
Khouli smuggled items into the US by making false declarations to customs about the country of origin and value of the items.
According to Immigration and Customs Enforcement, he provided “false provenances which stated that [two] Egyptian antiquities were part of a collection assembled by Khouli's father in Israel in the 1960s” when in fact “Khouli acquired the Egyptian antiquities from other dealers”.
He was sentenced to one year of probation, six months of home confinement and 200 hours of community service in 2012 after admitting buying and smuggling Egyptian antiquities, including coffins, funerary boats and limestone figures.
For sale
A number of other items said to come from the collection of Ezeldeen Taha Eldarir are currently or recently for sale.
Their provenance is described in near identical terms as the British Museum shabti: bought from Salahaddin Sirmali, "authenticated and appraised" by Hossen Rashed, then imported to the US in 1948.
- An Egyptian Mummy mask dating from 700BC-30BC, is on offer for £11,807 ($15,275) online by a seller in Mexico
- A coffin lid dating back to 664BC-332BC was offered for sale by a Colorado-based art dealer, with a starting price of $65,000
- A shabti that was on sale through a Chicago-based coin dealer, dating from 1567BC-1085BC, is up for $1,950
SPEC%20SHEET%3A%20SAMSUNG%20GALAXY%20Z%20FOLD%204
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The White Lotus: Season three
Creator: Mike White
Starring: Walton Goggins, Jason Isaacs, Natasha Rothwell
Rating: 4.5/5
The biog
Hometown: Cairo
Age: 37
Favourite TV series: The Handmaid’s Tale, Black Mirror
Favourite anime series: Death Note, One Piece and Hellsing
Favourite book: Designing Brand Identity, Fifth Edition
The National's picks
4.35pm: Tilal Al Khalediah
5.10pm: Continous
5.45pm: Raging Torrent
6.20pm: West Acre
7pm: Flood Zone
7.40pm: Straight No Chaser
8.15pm: Romantic Warrior
8.50pm: Calandogan
9.30pm: Forever Young
More on animal trafficking
Temple numbers
Expected completion: 2022
Height: 24 meters
Ground floor banquet hall: 370 square metres to accommodate about 750 people
Ground floor multipurpose hall: 92 square metres for up to 200 people
First floor main Prayer Hall: 465 square metres to hold 1,500 people at a time
First floor terrace areas: 2,30 square metres
Temple will be spread over 6,900 square metres
Structure includes two basements, ground and first floor
Specs
Engine: Electric motor generating 54.2kWh (Cooper SE and Aceman SE), 64.6kW (Countryman All4 SE)
Power: 218hp (Cooper and Aceman), 313hp (Countryman)
Torque: 330Nm (Cooper and Aceman), 494Nm (Countryman)
On sale: Now
Price: From Dh158,000 (Cooper), Dh168,000 (Aceman), Dh190,000 (Countryman)
Specs
Engine: Dual-motor all-wheel-drive electric
Range: Up to 610km
Power: 905hp
Torque: 985Nm
Price: From Dh439,000
Available: Now
