How investment in Expo 2020 will pay off for UAE economy, burnish Dubai brand

The so-called expo effect has been a constant feature of economic commentary about Dubai and the UAE, in what has been labeled the discipline of Exponomics. (Supplied)
The so-called expo effect has been a constant feature of economic commentary about Dubai and the UAE, in what has been labeled the discipline of Exponomics. (Supplied)
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Updated 01 October 2021

How investment in Expo 2020 will pay off for UAE economy, burnish Dubai brand

The so-called expo effect has been a constant feature of economic commentary about Dubai and the UAE, in what has been labeled the discipline of Exponomics. (Supplied)
  • In return for the billions of dirhams spent on the event, UAE policymakers expect a long-term economic “legacy”
  • After the pandemic-driven slowdown in global travel, trade and tourism, staging the expo at all is an achievement

DUBAI: The UAE will take global center stage for the next six months — the duration of Expo 2020 Dubai, the extravaganza of business, technology, connectivity, and sheer showbiz that will finally get underway at a lavish opening ceremony on Thursday.

There is no doubt the expo will raise the profile of Dubai and the UAE while it is on, but in order to justify the billions of dollars that have been spent on it by the government and private sector, the policymakers expect there will be a long-term economic “legacy.”

The organizers have long recognized this and have been seeking to highlight the expected permanent shift in economic conditions ever since the UAE won the right to stage the event in 2013.

The so-called expo effect has been a constant feature of economic commentary about Dubai and the UAE, in what has been labeled the discipline of Exponomics.

The message from the organizers is that expo means, “investing in a resilient, long-term future for the UAE economy. Expo’s capital expenditure will spur wider economic impact in key sectors including construction (such as facilities and infrastructure development, and international participant pavilions), transport, storage, and communications, as well as travel, tourism, hospitality, and business services.”

Extra investment by Dubai authorities in transport, utilities, and other infrastructure will enhance economic growth in the long term, while small businesses and sustainable enterprises will also get a boost from the event.

 

 

n particular, the exhibitions and conferences industry — already a major money-spinner for Dubai — will move to the next level with the creation of the Dubai Exhibition Center and District 2020 for holding big international forums.

Expo will accelerate the UAE’s efforts to diversify its economy, support the growth of a knowledge economy and smart connectivity, as well as provide a stimulus for cultural and creative life, officials said.

Putting some hard economic and financial figures on those strategic economic policy goals has been made more difficult by the COVID-19 pandemic. In 2019, global consulting firm EY produced an assessment of the economic impact of the expo.




For Dubai, which thrives on global connectivity and travel, there was a big incentive to open up the economy as soon as possible after the COVID-19 pandemic. (Supplied)

“Expo 2020 Dubai and its legacy are expected to contribute 122.6 billion Emirati dirhams ($33.4 billion) of gross value added to the UAE’s economy from 2013 to 2031,” EY said, specifying a 1.5 percent boost to annual gross domestic product during the six months of the event, and tens of thousands of new long-term jobs created.

Critically, EY expected the event to attract 25 million visits from 190 countries, of whom 70 percent would come from outside the UAE.

Matthew Benson, EY partner, said: “Expo 2020 is an exciting long-term investment for the UAE, and is expected to have a significant impact on the economy and how jobs are created directly and indirectly.”

It is not known whether EY has updated its forecasts to take account of the most severe economic recession in decades in 2020, but independent economists are taking a rather more cautious view of the long-term economic legacy.

“The 25 million expo visits may be a tad too optimistic during an ongoing pandemic,” Nasser Saidi, a regional economics expert and Lebanon’s former economy and industry minister, told Arab News.

But he recognizes the achievement of staging the event at all after such an unprecedented slowdown in travel, trade, and tourism during 2020.

“Little did anyone envisage the scenario within which the expo would eventually take place,” he said. “Expo 2020 will be the first global mega-event to be held permitting physical entry of visitors, after the Tokyo Olympics went ahead without spectators.




People walk towards the Sustainability Pavilion, a week ahead of its public opening, at the Dubai Expo 2020 in Dubai on January 16, 2021. (AFP/File Photo)

“A successfully run event will boost Dubai’s and the UAE’s image as a global frontrunner in safely hosting large-scale events during the pandemic era. The expo will act as a stepping-stone for potential investors to buy into Brand Dubai and move businesses and families into the country.”

For Dubai, which thrives on global connectivity and travel, there was a big incentive to open up the economy as soon as possible, with the first tentative steps toward reopening taking place last summer and accelerating as the UAE’s COVID-19 vaccination campaign gathered pace.

The UAE has now given the vaccine to a greater percentage of its population than any other country in the world and has been rewarded by new optimism in the strength of its economic recovery.

The International Monetary Fund said recently that the UAE economy would grow by 3.1 percent this year, a dramatic turnaround from the 6 percent plunge in 2020. The expo will be a big contributor to that.

James Swanston, Middle East economist at London-based consultancy Capital Economics, pointed out that Expo 2020 would be a “welcome boost” to Dubai’s economy, especially in the vital tourism-related sectors.

He said: “Around a third of GDP is made up of sectors like hospitality and wholesale and retail trade, and the latest figures show that GDP contracted 10.7 percent year-on-year in the first half of 2020. More timely data points to a slow recovery. Tourist arrivals were just a quarter of their pre-pandemic level in the first half of 2021.

“Dubai has pinned its hopes on the expo to boost its attractiveness as a destination for tourists and expatriate workers. On top of targeting 25 million visits to the expo itself, the authorities have set lofty ambitions of 23 to 25 million tourist arrivals to Dubai by 2025, which would make it the most visited city in the world – for context, 16.7 million tourists visited Dubai in 2019.” 

Swanston noted that officials also hoped that one in 20 visitors to the expo would decide to reside in Dubai permanently, which would imply a near-term population increase of roughly 10 percent for the UAE as a whole.

Such considerations are especially relevant for UAE real estate, which is in the early stages of recovery from a sluggish property market that began in 2014 and still remains below that level.

Whether these targets will be met at Expo 2020 still remains to be seen. Staging such a huge event is a costly and demanding exercise, although no detailed up-to-date figures on the actual cost are available from the organizers.




Staging such a huge event is a costly and demanding exercise, although no detailed up-to-date figures on the actual cost are available from the organizers. (Supplied)

“Hosting such mega-events is usually found to be a strain on country or city budgets,” Saidi said.

“The economic case for hosting such events is based on the increase in economic activity, the rise in tourists and spending, building the intangible Dubai brand, as well as other qualitative and social impacts, like strengthening trade and business with global counterparts.

“Plus the feel-good factor, which is more important during a pandemic when trying to return to normal.”

That sentiment seems to be the consensus among “Exponomics” experts: The UAE is to be congratulated for staging the first mega-event of the post-pandemic era, with actual people, and will only enhance its reputation over the coming six months.

“The direct financial impact on the Dubai economy may be subdued by the pandemic,” Tarek Fadlallah, chief executive officer of Nomura Asset Management in the Middle East, told Arab News. “But it will leave a lasting impression on its reputation and economic development.”

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Twitter: @FrankKaneDubai


US critics of Israel face challenges in redrawn Congress districts

US critics of Israel face challenges in redrawn Congress districts
Updated 6 sec ago

US critics of Israel face challenges in redrawn Congress districts

US critics of Israel face challenges in redrawn Congress districts
  • Planned changes to district boundaries could affect nine members of Congress who have a record of voicing support on Palestinian issues

CHICAGO: Nine members of Congress who have been vocal critics of Israel’s policies towards the Palestinians could face tougher re-election campaigns as a result of their districts being redrawn, an analysis by Arab News shows.

Every 10 years, the dominant political parties in many states re-draw district boundaries based on demographic data provided by the US Census, which does not count Arab and Muslim Americans as a separate category.

Where population shifts have led to proposed boundary changes, incumbents may be forced to stand in new districts. That’s the challenge facing Illinois representative Marie Newman, who won election in 2020 in the 3rd Congressional District, which has the largest concentration of Palestinian American voters.

Newman has chosen to face-off with Sean Casten, who is very strong on climate change, in the new 6th District rather than stand against Jesus “Chuy” Garcia, who is one of only two Hispanic congress members in Illinois, in the 4th District. Casten is a strong supporter of Israel and silent on Israeli violence against Palestinians, while Garcia has often joined Newman to support pro-Palestinian legislation, including voting against a bill giving Israel $1 billion for its Iron Dome defense system last September.

“Rep. Newman was supportive of the push to create a second congressional district of Latino influence and understood that doing so would mean the need to shift boundary lines of existing CDs in the Chicagoland area,” Newman campaign spokesperson Ben Hardin said.

Describing the challenges as “inevitable,” Hardin said: “Representative Newman is grateful … to have the support of so many people here in Chicago’s southwest side and in the south and west suburbs, including a strong coalition of supporters from the Arab and Muslim American community.”

The new Illinois district map was approved by Illinois Gov. J.B. Pritzker, one of Israel’s strongest advocates, in November. Pritzker aroused anger among Arab Americans after refusing to apologize for disparaging remarks he made in a 1998 congressional race in which he accused a rival of accepting money from a Muslim group that Pritzker asserted supported terrorists.

“There is no doubt that the Illinois Democrats are seeking to undermine Newman, who has been a vocal supporter of Palestinian, Arab and Muslim rights,” said Hassan Nijem, the president of the American Arab Chamber of Commerce.

“She and Chuy Garcia are the only Illinois Democrats to defend Palestinian rights and recognize our growing community.”

The Illinois primary has been delayed from March until June 28, 2022, because of the COVID-19 pandemic.

In addition to Newman and Garcia, seven other members of Congress who voted against the Iron Dome money could be affected by district changes.

They include Cori Bush of Missouri; André Carson of Indiana; Raúl Grijalva of Arizona; Ilhan Omar of Minnesota; Ayanna Pressley of Massachusetts; Rashida Tlaib of Michigan; and Thomas Massie of Kentucky, a Republican Congressman who consistently votes against all foreign aid regardless of the recipient.

Tlaib, Pressley and Omar are members of the “Squad,” a group of progressive Democrats that includes New York Congresswoman Alexandria Ocasio-Cortez. Instead of voting against the Iron Dome funding, however, AOC voted “present” not taking a position.

In Michigan, which is holding its primary on Aug. 2 next year, mapmakers are proposing to re-draw Tlaib’s 13th district, increasing the number of African American voters. That could be important even though Tlaib defeated several African American candidates when she first ran and won office in the predominantly African American district in 2018.

Tlaib may be forced into a new district against pro-Arab Democrat Debbie Dingell. However, she could survive as the Michigan process puts remapping in the hands of an independent commission rather than partisan politicians. The final Michigan remap might not be completed until late January.

Also in Michigan, proposed changes would pit Jewish Democratic Congressman Andy Levin, who has been an outspoken supporter of the two-state solution for Palestine and Israel, against Brenda Lawrence.

Minnesota congressional remapping plans have targeted Omar and another pro-Palestinian Congresswoman, Betty McCollum, although maps in those districts have not been finalized.


Israeli agents convinced Iranian scientists to blow up their own nuclear facilities

Israeli agents convinced Iranian scientists to blow up their own nuclear facilities
Updated 03 December 2021

Israeli agents convinced Iranian scientists to blow up their own nuclear facilities

Israeli agents convinced Iranian scientists to blow up their own nuclear facilities
  • They posed as Iranian dissidents and smuggled bombs into the Natanz facility disguised as food
  • Israel had pledged to never allow Iran to obtain nuclear weapons

LONDON: Agents from the Mossad convinced Iranian scientists to blow up their own nuclear facilities by “posing as dissidents” and smuggling explosives disguised as food into facilities, according to reports.

According to The Jewish Chronicle, Israeli agents convinced up to 10 scientists to destroy the Natanz nuclear facility, wiping out 90 percent of its centrifuges – crucial for research into nuclear weapons.

They are said to have smuggled some explosives into the plant in food lorries, while others were dropped in via drones and picked up by scientists – who they convinced to use against the nuclear sites by posing as Iranian dissidents.

The attack on the facility is just one of a long line of Israeli sabotages of Iranian nuclear facilities, a strategy that they have engaged in more as Iranian nuclear research has progressed.

The Natanz facility, a critical nuclear research site, has been hit by at least three attacks linked to the Israeli secret service, the Mossad.

In another incident, agents used a quadcopter drone to fire missiles at the Iran Centrifuge Technology Company in an attempt to disrupt its research.

In recent years, following the US withdrawal from the 2015 Iran nuclear deal, Iran has increased its atomic energy research, including enriching growing quantities of uranium above the levels required for civilian nuclear activity such as energy production.

In April Iran said that it would start enriching uranium up to 60 percent after the attack on its Natanz plant which it blamed on Israel – that is closing in on the 90 to 95 percent enrichment required for nuclear weapons.

This week – much to the ire of Israel – Iran and the US returned to the negotiating table to try to find a deal to curb Iran’s nuclear activity in exchange for relief from crushing economic sanctions imposed on the country by the US and its allies.

But on Thursday, Israeli officials called on the US directly to cease those negotiations.

In a phone call with US Secretary of State Anthony Blinken, Israeli Prime Minister Naftali Bennett called for “concrete measures” to be taken against Iran.

He said that Tehran was carrying out “nuclear blackmail” as a negotiation tactic and that “this must be met with an immediate cessation of negotiations and by concrete steps taken by the major powers,” according to a statement released by his office.

The Israeli leader also expressed his concern about a new report from the UN, issued during the US-Iran talks in Vienna, which showed that Iran had “started the process of enriching uranium to the level of 20 percent purity with advanced centrifuges at its Fordo underground facility.”

Israel, the only nuclear-armed state in the Middle East, has pledged never to allow Iran to obtain nuclear weapons.


Lebanon information minister resigns

Lebanon information minister resigns
Updated 03 December 2021

Lebanon information minister resigns

Lebanon information minister resigns

BEIRUT: Lebanon’s Information Minister George Kordahi has officialy submitted his resignation on Friday to “give Lebanon a chance.”
“I will resign this afternoon,” Kordahi earlier told AFP. “I do not want to cling to this position, if it can be useful, I want to give Lebanon a chance.”
An official at the presidency confirmed to AFP that President Michel Aoun had received a call from Kordahi confirming he would submit his resignation.


UAE, France sign $18 bilion deal for 80 Rafale jets as Macron starts Gulf tour

UAE, France sign $18 bilion deal for 80 Rafale jets as Macron starts Gulf tour
Updated 03 December 2021

UAE, France sign $18 bilion deal for 80 Rafale jets as Macron starts Gulf tour

UAE, France sign $18 bilion deal for 80 Rafale jets as Macron starts Gulf tour
  • Macron arrived in the early hours of Friday for a brief Gulf tour where he will also visit Qatar

DUBAI: French President Emmanuel Macron met Abu Dhabi Crown Prince Sheikh Mohammed bin Zayed on Friday at the start of a two-day Gulf tour that saw France sell the UAE 80 French-made Rafale warplanes for $18.08 billion (€16 billion). 
France’s Defense Minister said the deal was France’s largest-ever weapons contract for export while the Minister for the Armed Forces hailed the deal as "historic."

There was no immediate confirmation of the deal from Emirati officials. Macron was greeted at the leadership pavilion at Dubai’s Expo site for talks with Sheikh Mohammed, known as “MBZ."
“I don’t want to reveal the Christmas present” before the meeting, UAE presidential adviser Anwar Gargash told journalists in the build-up to the talks in Dubai.
Macron arrived in the early hours of Friday for a brief Gulf tour where he will also visit Qatar, host of next year’s World Cup, before traveling to Saudi Arabia on Saturday.
The UAE, which celebrated its 50th anniversary on Thursday, is expected to order dozens of Rafale jets to replace its Mirage 2000 aircraft acquired in the late 1990s.
The Emirates is the fifth biggest customer for the French defense industry with $5.31 billion (€4.7 billion) from 2011-2020, according to a parliamentary report.
Macron is accompanied by a large delegation in Dubai including Foreign Minister Jean-Yves Le Drian, Finance Minister Bruno Le Maire and Defense Minister Florence Parly.


Saudi Arabia calls on Syria to comply with chemical weapons watchdog

Saudi Arabia calls on Syria to comply with chemical weapons watchdog
Updated 03 December 2021

Saudi Arabia calls on Syria to comply with chemical weapons watchdog

Saudi Arabia calls on Syria to comply with chemical weapons watchdog

LONDON: Saudi Arabia has urged Syrian authorities to cooperate with the chemical weapons watchdog and implement all decisions related to the use of chemical weapons in Syria.

The Kingdom’s position on the matter was reiterated by the Saudi permanent representative to the Organization for the Prohibition of Chemical Weapons, Ziyad Al-Attiyah.

He said: “The use of chemical weapons and toxic chemicals as weapons anywhere by any person and under any circumstances is reprehensible and completely contradicts the provisions of the convention and the legal rules and standards of the international community.”

His comments came during the 26th session of the Conference of the States Parties to the Chemical Weapons Convention on Thursday in The Hague, in the Netherlands.

Al-Attiyah also highlighted the importance his country attached to implementing its obligations under the Chemical Weapons Convention, believing in its objectives, and based on its consistent policy to strengthen cooperation to ban weapons of mass destruction and prevent their spread.

He pointed out that Saudi Arabia was keen to help free the Middle East of all WMDs, a move that would increase international peace and security.

Al-Attiyah thanked the organization’s director general, Fernando Arias, for his efforts toward the cause, adding that the Kingdom would be supporting his reappointment for a second term.