Category Archives: Economy

Saudi Bin Ladin Group cuts 100,000 jobs

It has been recently filtered that the major Saudi Arabian construction company, Saudi Bin Ladin Group, has issued 77,000 final exit visas meaning it had terminated 77,000 foreign workers.

Rumors further says that the group is planning to lay off up to 17,000 Saudi nationals, bringing the total number of job cuts to almost 100,000, representing almost half of its workforce.

Contacted by a local newspaper the construction giant replied that “adjusting the size of our manpower is a normal routine especially whenever projects are completed or near completion. Most of the released jobs had initially been recruited for contracted projects with specific time frames and deliverables” as reported by news agency Reuters.

As a matter of fact, Binladin has been under pressure since September last year, when it was suspended from receiving new state contracts after one of its cranes collapsed into Mecca’s Grand Mosque during a dust storm, killing 107 people.

In addition, the company is suffering from low oil prices that have led to government spending cuts to curb a record budget deficit.

As reported by ArabianBusiness, rumors say that Saudi Binladin group owe local and international banks a total of about 30 billion USD.

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Emaar’s new Tower at Dubai Creek Harbour unveiled

Finally it has been made official. Emaar Properties, one of the most appreciated developers in Dubai with several successful projects already completed like The Greens, Dubai Mall, Burj Khalifa and the whole Downtown neighborhood, is going to beat his own records.  After having developed the current tallest building in the world, it has recently unveiled what could be the world’s new tallest tower.

Even though the official height still has to be disclosed, Emaar management has confirmed that it will be a “notch taller than Burj Khalifa” that with its 828 meters mesmerizes thousands and thousands of visitors every day.

The tower is expected to cost 1 billion USD and will face competition from the 1,000 meter high Kingdom Tower in Jeddah (KSA), currently under construction, for the “tallest building in the world” title.

The tower was designed by Spanish architect Santiago Calatrava, who has designed masterpieces of architecture like the Museum of Tomorrow in Rio de Janeiro or Athen’s Olympic Sports Complex, and was inspired by the Islamic minaret structure as well as a lily bud.

Emaar New Creek Tower

“Inspired by a Nation. designed for the World” is Emaar motto for the challenging Project – Photos from Emaar website.

The tower is going to be built as part of a wider Project knows as Dubai Creek Harbour, a mixed use development located in proximity to Ras al Khor Wildlife Sanctuary and its flamingos and many species of waterbirds.

The aim of the 6 sq km development was very well explained by Mohamed Alabbar, chairman of Emaar Properties:

“With The Tower, we are delivering a compelling destination that will add long-term economic value to Dubai and the UAE. It will also position Dubai Creek Harbour as one of the most desired residential, leisure and touristic attractions, providing visitors and residents with a modern, luxurious and sustainable environment in which to live, work, learn and entertain.”

The Tower and the Project are presented in the recently released videos prepared by Emaar.

 

The sky is the limit.

 

Dubai EXPO2020 theme pavilion design competition winners revealed

His Highness Sheikh Ahmed Bin Saeed Al Maktoum, Chairman of the Expo Higher Committee, in partnership with leading property developer Emaar Properties, have revealed the winners of one of the world’s most prestigious architectural competitions, to design the theme pavilions for Expo 2020.

The committee sought ideas for the three theme pavilions titled Opportunity, Mobility and Sustainability, which form a central part of EXPO 2020’s theme that is Connecting Minds, Creating the Future.

The winning design for the Opportunity Pavilion was submitted by Bjarke Ingels Group, a group of architects, designers, builders and thinkers based in Copenhagen and New York. Their design philosophy reflects a belief that contemporary urban life is a result of the confluence of cultural exchange, global economic trends and communication technologies as it could be read on the Expo 2020 official website.

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Bjarke Ingels Group winning design for Opportunity Pavilion. Photo from Emirates24/7

Expo-2020-Opportunity-Theme-Winner-is-BIG

Bjarke Ingels Group winning design for Opportunity Pavilion. Photo from Emirates24/7

 

The press release issued by Expo 2020 official website and reported by the major local newspapers, continues saying that Foster + Partners, the internationally renowned practice, based in London, submitted the winning proposal for the Mobility Pavilion. Their design drew on nearly four decades of pioneering designs including Dubai’s The Index building, and the master plan for Masdar City.

Expo-2020-theme-pavilion mobility - foster + partners

Foster + Partners winning design for Dubai Expo2020 Mobility Pavillion. Photo from ArabianBusiness.com

The winning design for the Sustainability Pavilion, which will become a long term ‘cluster’ centre promoting innovative technologies, was submitted by Grimshaw Architects. The firm designed the Eden project in Cornwall, UK, and is a leader in the field of sustainable architecture.

Expo-2020-Sustainability-Theme-Winner-is-Grimshaw-Particulars

Grimshaw Architects winning design for Sustainability Pavillion at Dubai Expo2020. Photo from Emirates24/7

Expo-2020-theme-pavilion sustainability - Grimshaw

Grimshaw Architects winning design for Sustainability Pavillion at Dubai Expo2020. Photo from ArabianBusiness

“Expo 2020 will be a festival of human ingenuity. We hope that the nations and organisations that take part in Expo, and the millions who visit, will explore the power of connections across the spheres of Opportunity, Mobility and Sustainability”

“Our theme pavilions will play a central role in bringing this to life.”

said HH Sheikh Ahmed Bin Saeed Al Maktoum.

Keep updated by visiting the official DUBAI EXPO2020 website.

Construction news: more than 390 billion USD projects ongoing in Dubai

The total value of projects under construction in Dubai equates to $53.6 billion, with a further $337.2 billion in the planning stage.  These are significant amounts of investment for most mature economies, but for an emerging market such as Dubai, they are extraordinary figures which provide evidence of Dubai’s ambition to diversify its economy away from oil-centered revenues. In this way we can summarize the new report “The Dubai Construction Pulse” published by Deloitte and MEED Projects, which analyses the construction market across a range of sectors.

Analyzing the data provided in the report, it is evident that the majority of the construction projects currently ongoing in the Emirate are related to residential and hospitality sectors with a 60% of the total value involved while 65% of the planned projects fall within the mixed use developments, most probably because of the EXPO 2020’s requirements.

Dubai Construction Projects Status

“Despite regional security concerns and wider macro-economic turbulence, Dubai continues at pace with significant project awards in Q1 2016, including the Palm Gateway Towers, Phase II of the Atlantis Resort and Dubai Creek Harbour to name but three”, said Ben Hughes, director at Deloitte Corporate Finance Limited, regulated by the Dubai International Financial Center.

Previously stalled projects have been resurrected, but new project awards have reduced since 2014-2015 as a result of regional economic uncertainty

The conclusions of the report are particularly interesting and are here below summirized.

“The current concerns relating to low oil prices and diminished market sentiment has clearly had a short term impact. Whilst the ongoing geo-political factors equally have profound effects, the fact that many Governments across the region, not least the Government of Dubai, are continuing to spend on infrastructure and other strategic developments suggests that they foresee the oil price issue and political turmoil as a temporary one.

[…] The mere action of building a project and expecting the demand to be there no longer applies, as the fundamental cost basis for these projects remains volatile and competitive. Focusing on factors such as affordability, differentiation and quality are going to be increasingly important factors, and it is hoped that such considerations will ultimately underpin the rationale for conceiving projects.

Simply constructing the tallest or most unique project no longer provides the impact it once did, so diversifying the offer by promoting a world class standard appears to be the mantra moving forwards.

[…] What is interesting is the connectedness of Dubai as an increasingly “smart city”, and […]  Dubai may even mature to the extent that it could surpass some of the more established cities across the world, such as London, Paris or New York, in terms of its level of sophistication and dedication to sustainability, smart city principles and ultimately success in delivering projects that are demand driven and profitable.”

Other than on “The Dubai Construction Pulse” website by Deloitte, the matter has been analyzed and reported by well done articles published on SaudiGazzette and Gulf Construction Online.

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UAE to implement 5 per cent VAT from January 2018

As already anticipated many times in this blog, the UAE will implement value added tax (VAT) at the rate of five per cent from January 1, 2018, said Obaid Humaid Al Tayer, UAE Minister of State for Financial Affairs.

Al Tayer made the announcement on Wednesday while speaking to reporters after a joint press conference with Christine Lagarde, Managing Director of the IMF in Dubai.

GCC countries have recently agreed they will introduce VAT at a rate of five per cent in 2018. The framework agreement on the implementation of VAT across the GCC is expected in June this year.

“Once the framework agreement on implementation of VAT is reached, GCC countries have time from January 1, 2018 to January 1, 2019 to implement VAT,” said Al Tayer.

The minister said each country has the flexibility to introduce VAT within this time frame. “A lot of ground work needs to be done before implementing VAT. The private sector will need time to prepare for complying with tax rules that is the reason we are giving enough time for all,” said Al Tayer.

The UAE will impose 5 per cent VAT while exempting 100 food items, bicycles, healthcare and education. In the first year, the country is expected to generate Dh12 billion from tax revenue.

GCC countries have decided to implement taxation as part of governments efforts to diversify revenues in the context of sharp decline in oil prices.

The news has been reported by several newspaper including GulfNews.

UAE to be Solar Thermodynamic Energy’s World Leader by using sand to generate electricity

Concentrated Solar Power (CSP) uses mirrors to reflect heat from the sun to one point, most typically the tow of a tower filler with a fluid (usually molten salt) capable of storing heat for prolonged periods then used to produce electricity.

Thermodynamic Solar Plant with Central Tower

Traditional Thermodynamic Solar Plant that concentrates sun light in the tow of the tower – photo from http://www.fotovoltaicosulweb.it

An alternative to the central tower is represented by curved mirrors concentrating the sun light in a suitable pipe that runs all the way from/to the storage accumulating heat while running in the plant.

Thermodynamic Solar Plant

An alternative to the central concentration tower – photo from http://www.strettoweb.com

In both cases, the molted salts are heated up to 600 degree Celsius and transferred in a hot storage.

The fluid so heated is used to produce high temperature/high pressure steam that is used to generate electricity by evolving in a steam turbine.

The main benefit of this technology is that energy is easily stored and can be used at night when the source of heat (the sun) is absent. However, the popular photovoltaic modules are currently more cost effective and therefore preferred over the concentrated solar power plants.

But now the situation can drastically change.

Masdar Institute of Science and Technology’s scientists, indeed, have published a breakthrough research into more efficient solar power plants by using sand as vector fluid to transport and store energy.

Named “Sandstock”, the research published at the Solar Power and Chemical Energy Systems Conference in South Africa in December 2015, showed sand can withstand temperatures of up to 1,000°C and the higher you can push the temperature, the more efficient the plant will be in generating electricity.

The approach chosen by the researchers at Masdar Institute completely eliminates the most expensive components of the traditional CSP, the molten fluid and the pump system, by substituting it with sand and gravity. The design concept, which is inspired by a traditional sand hourglass, features a ‘cold tank,’ where sand is initially stored – before flowing into a ‘hot tank,’ located directly underneath. The cold tank will take the form of a hollow cylinder, designed to allow the concentrated solar flux to penetrate an empty central cylinder part.

Sandstock diagram

Schematic concept of the Sandstock  design – photo from social.csptoday

 

“Sand is really always a drawback in this country but in this project we wanted to use it as an advantage because it can withstand very high temperature, and of course it is very cheap here,” said Dr Nicolas Calvet, assistant professor of mechanical and materials engineering, and guide for the research project, as also reported by The National.

“Photovoltaic is more popular because of more than 40 years of research, and the Chinese entering the market and driving prices down,” Dr Calvet said.

“If you want to make CSP more competitive you must significantly reduce the cost.”

The main costs for CSP are the reflective material, and whatever is used for heat transfer and storage. Dr Calvet and his students are using sand for the last two steps at almost no cost.

“When you build a CSP plant you need to import usually several thousand tonnes of molten salts from Chile,” he said.

“With this concept you can just build your plant in the desert and you don’t have to bring any other material, you have it on site.”

Dr Behjat Al Yousuf, interim provost at the Masdar Institute of Science and Technology, said: “The research success of the Sandstock project illustrates the strength of our research and its local relevance.

Contractors face slowdown in Abu Dhabi unless new projects come to market

I particularly liked the article by  about the current status of the construction sector in Abu Dhabi published yesterday on the local newspaper The National, an extract of which is here under reported.

by Michael Fahy, The National, 20 February 2016

The feeling construction companies operating in Abu Dhabi have is that not enough projects are coming to market to replace those being completed.

BMI Research said Abu Dhabi’s GDP growth is set to slow to 2.8 per cent this year, down from 4.3 per cent last year. It said that construction would outperform the overall economy, with an average annual growth rate of 5.9 per cent predicted between 2016 and 2020 across the UAE.

Richard Marshall, a senior infrastructure analyst at BMI Research, said that there are US$103 billion worth of UAE projects under construction, with $45bn of that in Abu Dhabi alone – more than any other emirate.

The pipeline of projects due to come to market is just $62bn. Given that more than 70 per cent of the $103bn of live projects is due for completion in 2017, a potential slowdown in the sector awaits unless more tenders come to market.

Moreover, the biggest project in the pre-tender phase is phase two of the Dh40bn Etihad Rail project, which was suspended last month until a review for “the most appropriate options for the timing and delivery” of the project is undertaken.

“Other GCC markets have been slow to deliver on their sections of the planned [railway] network, which has lessened the pressure on the UAE to meet the 2018 deadline.” said Mr Marshall.

On Wednesday, the ratings agency Moody’s said that Abu Dhabi was facing an economic slowdown as a result of government cuts in response to lower oil revenues.

Moody’s senior vice president, Steven Hess, said that a prolonged period of low oil prices could gradually erode the emirate’s fiscal buffers if it did not maintain prudent budgeting, but that it has enough reserves to be able to finance fiscal deficits for five to 10 years if it liquidated some of its assets. “Overall, the [emirate’s] considerable foreign assets should mitigate the negative consequences of oil price volatility on Abu Dhabi’s fiscal and external accounts,” said Mr Hess.

Read the full and original article on The National.