The spectacle of cars being abandoned on the way to Dubai airport has been familiar for months. But only now do the vehicles left by expats fleeing debts they couldn’t cover come in handy for television stations illustrating a far bigger problem: one of the largest government-owned firms has defaulted – or, in the preferred terminology, is seeking “standstill” – on its debt repayments.
Dubai World’s announcement that it would delay payments on its £36bn liabilities and, even worse, the statement by the emirate’s government that it would not be a guarantor for the firm, prompted falls in stock markets worldwide and fears of a firesale of Dubai’s assets, which vary from 20 per cent of Cirque du Soleil to a major stake in the London Stock Exchange. Paradise in this Footballers’ Wives dreamland has been postponed, if not lost altogether.
Not that it’s apparent there. Queues for the Wild Wadi Water Park were lengthy when I was there last month, while the Mall of the Emirates (“the world’s first shopping resort”) celebrated Eid-al-Adha with a human-sized robot and a local break-dancing group. Europeans continue to host Sunday lunches and bemoan guests who betray the fact they are near the end of their legally-allowed monthly quota of alcohol by bringing cheap red wine that no one wants to drink in the heat.
If it all went wrong, who would come to the rescue? The clue is in whose name adorns the capital’s highway, and whose portrait is everywhere: the
late Sheikh Zayed, the first president of the UAE – and ruler of neighbouring Abu Dhabi. Abu Dhabi is both the UAE’s capital and its chief underwriter of capital. It has the oil. Dubai never had much, and now has virtually none.
Abu Dhabi will feel no glee at Dubai’s troubles. But the irritation the senior neighbour has felt at being eclipsed by its flashy junior partner may be at least partially assuaged if Dubai has to beg for the purse strings to be opened. Abu Dhabi holds them. Quietly, at least, this proudly Bedouin emirate, a stranger to the “hookahs and hookers” lifestyle of Dubai, won’t mind at all if the world is reminded of that fact.
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