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Abu Dhabi’s necessary two steps backward
The reassessment of Abu Dhabi's Vision 2030 resulted in job cuts and project delays. It would've been nice without a negative knock-on effect but perhaps it just couldn't be helped.
December 11, 2011 6:10 by Precious de Leon
Even with a recent report that Abu Dhabi is now expecting to handle a million passengers a month, Abu Dhabi’s business landscape looks pretty shaky despite great momentum its aviation industry displays.
Recently, Kipp reported on Masdar job cuts and the rescheduling of the museum projects in the capital. But the downward movement hasn’t stopped there. Last week, Ferrari World has had to let go of 100 employees. The cuts, the company said, was merely due to a schedule change. One could deduce that the schedule change has been due to the less than expected traffic to the amusement centre.
The thing here to holds us off raising alarm bells is that Abu Dhabi still stands by the execution of its Abu Dhabi Vision 2030. It’s just that they are now more realistic about the realisation of these projects. Of course it’d be nice for this ‘recalibration’ to not have a negative knock-on effect on employees (ie losing their jobs) but in this case we are certain these decisions couldn’t be helped, right?
And this recalibration isn’t over. The latest weak link revealed is Abu Dhabi’s property market, which Jones Lang LaSalle (JLS) expects will “remain sluggish through the initial months of the new year due to suppressed demand coinciding with increased supply,” according to an article on Gulf News.
So be wary, Kippers. Abu Dhabi, while still comparatively strong is undergoing a kind of checks and balance as it reviews its projects and aligns them with the current market conditions. It’s never a good thing to cut jobs. But we do think it’s a good thing to address issues like this as early as possible to curtail maximum exposure to economic crisis.
Key to the property market’s recovery in Abu Dhabi, according to JLS, is the government’s “reinvigoration of its major investments” and “investing in physical and social infrastructure to stimulate job growth”.
Across the board, the reality is that the capital isn’t as protected and unaffected as we all hoped. As the cracks begin to show and the global economic crisis continues to try and chip away at Abu Dhabi’s ambitions, it is the way in which the capital reacts to these realities that will make all the difference.