The World on its shoulders

The World on its shoulders

So why has Nakheel been in the headlines this past week? Kipp takes you through some of the major developments of Dubai favourite developer.

January 27, 2011 3:39 by Eva Fernandes

Poor Nakheel. An allegation that its crowning-jewel project, The World, was sinking back into the sea led to quite a bit of negative press coverage and a whole lot of horrible ‘world’ puns: A World beset by problems, Could this be the end of The World?, Goodbye Cruel World [That last one was genius – Ed.], to name just a few.

And though many a bad metaphors and analogies were made at the expense of Nakheel, the company has hit back hard—dismissing rumors that the project was on the decline. On inspecting the islands, Ali Mansour, the director of projects for marine and civil works for Nakheel, said the company hadn’t found signs of significant erosion of the islands. “Significant”? Kipp would argue that pretty much any erosion on man-made island that costs millions is significant…

Though Nakheel has said it has been involved in maintenance work to “replenish” the beach, Mansour refers to the condition of island G19, Greenland, to illustrate just how well things are going: “This island has been here for six years and nothing has changed.”

Ali Lootah, the chairman of Nakheel, has said the responsibility of the upkeep and maintenance of the islands lies solely with the owners of the islands: “It is up to the developers. Our commitment to the developers is complete … They have their own financial problems. I cannot do anything for them. I cannot go and give them money.”

Wham, bam, slam! And that’s how you effectively deal with bad press folks. But wait, that is not all: clearly they’ve decided to fight fire with water by throwing a bit of good news back at them. Nakheel has also been in headlines because of its announcement to issue a $1.63 billion Islamic bond or sukuk by the end of the first quarter. In addition, Chairman Lootah told reporters this week that the company will no longer need ‘additional commitment‘ from the Dubai government (Dubai government last march has announced that it would give Nakheel a whopping $8 billion in cash so it could pay contractors and finished stalled projects).

Chairman Lootah told Gulf News that they will need no further support: “We will not need any more commitment from the Dubai government further to what they have already committed. The government pays us when required but we have money in the bank.” The news comes just after Nakheel had said it paid a total of Dh3.9 billion to its trade creditors till date on January 2nd.