The international yachting community will be watching Dubai with a mixture of concern and curiosity as the financial position of the Emirate continues to worsen.
The suspension yesterday of Dubai World’s payments and the request for a debt payment freeze has sent shockwaves around the world, with billions being wiped off shares at all the main stock exchanges.
Dubai World is a state-owned conglomerate and its yacht interests include Nakheel, which developed the Palm of Jumeirah; Emaar, another developer with several projects on the drawing board including marina facilities; and Drydocks World, which in turn is the parent of the Platinum Yachts division. Platinum ironically completed and now manages the world’s largest operating superyacht called Dubai. It will only remain the biggest until the delivery in the near future of Eclipse from Blohm & Voss for Roman Abramovich.
The Palm of Jumeirah, the first of a number of offshore island projects of which ultimately 40,000 marina berths were anticipated, is some 70 per cent completed. Its Anchor marinas, located on the stem of the Palm, are expected to be finished by the end of this year and they will offer berths for yachts up to 30m (98ft). Plans for a dedicated superyacht marina at which it was proposed to berth the QE2 have been postponed for now. Also Island Global Yachting, which was working with Nakheel on its marina projects, is no longer doing so.
It is anticipated that the other six Emirates in the UAE will share in a rescue of Dubai and its $80bn debt. Abu Dhabi has loaned Dubai $10bn but this it to be repaid with interest. How all this financial upset is resolved and its impact on the leisure marine industry in the Gulf will be watched closely.
A London-based yacht broker with business links to the Middle East told IBI: “It is far too early to speculate whether Dubai’s difficulties will have any impact on the region’s yachting market. I would think it unlikely but certainly the massive plans that Dubai has had will need to be reviewed.”
The broker, who preferred to remain anonymous, added: “I would think that financial support for Dubai will inevitably be forthcoming, either from the other Emirates or other countries. We have seen Abu Dhabi competing with Dubai to gain a share of the expanding large yacht market in the Gulf and the recent Formula1 Grand Prix at the Yas Island site helped promote this for the former. More time is needed to see what happens.”