The Worlds biggest Shopping-mall = The Worlds biggest flop?

I saw that the worlds biggest shopping mall just opened up in Dubai. I have seen it being built for the last 2 or so years as it is just next to our office in Dubai. The road I have taken to work was changed just about every week to make space for the mall. Now it is opened but at the same time the world economies are having a major crisis. So far the reporting in Dubai in general has been positive and spending has been continuing. The signs have though been there that a change was on the way.

About one and a half year ago EMAAR ,one of the largest construction companies, suddenly decided to sell of a larger amount of the apartment blocks they had built for rental. The tenants were basically informed that they had to purchase their apartment within 2 weeks cash or face eviction. Knowing that EMAAR is a multi billion dollar company trying to do a move like that with over 4000 apartments was strange. There was very little to no news reporting about this and other similar strange moves in Dubai.

The minister of Finanace in the UAE still seems very positive as the GDP and inflation has been in the double digits for the last 2 years so even if there was a decline in the overall costs and sales it would not potentially hamper operations in Dubai too much as per their predictions.

Within the last 24 hours there are though a multitude of news reports popping up that houses on the Palm island has dropped over 40% in value and people even try to use SMS spamming to try find buyers. About 40,000 Mobile phone users received a SMS with an offer to buy cheap?! if they were fast. In other places heavily loaned house buyers are trying to sell of fast. Probably not at a loss yet if they purchased about 5 years ago as then their prices where much lower than now.

The market in Dubai have over the last 6 years expanded so extremely that about 20% of the world construction cranes sit in the country. A massive amount of loans have been given and small time investors have purchased several apartments on speculation with full intention of selling them at a much higher price even before they were finished.

Already when I arrived in Dubai in 2002 there was apartment blocks completely empty. Not because people did not want to rent but due to that the owners simply refused to lower the rent and rather kept the apartments empty. But this meant that whole buildings with 200- 300 apartments could stand empty. The boom is now starting to shake in its foundation fast.

Banks are refusing to give loans to expats all over the country. Simply because they expect that there will be larger layoffs off people in large portions of the businesses. Even if Dubai by itself has a lot of money to invest in construction, based on oil and the profits from the Iraq wars the main part of the companies working in the country is companies that have their HQ somewhere else in the world. Dubai by itself do not have any raw material thus it is built on the trade and potential refinement of raw material imported.

The main travel companies in Europe are seeing a stop in the holiday bookings and are cutting down fast among the destinations and booking of hotel for charters, thus the influx of tourists for the shopping malls and hotels in Dubai will shortly also take a big hit. The newly opened Atlantis hotel has dropped the room rates from 400+ USD to around 44 USD per night with less than 30% occupancy rates.

Gulf news
By Suzanne Fenton, Staff ReporterPublished: November 22, 2008, 23:27
Dubai: Business at Atlantis, the $1.5 billion (Dh5.5 billion) hotel on the Palm Jumeirah is slow, with room rates slashed dramatically and occupancy low.
Despite the grand opening of the resort on Thursday night, which saw stars and celebrities descend on the Palm, causing actual residents difficulty accessing their own homes, business is not so impressive. Full story

With all this I would guess that there is a quite big chance for Dubai taking a Guiness World Record Title they probably would not want to see nor ever expected. The Largest Shopping-Mall in the world becoming the Largest shopping flop in the world in the shortest time ever. Over the last week alone the retail business has dropped over 20% in some areas.

Dubai in a nutshell! or Credit card Hell!

Using a credit- or debit- card in Dubai is a natural thing. As with most other developed countries this is one of the features that normally works. During most of the shopping festivals around here we see a major amount of advertisements for VISA, MasterCard ,Diners, American Express and so on. Usually one of the credit card companies have teamed up with a Bank and several of the shopping malls and other outlets so that you can earn points for life for every dollar you spend. Once you have your gold card another bank comes up with a platinum, or why not the latest titanium card. The banks keep calling us to tell us how good their card is and why we must have it. Just use it and earn points you can even use on the airlines. Why not! They are very surprised when I tell them to never call me again as it seems they believe they have the offer of a lifetime. (Have a friend who actually took them up on the offer.. 8 months later he had still not received the card or was it the pincode to use it... And guess what the shopping festival had ended.)

It worked perfect for a while, I have a VISA and MasterCard from my usual bank and not a Dubai based one, so don't need any more cards thus I don't earn any points... But neither do I pay all the various transaction fees that they invent meanwhile. Until lately, that is.

I normally fuel up at the most prevailing fuel chains. It is two Dubai based companies that somehow are still owned by the same company and they almost have a monopoly in Dubai for the fuel stations. I know of one other chain also but to find a fuelstation from them is virtually impossible.

4 months ago the large ones announced that it was too expensive for them to cover the Creditcard fees so they would charge 1.5% or 2% on each transaction. I did not really complain about the 2 Dirham they charge me extra but it felt crazy... the reason for using the card should be benefiting the company probably more than me as it means no cash to move around thus less risk of robbery.

To my surprise it was getting more and more difficult though to use the cards. The attendants kept coming back to me saying "card no work!" Looking at the 4-5 slips they had it was evident that the card did work but their machines did not. Transaction cancelled was the error code so normally I sent the guys back and voila! it worked.

Now yesterday I tried to fuel up and pay with my card again and the guy simply informed we "we don't accept credit-cards anymore!"



Hmmm. Well looking at how things work in Dubai in general I am not really surprised. It seems everything is about how to move costs around and try to gain maximum amount of profit for a few in the shortest possible time. I guess it is not unlike any other place but to stop accepting credit cards that must be a novelty in this day and age. Are they on to something the rest of us don't know about yet?!

Maybe the fuel company got fed up trying to access the lines to the bank 5 times as they could only charge for one transaction try.... maybe it is the bank that is not catching up with their internal connections?.. for sure this is the case with the local bank we normally use for our office!, or maybe it is the telephone company lines that simply can not catch up with the expansion in the country..still charging for each call tried between the fuel station and the bank, thus they earn their money while no transaction could be made, or maybe it is that all these credit card offers in reality look nice on the surface, and the easy way out of delivering all the points is to close down the services people use and then maybe re-create them in the future, under a new name not in the list of participating companies.. Thus avoiding people to amass enough points to make it worth anything.

I have no clue what the answer is but I just cant figure out why a major chain would suddenly stop having people pay this way. Oh by the way you can though still get their internal fuel payment cards and pay with them ;-) I dont know but I would guess it works on pre-payment ;-)

I do though know that the price has always been cheaper in the next Emirate, Abu Dhabi, and guess what?! They have never charged for using the credit cards !? Even from their large almost monopoly size company.

852,231,021 the number is ... not 852 Million!

At work I am quite often requested to hold presentations or press conferences with dignitaries of various sorts. Since WFP is completely dependant on donations for any work every day we are becoming quite good salesmen but we are still not catching up it seems.

In all the presentations and conferences there is certain amount of numbers that probably any staff in the organisation can rattle on his five fingers. One of them is 852 Million. That is how many hungry poor there are in the world, or is it? Well first of all the numbers is so huge that we normally only see it in relation to how many millions a company is making in profit for their shareholders, or how much a new movie cashed in at the box office... There simply is no one who can relate to how many people that actually is. But the number is not 852 Million. I know, because it is 852,231,021. The difference is enormous.

I know it is 852,231,021 because I met number 852,231,020. It was a mother in Northern Democratic Republic of Congo in a small village outside Mbandaka. She was so frail that she could barely keep her body to sit upright. She tried her best as she was holding number 852,231,021 in her arms. Her little son who was probably anything between 3 to 12 months. I was not able to tell because the baby boy was so small and exhausted that he could not even let out a sound while crying.

I remember the situation as if it was happening right in front of me even today, 8 years later. On that mission I was the only white man on the whole place. The woman sitting there on the floor, barely able to hold herself up, trying to make herself dignified in front of me while her hollow eyes told a story that I can never forget. She did not utter a word, she didn't have to. Her eyes looked right into my soul with such a presence, I will never forget. I had brought my camera, but I couldn't bring myself to take a picture.

I knew the story already. - Are you the one who can save my baby????? Please help my baby, please give him a chance to live and grow up. She never uttered a word. But from that single moment I knew. There is nothing else that I want to spend my life working with, what could be more important.....

This is why I know the number is 852,231,021 and not 852 million, I have seen it with my own eyes. I have also seen about 329,094 other ones. Yes about!! Because I can simply not get the numbers straight, but I know that the number does not end with one two or even up to 6 zeroes!

Yet every day when I turn on the news I see 2 more dead American soldiers in Iraq, 3 more , 6 more and totals of what 3215 soldiers since the war ended, I dont even recall the number anymore. How come it is not rounded of to "just" about 3000. How come these numbers can be reported day in and day out for several years, as if it was big news. To tell you the truth I have stopped watching the news, I got fed up with the incredibly twisted reporting. I am sure it is important but in the scope of things it really is insignificant. I feel for the families of the dead soldiers. But it can never compare to what I feel for number 852,231,020 and her son 852,231,021.

Every 5 second a child dies. Tomorrow when I hold my 15 minute presentation another 181 children, yes 181 as even the "every 5 second" is rounded of, will have died. Yet it will not be on the news because the slot is taken by a story of someone killed in THE war, as school shooting killing 3 people somewhere or a bridge collapsing with 40 dead..a car crash killing 10 the list goes on. How extremely horrible that it happened, we hear. Hours on end the live broadcasts are going on even if it was "just" one person dead. I say "just" because somehow that this life was worth atleast as much as 5,000 or 10,000 in another Country or Continent. Oh, it was an American or Eurpoean!!! Then it must be news. To show the live coverage of the 25,059 people that die from hunger every day of our life, would be able to cover any news channel 24 hours a day, even if they showed each and every one of them for 3 seconds and just listed a name. Yet that is lumped together as another remote statistic. Just imagine it, a TV channel that every 3 seconds showed a new picture of another dead person. day in, day out, month in month out, year in year out..... the TV channel would have to continue for 93 years doing nothing else to reach the 852,231,021st picture.

I can only hope that 852,231,020 and 852,231,021 is still alive. That they were in the hospital atleast gave them both a head start compared to all the others who are still not able to make it even to such a place. I can only hope as I don't know, never will. What I do know is that this moment changed my life.. forever..