While the euro’s drop yesterday to a low against the dollar not seen since 2006 may mean good news for businesses that import from Europe, it could also contribute to slower economic growth in the UAE amid weakening demand for the services sector, economists said.
The euro slumped to $1.1864, its lowest level since March 2006, before recovering later in the day, as concerns over Greece further fuelled expectations that the European Central Bank may introduce monetary easing measures.
“The weakening euro is negative because the competitiveness of the UAE’s non-oil sector, particularly Dubai’s service sector, is undermined not just by the weakness of the euro but most other currencies against the dollar and by extension against the dirham,” said Simon Williams, the London-based chief economist for central and eastern Europe, the Middle East and Africa at HSBC.
The dirham is pegged to the US dollar.
“Every other currency is weakening against the dollar right now,” he added. “The only ones that aren’t weakening against the dollar are the GCC pegged currencies, which undermines the competitiveness of the export-orientated goods and in particular service sectors such as tourism.”
The tourism sector contributed about 8.5 per cent to the country’s GDP in 2013.
The Bloomberg Dollar Spot Index, which tracks the currency against 10 major peers, gained 11 per cent last year, the biggest annual gain since 2004. The dollar advanced 14 per cent against the yen last year, a third straight annual advance. And it rose 12 per cent against the euro, the biggest gain since 2005.
“It’s probable that the euro will go on sinking,” Stephen Lewis, the chief economist at ADM Investor Services International in London told Bloomberg News. “There are very few fundamental factors in its favour.”
Russian tourism to the UAE has been particularly hit by the appreciation of the dollar as well as the sharp drop in the price of oil, a commodity that Russia is also reliant on as a key driver for its economy.
Russian visitors to Dubai dropped by almost a fifth in November as the falling rouble, which lost 50 per cent of its value against the dollar last year, took its toll on Russian spending power. The 18.2 per cent year-on-year plunge in passenger traffic to Dubai from Russia and CIS countries in November was part of a trend that started in September when Russian visitor numbers fell 5.5 per cent from a year earlier, followed by a fall of 8.2 per cent in October.
Russia’s currency yesterday was down 5 per cent to 58.9335 per dollar at 4.08pm in Moscow.
As well as the strengthening dollar, the outlook for the UAE economy has also been shaken by the drop in oil, an export commodity from which the federal government funds more than 60 per cent of its budget. While the country has amassed large cash reserves in the previous years, a further drop in crude, Mr Williams said, may weigh on economic growth.
Already, UAE stock markets have weighed in with Dubai’s index dropping as much as 35 per cent last month from highs registered in November as oil prices plunged. The Dubai Financial Market General Index yesterday slipped 3.3 per cent.
* with agencies
mkassem@thenational.ae
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COMPANY PROFILE
Founders: Alhaan Ahmed, Alyina Ahmed and Maximo Tettamanzi
Total funding: Self funded
Farasan Boat: 128km Away from Anchorage
Director: Mowaffaq Alobaid
Stars: Abdulaziz Almadhi, Mohammed Al Akkasi, Ali Al Suhaibani
Rating: 4/5
COMPANY PROFILE
Name: Almnssa
Started: August 2020
Founder: Areej Selmi
Based: Gaza
Sectors: Internet, e-commerce
Investments: Grants/private funding
The specs
Engine: Dual 180kW and 300kW front and rear motors
Power: 480kW
Torque: 850Nm
Transmission: Single-speed automatic
Price: From Dh359,900 ($98,000)
On sale: Now
The Sand Castle
Director: Matty Brown
Stars: Nadine Labaki, Ziad Bakri, Zain Al Rafeea, Riman Al Rafeea
Rating: 2.5/5
Visit Abu Dhabi culinary team's top Emirati restaurants in Abu Dhabi
Yadoo’s House Restaurant & Cafe
For the karak and Yoodo's house platter with includes eggs, balaleet, khamir and chebab bread.
Golden Dallah
For the cappuccino, luqaimat and aseeda.
Al Mrzab Restaurant
For the shrimp murabian and Kuwaiti options including Kuwaiti machboos with kebab and spicy sauce.
Al Derwaza
For the fish hubul, regag bread, biryani and special seafood soup.
Astroworld
Travis Scott
Grand Hustle/Epic/Cactus Jack
COMPANY%20PROFILE
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RESULTS
West Asia Premiership
Thursday
Jebel Ali Dragons 13-34 Dubai Exiles
Friday
Dubai Knights Eagles 16-27 Dubai Tigers
A timeline of the Historical Dictionary of the Arabic Language
- 2018: Formal work begins
- November 2021: First 17 volumes launched
- November 2022: Additional 19 volumes released
- October 2023: Another 31 volumes released
- November 2024: All 127 volumes completed
UAE v Gibraltar
What: International friendly
When: 7pm kick off
Where: Rugby Park, Dubai Sports City
Admission: Free
Online: The match will be broadcast live on Dubai Exiles’ Facebook page
UAE squad: Lucas Waddington (Dubai Exiles), Gio Fourie (Exiles), Craig Nutt (Abu Dhabi Harlequins), Phil Brady (Harlequins), Daniel Perry (Dubai Hurricanes), Esekaia Dranibota (Harlequins), Matt Mills (Exiles), Jaen Botes (Exiles), Kristian Stinson (Exiles), Murray Reason (Abu Dhabi Saracens), Dave Knight (Hurricanes), Ross Samson (Jebel Ali Dragons), DuRandt Gerber (Exiles), Saki Naisau (Dragons), Andrew Powell (Hurricanes), Emosi Vacanau (Harlequins), Niko Volavola (Dragons), Matt Richards (Dragons), Luke Stevenson (Harlequins), Josh Ives (Dubai Sports City Eagles), Sean Stevens (Saracens), Thinus Steyn (Exiles)
More on Quran memorisation:
More on animal trafficking
If you go
Where to stay: Courtyard by Marriott Titusville Kennedy Space Centre has unparalleled views of the Indian River. Alligators can be spotted from hotel room balconies, as can several rocket launch sites. The hotel also boasts cool space-themed decor.
When to go: Florida is best experienced during the winter months, from November to May, before the humidity kicks in.
How to get there: Emirates currently flies from Dubai to Orlando five times a week.
Bridgerton%20season%20three%20-%20part%20one
%3Cp%3E%3Cstrong%3EDirectors%3A%20%3C%2Fstrong%3EVarious%3C%2Fp%3E%0A%3Cp%3E%3Cstrong%3EStarring%3A%3C%2Fstrong%3E%20Nicola%20Coughlan%2C%20Luke%20Newton%2C%20Jonathan%20Bailey%3C%2Fp%3E%0A%3Cp%3E%3Cstrong%3ERating%3A%20%3C%2Fstrong%3E3%2F5%3C%2Fp%3E%0A
COMPANY%20PROFILE
%3Cp%3E%3Cstrong%3EName%3A%3C%2Fstrong%3E%20Carzaty%2C%20now%20Kavak%3Cbr%3E%3Cstrong%3EBased%3A%3C%2Fstrong%3E%20Dubai%3Cbr%3E%3Cstrong%3ELaunch%20year%3A%20%3C%2Fstrong%3ECarzaty%20launched%20in%202018%2C%20Kavak%20in%20the%20GCC%20launched%20in%202022%3Cbr%3E%3Cstrong%3ENumber%20of%20employees%3A%3C%2Fstrong%3E%20140%3Cbr%3E%3Cstrong%3ESector%3A%3C%2Fstrong%3E%20Automotive%3Cbr%3E%3Cstrong%3EFunding%3A%20%3C%2Fstrong%3ECarzaty%20raised%20%246m%20in%20equity%20and%20%244m%20in%20debt%3B%20Kavak%20plans%20%24130m%20investment%20in%20the%20GCC%3C%2Fp%3E%0A
Killing of Qassem Suleimani
COMPANY%20PROFILE
%3Cp%3E%3Cstrong%3ECompany%3A%3C%2Fstrong%3E%20Eco%20Way%3Cbr%3E%3Cstrong%3EStarted%3A%3C%2Fstrong%3E%20December%202023%3Cbr%3E%3Cstrong%3EFounder%3A%3C%2Fstrong%3E%20Ivan%20Kroshnyi%3Cbr%3E%3Cstrong%3EBased%3A%3C%2Fstrong%3E%20Dubai%2C%20UAE%3Cbr%3E%3Cstrong%3EIndustry%3A%3C%2Fstrong%3E%20Electric%20vehicles%3Cbr%3E%3Cstrong%3EInvestors%3A%3C%2Fstrong%3E%20Bootstrapped%20with%20undisclosed%20funding.%20Looking%20to%20raise%20funds%20from%20outside%3Cbr%3E%3C%2Fp%3E%0A
Director: Paul Weitz
Stars: Kevin Hart
3/5 stars
In numbers
1,000 tonnes of waste collected daily:
- 800 tonnes converted into alternative fuel
- 150 tonnes to landfill
- 50 tonnes sold as scrap metal
800 tonnes of RDF replaces 500 tonnes of coal
Two conveyor lines treat more than 350,000 tonnes of waste per year
25 staff on site
City's slump
L - Juventus, 2-0
D - C Palace, 2-2
W - N Forest, 3-0
L - Liverpool, 2-0
D - Feyenoord, 3-3
L - Tottenham, 4-0
L - Brighton, 2-1
L - Sporting, 4-1
L - Bournemouth, 2-1
L - Tottenham, 2-1
Our family matters legal consultant
Name: Hassan Mohsen Elhais
Position: legal consultant with Al Rowaad Advocates and Legal Consultants.
Diriyah%20project%20at%20a%20glance
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Company profile
Company name: Suraasa
Started: 2018
Founders: Rishabh Khanna, Ankit Khanna and Sahil Makker
Based: India, UAE and the UK
Industry: EdTech
Initial investment: More than $200,000 in seed funding
COMPANY%20PROFILE%20
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Business Insights
- As per the document, there are six filing options, including choosing to report on a realisation basis and transitional rules for pre-tax period gains or losses.
- SMEs with revenue below Dh3 million per annum can opt for transitional relief until 2026, treating them as having no taxable income.
- Larger entities have specific provisions for asset and liability movements, business restructuring, and handling foreign permanent establishments.
