Correct, it’s a crash

The Gulf’s stock markets have collapsed this year, whatever else the experts might tell you. I have always been curious about words and their meanings. One man’s victory is another man’s defeat.

  • E-Mail
By  Anil Bhoyrul Published  November 26, 2006

|~||~||~|The Gulf’s stock markets have collapsed this year, whatever else the experts might tell you. I have always been curious about words and their meanings. One man’s victory is another man’s defeat. One man’s success is another’s failure. Compromise can be mistaken for weakness. Strength for arrogance. But in the past few months, there is one particular word that I have had a great deal of trouble becoming clear about: crash. Yes, crash, as in stock market crash. I wasn’t born speaking English, nor do I have any qualifications in the language to boast about. But I am pretty sure that when stock market prices collapse, and investors lose huge amounts of money, week after week, month after month, over the course of a year, it means the stock market has crashed. Not in Dubai, Doha, Muscat, Riyadh, Kuwait, or for that matter, anywhere else in the Arab world. Here, we are told, it is called a “market correction.” In the last twelve months, the Dubai Financial Market has fallen 64%. Abu Dhabi stocks slid last week another 0.43% to close at their lowest point since January 3 2005. Saudi Arabia’s stock market has collapsed by 18.4% since October 28th this year, and is now running at 49% down over the past year. Doha’s stock market is 42% down on the year, having lost another 3.3% in the past week, while Kuwaiti stocks are 12% lower than a year ago – after a 2.21% slide last week. Is this a ‘market correction’? Just a few days ago, the Hariri-controlled Oger Group canned its planned US$1.25bn flotation on the Dubai International Financial Exchange, just three hours before holding a press conference to announce its details. “Market volatility” was cited as the main reason. That, I presume, is a posh phrase for “We’re worried the market is crashing.” And what about the poor investors? Last Spring Emaar shares were US$7.9, today they are under US$3. Etisalat is down 20% in the last year. The Dubai National Insurance Company has fallen 55% in 12 months. Even shares in du fell 2.79% last week. I could give you a hundred more examples from across the GCC of other ‘corrections.’ But corrections to what? I have no doubt the markets will eventually recover – GCC economies are too strong for them not to. But in the meantime, let’s face facts and reality. The market has crashed.||**||On air, on track|~||~||~|Nobody likes to swallow their pride and admit they may have got something rather badly wrong. And I am no different. So it is with very great difficulty that I have to take my hat off to Al Jazeera International, which finally launched its English news channel last week. For the past year I have been one of the station’s biggest critics, putting most of the blame on managing director Nigel Parsons. The launch has been dogged by technical delays and came almost a year late. But when it came, it was first rate. Hugely professional, technically brilliant, and at times both gripping and entertaining. The line up of presenters has been justified, and already, Sir David Frost has grabbed world-wide headlines for his brilliant Tony Blair interview. In fact, compared to the first pictures from Sky News and CNN, this is award-winning stuff. In the long run, I still think problems will mount. Who will watch it? Who will advertise? Who will care? For now though, Parsons and his team deserve every praise.||**||Fashionable times|~||~||~|On Tuesday night I had dinner with Marco Franchini, the very impressive chief executive of Bally International. Like most executives in the fashion and luxury goods industry, Franchini made no secret of the fact that Dubai and other key Middle East cities are now the centre of almost all his attention. With Dubai set to host its own Fashion Week next year, many analysts now predict that the fashion industry in the region could grow by over 20% next year – faster than property. I agree with Franchini, and with the likes of him running the big companies, there is even greater chance of success. But what may change in the coming years is the style of shopping. With the arrival of more and more mega-malls, the “exclusivity” of the shopping experience is fast disappearing. You want to shop – so do 80,000 other people, and usually at the same time. Which is why Franchini predicts that a new style of visiting by appointment only shops may spring up in the Gulf. Time will tell. If so, it could change the way we all shop.||**||

Add a Comment

Your display name This field is mandatory

Your e-mail address This field is mandatory (Your e-mail address won't be published)

Security code