Dubai (AFP)
The ruler of Dubai, Sheikh Mohammed bin Rashed al-Maktoum, announced Monday the creation of a committee to resolve the crisis in the real estate market, key sector of the emirate.
Since 2014, the real estate market is experiencing a sharp decline in Dubai due to oversupply of developers.
The committee, charged by the Sheikh to establish a ten-year strategy, will include representatives of the major property developers operating in the emirate of Dubai.
It will be led by one of his sons, Maktoum ben Mohammed, who is also the vice-ruler of Dubai.
"Today we have formed in Dubai a high-level committee for real estate planning (...) with the aim of achieving a balance between supply and demand," Sheikh Mohammed bin Rached Al said on Twitter. -Maktoum, also Prime Minister of the United Arab Emirates.
He called on the committee to ensure that any new construction adds value to the market, not just a pre-existing offer.
According to economic forecasts, the sector, which accounts for about 7% of Dubai's gross domestic product, is likely to continue to collapse due to oversupply and the economic slowdown caused by lower oil prices.
In a megalopolis with futuristic skyscrapers and luxurious apartments, the developers continue to build for the 2020 World Expo, an event that should create 300,000 jobs and attract more than 20 million visitors.
On this occasion, the promoters hope to conclude the sale of many homes and offices.
According to the rating agency Standard & Poor's, the prices observed in Dubai are close to those known by the emirate of Dubai during the real estate crash of 2009 and 2010.
In the wake of the global economic crisis of 2008, the debacle of the Dubai real estate market had then strongly weakened the economy of the emirate, causing a recession of 2.6% as of 2009.
© 2019 AFP