IPOs Initial Public Offers fostering Dubai’s Business and Economy

Global economic recession of year 2008 had badly hit the economy of Dubai and property prices showed downfall of 65%. After experiencing four years of consecutive downfall, real estate sector of Dubai showed first sign of recovery in year 2012. Recovery signs also support investors to regain their confidence and they rejoin the real estate industry to make investments. Good progress rate of business and real estate sector has enabled State Government to take significant steps to clear debts and generate funds to stabilize Emirate’s economy. IPO Initial Public Offers, selling stakes/shares of Governmental companies among public is a very bold initiative taken by State Government. IPO can generate funds quickly. IPOs also help Dubai Government to protect itself being a defaulter.

How IPO Helped Dubai Government?

IPO has helped government to generate $26billion funds after selling Islamic and non-Islamic bonds in 2013, whereas $17.93 billion bonds will mature in next year. Sheikh Ahmed bin Saeed Al Maktoum, head of the emirate’s Supreme Fiscal Committee, clearly mentioned that stock market still needs more companies to sell their shares to general public via IPO to generate more funds. He further said ICD, Investment Corp. of Dubai; the Emirate’s main state holding company can be the next potential IPO. ICD is a huge company, which possesses shares in more than 30 companies including Emirates (world’s biggest international airline). He further quoted that Dubai is committed to repay its debts and will do “whatever we have to do.” Issuers in Dubai or IPOs have sold securities of $5.8 billion so far in 2013. Government’s strong interest to generate funds and profitable investment opportunities predicted that economy will expand 4.6% on average between 2012 and 2015, which is more than twice of the average economical growth in previous 4 years.

Positive Outcomes of IPO


Clearing debts and generating more funds can expand business andinvestment opportunities in the region. Dubai Government has efficiently regained its previous status by selling 30-year bonds and 10-year Islamic bonds of total worth $750 million in the month of January 2013. Further they also reduce their borrowing by 40%. Top financial officers further shares that Government has refinanced companies to clear their debts, with total $3.75 billion in 2012 in addition to a 3.3 billion Dh ($898 million) liabilities in April 2013. Reduced credit risk in the emirate also provoked Issuers in Dubai to maximize bond sales during this year. According to Dubai Financial market General Index ranked Dubai as third best performer after Ghana and Argentina in year 2013. 

About Abu Dhabi

Following Dubai’s footstep Abu Dhabi has successfully got it recognized as gem of Middle East. It is not only the capital Emirate of United Arab Emirate but it is also the largest UAE Emirate with biggest oil reserves. Spreading over the total area of 67,340 sq km on north-eastern part of Persian Gulf on the Arabian Peninsula, the Emirate consists of total 200 natural islands. Abu Dhabi is bordered by the Kingdoms of Oman and Saudi Arabia to east and south respectively and Dubai to the northeast. Abu Dhabi is the main Island of this Emirate whereas other important islands are Saadiyat, Al Reem, Delma and Sir Bani Yas Island. Emirate’s main Island Abu Dhabi is located just 250 Metres from mainland of UAE. Moreover, it also has an electrifying coastline of 700 Km.

Abu Dhabi is Famous for…

Abu Dhabi also possesses two fascinating oases of UAE Liwa (south-southwest of main city) and Al Ain in main city of Emirate. These oases are extremely fertile providing lush green views and good water resources. Emirate also known to possess world renowned largest and amazing sand dunes “Hajar Mountains” on its eastern region. Hajar Mountains are also known to possess huge ores of copper. The western region of capital Emirate consists of over 50 villages, whereas Zayed City is capital city of this region.

Hajar Mountains

More facts about Abu Dhabi

Abu Dhabi possesses diverse geographical landmarks other than deserts, mountains and coasts. It also has waterfalls, forest, caves, lakes and natural oases. Waterfalls can be observed on Jebel Hafeet during winter after rainfall; Jebel Hafeet mountain series also have several caves of archaeological importance. Plus Abu Dhabi has Saxaul dew forest, which is found inland to the south region of Abu Dhabi. Last but not the least Abu Dhabi displays an odd population makeup like other UAE emirates specially Dubai. UAE nationals form only a small part of 20-25% in total population of Abu Dhabi as compared to expat’s huge contribution of 75-80%.

After observing its potential to be the next business and tourism destination of UAE and Middle East, developers and investors are now focusing to build Abu Dhabi. State government is also taking interest to revamp Abu Dhabi’s image from oil producing giant to a business, finance and tourism spot of United Arab Emirate.