Nahkeel turned a very important corner when it announced on Monday that it is now debt free. All of Dubai can celebrate this achievement and share in the pride taken in the Dubai Government-owned company’s return to normality. A very important part of this achievement is that it has taken years of hard work.
The elimination of the debt was truly due to careful management by a hard-working management backed by the entire staff and the company’s stakeholders. The scale of the turnaround is a magnificent victory which reassures the underlying international confidence that has always been Dubai’s major asset.
Seven years on, it is hard to remember the severity of the problems that afflicted Dubai’s commercial entities when the panic caused by the collapse of the American mortgage market caused a worldwide squeeze on liquidity with an understandable impact on Dubai’s commercial life.
Dubai’s companies had to resort to the financial markets to look for unprecedented support, but it is also vital to remember that the Dubai Government was always confident that it would be able to ride out the storm, despite some doom-laden and grossly exaggerated coverage. The short-term crisis was largely solved by going to the markets and then over the following years moving to more and more long-term instruments to manage what debt remained efficiently — the final stage which has been demonstrated by Nakheel by its paying the debt in full.
His Highness Shaikh Mohammad Bin Rashid Al Maktoum, Vice-President and Prime Minister of the UAE and Ruler of Dubai, played a vital part in offering steady leadership throughout the crisis, and in the ensuing years which followed the global meltdown.
Shaikh Mohammad was determined in his repeated reminders to the global business community and the banking world that Dubai and its companies would repay their debts.
Dubai is preparing to move ahead into an exciting future. Its huge investment in hosting Expo 2020 is a massive demonstration of confidence in the future. But even this massive project is also only a part of a much larger plan as Dubai becomes a pivotal global hub connecting some of the world’s fastest growing continents.
A significant part of the confidence with which Dubai is working for this exceptional future is through overcoming past problems. Nakheel’s remarkable hard work is both a great example and also an integral part of building that future.