Dubai companies, including Nakheel PJSC, owe billions of dollars to Japanese companies who worked on projects such as the emirate’s metro and Palm Island, the National said, citing Japanese Consul General Seiichi Otsuka.

Some Japanese construction companies are facing serious problems as Dubai-based firms can’t pay their bills, Otsuka was quoted as saying by the Abu Dhabi-based newspaper yesterday. Mitsubishi Heavy Industries Ltd and Taisei Corp are among those affected by the non-payments, the National reported.

Dubai has dropped from the top of a list of the fastest rising financial centres in the world, it was announced on Wednesday.

The latest independent Global Financial Centres Index (GFCI) showed that Shanghai, Beijing and Shenzhen are now considered the most likely to become more significant on the world stage, a position held by Dubai in last year’s index.

Dubai also fell to fifth in the list of financial centres where international companies saw future offices being opened, behind four Asian-based centres, according to the results of the GFCI questionnaire.

International companies would be allowed to hold 100 per cent ownership of businesses they establish in the UAE under proposed changes to legislation aimed at boosting foreign investment.

Currently, foreigners must have a UAE national as a sponsor and are limited to a maximum 49 per cent ownership of businesses in the Emirates, except in free zones scattered about the country.

The new industry law would open the door for hi-tech firms offering large capital investments to set up operations here as the Government seeks to expand its industrial base and create new jobs.

Tourism chiefs in Abu Dhabi have said the city is on track to hit its 2009 targets despite the impact of the economic downturn.

The Abu Dhabi Tourism Authority (ADTA) is aiming for about 1.5 million hotel guests this year.

“The targets we have in place are based on a solid understanding of demand and supply fundamentals,” said Lawrence Franklin, the director of strategy and policy at the authority in comments published by UAE daily The National on Monday.

Falling glass and cracking walls provided enough warning for 21 workers to reach safety before a large section of a building under construction in Deira collapsed yesterday.

No injuries were reported in the incident, which lasted about 40 minutes, destroying at least 12 cars and causing millions of dirhams in damage. It left shattered glass and debris strewn over the area.

Last night Dubai Police confirmed that the contractor of the commercial complex had been taken into custody after a part of the building collapsed on to the busy road heading to Sharjah. The rest of the structure remains intact.

Hotels in Dubai continue to lead the world in profitability with net profits, or margins, of 35 per cent in 2009, according to researchers.

"We still have excellent net margins compared to other parts of the world," said Amine Hamdani, Vice-President, CBRE Hotels, a hospitality consultancy and asset management firm.

Arnaud Andrieu, CBRE's Vice-President, said: "Cities, such as Paris, London and New York, would have a lower net profit than Dubai. In Europe, the average net profit is about 18 to 20 per cent so far in 2009 for the five-star segment. In New York, it would be above 20 per cent this year."

Revenue and profit margins have plunged in Dubai’s world famous retail sector this summer, as shops slash prices to boost dwindling sales.

Dubai Summer Surprises (DSS), the annual event organised by the Dubai Shopping Festival (DSF), is an important time of year for the city’s retailers.

Summer is traditionally a strong season for Dubai’s many shopping malls, as schools and universities close for the holidays and soaring temperatures keep people from going outside.But this year, no amount of discounting seems to help.

Dubai launched the second tranche of a $20 billion sovereign bond programme, turning to foreign as well as local banks and setting up a fund to support local companies hit by the fallout of the financial crisis.

The tourism and finance hub, part of the United Arab Emirates, also said it has more tools to raise funds to support state-linked firms. The first $10 billion tranche was sold to the United Arab Emirates central bank.

"It's open to banks, financial institutions inside and outside the country," Abdulrahman Al Saleh, the new director general of Dubai's department of finance, told Reuters.

Sweets lovers outside the Middle East will soon be able to enjoy a Dubai company’s speciality: camel’s milk chocolate.

Martin Van Almsick, general manager of Al Nassma, the world’s first camel-milk chocolate, said the company planned to enter Saudi Arabia first, followed by Bahrain, Qatar, Kuwait and the United States within the next few months.

Al Nassma is also in talks with the British department store Harrods and San Francisco’s Chocolate Covered.

The developer of a luxury five-star hotel in Dubai has scrapped plans for a refrigerated beach due to concerns over the environmental impact, its managing director said in remarks published on Sunday.

Emirates Sunland Group’s Soheil Abedian said the idea of a chilled beach “sounded good at the time”, but consultants concluded the cooling system’s high energy consumption would be environmentally unsustainable, UAE daily the National reported on Sunday.

The beach would have been chilled through a system of pipes under the sand.

TechnoPark, the science and technology facilitator of Economic Zones World announced that it has signed a land lease agreement with First Sea Mining Factory LLC to be built in TechnoPark

The First Sea Mining Factory uses cutting-edge technology from I.E.S. Germany and will implement advanced one-of-its kind Seawater Brines Recycling Technology that will completely eliminate the harmful pollution caused by brine discharges from Seawater Desalination Plants.

The establishment of the new company is a landmark step towards ecological preservation of UAE's marine seawater resources and its fishing industry.

Dubai-listed Deyaar Development has scrapped its Enclave project in Dubai and put a deal in Saudi Arabia on hold, its CEO said in comments published on Wednesday, as the downturn in the Gulf real estate market sees further project cancellations.

"We had to cancel the Enclave. Although the project was good, it was launched at a very inopportune time,” Markus Giebel was quoted as saying by UAE daily Emirates Business.

“As a developer we had to be fair and so we returned 100 per cent of our investors' money. We will be happy to review the decision if the market comes back.”

"The expansion in the services sector, notably in the tourism industry, will slow down as the influx of tourists falls on the back of weaker private consumption growth," he said.

However, Dubai's growth is expected to remain strong from a global perspective

The determination of the Dubai authorities to use strong fiscal expansion in order to ensure that the economy bounces back, especially in the construction sector, will mean that the economy will maintain strong growth going forward.

Sales of luxury goods in Dubai have dropped about 45 percent since the global economic crisis prompted local shoppers to tighten their purse strings and tourists to rethink spending sprees, a top retailer said.

Speaking to the Reuters Global Luxury Summit in Dubai, Tony Jashanmal, a director of the 90-year old Jashanmal Group of Companies, said the worst of the first real downturn in the region's retail sector in about 17 years had passed.

But the repercussions would linger as retailers scramble to sell excess stock and shoppers from recession-hit countries like Russia, who tended to frequent Dubai malls, stay home as they seek ways to weather the crisis.

"The sales of everything dropped a little bit, but more drastic was in the luxury field," said Jashanmal on Monday.

Low-fare air just landed smack-dab in the middle of the Middle East - specifically in skies-the-limit Dubai. That’s the place they’re building the world’s tallest building, the Burj Dubai, which already towers some 2,300-feet above the desert.

Dubai is known for grand schemes and projects writ large. Its service-intensive, globe-girdling airline is Emirates, which flies A380s replete with shower baths for First Class flyers. That’s why it’s so seemingly out of character for a low-fare new-entrant to set up shop in this opulent desert kingdom, somewhat as now-defunct Skybus did in Columbus (CMH). Skybus was the quintessential “unbundled” airline. After paying a pittance for the seat itself, you shelled out for virtually everything else a la carte – a practice that’s gained lots of traction over the past couple of years among not just discount airlines, but majors as well.

While their biggest customers may continue to wallow in recession into 2010, the oil-producing nations of the Persian Gulf are again luring foreign investment and looking for places to park their own wealth.

Crude prices that have stabilized above $50 a barrel mean the Middle East’s oil-rich economies are likely to pull out of the global financial crisis sooner than the rest of the world. Saudi Arabia, the largest Arab economy and the world’s biggest oil exporter, is attracting renewed interest from investors including leveraged-buyout firm KKR & Co. Qatar and Abu Dhabi have returned to international capital markets.

Dubai World Central (DWC) - the 140-square-kilometre aviation and logistics city in Jebel Ali - will open for business in June 2010, the government has reconfirmed.

"Our vision for Dubai is to be an unparalleled global commercial, trade and transportation hub with a unique integrated multi-modal logistics platform in DWC which will change all known air, land and sea transportation parameters," Shaikh Ahmad Bin Saeed Al Maktoum, chairman of Dubai Aviation City Corporation (DACC), who is also president of Dubai Civil Aviation Authority and chairman and chief executive of Emirates Airline and Group, said in a statement.

"Construction on all related infrastructure works is continuing with all our stakeholders recognising the fact that Dubai World Central is a committed Dubai government project; and once the global economic recession tides out its cycle, work towards its final master plan will resume at its original pace."

The Ministry of Labour is set to introduce new rules for labour accommodation standards and a fresh mechanism to ensure payment of salaries, to protect workers' rights and improve their conditions.

Speaking to the press at the sidelines of the labour and human rights symposium, Saqr Gobash Saeed Gobash, Minister of Labour, emphasised that payment of workers' salaries and dignified living conditions are fundamental principles for the ministry of labour.

In order to safeguard those rights, the ministry will introduce a set of new measures such as the adoption for new criteria for labour accommodation and a requirement for companies to pay workers' salaries through banks.

Dubai government is pushing for reforms to company law to allow 100 percent foreign ownership of businesses across the UAE to boost foreign investment and help weather the global financial crisis, a senior government official said in comments published on Monday.

Currently 100 percent foreign ownership is only allowed in designated areas, known as free zones. Outside these areas all companies must be at least 51 percent owned by a UAE national.

The Ras Al Khaimah Free Trade Zone (RAK FTZ) reported a 16 per cent increase in revenues in the first quarter of 2009, compared with the first quarter of last year.

RAK FTZ, one of the fastest-growing free trade zones globally, also reflected a four per cent increase in company registrations compared with the same period in 2008.

So far 378 new companies have registered this year, the five largest being Jamal Travel Agency, Middle East Spark Trading, Al Mohandis International, Info Seven and Aysha Trading.

Dubai's Public Prosecution indicted Wednesday a former minister of state and several others including former company executives as a year-long probe into alleged corruption at one of the city's biggest property developers draws to a close.

Mohammed Khalfan Bin Kharbash, former government minister for finance and industry, and ex-chairman of Dubai Islamic Bank PJSC (DIB.DFM), faces charges of alleged embezzlement and "harming state interests", according to an emailed statement from the prosecutor's office.

Kharbash is alleged to have seized "public money and harmed the state's interests" in relation to an investigation into financial wrongdoing at Deyaar Development PJSC (DEYAAR.DFM), according to the statement.

Abu Dhabi is pumping nearly $10 billion (Dh37bn) into projects to expand its gas output capacity despite plans by several Middle East nations to shelve key hydrocarbon projects because of the global financial turmoil.

The government-controlled Abu Dhabi Gas Industries Company (Gasco), the main onshore gas operator in the emirate, said the projects will increase the firm's production in five years.

"The projects are in line with Adnoc's general plans to expand its sustainable oil and gas production capacity by developing its associated and non-associated gas resources," Gasco general manager Mohammed Al Suwaidi told Adnoc's quarterly bulletin, Adnoc News.

He said the investments would nearly triple the company's output of around three billion cubic feet within five years, adding the expansions cover LNG, LPG, sulphur, condensates and other products.

Faced with a sudden economic slowdown, Dubai is trying to combat the fraud cases that surged during the past years of rapid economic growth in a bid to boost its status as a regional business hub.

But the clean-up drive has stirred controversy as several former executives of major firms, suspected of embezzling sums which total hundreds of millions of dollars, have been held for months without charge.

The economic boom of the past several years appears to be the main culprit.

"It was a boom market. Everybody gets greedy and you have corruption," economist Eckart Woertz of Dubai-based Gulf Research Centre told AFP. "You have the opportunity to cash in some bribes, and you do it."

The UAE witnessed a 16 per cent rise in the salaries of private sector employees in 2008 - marking the highest increase in the Gulf region, according to a recent study.

The study, conducted by a Dubai-based company specialising in administrative development, covered a number of private service companies in the fields of money exchange, finance, insurance, property development, oil and information technology.

The study put Qatar in second place with a 14 per cent average salary increase, followed by Oman with an average increase of 11 per cent.

The Ministry of Foreign Trade said UAE's non-oil foreign trade rose by 33 per cent in 2007 compared to the previous year.

It reached $150.7 billion (Dh553bn).

In a press conference at its new premises, the ministry said India came first as the volume of its foreign trade with the UAE rose to $21.7 billion, followed by China ($12.8bn) and the United States ($9bn).

The UAE's foreign trade focussed 56 per cent and 57 per cent for the year 2006 and 2007, respectively, on around 10 countries at a growth rate of 35 per cent in terms of trade volume.

UAE. Gulf shares rose as a US plan to revive growth in the world’s largest economy boosted the price of crude oil, improving economic prospects for the region.

Abu Dhabi Commercial Bank, the UAE’ third-biggest bank by assets, and Commercial Bank of Dubai, the lender 20%-owned by the Dubai government, surged after banks said they will convert federal government deposits into capital to cushion losses.

Arabtec Holding, Dubai’s biggest construction company, led gains among real-estate firms.

Arabian Construction Company (ACC) says it is bidding for new projects worth about Dh8 billion and has enough work to take it through until 2012.

The company says it has registered significant growth during the past few years and had to restrain itself and also warns that the forecast for 2009 will be less optimistic compared to previous years.

Wassim Merhebi, Executive Director at ACC, speaks about the company's strategy for the future, its recent expansion and the state of the construction industry in the region.

State-run Abu Dhabi Investment Co (ADIC) said this week it expects buyout opportunities to begin emerging in the Middle East and North Africa as valuations are hit by the global financial crisis.

The investment firm, owned by Abu Dhabi Investment Council, said it was looking for companies with solid cash flows in sectors that are likely to be least affected by the economic downturn such as healthcare, education and telecommunications.

Companies are still flocking to Dubai despite difficult times, thanks to the emirate's advanced infrastructure and its status as a major financial centre, a board member of Dubai Financial Services Authority said yesterday.

"The Gulf economy is clearly strong and I am optimistic about it in the long term. Every economy at the moment is suffering major pressures. Dubai and the UAE no different from that. But I do think fundamentals here are good. Dubai is a major international business centre; infrastructure here is very strong. Companies are coming here even in difficult times," said Lord David Currie, DFSA Board Member.

There has been a dramatic rise so far this year in the numbers of trade and business licence applications in Ras Al Khaimah, with the total in January and February at 3,804, according to a statement issued by the emirate's Economic Development Department.

This follows a 2.6 per cent rise in the number of licences issued in 2008 over the previous year. While 17,840 business and trade licences were issued in 2007, last year saw that number increase to 18,318, the department said.

New trade licences in 2008 totalled 9,162, while the number of new industrial licences was 314, and new professional licenses 8,842.

The statement also said January and February 2009 saw remarkable activity in the sphere, with a total of 3,804 licence applications being referred to the department, including 1,817 trade licences, 74 industrial licences and 1913 professional licences.

The sudden drop in the prices of prime Dubai properties is drawing attention from real estate investors seeking attractive entry points.

"It is not so much that Dubai is gearing to attract more real estate funds into the market, but with property valuations becoming more attractive... investors are deploying more capital into the real estate sector," says Kerrie Alder, Head of Real Estate, Emirates Investment Services (EIS) Asset Management.

"The re-introduction of available financing will also further aid interested funds in due course," said Alder.

Official figures indicate that cancellations of residency visas in January 2008 rose 86% over January of 2007.  Dubai’s Ministry of Interior Naturalization & Residency (DNRD) released data showing that 54,684 residency visas were cancelled during the month of January, compared with 29,418 in January 2008.  This translates to approximately 1,764 per day, higher than the 1,500 cancellations reported in the media during the past three weeks.