Monday, March 16, 2009

The Heat Is On

Today is the first day here where I have said "geez!  How about this heat!!".  It's getting warmer here and the dreaded Arabian summer that everyone seems to talk about is just around the corner.  I keep saying "Yeah, but I'm an Aussie - all you Poms are whingers" but they just laugh... perhaps it will test my patience for the heat.  (Which is none, because I much prefer winter!)

But that aside, I had one of the UAE's great mysteries uncovered for me yesterday.  Speaking to a Lebanese Arab who has been in the UAE for 4yrs, we got talking about houses, cars and loans... he then revealed why all Emirati's are so rich and don't need to work.

Essentially, the good Sheikh Zayed, the founder of the UAE who ruled and was loved by everyone from say sometime in the 1960's through to his death in the early 2000's would approach the countries banks at the same time every year and clear the debts of Emirati citizens.  Yes... Every Emirati had their mortgage, car loans and personal loans PAID FOR by the Sheikh.  Every year.


So each year, Emiratis would take out as many loans as they could for houses, cars and other luxuries and the Sheikh paid for them.  Then using their new 100% owned assets as collateral they would then get bigger loans the following year and the Sheikh would pay for them.  As long as the Emirati could meet the repayments during the first 12mths there was no real cap on borrowings and hence the Sheikh's benevolence.

This explains why the mail boy who drives between Abu Dhabi Headquarters and the construction site drives a US$500K Mercedes and it also explains why Emiratis have no concept of money.  They pay speeding fines like road tolls and they right off cars left right and centre.  They will bash your car in the car park rather than take a 3 point turn.  As a westerner, we just have to live with their decadence.

Unfortunately when Sheikh Zayed abdicated due to ill health to his son (Sheikh Khalifa?), the son stopped the practice but it is immaterial now as all Emiratis have so much property they don't know what to do with all their money!

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