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Khaled Reza - Mohammed Yaser - Ashfaq UrRahman

Khaled Reza - Mohammed Yaser - Ashfaq UrRahman. Contents. General introduction to the world of expositions Economic impacts of the expo to the UAE Social impacts of the expo to the UAE. What is expo?. Khaled Reza. Introduction – expo. Simply put, expo means ‘large public exhibition’

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Khaled Reza - Mohammed Yaser - Ashfaq UrRahman

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  1. Khaled Reza - Mohammed Yaser - Ashfaq UrRahman

  2. Contents • General introduction to the world of expositions • Economic impacts of the expo to the UAE • Social impacts of the expo to the UAE

  3. What is expo? Khaled Reza

  4. Introduction – expo • Simply put, expo means ‘large public exhibition’ • Entered into force of the 1928 Convention Relating to International Exhibitions, the ‘Bureau International des Expositions’ • 3 types – Universal, International and Specialized • Usual duration of an expo: 3 weeks - 6 months

  5. On the road to Dubai 2020 Universal Exposition - Feeding the Planet, Energy for Life Specialized Exposition – Future’s Energy Universal Exposition - Connecting Minds, Creating the Future

  6. Supporting the bid “In today’s highly interconnected world, a renewed vision of progress and development based on shared purpose and commitment is key. While a single human mind, an individual country, or a specific community is both unique and remarkable, it is by working collaboratively that we truly advance.” -HH Sheikh Mohammed Bin Rashid Al Maktoum

  7. Dubai • Business capital of the UAE • Population of almost 2,100,000 January 2013 • Major transportation hub – Dubai Airports - DXB & DWC • Home to the Jebel Ali Free Zone – World’s largest of its kind

  8. Dubai’s Achievements • Establishment of the city into a cosmopolitan ‘micro-world’ • Home to the world’s highest tower, largest flower garden, biggest mall etc… • Tourism and transportation facilities that are the envy of other countries • Unparalleled leadership

  9. In preparation • Building of the venue for the event – post modern, nature-filled & eco friendly; built with a post-expo purpose • Creation of 300,000 jobs in the UAE • Overall, 80,000 jobs will be temporary and 30,000 will be volunteer positions • Al Maktoum Airport to be fully functional as the World’s largest airport • Jebel Ali Free Zone used as a new micro city in Dubai

  10. More connectivity “Our unique geographic location connects us to a third of the world through a four-hour flight and two-thirds of the world through an 8 hour flight” - Reem Al Hashimi, the managing director of the Expo 2020 Executive Body

  11. Win, Victory and Love

  12. Expo 2020 • The costs for the event alone will be around US$2-3bn • Estimation: ‘secondary infrastructure’ cost will rise to US$8bn including construction opportunities in the transport, hospitality, retail and commercial sectors • Extension of metro lines and highways • New hotels, entertainment centres and golf clubs will be built to keep both international and domestic visitors happy

  13. The Theme Dubai has a long history of facilitating connections and pioneering new ideas and Dubai Expo 2020 would be no different, with a predicted 70 per cent of the expected 25 million visitors originating from outside the host nation, making it the most international event in the history of Expo.

  14. The subthemes The key drivers of global development: Sustainability - lasting sources of energy and waterMobility - smart systems of logistics and transportationOpportunity - new paths to economic development The focus will be on exploring their interdependencies and identifying potential partnerships, ultimately resulting in a legacy of innovation.

  15. The purpose of Expo 2020 Connecting Minds, Creating the Future • Be an event to connect the world • Bring up the reputation of the country • Maximize international relations • Add fuel to the economy • Help pioneer new partnerships for growth and sustainability for the future

  16. Event partners

  17. Economic Impacts Mohammed Yaser

  18. “At CBD we are very optimistic about the positive impetus for the UAE economy that Dubai Expo 2020 will bring” - Peter Baltussen, CEO of Commercial Bank of Dubai (CBD)

  19. A Legacy of Success • Expos have mostly proved pivotal in the infrastructural development of host nations and cities. The benefits for most of the participating nations were compelling • According to a report by the marketing guru Tjaco Walvis, while the Dutch Pavilion at Expo 2000 cost €35m (US$47m) it potentially generated some €350m (US$470m) for the Dutch economy, with 92 per cent of visitors saying they were now more likely to either visit the Netherlands or look to do business there • The most recent World Expo in Shanghai in 2010 was of great significance to China. The Expo involved 192 countries and 50 international organizations and was the most expensive in the history of World’s Fairs. By its end, a record 73 million people had visited. It cost 11.96bn Yuan (US$1.89bn) to run the event, but it made a profit of more than 1bn Yuan (US$158m)

  20. Expectations •  A majority of UAE residents expect Expo 2020 to positively impact their lives ahead of the event and after the event, according to a recent survey of more than 1,000 residents by strategic research company, Insight Discovery • A majority (95 per cent) of the respondents are interested in the Expo, out of which 62 per cent expressed strong interest. Eighty-eight per cent said it will impact their lives positively • Respondents in the survey were asked to identify the sectors which would most likely be the beneficiaries of Dubai Expo 2020. Sectors which received favorable mention included advertising/media/communications, financial services, real estate, retail, telecoms, and tourism/hospitality

  21. Favorable Outlook • More than 60 per cent of respondents had a favorable outlook for tourism growth in the years (2018-20) closer to Dubai Expo 2020, in comparison to the earlier period (2016-18) where tourism were predicted to grow by 33 per cent to 40 per cent • 73 per cent of the respondents believe that the UAE’s financial services sector will cope easily with the opportunities but challenges may arise • 57 per cent of those surveyed think that the impact of the event on local banks will only be moderate, given that three quarters of the 25 million visitors to Dubai Expo 2020 will come from outside the UAE • In terms of employment opportunities in the UAE, 57 per cent of the respondents think that the EXPO 2020 will lead to a positive impact with more job creation and new businesses • 91 per cent strongly believe that EXPO 2020 will lead to a rise in the general cost of living. Interestingly, 16 per cent doubt whether the event will be delivering benefits after it is over

  22. Early Speculations (Michael Lahyani -CEO and Founder of regional real estate and property) • It has been projected that the UAE economy will see over AED 100 billion in revenue. • Creation of more than 200,000 jobs between 2013 and 2021. • The win will also accelerate the implementation of megaprojects such as Mohammed bin Rashid City. • Residential and business districts in and around Dubai World Central Airport. • The construction of infrastructure projects such as the Dubai Metro Purple Line.

  23. Positive already… HamadBuamim, chief executive officer of Dubai Chamber of Commerce and Industry, said that we started this year on a high note “2013 is the best year we ever had during the past five years across the board. Major highlight of 2013 and its impact on 2014 was Expo 2020 announcement. This is really a turnaround event” - Hamad Buamim, chief executive officer of Dubai Chamber of Commerce and Industry

  24. Benefits – facts and figures • Dubai's Expo 2020 is expected to yield AED 89 billion ($24.2 billion) in added economic activities, according to Reem Al Hashimi, the managing director of the Expo 2020 Executive Body • Expo 2020 will provide 277,000 new job opportunities and will have a positive and comprehensive economic impact on small and medium enterprises (SMEs) • On an average, more than 11,000 job openings are posted online • Emirate expects to have 80,000 hotel rooms by 2020, suggesting that more than 15,000 new hotel rooms (more if older hotels are revamped) may be built before the event begins • “For every US dollar spent by Dubai, its economy should reap a six-fold return“ Standard Chartered Bank said in a note.

  25. Benefits – facts and figures • The event would also raise the overall GDP of the country in a variety of sectors • Real estate consultant Jones Lang La Salle states that more than 840,000 square meters of gross leasable retail space is expected to come to the Dubai market by 2016 • A little over 6,000 new hotel rooms are expected to come on the Dubai market next year, taking the emirate's total hotel room stock to just over 65,000 • Dubai International Airport will have increased its capacity to 90 million passengers a year from the current 60 million

  26. Confidence Enhanced • In a sign of confidence even before the Expo bid was secured, Emirates Airline ordered 50 Airbus A380s at a list price of USD 20 billion at the recently concluded Dubai Air show, to take its total order for A380s to 140. The airline also placed a USD 76 billion order with Boeing Co. to buy 150 of the manufacturer's new 777X aircraft, as the authorities pull all the levers to achieve the target of 20 million visitors by the end of the decade • Even beforereceivingconfirmation of the rights to host the Expo, the authorities had begun working on a budget for 2014 that was 11% higher than the previous fiscal year

  27. THE EXPO EFFECT – Outlook(The emerging market bank report) • The event is set to lift confidence in Dubai's housing sector by supporting long-term demand dynamics • Most of the infrastructure and related housing facilities will be built in the relatively less populated southern part of the city, which will contribute to Dubai's expansion • Expo 2020 effect to be evident as early as next year with GDP jumping 5.4% compared to its previous forecast of 4.5%

  28. Multiplier effect • The new wave of investments will add to the USD 705 billion worth of projects already under way in the emirate over the next 10 years • The emirate would also benefit from enhanced global media exposure • Raising Dubai's profile as an open, vibrant business hub in the heart of Middle East would be invaluable promotional tool - the kind that could only be attained by spending millions on advertising • When Qatar won the right to host the World Cup in December 2010, the country's stock exchange jumped 9% within a week's time.The Expo may have a similar effect on the Dubai Financial Market, except that the market has already been soaring at record highs

  29. Challenges “... We caution against overstating the economic benefits of hosting the Expo. We expect direct expenditure of $7 billion on the event to amount to around one per cent of GDP per year between now and 2020” -Citi Bank’s Middle East Macro Monthly report

  30. Challenges • The effectiveness of the impact of this expenditure on the local economy was likely to be limited and short-lived as the majority of contractors and workers preparing and managing the event would be foreign • The government expenditure directed towards the Expo will need to be diverted, at least in part, from other areas of spending to avoid an excessive build-up of debt • The visitor numbers will not be a net increase in tourism — much non-Expo related tourism is likely to be squeezed out by the event • The ripples will also be felt by the cement sector which hasseen its utilization fall dramatically after the real estate crash of 2008, as construction projects were halted or mothballed • The International Monetary Fund recently warned the emirate to keep a close eye on its soaring property market

  31. Challenges • Qatar has recently been under fire for its management of its foreign labor workforce as it prepares to host the 2022 FIFA World Cup, and has been called out for its poor labor rights record • Fears of a massive jump in rents and real estate prices. Dubai's real estate prices have already risen 21.8% this year - second only to Jakarta, according to Knight Frank • The IMF estimates that about USD 64 billion of debt owed by Dubai's Government-Related Enterprises (GREs) and government will be due between 2014 and 2016 • The scale of the planned expansion also creates a significant risk that there will not be enough demand to support the new hotels, offices and retail space once the expo is finished • Du and Etisalat would see their mobile subscriptions growing multiple times

  32. Strategy • The Dubai authorities will do well to ensure that all the necessary frameworks and regulations are in place to ensure that the event is only remembered for positive developments, and foreign labor is offered adequate working conditions • The government would finance the expo through a mix of bond issuance, bank borrowings and cash raised from asset disposals and profits from Dubai Inc. businesses • This huge borrowing would mobilize loan growth of the banking sector and lead to strong fee generation over investment banking deals. UAE banks have the capacity to lend additional [AED 300 billion] given their current and forecasted lending ratios

  33. Social Impacts Ashfaq UrRahman

  34. Interconnected world-Interconnected challenges, through the forging of new partnerships and alliances we will be able to achieve social progress on a global scale • Dubai Expo 2020’s theme of ‘Connecting Minds, Creating the Future’ recognizes that the key innovations and partnerships to build a better world can
be found within the fabric of our interconnected lives (UAE- unity)

  35. People’s support • Over 95 per cent of investment professionals in the UAE supported Dubai’s bid for Expo 2020 • Statistics Clearly show how the campaign has been massively successful on social media • Region’s youth confident Expo 2020 will boost image of Arab world • Almost everyone who lived in the UAE wanted it to happen

  36. Past experiences • Expo 2010 - transformed Shanghai into a global commercial district • A staggering figure of over 73 million visitors is a clear indication of the global exposure Shanghai was able to achieve

  37. Dubai •  Expo 2020 will be a powerful catalyst in Dubai’s social and cultural growth • Improved lifestyles- world-class infrastructure and cutting-edge technology • Dubai Expo 2020 would serve as a platform for idea creation across nations, institutions and corporations, inspiring a generation with lasting social change • One key area of growth - education sector, smart learning (it’s crucial to foster and develop new talent)

  38. Expo 2020 bid to impact residents and Emirati culture – Survey • Conducted by research firm YouGov (1,000 residents) people are optimistic about the positive effects expo 2020 will have on the region • Participants were asked whether Dubai’s win would make it more or less likely for them to consider leaving the emirate (77% less likely to move, 67% would even encourage family and friends to move to the UAE)

  39. Impact on residents • The multiplier effect-more jobs means more people, more families living, earning and spending their money in the UAE • Dubai has multinational workforce, the effects will be felt as far as India, Pakistan, Philippines, with increased remittance streams offering many families opportunities of a better life • Higher cost of living for the expatriate community (hike in rent rates)

  40. Labor demands • Casual and part-time labor is not possible • Hotels will most likely face the problem of being overstaffed when the event is over and will see an unbalanced supply-demand ratio • Dubai’s construction and real estate sectors are facing a combined manpower shortfall of up to 500,000 at the moment • Hiring more staff without understanding demand and being able to match labor to demand can impact quality and customer satisfaction

  41. Impact on local culture “If the cart is politics and the horse is the economy then we have to put the horse before the cart and not the other way around.” – Sheikh Mohammed Bin Rashid Al Maktoum Elements of Emirati identity that are most under threat are “social values, culture and traditions” - Dr. Ameenah Al Daheri, Associate Professor of mass media, UAEU

  42. Expo and national day Dubai Expo would take place before the UAE marks its 50th anniversary in 2021, offering a unique opportunity to connect Expo to the national celebrations

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