Posted by: Pradeep | July 7, 2008

Country of shopaholics

Ever wondered what keeps Dubai going. Recent studies have projected that per capita per day spend in Dubai is USD 27 as against USD 3.5 in neighbouring countries who boast equally well infrastructure, living etc. Rise in living costs also have not deterred the shoppers from spending and this is causing ever rising inflation. If one has to do profiling of high spenders it would be mostly Locals, CIS citizens, Europeans, Arabs, Asians in that order of spending. This is definately causing vast differences in living of people of different income groups in the country and people are living on plastic money and generous lending policies of banks.

Is Dubai also a subprime default prone society? In all probability it would be. I have seen people flashing number of credit cards with revolving limits. As there is no social welfare or pension system in the country, at the end of day it would merciless retirement in debts.

Recently Central Bank has indicated at tightening the lending policy and it should be observed with strict discipline if the people have to rise in long term.

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