Laid-Off Foreigners Flee as Dubai Spirals Down

DUBAI, United Arab Emirates — Sofia, a 34-year-old Frenchwoman, moved here a year ago to take a job in advertising, so confident about Dubai’s fast-growing economy that she bought an apartment for almost $300,000 with a 15-year mortgage.

Now, like many of the foreign workers who make up 90 percent of the population here, she has been laid off and faces the prospect of being forced to leave this Persian Gulf city — or worse.

“I’m really scared of what could happen, because I bought property here,” said Sofia, who asked that her last name be withheld because she is still hunting for a new job. “If I can’t pay it off, I was told I could end up in debtors’ prison.”

With Dubai’s economy in free fall, newspapers have reported that more than 3,000 cars sit abandoned in the parking lot at the Dubai Airport, left by fleeing, debt-ridden foreigners (who could in fact be imprisoned if they failed to pay their bills). Some are said to have maxed-out credit cards inside and notes of apology taped to the windshield.

The government says the real number is much lower. But the stories contain at least a grain of truth: jobless people here lose their work visas and then must leave the country within a month. That in turn reduces spending, creates housing vacancies and lowers real estate prices, in a downward spiral that has left parts of Dubai — once hailed as the economic superpower of the Middle East — looking like a ghost town.

No one knows how bad things have become, though it is clear that tens of thousands have left, real estate prices have crashed and scores of Dubai’s major construction projects have been suspended or canceled. But with the government unwilling to provide data, rumors are bound to flourish, damaging confidence and further undermining the economy.

Instead of moving toward greater transparency, the emirates seem to be moving in the other direction. A new draft media law would make it a crime to damage the country’s reputation or economy, punishable by fines of up to 1 million dirhams (about $272,000). Some say it is already having a chilling effect on reporting about the crisis.

Last month, local newspapers reported that Dubai was canceling 1,500 work visas every day, citing unnamed government officials. Asked about the number, Humaid bin Dimas, a spokesman for Dubai’s Labor Ministry, said he would not confirm or deny it and refused to comment further. Some say the true figure is much higher.

“At the moment there is a readiness to believe the worst,” said Simon Williams, HSBC bank’s chief economist in Dubai. “And the limits on data make it difficult to counter the rumors.”

Some things are clear: real estate prices, which rose dramatically during Dubai’s six-year boom, have dropped 30 percent or more over the past two or three months in some parts of the city. Last week, Moody’s Investor’s Service announced that it might downgrade its ratings on six of Dubai’s most prominent state-owned companies, citing a deterioration in the economic outlook. So many used luxury cars are for sale , they are sometimes sold for 40 percent less than the asking price two months ago, car dealers say. Dubai’s roads, usually thick with traffic at this time of year, are now mostly clear.

Some analysts say the crisis is likely to have long-lasting effects on the seven-member emirates federation, where Dubai has long played rebellious younger brother to oil-rich and more conservative Abu Dhabi. Dubai officials, swallowing their pride, have made clear that they would be open to a bailout, but so far Abu Dhabi has offered assistance only to its own banks.

“Why is Abu Dhabi allowing its neighbor to have its international reputation trashed, when it could bail out Dubai’s banks and restore confidence?” said Christopher M. Davidson, who predicted the current crisis in “Dubai: The Vulnerability of Success,” a book published last year. “Perhaps the plan is to centralize the U.A.E.” under Abu Dhabi’s control, he mused, in a move that would sharply curtail Dubai’s independence and perhaps change its signature freewheeling style.

For many foreigners, Dubai had seemed at first to be a refuge, relatively insulated from the panic that began hitting the rest of the world last autumn. The Persian Gulf is cushioned by vast oil and gas wealth, and some who lost jobs in New York and London began applying here.

But Dubai, unlike Abu Dhabi or nearby Qatar and Saudi Arabia, does not have its own oil, and had built its reputation on real estate, finance and tourism. Now, many expatriates here talk about Dubai as though it were a con game all along. Lurid rumors spread quickly: the Palm Jumeira, an artificial island that is one of this city’s trademark developments, is said to be sinking, and when you turn the faucets in the hotels built atop it, only cockroaches come out.

“Is it going to get better? They tell you that, but I don’t know what to believe anymore,” said Sofia, who still hopes to find a job before her time runs out. “People are really panicking quickly.”

Hamza Thiab, a 27-year-old Iraqi who moved here from Baghdad in 2005, lost his job with an engineering firm six weeks ago. He has until the end of February to find a job, or he must leave. “I’ve been looking for a new job for three months, and I’ve only had two interviews,” he said. “Before, you used to open up the papers here and see dozens of jobs. The minimum for a civil engineer with four years’ experience used to be 15,000 dirhams a month. Now, the maximum you’ll get is 8,000,” or about $2,000.

Mr. Thiab was sitting in a Costa Coffee Shop in the Ibn Battuta mall, where most of the customers seemed to be single men sitting alone, dolefully drinking coffee at midday. If he fails to find a job, he will have to go to Jordan, where he has family members — Iraq is still too dangerous, he says — though the situation is no better there. Before that, he will have to borrow money from his father to pay off the more than $12,000 he still owes on a bank loan for his Honda Civic. Iraqi friends bought fancier cars and are now, with no job, struggling to sell them.

“Before, so many of us were living a good life here,” Mr. Thiab said. “Now we cannot pay our loans. We are all just sleeping, smoking, drinking coffee and having headaches because of the situation.”

A New York Times employee in Dubai contributed reporting.

Replace Middle East with any South American country and I think you still find this a common mode of thought. I think I might be guilty as well. Why does Africa seem so accessible, possible?

Finding a stable internet connection has gotten to be a more and more difficult task as time has progressed, but luckily I’m able to spend the afternoon at Friends Cafe, probably the nicest one I have seen so far. It’s in Nassarawa, the other side of town from CITAD and Mambayya House.

I was able to upload pictures, here are some. You can see the rest of you click the icon below:

three weeks left

one of the stickers at citad:

mambayya house, the compound i’m staying at:

my digital storytelling workshop:

bayero university:

where’s waldo?

guess the harddrive:

in Abuja with Umar:

in the linen market, he wanted to take a picture with the bature

YZ and Paul, they are kind of a big deal

Jummai, who works for DFID, needed to make a short slideshow/documentary about Ramadan and her work. Since it wasn’t Ramadan yet, she took me to her house and pretended to break fast with her family….at 2pm.

how i get around

Kuri market is the linen market with stacks and stacks of cloth everywhere. I picked out a fabric I liked and took it to the tailer, where I had a proper Hausa outfit made. Maybe I’ll upload pictures later…just maybe.

I can now confidently say that it is definitely worth the read. I chose it over the Audacity of Hope because he wrote Dreams before his political career, fresh off graduating Harvard Law School. I was really surprised by his honesty and the way he paints himself as an incredibly vulnerable and unsure person, trapped between conflicting expectations and images that connect him to a deep racist history in the United States and colonialism in Kenya.

I never imagined it would be as complicated and profound as it is, and as I passed the book on to my friend Umar to read, I actually felt proud that this person might be president. After the past eight years that means a lot, especially considering I expect so little from mainstream politicians.

That being said, I need to take more time to understand Obama’s policies (where they exist in some concrete form). It’s kind of a bizarre situation with this incredibly important presidential election coming up. I feel like I should be converting every McCain supporter I can find, but, I live in California and do we actually need to worry about California going red? I don’t think so. So what is another Obama bumper sticker driving through Santa Cruz? The best I can think of to do is focus on the propositions and make sure Obama is accountable to his promises and rhetoric once elected.

Oh, and we should start planning a coup d’etat just in case America totally lets us down and votes for McCain.

So, instead of insulting you with that, I’ll just say I had an amazing day yesterday traveling to Jigawa state for CITAD’s “Rural Road Show” where we met with the local government and community members of Auyo. The purpose of these visits are to “plant the computer seed” and to present the technology and some of its uses, sometimes to people who have never seen a computer before. The presentation and most of the communication that day was in Hausa, so I had to learn to take comfort in being the awkward foreigner who doesn’t understand anything that’s going on.

The drive there and back was perfect (besides the usual crazy driving) and like my last visit to a village my first week here, it’s really refreshing to take a break from the busy and polluted streets of Kano to see a bright green countryside with its clay colored dirt, and boabob trees everywhere.

I can’t believe I’m already at the half-way point (and then some). I’m constantly excited and motivated by the projects I have going on here, but definitely worried that I won’t be able to get as much done as I’d like before September 15.

I thought the hardest part about getting on the achabas would be the insane roads and driving practices, but really my biggest fear at the moment is just dealing with the drivers. All the drivers waiting outside of the hotel know that whoever comes out of it can afford more than the 50 or so naira fare that most people pay. And, according to the culture here just about everything must be haggled.

Common sense tells me that before I get on a bike I should be sure that the driver knows where I want to go and how much I’m going to pay him when I get there. This should be easy but it definitely isn’t. For one, I can barely understand their English and they can barely understand mine. The incredibly huge generator building next to us doesn’t make it easier for anyone to hear. Secondly, it’s in the best interest for the drivers to get you on the bike as quick as possible without ever really settling on anything. They know you have money and once you get there, they can charge whatever they want. So it’s always a struggle/argument with a lot of confusion and hussle. I usually end up paying more than I say I will, sometimes because they end up asking for more or because I just want to please them.

Why is that? At the airport when I first arrived, I was so determined to please the workers there that I didn’t even think to try and put my foot down and remind them that I had already been approved to stay until September, and no, I don’t want to have to go to an immigration office to extend my visa. Instead, I nodded and reassured them that everything is fine. I think my fear is somewhat grounded in reality, after all I am in a strange place that I don’t know well and especially when confronted with figures of authority (official or otherwise) I’m sort of at their whim. At the same time, I can’t set myself up to be taken advantage of because I’m more or less certain that I will be.

Anyway, the big move today! I’m excited.

In the United States, where the median household income is about $48,000, $4-a-gallon gas is painful.

In Nigeria, most of whose 140 million citizens live on less than $2 a day despite their country’s status as the world’s eighth largest oil exporter, $5.50-a-gallon diesel is excruciating.

If your entire home ran off a diesel generator, how much energy would you use?