Dubai has removed the high-profile governor of the Dubai International Financial Center as a political power struggle caused by the emirate's financial troubles continues to build.
Omar bin Sulaiman, governor of the centre since 2004, has been replaced by Ahmed al Tayer, a former finance minister. He is chairman of Emirates NBD, Dubai's largest bank, and a member of one of the merchant families that helped build the foundations of the emirate's economy.
The US-educated Mr bin Sulaiman appears to be the latest victim of Dubai politics as the emirate seeks to redress the excesses of the supercharged growth from 2003 to 2008 that created an $80bn debt pile and a burst real estate bubble. The ruler's court, the traditional root of the sheikh's power base, has assumed increasing powers, including controlling a $20bn (€13.4bn, £12bn) fund that will support cash-strapped state-linked businesses.
The ruler on Thursday also reshuffled the board of the Investment Corporation of Dubai, a government company overseeing the government's stakes in commercial companies such as Emirates airline.
The ICD board reshuffle has removed three of his lieutenants: Mohammed Gergawi, head of Dubai Holding; Sultan bin Sulayem, head of Dubai World; and Mohammed Alabbar, chairman of Emaar Properties, the government-linked real estate giant.
This triumvirate was instrumental in Dubai's transition from a regional trading centre to global business hub over the past decade.
The replacement of Mr bin Sulaiman with an old school government official from an established Dubai merchant family could be another signal of a back-to- basics policy.
"This is all about projecting a more conservative image to the bankers, to show that Dubai will be more careful in the future," said one observer.
Dubai is trying to renegotiate billions of dollars of debt with bankers while also raising the finance needed to meet other obligations, such as the $4bn that becomes due in mid- December on an Islamic bond issued by Nakheel, the government-owned developer that built the city's Palm Islands.
An anti-corruption campaign against executives who abused their positions of power for personal gain during the real estate boom has recently stepped up a gear.
The authorities are now said to be investigating the bonus culture and real estate holdings of many executives at the state- linked companies that helped propel Dubai to global prominence during the boom.
Yet some local observers are also scratching their heads at the arbitrary nature of the reshuffles, with some executives responsible for ballooning debts and bad investments apparently escaping retribution.END
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