Dubai News: Palm Island Pizza and Coronavirus Impact - Bloomberg:
In a bleak morning ritual at his home in Dubai, Hisham Ibrahim weighs up which invoices he absolutely must pay.
The Canadian entrepreneur’s “House of Pizza” restaurant on the man-made Palm Jumeirah island had been restricted to delivery orders by government regulations to contain the Covid-19 pandemic for most of April. Unable even to cover salaries in full as sales slumped 70%, the 49-year-old gave each employee 1,000 dirhams ($272) to help them through. Some suppliers, though, would have to wait. “We were already struggling and now the coronavirus is killing us,” he said.
With its low taxes, wealthy residents and sun-seeking tourists, the business hub of the United Arab Emirates was an obvious choice when Ibrahim set up in the Gulf in 2016. In Dubai, small and medium enterprises like his generate nearly half of output, double the level in neighboring Saudi Arabia, and employ 51% of the workforce.
Yet the arrival of the virus exposed some of its downsides. Cautious banks are still reluctant to lend to the private sector a decade on from the emirate’s near-default during the global financial crisis. And the government’s preference for monetary stimulus, through lenders, rather than direct cash handouts to an expat-dominated private sector means Dubai’s virus safety-net falls far short of those elsewhere.
In a bleak morning ritual at his home in Dubai, Hisham Ibrahim weighs up which invoices he absolutely must pay.
The Canadian entrepreneur’s “House of Pizza” restaurant on the man-made Palm Jumeirah island had been restricted to delivery orders by government regulations to contain the Covid-19 pandemic for most of April. Unable even to cover salaries in full as sales slumped 70%, the 49-year-old gave each employee 1,000 dirhams ($272) to help them through. Some suppliers, though, would have to wait. “We were already struggling and now the coronavirus is killing us,” he said.
With its low taxes, wealthy residents and sun-seeking tourists, the business hub of the United Arab Emirates was an obvious choice when Ibrahim set up in the Gulf in 2016. In Dubai, small and medium enterprises like his generate nearly half of output, double the level in neighboring Saudi Arabia, and employ 51% of the workforce.
Yet the arrival of the virus exposed some of its downsides. Cautious banks are still reluctant to lend to the private sector a decade on from the emirate’s near-default during the global financial crisis. And the government’s preference for monetary stimulus, through lenders, rather than direct cash handouts to an expat-dominated private sector means Dubai’s virus safety-net falls far short of those elsewhere.
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