 
Creator: Maryam Shahvaiz, Options Author
On April 16, Dubai skilled its heaviest rainfall in 75 years, disrupting lives throughout the town. Whereas the town is often related to a dry local weather and scorching warmth, residents discovered themselves unexpectedly dashing for umbrellas to guard themselves in opposition to heavy rainfall. It hardly rains in Dubai, which is why the drainage system was not included in metropolis planning. In consequence, a good portion of the water remained stagnant attributable to urbanisation and insufficient drainage infrastructure, exacerbating flooding in lots of areas. Blocked roads made it tough for folks to renew their day by day actions, with grocery shops unable to restock and a number of other staff having hassle reaching their workplaces.
The storm in Dubai not solely brought about inconvenience for its residents however has additionally jolted traders and companies throughout the UAE. Dubai is closely depending on its tourism trade and all companies flourish below this trade. Being UAE’s monetary hub, Dubai has the busiest airports on this planet. As a result of heavy storm, roughly 1,000 flights had been cancelled, resulting in days of subsequent delays. Motorways remained submerged till the rain stopped. Round 21 folks sadly died throughout the UAE and Oman.
These circumstances don’t current a beneficial image to the traders. That they had not predicted that pure disasters akin to rain would have such an influence and should now be factoring it into their future funding choices. At current, their major concern will likely be whether or not it’s a one-time factor or one thing set to proceed.
In the meantime, scientists and researchers are divided about this sudden rainfall. Some are blaming seeding, whereas many suppose it is because of international warming. In line with Richard Washington, a professor at Oxford College, it’s technically fairly tough responsible seeding alone for this storm. As per World Climate Attribution, “heavy precipitation hitting susceptible communities within the UAE” is ready to develop into “an rising menace because the local weather warms.” If this form of occasion is now the norm, it’ll elevate concern for Dubai’s traders. Moreover, it’ll pose challenges for Western traders, for whom one of many key sights of residing and investing in Dubai is its climate.
Authorities response amid disaster
A optimistic signal for the traders is that the Authorities of Dubai has assured its residents that it’ll present damages for the loss suffered and the UAE has allotted $544m for repairs brought on by the storm. The UAE Central Financial institution, alternatively, has confirmed that insurance coverage claims will likely be offered for broken houses and autos if the social gathering holds a complete insurance coverage coverage in opposition to loss and harm.
The financial institution has instructed all monetary establishments to supply a six-month reimbursement deferment to clients with private and automobile loans affected by flooding. It has assured that clients is not going to be sure to pay any further quantity, curiosity, or revenue fees. Furthermore, the principal quantity of the mortgage may also not be elevated.
Insurance coverage firms within the UAE weren’t ready to handle such claims, and have taken time to settle them, with claims made by clients in opposition to loss and damages backed by UAE Central Financial institution, which is a sigh of reduction for a lot of traders. Nevertheless, it is going to be fairly difficult for customers to file a declare, particularly relating to negligence, even when they’ve complete protection. As an illustration, in case you have knowingly parked a automobile or a car in a flooded space or when you had been driving in a rain-affected space. Rejection of those sorts of claims might put a dent in investor confidence.
Dubai is aware of that it can not afford to lose its popularity as each a pretty journey vacation spot and ‘protected haven’ for traders to mere rain. Due to this fact, it has deployed hundreds of staff to deliver again normalcy. Aside from banks and monetary establishments, many builders in Dubai are additionally facilitating the restore of residential property harm. As per Khaleej Instances, the CEO of Damac Properties, which is the biggest property developer in Dubai, has additionally come ahead to supply assurance to its residents that they may restore all their property damages for gratis. However the true query for traders is maybe not about repairs, however about an improve to the town’s drainage system.
Dubai’s traders will definitely have this enjoying on their minds whereas in search of enterprise alternatives. Buyers will likely be seeking to see how the Dubai authorities intends to assist them within the case of flooding or different excessive climate occasions. They are going to fastidiously assess and scrutinise how insurance coverage firms will facilitate them, what is roofed and what’s not. Contemplating present predictions, the probability of extra extreme rainfall occasions sooner or later stays excessive. Due to this fact, the federal government of Dubai should prioritise offering assurance to its potential traders by taking proactive measures to deal with the town’s insufficient drainage infrastructure and bettering insurance coverage insurance policies. By tackling these challenges, Dubai can mitigate these dangers and preserve its attractiveness as a vacation spot for traders and residents alike.
