UAE : Northern Emirates Left in the Dark - Triggers Economic and Environmental Threat


Emirates left in the dark

A store worker uses a candle in Sharjah’s Industrial Area 1 following the breakdown of an electricity plant. Paulo Vecina / The National

UAE - AUG 26: A chronic shortage of electricity in the northern Emirates is a serious economic and environmental threat, a government study has found.

The National was allowed exclusive access to parts of the study, carried out over the past year by a special Federal National Council (FNC) committee.

The report paints a picture of poor planning for growth in the northern Emirates by the Federal Electricity and Water Authority (FEWA), which is responsible for providing the bulk of power there.

Ajman, Fujairah, Ras al Khaimah and Umm al Qaiwain, known as the northern Emirates, lack their own electricity and water authorities and are essentially dependent on federal supplies. About 1,000 commercial buildings in the region are waiting to be hooked up to the federal power grid, including 500 in Ajman.

In many cases, building owners have been waiting months or even years for electricity.

Some have resorted to noisy, expensive and environmentally unfriendly petrol-powered generators to make their buildings inhabitable.

The side effects of generator-produced electricity has persuaded local authorities in Fujairah to significantly curtail their use.

If solutions are not found there could be serious effects, said Yousef Neaimi, an FNC member from Ras al Khaimah who has a leadership role on the committee producing the study, which will be presented to the FNC this autumn.

“When they started building all these buildings, the interest rates on loans were much lower and there was a lot of liquidity in the market,” he said. “Now rates have gone up.

“And, of course, all of these buildings are financed by banks, and all of their owners are going to be hit with bad debts.”

He said FEWA bore much of the responsibility, mainly because developers in the northern Emirates typically had to obtain approval before they built buildings.

“For most of these buildings, they couldn’t start construction until they received approval from the electricity authority,” Mr Neaimi said.

“Sadly, FEWA did not keep their promise, and a lot of building owners are now left with debts in their banks that are going bad.”

Officials at FEWA could not be reached for comment.

It is not only the northern Emirates that are affected, according to Mr Neaimi. Twenty-five buildings were not connected to the grid in the Al Dhaid area, which, although part of Sharjah, was supplied by FEWA. Last week, Sharjah itself was hit by severe power cuts.

Rashed al Shariqi, another FNC member from Ras al Khaimah, said the delay in connecting housing developments in the emirates had caused hardship for low-income Emiratis.

There have been several instances in Ras al Khaimah in which villas built by the Sheikh Zayed Housing programme were left empty for several years.

Mr Shariqi also warned of environmental problems from widespread use of generators. “If this were a cost effective solution, everyone would buy generators and use them instead,” he said. “But it’s not. If you walk in the street and see each building with a single generator, how much noise will we get? How much pollution will we get?”

He added: “If we continue to mismanage the resources we have, if we continue to miscalculate the amount of that we currently have, the problems will fester.”

Embezzled cash put into suspect fund

DUBAI - AUG - 26: An embezzler who invested some of his illegal gains with an institution that has itself become the subject of a fraud investigation was jailed for a year.

The 28-year-old Emirati, RM, a Dubai Islamic Bank executive, was convicted last Thursday by the Dubai Court of Appeal of defrauding investors of more than Dh42 million (US$11m) with a bogus investment fund.

JH, 25, a Lebanese executive of the same bank, was convicted of aiding and abetting the fraud, and will serve six months. He was alleged to have pocketed Dh115,895.

Two other DIB employees, AG, 42, and SJ, 32, were found not guilty of aiding and abetting. AG, an executive, had been accused of facilitating the swindle, while SJ, a strategic planning manager at the bank, was alleged to have pocketed Dh105,000.

In an ironic twist, RM had deposited some of the embezzled funds with the Al Boom investment fund, whose chief executive, Abid al Boom, has denied charges of embezzling more than Dh900m from 3,700 investors.

According to the charge sheet, RM had been using forged documents since 2007 to persuade victims to put money in a non-existent investment fund.

The crime, which came to light in August 2007, was discovered after a Kuwaiti investor contacted the bank, enquiring about his profits. An internal auditor at the bank told prosecutors the bank set up an investigating committee after the Kuwaiti’s investment certificate was found to be a forgery.

Another bank customer, an Indian imam, MA, 50, also said he had been encouraged by RM to invest Dh300,000 in a new property fund offering returns of between 20 and 25 per cent.

RM later asked him to sign papers because the bank was updating its systems. The imam said he did so without reading them and a month later found Dh265,000 was missing from his account.

Prosecutors said RM had opened a bogus account under the alias Mark Elias. He transferred the embezzled funds into that account and then invested them in the names of his son and mother with the Al Boom properties fund.

A Sudanese legal adviser at the bank said when RM was questioned he admitted the fraud but claimed to have embezzled only Dh21m.

However further investigations revealed the total to be more than Dh42m.

The legal adviser said the other three defendants had all denied the charges when confronted. “SJ claimed to us that he did not work with RM but only had a three-year-old friendship with him,” he told prosecutors.

Dr Ali al Jarman, the lawyer representing SJ, said his client was implicated only because he had borrowed money from RM.

“The money was transferred to him from the disputed account and therefore he was held accountable,” he said.

“Currently we are trying to unfreeze his accounts, because since he was implicated all his funds were held by the authorities.”

Cost of traffic plan: time and money

ABU DHABI - AUG 26: Commuters are losing time and haulage companies losing money because of restrictions that limit the movement of lorries during Ramadan.

Traffic police banned lorries from entering the island from 7.30am until 9am and from 1pm until 3pm in a bid to ease traffic during the Ramadan rush hours. Police said the move has reduced the number of accidents from last year.

But many commuters who enter the capital near the times of day when the restrictions end say that they are being delayed by up to 30 minutes as large numbers of lorries begin to rumble into the city all at once.

And haulage companies say they are losing customers because of the delays, and they are having to pay drivers overtime to make deliveries at night.

Murtaza Salim, 32, a banker from Canada who lives in Dubai and drives to his office in Abu Dhabi every morning, said traffic had built up in the Al Raha beach area since the beginning of Ramadan.

“Near the construction in Al Raha where much of the area is blocked, the traffic gets really nasty,” he said. “On Sunday I saw around four or five accidents in the area, one of the accidents the car was turned upside down.”

Ghassan Deeb, 45, the Palestinian owner of a manufacturing company for firefighting equipment, said he was stuck in traffic for 20 minutes at Al Raha yesterday at 3.30pm after the afternoon restriction was lifted.

Lorry road times adjusted

The Roads Transport Authority (RTA) has announced an adjustment to the times when lorries are allowed on certain roads in Dubai during Ramadan.

Lorry traffic is prohibited from 7.30am up to 9.30am, from 1pm to 3pm and from 5.30pm to 8pm on the Al Maktoum and Al Garhoud bridges and on a series of roads, including: Al Khail, Al Wasl, Al Mankhool, Emirates, Sheikh Zayed, Safouh, Jumeirah, Ras Al Khor, Dubai-Al Ain, and Al Awir.

The ban on lorries in certain downtown areas runs from 7am up to 11pm. These areas include: Sheikh Zayed Road from Jebel Ali Port to Za’abeel Tunnel; part of Sheikh Rashid Road from Za’abeel Tunnel to Al Garhoud Tunnel; and Al Ittihad Road in the sector from Al Garhoud Tunnel to Al Mamzar Bridge, in addition to all downtown roads. Industrial areas are not affected by the ban times.

The areas banned for traffic 24 hours a day are Shindagha Tunnel, Al Maktoum Bridge and Business Bay Crossing.
“There were a lot of lorries and an accident,” he said. “But the traffic was mostly from the large number of lorries on the road.”

Mr Deeb said he travels to Dubai three mornings a week and returns after 3pm, yet was never stuck in traffic before Ramadan.

He said he is considering leaving Dubai after 5pm during Ramadan to avoid traffic.

Mohammed Radwan, deputy manager of Car Recovery, a company for transferring vehicles based in Dubai, said business has slowed since the ban started. Before Ramadan, heavy vehicles were also banned from entering the island, but for a shorter time between 6am and 8am. “We have to send more drivers at night since there is no night ban, which means we have to pay the drivers overtime,” he said. “And as a result we increase the fees for the customer to compensate for the extra costs.

“We explain the situation to them, some customers accept it, while others decide to shift to another company. However, when they go to other companies they find similar prices, because it is the same situation for all, so some come back to us and some we lose.”

Reji Alex, sales manager of Reji Shipping, based in Dubai, suffers a similar situation.

“The lorries have to wait for a long time until they open the road, and the customers are always complaining because of the delay.

“It is costing me more money. I don’t know exactly how much I lost but I did lose money heavily since the ban started.

“We also have to pay the drivers overtime because we send them at night.”

He said Abu Dhabi is full of business but because of the situation, his company is accepting fewer jobs.

Col Hamad al Shamsi, the head of the traffic and patrols department at Abu Dhabi Police, said the restrictions would stay in place.

“We won’t cancel the ban. It has proved very effective in reducing accidents.

“Even in Dubai and Sharjah they started applying it because they saw that this year the accidents we’ve had are not like last year,” he said.

“Last year we had accidents every day. This year they were very minor, mostly caused by motorists not leaving enough space between them and the vehicle in front of them.”

Regarding commuters who are suffering from the number of lorries piling up outside the island, he said they should be aware of the timings.

“We cannot completely ban the lorries from entering the island, they have to be released at some point.

“We have big projects and businesses, and these lorries have business inside.”


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Title: UAE : Northern Emirates Left in the Dark - Triggers Economic and Environmental Threat

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