UAE faces fresh wave of job cuts

Published: 11/1/2009 3:53:14 AM

By Maktoob Business

DUBAI - The UAE faces a second wave of job cuts that could continue into next year as companies suffer amid the economic downturn, local daily the National reported on Sunday, citing senior bankers.

“We are not out of the woods yet, by no stretch of imagination. We may see some corporate failures and stress in the corporate world,” Chris de Bruin, head of consumer banking in the UAE at Standard Chartered, was quoted as saying.

“Our biggest challenge (as consumer bankers) are people who have lost their jobs.”

The global financial crisis saw thousands lose their jobs in the UAE, especially regional business hub Dubai, with the real estate and financial sectors worst hit.

The financial crisis also saddled local lenders with billions of dollars in bad debts.

Banks lent aggressively during the boom years, but when the crisis hit many expatriates who lost their jobs returned home leaving their debts behind.

Bankers said a second round of layoffs could add further pressure to lenders’ battered balance sheets.

“It is a difficult time for consumer banks right now,” Suvo Sarkar, head of consumer banking at Emirates NBD, was quoted as saying by the National.

“The fourth quarter and first quarter of 2010 will be tough, but the second half should get better.”

The comments come a week after Deyaar Development, one of the country’s largest real estate companies, said it has slashed its workforce by 20 percent as it looks to cut costs amid the collapse of Dubai’s once-booming real estate market.

The 20 percent workforce reduction equates to around 60 staff from its total headcount of 307, according to business information website Zawya.

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