THE ECONOMIC OUTLOOK FROM THE VISA WINDOW

UNCLAS ABU DHABI 000609

SENSITIVE
SIPDIS

E.O. 12958: N/A
TAGS: ECON EFIN CASC CVIS ELAB PGOV SOCI AE
SUBJECT: THE ECONOMIC OUTLOOK FROM THE VISA WINDOW

REF: A) ABU DHABI 568
B) ABU DHABI 361
C) ABU DHABI 11
D) 08 ABU DHABI 1221


1. (SBU) Summary: As business and financial circles debate the
extent of the economic downturn in the United Arab Emirates (Ref B
and C),Consular Section patrons have a decidedly negative outlook.
Beyond the impact on private Americans (Ref A),rising numbers of
third country national (TCN) visa applicants in the UAE are
reporting job losses, economic hardship, and canceled residence
visas. Many well-established firms and government entities are
reportedly avoiding serious difficulties, but newer companies and
contractors are struggling. Employees in the real estate,
construction, and hospitality sectors appear hardest hit. End
Summary.


2. (SBU) During a recent interview, a TCN working as an advisor in
the electricity and water industry claimed that his sector is among
the most stable in Abu Dhabi. He explained that Emirati and TCN
employment in government sectors like infrastructure, urban
planning, utilities, and higher education has remained stable.
Applicants report that the Abu Dhabi government, for example, is
continuing to hire and retain employees at a regular pace. (Note:
As in many countries, UAE local and federal government entities are
supporting the economy with fiscal stimulus (Ref D). End Note.)


3. (SBU) The broader downturn, however, is spurring competition in
the job market. TCNs who were previously highly paid are now
competing with colleagues to keep their jobs or maintain their
portfolios as companies look to hire other qualified TCNs who will
work for less. As one applicant's spouse described it, "They hired
me at a high salary because I'm British; now they want to let me go
because I'm too expensive to retain". Similar complaints have been
heard from other applicants from Visa Waiver Program (VWP)
countries.


4. (SBU) Many still-employed applicants said their portfolios were
increased 2-3 fold to compensate for colleagues who had been let go.
Some applicants were informed that they should take holiday leave
now because notices would go out this summer and unused vacation
time could be cancelled as contracts are re-negotiated. Another
applicant working at a well established US engineering consulting
firm explained that all of the firms' long term projects will
continue as usual and they are carefully selecting new projects to
avoid hiring new or firing long-term employees.


5. (SBU) Some applicants working in less stable sectors will list
themselves as employed on their application, but will describe
themselves as unemployed or "between jobs" when pressed by consular
officers to describe their work in greater detail. This is
especially the case with applicants working in the real estate,
construction, and hospitality sectors. Many unemployed applicants
are hoping to gain new employment over the summer and report plans
to stay in Abu Dhabi until their residence visas expire,
particularly if their housing has been pre-paid.


6. (SBU) When asked if they plan to work in the U.S., some
applicants are bold enough to admit that they might look for work
while on holiday in the U.S. During a recent interview, two Cuban
musicians who have been working at a local hotel for the past six
months revealed that they hoped to look for work in Miami while
attending a music festival. They did not overcome 214b. Applicants
who invested heavily in real estate - often planning to quickly sell
for a profit - are now saddled with debt they cannot repay. A year
ago, applicants proudly explained their real estate investments a as
means of establishing ties to the UAE. Even applicants of moderate
income were pooling money with friends and coworkers to invest in
new residential developments. The economic downturn has transformed
many investments from a financial tie to a financial burden.



7. (SBU) COMMENT: Anecdotes from visa applicants reflect broader
public and private economic sentiments in the UAE: concern, but not
panic. Despite the recent economic downturn, post's non-immigrant
visa workload is up 25 percent this year. While some TCNs may be
seeking economic opportunities in the U.S., other applicants'
business and vacation plans appear unchanged. END COMMENT.

OLSON