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