Over $18bn spending at stake as Dubai awaits Expo 2020 news
Winning bid to host the six-month world fair is set to be revealed on Wednesday
Residents of Dubai will on Wednesday discover whether the city has won the right to host the World Expo 2020, with expenditure on the event likely to reach several billion dollars if the emirate's bid is successful.
The UAE emirate is competing with cities in Turkey, Brazil and Russia to host the event.
Despite uncertainty on the economic benefits Expo 2020 may bring, experts agree that a winning bid would accelerate infrastructure projects, as well as promote Dubai and boost its tourism sector.
According to HSBC, overall expenditure to prepare the emirate for the six-month global fair may exceed $18.3 billion.
Of this amount, the Dubai government is expected to spend $1.4bn to expand the Dubai metro, and $1.7bn in operational expenses during the event.
The bank forecasted that $9.5bn of spending would come from the private sector.
Dubai’s real estate and banking sectors are most likely to benefit from a winning bid, as HSBC estimated that UAE-based banks have the capacity to lend a further Dh312 billion in real estate loans until 2017, Bloomberg reported.
On the other hand, concerns were raised over the formation of another property bubble, similar to the one in 2008 that led to a crash in the real estate sector.
Bank America forecasted a 0.5 percent growth in Dubai economy between 2016 and 2019, and 2 percent growth during 2020 and 2021, in the case of a winning bid.
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