Posted on 02/21/2006 2:30:11 PM PST by new yorker 77
P&O battle fans Singapore, Dubai rivalry SINGAPORE/DUBAI, Jan 16 (Reuters) - The battle for British ports firm P&O between tropical city-state Singapore and desert emirate Dubai will decide who becomes the world's top ports group, but a much bigger issue is at stake: two cities' ambitions to be major hubs for shipping, finance and tourism. Dubai has long sought to emulate Singapore's success. Like Singapore, Dubai positions itself as a centre for regional trade and as a safe, clean place for expat professionals.
But much as leaders in the two cities admire one another, their shared ambition to be a port of call for travellers between east and west has put the two economies on a collision course.
Dubai won the first round when, two years ago, Dubai Port International elbowed out Singapore's state-owned ports group PSA with a $1.15 billion bid for the global port assets of U.S. firm CSX Corp. .
A bigger battle is now raging after state-backed Dubai Ports World offered 3.33 billion pounds ($5.9 billion) for P&O in November.
Singapore quickly jumped into the fray, as PSA and its state-owned parent Temasek [TEM.UL] bought P&O shares. The battle heated up last week when PSA, the world's second-biggest container port operator, trumped Dubai with a 3.5 billion pound bid approach.
If PSA's bid succeeds, it would overtake Hong Kong's Hutchison Whampoa to become the world's top port operator, controlling P&O's 29 container terminals in 19 countries. If Dubai wins, it would become the third biggest.
"Singapore's viability as a regional hub would be threatened" if Dubai were to win P&O," a Singapore-based economist said.
"Dubai is a competitor. Small cities quickly outgrow their domestic markets," added William Belchere, head of Asian economics at Macquarie Securities in Hong Kong.
"DUBAI'S MODEL IS SINGAPORE"
Since independence in 1965, Singapore has wooed world manufacturers and banks with tax breaks, a well-educated workforce and modern infrastructure.
"Dubai's model is Singapore. Whatever we do which (is) successful, they copy and do it on a larger scale," Singapore Senior Minister Goh Chok Tong said after a 2005 Middle East trip.
"In Dubai, whatever they do, they want to be the biggest," Goh told parliament, citing Dubai's ambitions to have the world's tallest building and largest shopping mall.
This obsession with superlatives in two small cities -- Singapore has 4.4 million people, Dubai 1.4 million -- is driving a flurry of investment and building, and stoking the rivalry.
So while Dubai's property projects include a luxury island built in the shape of a palm tree, Singapore wants to build a $3 billion casino whose design it hopes will rival Sydney's iconic Opera House.
Singapore even plans a waterfront skyscraper shaped as a billowing sail, just like Dubai's landmark Burj Al Arab hotel.
Such projects may help lure tourists, as Dubai and Singapore have few natural or cultural attractions and risk losing their role as stopovers with the advent of long-distance aircraft.
Both cities also need to boost their service economies.
Although the United Arab Emirates is a major crude exporter, Dubai -- one of seven emirates that make up the UAE -- has little oil. To compensate for declining oil reserves, Dubai has spent the past three decades investing in tourism, real estate, retailing, shipping, airlines and financial services.
Oil accounts for 6 percent of GDP and the ratio is shrinking.
Singapore too needs to diversify, as its decades-old mainstay of electronics manufacturing is under threat from low-cost China and the government tries to boost the pharmaceutical and biomedical sector, education, and even arts and entertainment.
GOING AFTER SINGAPORE GIRL
What both cities ultimately want is to be leading regional centres for trade, transport, finance and tourism.
Long before they clashed over ports, the two merchant cities started competing in the airline and airport business.
Dubai has been pumping money into its flag carrier, Emirates [EMIR.UL], one of the world's fastest growing airlines, and is challenging Singapore Airlines -- famous for its sarong-clad hostesses -- in many of its key markets.
"Dubai could be a threat because it is building up its airport, and it has built up a strong airline, so it could be an aviation hub," said Zafar Momin at Boston Consulting Group.
Dubai has earmarked $4.1 billion to expand its international airport and aims to handle 60 million passengers a year by 2010.
It more than doubled the number of passengers from 9.7 million in 1998 to 21.7 million in 2004. In the same period, Singapore's Changi airport had a 28 percent increase, from 23.8 million to 30.4 million passengers.
It's not just in the transportation sector that Singapore needs to watch out. Dubai's drive to expand its role as a financial centre beyond the Gulf has taken it into direct competition with Singapore for a share of Asia's economic boom.
Officials say they want Dubai to ride the Indian boom to financial stardom, much as Hong Kong did with China.
Dubai hopes the Gulf's abundant liquidity will persuade companies from outside the region to list on a new bourse in the dollar-based Dubai International Financial Centre.
Glossy advertisements in the run-up to the launch of the exchange in September showed a world map with just four cities: New York, London, Hong Kong and Dubai.
Singapore, like Tokyo, was conspicuous by its absence. ($1=.5632 pound)
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The link is this:
http://asia.news.yahoo.com/060118/3/2e7ax.html
muslim pissing contest
So it seems that Dubai is already here?
Folks, P&O is selling control of container terminals not entire ports.
mark for reference
"muslim pissing contest"?
perhaps on dubai's part. but singapore is NOT a muslim country. i was born and raised there 'til i was 13, so i would know. still have maternal rellies there, too. gorgeous place. world's best food, airline, shopping, nightlife, history, etc... singapore is run by ego-maniacal, professional, millionaire politicians. majority of whom are ethnic chinese - majority of whom suffer from 24/7 'little man syndrome'. they are never to be outdone. they've lost the battle with dubai over our ports, so i highly doubt they're going to go to sleep on this one w/ p&o. btw, tropical island beats a desert by the sea ANY DAY. and not everyone walks around wearing bedsheets 24/7. I LOVE TIGER BEER!
Best Airline, OK, maybe that, SQ on a good day is pretty darn good :). But best food, shopping, nightlife, history??? Dude, you need to get out more.
And Tiger Beer is from Thailand ...
ok, so maybe i got a little excited about singapore's good points. i was BORN & RAISED there and still have family there. it may not top the list at #1, but singapore does have an exciting, albeit expensive, nightlife. the food is fabulous because it encompasses aspects from all the ethnic groups. the history is interesting indeed. pardon me, i am not a DUDE. i lived there & have visited often over the years since. so, i DO have some idea about what i'm talking about. btw, SINGHA beer is from thailand. TIGER BEER is a singapore/malaysia venture.
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