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Large parts of the UAE emirate of Sharjah has been suffering from prolonged power cuts. Sharjah is located just north of Dubai and is home to a large number of expatriates who work in Dubai and commute to Sharjah.

 

Calls to Sharjah Electricity and Water Authority (Sewa) are unanswered, residents said.

 

Temperatures average over 45 degrees and with high humidity makes living without air-conditioning unbearable. With Ramadan around the corner and the weather bureau predicting very high humidity even in the nights, local government-controlled press reported that some residents are thinking of moving to neighbouring emirates.

 

Doctors have warned that the suffocating atmosphere in apartments will stress out people, especially children and the elderly. But going out in the hot sun can lead to heatstroke.

 

July 21, 2010

 

 

Analysis and Forecast: Increasing Risk

 

Sharjah is the UAE’s third largest emirates, after Abu Dhabi and Dubai. It is home to a large expatriate community, with many of the expatriates working in Dubai living in Sharjah due to lower expense. Sharjah is also home to a large industrial areas.

 

The Sharjah real-estate sector has been particularly badly hit as a result of the real-estate crash in Dubai, as lower rents in Dubai has resulted in many residents in Sharjah to move to Dubai. The repeated power cuts, unprecedented in their scale, have already reportedly led to many residents fleeing the emirates to Ajman and Dubai. There are reportedly and expectedly massive losses to businesses, whilst many of the hotels reportedly being totally empty.

 

The news of the power cuts will add further pressure on the Sharjah economy, which is closely linked to Dubai’s and will result in losses in the real-estate, tourism, industrial and retail sectors. The scale of the damage is too early to count as the cuts are still ongoing, but is likely to be significant. The seriousness of the situation is emphasized by the fact that the heavily government-controlled press have given the story prime coverage.

 

Labour camps, where tens thousands of labourers live, have been particularly hit hard. Unrest amongst labourers is reportedly increasing and this may not only have implications on civil unrest, but likely  to further damage productivity.

 

In addition to the direct damage to the Sharjah economy, the power cuts highlight the issue of power shortages in the UAE generally, and the inability of the country to cope with increasing populations. Whilst the UAE have decided to generate nuclear energy, this is likely to take several years before this can add sufficient supply to the highly stretched demand. Similar power cuts are to be expected, and likely to increase in coming years, before additional supply is provided, particularly in the summer months when demand for electricity rises. The proposed combined GCC grid, if it starts, should help alleviate many of those challenges, that not only faces the UAE but other GCC states. The UAE is a major contributor to the grid as shown in the following figure: