Tags: Dubai, Gambling Industry

Solid Regional Growth Helps Emirates Telecommunications Report Profits of $1.5 Billion Through Year's First Nine Months

By , Money Morning •

By Mike Caggeso
Staff Writer

Dubai-based Emirates Telecommunications Corp. (generally referred to as Etisalat), the third-largest Arab telecommunications company, reported that profits for the first nine months of this year jumped 14% (or $490.2 million) to $1.5 billion, as the company added more customers in the rapidly growing area, Reuters reported.

Though Etisalat's coverage area reaches from Pakistan to Nigeria, domestic cell phone customers account for more 60% of the company's revenue. Overall revenue in the nine-month period reached approximately $4.17 billion. That represented an increase of 30%, the company said in a statement.

Etisalat isn't SEC registered and therefore isn't available for U.S. investors to buy into. Even so, the strong growth is important because Dubai is a market savvy U.S. investors are watching very closely.

"Dubai is one of the world's most sophisticated investors," and is investing heavily in Asia, with a special focus on China, says Keith Fitz-Gerald, a professional trader and Money Morning contributing editor who is a well-known expert on the Asian market and on Asian investments.

Dubai is making investments throughout the world via its state-run investment fund, and through other investments - such as a deal to buy into the U.S.-based gaming-and-hotelier MGM Mirage (MGM). That deal alone merits a close watch on Dubai by U.S. investors. But shrewd U.S. investors would do well to keep an eye on anything related to Dubai for hints on future moves, Fitz-Gerald said in a recent interview.

Indeed, Fitz-Gerald recommends MGM as a great way to benefit from Dubai's aggressive global investing plans, and on China's growth. [For Money Morning's investing report, "Here's Why MGM is a High-Profit Play on China," which includes an interview with Fitz-Gerald, please click here. The report is free of charge.]

And cell phone use - like housing statistics and Internet use figures - is an excellent indicator of economic growth.

But this growth is different than, say, China's. There, first-time cell phone users and home owners are enjoying newfound expendable incomes, indicating long and unpredictable growth. Dubai and neighboring Qatar are already wealthy. Though slower than China, the growth rates in these emirates have a more-solid foundation to build on because the growth is backed by higher per capita wages and savings.

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