Dubai launches $545m canal project

Dubai has revealed plans for a AED2bn ($545m) downtown canal project that will span more than 80,000 square metres and encompass new shopping and entertainment centres, more than 450 new restaurants and four new hotels, reports the WAM news agency.

The three-kilometre (1.9-mile) canal is to extend from the Business Bay district to and will cross the Sheikh Zayed Road, between Safa and 1st Interchanges, and will pass across Safa Park and Al Wasl Road and terminate at the Arabian Gulf.

The development, which is due to be completed in 2017, will allow for the construction of deluxe residences and private marinas for boats along with pedestrian pathways and cycling tracks and is expected to attract up to 22 million visitors per annum.

Authorities did not say how the project will be financed. Billions of dollars of real estate projects have been unveiled by the government and state-linked firms over the past year, triggering a bull run in the stock market but causing concern at the International Monetary Fund.

The IMF warned in July that overspending could leave Dubai vulnerable to another debt crisis if global market conditions deteriorated. Dubai officials say they have brought the emirate's debt under control and are investing to take advantage of strong economic growth expected in the region over coming years.