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Lombok Emaar Project Not Dead?

Jakarta Globe Retracts Earlier Reports That Emaar Deal in Lombok is Dead. Emaar Jakarta Office Remains Closed and Report of Emaar's Financial Woes Mount.

(3/21/2009) The reported death a US$600 million tourism project in Lombok as reported by Bali Discovery [see; Emaar Group Withdraws From US$600 Million Lombok Project] and based on a Jakarta Globe report, is being adamantly denied by high-ranking Indonesian officials who insist the deal is far from dead and that a three-month deadline extension has been negotiated by the government with the Dubai-based Emaar International Group.

The Jakarta Globe quoted an Emaar spokesman in Dubai as saying "the government of Indonesia and Emaar have extended a delayed joint venture agreement to get the project underway for another three months." The same spokesman, who requested not to be named, also said, "Emaar has met its contractual obligations and the Indonesia Investment Coordinating Board [BKPM] has now asked Emaar for an extension of time to meet their obligations under the joint venture agreement."

Signaling that all is not well with the transformational tourism project for Lombok, Emaar has closed its Jakarta office and will reportedly conduct its business from Dubai during the 3 month reprieve period.

Forming additional background to the unfolding drama, Emaar is reported to be in serious financial difficulties, recording a fourth-quarter 2008 loss of US$481.0 million precipitating a sharp fall in its publicly traded share price. The Jakarta Globe reports that the Dubai company has suddenly cancelled its annual general meeting without explanation.

In a correction published in The Jakarta Globe that newspapers has now retracted its earlier reports attributed to an Emaar employee which blamed corruption by local officials as one of the contributing causes to the termination of the Lombok project. In light of their latest reports, the paper now insists that neither Emaar Indonesia or its Dubai principals have made any announcement to quit the Lombok project.

Stay tuned, this promises to be interesting.