Economy of Dubai
- Preliminary Features
- The human toll
- Political risk
- The real economy: Economics and Debt
- Economic Policy
- The external accounts and debt
Formerly called the 'City of the Merchants', the town of Dubai is a powerful symbol of modernity and revival in the Middle-East today. Located on the border of the Persian Gulf, this city has attracted a mosaic of men and women for a few decades now, who have come from all horizons in search of a new life. This has led to the combination of diversity and dynamism.
Dubai is often regarded as the 'Las Vegas' of the Middle-East, due to its ability to attract capital, to develop quickly and to carry out extravagant projects. This city is distinct from its neighbors, and is in strong contrast with the practices specific to the Arab countries. The Arab countries are normally accustomed to discretion and are hostile towards any form of exuberance. Dubai is known as the City of all extremes, which may be a criticism or at the same time an adulation. Dubai has skilfully opened its doors to wealthy investors of the world through its unpublished tax concessions. But, this city also has an inhuman side, which involves the inhuman treatment meted out to the hundreds of thousands of workmen who come here to build the new world of Paradise.
The 'world city', as nicknamed by Omar Saghi I, is an ambition, and a colossal project focused towards the future. This city owes its development to a monarch, who realized that the future of his country could not indefinitely depend on oil resources. Hence, he invested capital on an economy he considered safe and sustainable. So, what is the key to success for this city? The answer is Luxury Tourism.
The specific case of the emirate of Dubai illustrates the complexity of Metropolisation and limitations. A unique city, an experimental model, difficult to transfer, which shows that the lack of human structure combined with a strategic geographic location can support the business, but this time at the expense of community solidarity.
It is comparable geographically with Hong Kong as it is in the center of economic activity in the Persian Gulf, under the influence of its neighboring states, but no action to it culturally. Indeed, Dubai pays little importance to foreigners, unlike the Chinese metropolis that has turned into a real asset and a driver for growth.
Remember, in Dubai, human relationships are primarily conditioned by market relations. Often compared to "boomtowns" as experienced by the United States of America or Asia, it is distinguished by its oriental influence and commitment to Islamic values always present even when arguably the emirate suffers from influence of the West.
One weakness of the metropolis is Dubai's dependence on oil, not because it is soon to be exhausted, but vis-a -vis the UAE and neighboring countries, which provide not only the workforce it needs, but also economic activity. A downturn in economic activity in the area, due to global growth or a war in the region, the city would face its realities: a colossus with feet of clay.
This paper will try to explain in this part the ins and outs of the business model in Dubai, and how it differs from that of other countries, but also the reasons behind this success.
Tags: Dubai; economy of Dubai; luxury tourism; center of economic activity in the Middle East