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Since the early 1s990s, Dubai has always sought to be the best and prides itself on its ‘firsts’. Dubai was the first Gulf emirate to wholly-own its own airline and within no time, others followed. It was also the first to build a championship golf course, an indoor ski-slope complete with snow and it was the first to create man-made islands depicting an Atlas of the World. It was even the first to announce it had cloned a camel.
The list of ‘firsts’ is too long to mention here but if imitation is the sincerest form of flattery, then Dubai should be proud of its incredible achievements to date.
This tiny place also boasts the world’s tallest hotel, highest building, and biggest mall as well as the world’s longest fully-automated rail system. Quite a few of Dubai’s neighbors have attempted to emulate the emirate’s strategies to put themselves on the global map, while it has been internationally acknowledged as a role model for the Arab world.
It’s little wonder that besides a string of accolades Dubai has also attracted envy during its phenomenal rise. So, it isn’t too much of a surprise that there were people out there who rather enjoyed all the negative attention that was being hurled in Dubai’s direction last year.
Those in the region who were naïve enough to fall for the ridiculous predictions of media pundits who said Dubai was destined to return to the sands, might have fleetingly believed that their own country was well-placed to grab the number one spot in terms of tourism, commerce and trade. Sorry to disappoint them, but that’s not going to happen any time soon.
For one thing, Dubai’s infrastructure, transport systems, highways, tunnels, malls, office towers, residential apartment blocks and hotels already exist. They were conceived and constructed at a time when money was in plentiful supply and relatively inexpensive to borrow. Banks today are reluctant lenders following the near collapse of the banking system that had to be rescued by governments.
As one financial expert has been quoted as saying, “I don’t see in the near future that any city can take the role of Dubai. Dubai has built its infrastructure when the money was cheap; when banks were still lending money. You might find nations that are willing to build and hoping to develop, but they won’t find the backing from the financial institutions. Dubai is unique because it is already built, i.e. metro, airports, highways, the Dubai International Financial Centre (DIFC)…”
Wannabe Dubai clones will need at least ten years to catch up, but by the time they do, Dubai will probably be in another place; a place still out of reach. That is provided it capitalizes on its strategic location in the center of the MENA and positions itself in terms of its open door policy, virtual tax-free status, minimal red tape, efficient services and business-friendly atmosphere. It’s also important for the emirate to continue displaying the confidence for which it is known and continue with its expansion plans.
As Dubai was hit by global downturn, so it will benefit from the worldwide revival. This month, the Institute of International Finance (IFF) indicated that the economy of the UAE is back on course and is expected to show a 2 percent growth this year. It also predicts that Dubai is expected to return to a growth trajectory in 2011 while confirming that the emirate’s debt restructuring challenges should be viewed in the context of the global financial crisis.
In the meantime, bar an extreme shock to the markets, the crisis is nearing its end.. Banks have reorganized and stabilized, new monitoring systems have been put in place and the major global markets, such as the Dow and the FTSE although still volatile have rebounded. Oil-producing Gulf States are already benefiting from the new mood optimism as oil prices have almost doubled since last year.
For Dubai, the key to a fast recovery is in the hands of the banks, which need to free-up capital and begin lending again. They represent the life blood for new and established businesses wishing to grow. The government should tell this sector in no uncertain terms to quit being tight-fisted.
Lastly, Dubai may be a city of ‘firsts’ but it’s much more than that. It offers economic freedom to investors, an open door to the global market for manufacturers and traders, advanced educational opportunities for students and, most of all, an enviable lifestyle for those lucky enough to live here. In short, there’s nowhere quite like it.
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