Dubai is a good lesson on what to offer the world when you’ve got nothing to offer…
So I’m on the road again. It’s a mix of business and pleasure, but I’ll get to that later.
Right now, I’m writing this to you from the comfy lounges of Dubai’s international airport. I’m trying to keep a low profile. A couple of years ago a man was deported from Saudi Arabia for being too sexy. Apparently that sort of thing doesn’t go down so well over here.
This is his picture.
You’ve got to admit there’s a striking resemblance. So I’m keeping my head down and my nose clean.
I’ve just had three days here in Dubai. That’s a quick tour of duty, but it’s enough to leave your jaw on the floor. This city is incredible. It’s really like nowhere else on earth.
The first thing that strikes you is the immense wealth on display. It’s next level. From massive sky-scrapers to man-made islands.
But it doesn’t stop there. It goes all the way to ridiculous town.
For example the Dubai police fleet includes Lamborghinis, Ferraris, and even Bentleys.
Though its not all that clear who they’re chasing. Dubai is ranked as the 5th safest city in the world – and you get the sense wandering around that you don’t want to find yourself on the wrong side of the law here.
The locals also have a deep love of gold. One in five purchase gold each year. 40% of physical gold traded in 2013 occurred in Dubai. I read a stat that said the combined weight of annual gold traded amounted to more than 354 elephants! I don’t know when elephants became the standard measure of the gold trade, but there you go.
There are even vending machines that dispense gold bars.
(Did I mention how little crime there is?)
Dubai Mall is the largest shopping centre in the world, and DubaiLand, when it opens, will be the largest theme park in the world – twice the size of DisneyWorld in Florida. It seems they just can’t resist the allure of all those white-elephants. Earlier this year a state-owned firm announced plans to build the world’s largest Ferris wheel, on – you guessed it – another artificial island.
Seriously, it’s nuts. So much money. So much gold-plating (literally) of ridiculous things. How do they pay for it all? Dubai government bonds are unrated and there’s no data on how much public debt Dubai actually has…
But what’s really strange is when you try and get under the hood of the economy and figure out where all this money is coming from.
My first thought was of course its oil. But then I found out that Dubai ran out of oil years ago, and oil trade only accounts for 6% of GDP.
That’s not enough to build golden palaces with.
The key to Dubai’s success is that it has successfully positioned itself as a pivot point for massive amounts of global trade.
Dubai is now a regional and global hub. A massive 70m passengers used Dubai airport – more than any other airport in the world. But hold on to your hats because the airport is expanding to a capacity of 200m!!
The port at Jebel Ali is hands down the busiest in the Middle East, and it’s on track to be the biggest container port in the world by 2030.
This hasn’t been an accident. Local officials saw the writing on the wall as the oil reserves ran out, and made trade a focus. It has 22 “free zones” – where international companies can operate with little regulation and minimal taxes. The free-zones are based around particular industries. The financial free zone even has it’s own judicial system.
There are also no income taxes here. Though that doesn’t mean that it’s a capitalist utopia. There are many state-owned enterprises, and there is a keen focus on job creation. (Someone told me that you can get a job at a construction site as a ‘red cone’ if you can’t find anything else!)
And there’s a certain social cohesion that drives things along. They managed to build an above ground train network, consisting of 42 stations, in less than 18 months! How’s that for efficiency?
The other weird thing about Dubai is the population. Locals account for only 15% of the population, and almost none of them work. They seem to live like landed gentry. Bangladeshis and Indians seem to be doing the manual labour, while Chinese, Europeans and Americans are running the rest of the show.
(There’s a legend of foreigners just dumping their cars at the airport as everyone left during the 2009 financial crisis.)
So Dubai is a ‘merchant’ city. That is, it doesn’t produce anything. Rather, it just facilitates a whole lot of economic activity. And the rewards from that role, it seems, are lucrative.
As we transition from the mining boom and the world turns its back on coal, there might be a lesson here for Australia…
Anyway, I’m on the road. I’ve developed the Knowledge Source model into something I think I can take to the world. So it’s a bit of a road show. But don’t worry. I’ll still find time to duck back to Greece for some quality RnR.
Next time you here from me, it’ll be from there.
Been to Dubai? What did you make of it?
Justin says
Dubai looks shiny and flash from a distance, but most of the expensive look and feel is similar to a trip to Disney or Universal studios, as in its all a faucard. Foam covered building which are highly flammable causing the loss of a couple of builds due to fire.
From a visitors experience, the quality of food and service at restaurants and clubs is superb and the experience is the same as you would receive in the best clubs and restaurants in London/Paris/New York for a fraction of the money. Not to mention the super cars parked outside the front doors. Buddha Bar, Toro Toro, Dubai Marina Yatch Club sit out and enjoy a drink overlooking the Spectacular view. This in only to name a few.
There is plenty of attractions to see, food to eat, bars to drink at, some of the largest shopping malls in the world. Atlantis hotel on the palm islands is also worth a look. There are two great water parks, Wild Wadi and the second on Atlantis.
Definitely worth a visit for the experience.
grewster says
I find the Airport a little bland and vast, but have only stopped between flights , I’m sure the city itself would be something to see and it is on my list to do.
Jeanette says
Noticed that alot of flights go via Dubai to get to Europe.
Wondering why. Is it safe for females?
ron goddard says
never been there…one day soon maybe. but you are right it would be good for australia to be a merchant port country with little taxes etc. but again we have myriads of government quangos and servants who cling to their parasitical jobs. this means huge government expenditure and delays in approvals until 26 quangos give the green light. its a quagmire of ineffiency. i think that our ‘leaders’ could investigate the probabilities.
Jacqueline says
Dubai is madness and has to be seen to be believed. If you can think of it, they have it. How about the snow ski slopes inside the shopping mall, great to get your ski legs in the desert before you head of to Europe! A massive city completely built in the middle of the desert, sand everywhere except where those rich folk can afford the water to grow plants, trees or grass. A visit makes you appreciate green plants of any kind when you get home. Yes migrant workers everywhere, the only locals we found working were the Bedouins taking the desert 4wd safaris, even the belly dancers are from Egypt. The “..cars left at the airport..” story is no legend, its fact and still going on because bankruptcy isnt an option – pay your debts or go to jail (or escape the country). Highly recommend a visit to Dubai for a holiday or short stop over. Its fascinating (and yes, safe for females, unlike many cities in Saudi Arabia or other Middle East destinations)
Elizabeth says
http://muftah.org/it-is-time-to-stop-misrepresenting-what-is-happening-to-migrant-workers-in-the-uae/#.V7_xKv5fy70
Under the “kafala,” or sponsorship system, employers in the UAE are able to exercise substantial control over their workers’ legal status, including confiscating passports.
Whist over there, had many conversations with workers, taxi drivers confirming the modern slavery
described in the article. Great city, ha?
Traveller says
Dubai is definitely the hub of the global air network. If you look at the map (or globe) you’ll see that Dubai is just about the centre of the populated world. Last year when I passed through Dubai there were flights to 59 countries – and counting.
I’ve stopped over in the past and it’s an amazing place, but look under the façade it is not so pleasant. If you go away from the glitzy centre even the local Arabs who are not part of the tribe can be seen begging on the street. Even the beautiful floral displays are pulled out and replanted each year! It is capitalism gone mad.
John mentioned the top business people are all westerners and Chinese and at the bottom are the Indians and Bangladeshis. But John left out the guys in the middle – Filipinos run the shops and work in the offices and act as maids.. I have worked in the Philippines and talked to the people there. The working condions for the guys and girls in the middle and bottom levels are appalling. Passports are confiscated and many of the girls are abused. There is no way to escape.