Tuesday, January 31, 2006

Postcard from Dubai

If you think that the real business to be in is providing cranes for the Celtic Tiger skyline boom in Dublin, then you should take a look at Dubai City.

The second-largest of the group of sheikdoms that make up the United Arab Emirates, Dubai's main city and port already has a set of skyscrapers that rivals many of the world's most modern capitals, and is hard a-building at least as many more.

Each one is different. Each vies to be bigger in some way than its neighbours. And among those which are being constructed is what is planned to be the largest tower building in the world ... until another already in the gestation stage not too far away tops it.

Even so, nobody's telling just how tall the Burj Dubai tower, growing at a storey a week, will be. Anything between 700-1,000 metres is being guessed, and wagered on presumably, in this little country where gambling on fine horses and camels is a dizzying experience amongst its wealthy ruling classes.

The rush to build is all part of a plan to add value to Dubai's current massive earnings from its oil production.

The Al-Maktoum rulers, well known in the Kildare area for their horse breeding and racing interests, have been judicious in their infrastructural investment from the proceeds of the depleting black gold.

One estimate is that the resource will be largely used up by 2010. Given that oil was only discovered there in 1966, it will have been a very short-term moneyspinner when the pumps splutter to a stop

But money attracts money and business. And expatriates. Today an estimated four-fifths of the population are not native to the emirate. A large chunk of those are from further east, mainly India and adjoining countries, running a high proportion of the shops and small service businesses. There are also many Philipinos, working as domestics and in the hospitality industry.

And then there are the 'suits'. Lots of them.

Up to now, any of the international global businesses that wanted to set up shop here had to take on a 'sponsor', a native Dubai businessman who would, as part of the deal, retain 51 percent of the profits from the enterprise.

However, with a view to doing something similar to what Ireland achieved in the International Financial Services Centre in Dublin, a complete skyscraper suburb is being built which will be a 'free' area, to attract businesses which don't have to locate in Dubai but could find it a strategic move with the right incentives. And they will not need to take on a 'sponsor'.

The enterprise is named Internet City. Presumably Dubai is hoping to provide for clients in Europe and the Middle East what was achieved by Singapore and South Korea in their part of the world, providing high-tech IT facilities for the global business 'village'.

But other ideas are being pushed too. A massive 'healthcare city' is under construction just around the corner from the hotel where I'm writing this. Healthcare 'tourism' is already well established in places like Thailand, and Dubai's business leadership clearly sees similar potential.

It seemed to me in my short stay, while here for an initial evaluation of Volvo's new generation C70 car (above), that there's some impetus for the establishment of golf resorts and similar activities. There's already a Formula 1 quality race track. And certainly the city is working hard to become the 'shop till you drop' capital of the region, with some major malls (below) already attracting hundreds of thousands of credit card wielders.

One of them even has its own ski 'resort' attached, a completely indoor set of ski runs, even a 'black' one, using some 6,000 tonnes of manufactured snow, and where you have to wear all the cold-weather gear you'd need in the Alps.

Shoppers in the mall itself can even watch the activities, including a snowboarding course. through glass.

Prior to the discovery and exploitation of its oil, Dubai was a key trading port, and that's still the case. Much of the business of the city is 'import-export' transhipment. But among the various goods sold locally, the place is probably most famous for its gold, which those who know about such things claim is very good value.

There's a special area of the city which specialises in this, the 'Gold City', a warren of little streets where every shop is a jewellery store and a haggler's delight. And where every few yards on the sidewalk one is also accosted to buy fake 'designer' watches. The mobile vendors are persistent, and you must develop a clear attitude of 'no thank you'; the slightest waver and they'll have you.

Dubai is a country free of income taxes for its citizens, and also for its resident guest workers. The oil pays for all. There's free education, apparently for everyone, and free healthcare for those living and working here.

The emirate is also tolerant of other than Muslims and their cultures, with freedom of worship for Christians and others allowed, though mosques naturally predominate in the low-rise suburbs.

Alcohol is even available, in licenced hotels, but an individual wishing to buy alcohol for home use must also get a licence. And in the hotels, it is very expensive.

Unlike in some neighbouring Arab countries, there's no bar on women driving, but in two days of touring and driving we saw very few women behind the wheels of the -- mostly large SUVs -- cars, the many, many cars in a country where petrol is so cheap that only trucks use diesel. That said, it was clear that the very traditional Arab attitudes to women and the more western ones are able to co-exist. It is, apparently, the husband/father who decides what status his family will assume.

Two or three days is no time to judge anywhere properly, or comprehensively. And didn't give me a chance to look closely at the downsides of a system which is in effect a 'benevolent dictatorship'. Democracy as we know it today is not traditionally a comfortable fit in the Arab world.

But with Gulf Air already running direct flights from Dublin to Bahrain and connections to Dubai, and Aer Lingus starting its own three-times-a-week service directly to Dubai next month, many more Irish people will get the chance to see for themselves a rapidly changing part of the mysterious Middle East.

Some Irish high-flyers already do business here, even have homes here. It will be interesting to see how many of the Celtic Tigers will be establishing themselves in Internet City.

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