With its magnificent skyline and the home to The Burj Khalifa, the world’s tallest skyscraper, one has to wonder how Dubai transformed from a desert village into a modern metropolis and a global player in today’s economy.
The city has diversified into a knowledge-based and services driven economy since its founding. The incorporation of high levels of innovation and technology has served and still continues to be a catalyst in allowing Dubai to achieve its ultimate vision of becoming the ‘City of the Future’.
A Sustainable City
According to research by the World Bank, the UAE consumes 18.8 tons of CO2 per capita per year. Although nearly four times the global average consumption, the UAE has seen an impressive 75.2% decrease in its CO2 consumption between 1971 and 2013.The commitment of Dubai towards its sustainability goal can be seen through the developments of ‘The Dubai Sustainable City’ that runs on net zero energy as well as the Dubai Expo 2020 sub themes that promote mobility, sustainability & opportunity.
With the implementation of the Dubai Clean Energy Strategy 2050, the emirate intends to source 7% of the city’s total power output from clean energy by 2020, 25% by 2030 and 75% by 2050. Investments that flow into the Dubai Green Fund will be instrumental boosting the clean energy sector. Along with these sustainability programmes, the recent launch of the Dubai ‘10x’ initiative has placed the city at the forefront of embracing the mechanisms of disruptive technology in order to sustain its competitiveness and to achieve the ‘future-ready city’ status.
It is evident that Dubai has spearheaded the call to move away from its reliance on diminishing oil revenue to eco-friendlier approaches. In today’s world, as progress hinges on sustainability, it is vital that these long term visions facilitate the rise of greener communities and propel the economy forward whilst engaging and empowering the society of the city.
Despite Dubai being less dependent on oil than its neighbouring emirate, Abu Dhabi, the crude price slump squeezed business performance in the city resulting in drastic spending cuts being undertaken in order to balance budgets. Job losses were felt across Dubai’s most important industries- construction, banking and tourism which further fueled the economic slowdown.
However, in preparation for hosting the six-month long Expo 2020 event, Dubai has pressed forward with ambitious economic restructuring policies that have positioned the city as a global hub for transport, finance and tourism. It will be the ultimate showcase of exposing the new ideas Dubai has to offer. Furthermore, The Airports Council International have highlighted that the aviation industry in Dubai continues to stand strong taking advantage of its strategic location at the crossroads between Asia and Europe in order to provide air-transport and logistics services.
The plethora of unique and iconic attractions and accommodation options has served to be the key driver in creating an experience portfolio that is above the norm as well as keep up the ‘brand image’ of the city. All this ties into the figures of Dubai achieving a growth of 2.7% in non-oil foreign trade, increasing from Dh318bn in 2016 Q1 to Dh327bn in 2017 Q1.
The next step would be to convert transiting passengers into tourists which will further boost the sector and provide demand for goods and services, providing opportunities for local business to flourish.
The Ease of Business and Investment
One can agree that with an economic slowdown or crisis comes a lacklustre economic future, with unemployment being one of the paramount problems. It is evident that Dubai did indeed experience a series of redundancies across very many of its sectors during the oil slump period. However, with commitments to improve its broader economic health the Emirates’ financial centre showed its resilience and followed a different trend, growing by 14% in 2016 alone and seeing a 9% increase in the workforce within the central business district.
Since the establishment of the Dubai Financial Center in 2002, Dubai has run the DIFC strongly based on a market-led dynamics approach. The emergence of financial firms in the emirate has been on the rise as a result of the incentives which include world class infrastructure, open and free economic system, an extensive foreign trade network and a wide choice of potential business partners. Due to its financial attractiveness, Dubai has successfully attracted foreign talent as well as host several of the world’s leading technology and media companies.
It is now important for Dubai to maintain its position as an important gateway into the emerging markets across the Middle East, Africa & South Asia (MEASA) with strong macroeconomic policies that will link the UAE to global opportunities and key financial centres of the world.