Moving Faster and Further Than The Rest
Sunil here folks to discuss the Dubai economy,
Frankly she finds this stuff boring!
Me on the other hand the business school nerd is turned on by subjects like economics.
Many still think (I was one of them before) that Dubai is an oil well like other Middle Eastern jurisdictions.
Transformation Into A Business HubBecause of the boom in construction, tourism and sports, Dubai quickly transformed into a busy business hub. Visitors realized the investment potential in Dubai as well as the citys future potential and place in the global economy. Thus started the Dubai business revolution.
Today, every single financial institution you can think of has a hub in Dubai. I work for a Fortune 100 Financial Services company in the US and often come across top competitors on a daily basis. I cant think of one that is not doing business in Dubai in some shape or form.
Geography A Big Aid to Dubai EconomyA big part of Dubais success can be attributed to its geographical location. Because of where Dubai is located on the worlds map, it is a convenience and easy place to meet for other countries. Its waterfront area also allows for docking and trade to take place.
Western manufacturers and banking centers all had main hubs by the Dubai ports. These ports are known to pass anything and everything. There is not much you can think of that doesnt take place at these ports.
Dubais easy going approach to trade and lax tax, tariff and quota laws makes trade easier and attractive for everyone. Dubai simple collects a small fee and allows its local residents to partake in trade.
Year after year, Dubai is voted on of the top cities in the world as an ideal trading hub. Dubai quickly became the apple of the Middle Eastern eye, bringing in all kinds of trade revenue. What did the ruler do with that money? You guessed it. He reinvested it into the Dubai economy and pushing its success further.
Dubai Stock MarketThe Dubai Financial Market (DFM) was established in March 2000. The market trades both local and foreign securities and bonds. In 2006 DFMs trading volume was approximately 400B shares in the amount of $95B (USD). Total market cap was near $87B.
The establishment of the DMF was a great move by the Dubai Government. It supports further diversification for the Dubai economy (away from trade, manufacturing and oil) and gives more confidence to the real estate investor.
Think about it, if you had a property in Dubai or wanted to buy one, wouldnt you be more comfortable knowing that The City will continue to remain strong and grow because of its diversified income streams?
Yes, just like that many others realized the same thing and begun to invest in real estate. Dubai experienced record breaking unprecedented real estate appreciation from 2004 onward. Rents rose close to 30% in a two year time span. Properties were becoming (and still are) more valuable by the day.
Things happened so quickly so fast that you would see skyscrapers crop up over night. Some of the largest projects today are in Dubai. Over 70% of the worlds cranes are active in Dubai today!
The Future of Dubai EconomyMark my words; this place isnt slowing down anytime soon. Dubai is considered one of the biggest tourist destinations today. The Jebel Ali Free Zone in Dubai (constructed in the 1970s) has the largest man-made harbor in the world.
And if that all is not enough, Dubai City is building mini cities that are focused on certain industries like financial services and IT. Areas like Dubai Internet City, Dubai Marina, Dubai Media City and Dubai International City are all examples of The Citys commitment to further progress. There are all kinds of industry specific free trade zones all over Dubai.
The Dubai Outsourcing Zone - Apparently there is now a region within Dubai City dedicated to companies who are heavily involved in outsourcing activities (hey that is my company too).
Companies can now set up offices in this zone and receive all kinds of concessions from the Dubai Government. Expect this region to grow as more and more companies are getting into outsourcing to cut costs.
Like I said, there is nothing stopping this sonic boom of success anytime soon. If you are well educated and/or entrepreneurial in spirit, now is the time to study the Dubai economy in depth and see if you can find an opportunity.
Trust me, its not hard. Opportunity is everywhere in Dubai and it is only increasing by the day. People are job skipping like grasshoppers and businesses are forming every day.
As far as large projects within the city are concerned, stay tuned for the Burj Dubai (most expensive and tallest tower of the world), Dubai Metro (biggest rail system in the world), The New Dubai Airport (biggest airport in the world), Dubai World Islands (man-made islands in the shape of the world), Hydropolis (underwater hotel), Dubailand (biggest theme park in the world), Sports City (all in one sports town) and the recreation of the 7 wonders of the world (bigger and better than the actual wonders) post 2009!
The Dubai economy is indeed a centrally-planned free market capitalism economy!
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