LET­TER FROM DUBAI

Dubai is ad­dress­ing some of its is­sues by ex­pand­ing the scope of its su­perla­tive tar­gets

The Peak (Hong Kong) - - Contents - SO­PHIE KALKREUTH New York-based free­lance writer, ed­i­tor and wan­derer So­phie Kalkreuth re­ports on the lat­est trends in lux­ury travel, real es­tate, de­sign and ar­chi­tec­ture.

Dubai, I dis­cover on a re­cent visit, is still in the busi­ness of build­ing megas­truc­tures. In ad­di­tion to the world’s tallest build­ing and largest mall, Dubai is now home to the world’s largest pic­ture frame, a gilded rec­tan­gu­lar struc­ture that stands 150 me­tres tall, 93 me­tres wide and frames views of the old city to the north and city sky­scrapers to­ward the south. In­side the build­ing, a neon “vor­tex” tun­nel ush­ers vis­i­tors into an in­ter­ac­tive, aug­mented re­al­ity exhibition on the his­tory and fu­ture of the city – a fit­ting for­mat for a me­trop­o­lis that might best be de­scribed as hy­per real.

If St Pe­ters­burg was born as a Re­nais­sance per­spec­tive draw­ing erected on a swampy tab­ula rasa, Dubai is a real-life Sim­c­ity video game, a fan­tas­ti­cal me­trop­o­lis that emerged on the desert straight from an ar­chi­tect’s com­puter-as­sisted de­sign soft­ware. But although it was built from scratch, Dubai nonethe­less in­cludes com­mon de­sign mis­takes: a lack of den­sity and con­nec­tiv­ity, de­pen­dency on cars, and a no­table ab­sence of walk­a­ble neigh­bour­hoods and pub­lic spa­ces.

So to be more than just a city of big build­ings, it ap­pears Dubai is ad­dress­ing some of its is­sues by ex­pand­ing the scope of its su­perla­tive tar­gets. To boost its live­abil­ity rank­ings, the Emi­rate has ap­pointed a Min­is­ter of Hap­pi­ness whose mis­sion is to make Dubai the “hap­pi­est city in the world.” To in­crease cul­tural vi­brancy and pub­lic space, the city has built d3, a “cre­ative com­mu­nity” it hopes will be­come like Lon­don’s Shored­itch, and in­stalled pub­lic prom­e­nades along the wa­ter­front. To de­crease de­pen­dency on oil rev­enues, the govern­ment has cre­ated the DIC “in­no­va­tion hub”, ded­i­cated to new ideas in me­dia, tech­nol­ogy and smart ed­u­ca­tion. By the time it hosts the World Expo in 2020, Dubai aims to be the “smartest” city in the world.

The govern­ment has also an­nounced it will con­vert its World Expo site into a ready­made com­mu­nity called “District 2020”. The tech city will fea­ture one of the world’s first 5G mo­bile net­works and the govern­ment is ac­tively tar­get­ing com­pa­nies work­ing in tech and in­no­va­tion to oc­cupy some of the 1.5 mil­lion square feet of com­mer­cial space al­lo­cated to the site – Sie­mans has al­ready agreed to build a new lo­gis­tics hub in District 2020, and con­sul­tancy firm Ac­cen­ture is also in­volved.

“Our am­bi­tion for Dubai is to be a hub for in­no­va­tion,” says Mo­hammed Al Shaibani, CEO of In­vest­ment Cor­po­ra­tion of Dubai.

Lofty – pos­si­bly ec­cen­tric – ob­jec­tives are rou­tinely set from on high in Dubai. The city is to have “the world’s first blockchain-pow­ered govern­ment” by 2020. The Roads and Tran­sit Ad­min­is­tra­tion aims for a quar­ter of all rides in Dubai to be driver­less by 2030. The city also aims to be “the world’s 3D-print­ing hub,” and to build a Mar­tian colony by 2117 – an ef­fort that be­gins with build­ing a 1.9-mil­lion square foot Mars sim­u­la­tion cen­tre.

But given the scale and speed at which Dubai man­aged to fash­ion a global busi­ness hub in the mid­dle of the desert over the last two decades, there’s rea­son to be­lieve it will de­liver on its prospec­tive goals. And the govern­ment is cur­rently pour­ing bil­lions of dol­lars into in­fra­struc­ture and tech in­no­va­tion (43 per cent of the 2018 bud­get is fund­ing in­fra­struc­ture projects).

To foster a start-up cul­ture, the govern­ment has also set up in­cu­ba­tors like Dubai Fu­ture Ac­cel­er­a­tors (DFA), an amal­gam of en­tre­pre­neur­ial hub and govern­ment bu­reau­cracy, where start-ups com­pete to help ac­cel­er­ate govern­ment in­no­va­tion. The com­pany Civil Maps, for ex­am­ple, which de­vel­ops 3D map­ping soft­ware for pos­si­ble use in au­tonomous ve­hi­cles, was in one of the first co­horts at the DFA and later worked with Dubai’s Roads and Tran­sit Ad­min­is­tra­tion.

Com­pa­nies, which are cho­sen based on a “mini-vc-anal­y­sis” of their vi­a­bil­ity, have also in­cluded Hy­per­loop One. The head­line grab­bing high-speed train is now be­ing de­vel­oped by Vir­gin and the Dubai Roads and Trans­port Author­ity (RTA) and is set to hur­tle pas­sen­gers from Dubai to Abu Dhabi in lev­i­tat­ing mag­netic pods through low-fric­tion pipes at 1,220 kilo­me­tres per hour, re­duc­ing travel time from 90 min­utes to 12.

“Dubai keeps mov­ing up on the list of the world’s eas­i­est places to do busi­ness”, says Taimur Khan, a se­nior re­search an­a­lyst at con­sul­tancy Knight Frank. “It takes all of five min­utes to start a busi­ness here.”

Ac­cord­ing to mar­ket in­tel­li­gence firm CB In­sights, start-up in­vest­ment in the UAE ex­ceeded US$1 bil­lion in 2016. The same year saw the num­ber of pri­vately owned start-ups re­ceiv­ing eq­uity fund­ing in­crease by 45 per cent.

But de­spite the lofty ob­jec­tives, bar­ri­ers re­main. Dubai’s le­gal and reg­u­la­tory frame­works still lag be­hind the tech ecosys­tem’s re­cent growth, and it is there­fore risky for a com­pany to op­er­ate with­out hav­ing most of its own­er­ship held out­side of the UAE. Bank­ruptcy laws, for in­stance, are in the process of be­ing re­formed, but pro­tec­tions aren’t nearly as ro­bust as in coun­tries like the US. Even in­side the city’s ‘free zones’, the cost of a com­pany’s fail­ure is po­ten­tially steep.

Dubai has a few emerg­ing VC firms – Wamda Cap­i­tal, for ex­am­ple, launched a US$75 mil­lion Mid­dle East-spe­cific ven­ture fund in 2015 – but the ecosys­tem hasn’t de­vel­oped to the point where big-money ex­its are all that com­mon. And the city has yet to pro­duce a true uni­corn of its own, although Ca­reem, a lo­cal Uber-style ser­vice is said to be val­ued at around US $1 bil­lion.

But per­haps the deeper ques­tion here is whether ab­so­lute mon­archs can re­ally build a 21st-cen­tury tech ecosys­tem through top down de­crees. Cities such as Ber­lin, Mel­bourne and Stock­holm, rec­og­nized for their cul­ture of en­trepreneur­ship, are also cul­tural hubs known for open­ness and ex­per­i­men­ta­tion. Cre­at­ing a tran­sit hub is one thing – Dubai’s air­port is of­fi­cially the busiest in the world for in­ter­na­tional pas­sen­gers – but start-up cul­ture, much like hap­pi­ness, is a lit­tle harder to en­gi­neer.

DUBAI IS AD­DRESS­ING SOME OF ITS IS­SUES BY EX­PAND­ING THE SCOPE OF ITS SU­PERLA­TIVE TAR­GETS

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