SOMETHINGels Towers of Babel
Confusing messages out of Dubai
I FIRST WROTE about Dubai back in 2001 under the headline “Almost 1 001 Arabian shopping nights” and ended the piece with the following: “Even if Dubai isn’t really ‘to buy for’ you might just be coaxed back when they finish the indoor skiing slope, the tropical jungle, the palm tree-shaped artificial island, add another dozen sky-scraping five-star hotels, waterworlds and of course shopping malls. After all, you can’t stand in the way of progress or a brilliant real-estate scam.”
The rulers of Dubai made good on their promises. The indoor skiing slope is finished; so is one of the palm island developments, as well as the hotels and shopping malls and then some. A refrigerated beach is coming; so is a theme park to put Disney World to shame. And the world’s tallest building by some stretch – Burj Dubai is nearing completion.
Yet on this visit I detected some evidence I may have been half-right with my real estate comment. Scam may be too strong a word, unless you consider the whole sub-prime mortgage crisis to be a scam and not just a sham. As Dubai experts never tire of telling you, the town wasn’t built with oil money but imports and exports account for its meteoric (for once the adjective is apt) rise. That’s only half true.
Yes, international trade – especially with the region’s pariah states (in the eyes of the West) such as Syria, Iran and Iraq – makes up the biggest chunk of its GDP, but with most of the world’s cranes as our very own former Deputy President has confirmed the big money has been poured into construction and real estate (and concomitant tourism). And that money comes from petrodollars that have been accumulating in their trillions in the Middle-East when oil was hovering at around $100/barrel.
Besides, if Dubai were built solely on import/export then by now it would have been suffering the same fate as Singapore, where the economy shrank an eye-popping 5% over last quarter 2008. Yet, the United Arab Emirates’ central bank says there won’t be a recession.
The most transparent part of the Arab world’s economy dominated by state-owned corporations and family businesses, the stock exchanges, may provide some real insight. An uncharacteristically sensational headline in one business daily read “Black Wednesday” after the region’s markets dropped to four-and five-year lows. A marked change from the usual front page fare dominated by ribbon cutting for a store sale and scale models of the latest mega-projects.
Tourism authorities point to a slight increase in visitors to 1,5m/month during the current peak winter season and the Dubai Shopping Festival. That’s hard to believe. As is much of the information coming out of the city-state. You can’t but notice how empty the concourses of Festival City were or how few people walked along the creek to inspect stalls, despite the glorious weather.
Chatting to the locals to get a real picture doesn’t help much, because there aren’t any. Expats make up more than 90% of the population and it’s in their best interests to keep suspending disbelief: as one long-time resident told me: “This place was built on PR.” The emirate is now making it easier for people to stay on even if they lose their jobs. Previously, once you were laid off you had to get back to your home country straight away.
After decades of creating fantasylands it seems Dubai is now becoming part of the real world. Or maybe not. Not when you look at the skyline in the morning mist and see the almost kilometre high Burj Dubai pierce the clouds.