Dubai and the possible growth options for its economy

Offices in Dubai11

The Economy of The United Arab Emirates represents a gross domestic product as of 2018 of US$102.67 billion. The Great Recession slowed the construction boom. According to Healy Consultants, Dubai is the top business gateway for the Middle East and Africa. The government has set up industry-specific free zones throughout the city in hopes of giving a boost to Dubai property. Dubai Internet City, now combined with Dubai Media City as part of TECOM (Dubai Technology, Electronic Commerce and Media Free Zone Authority) is one such enclave whose members include IT firms such as EMC Corporation, Oracle Corporation, Microsoft, Sage Software and IBM, and media organizations such as MBC, CNN, Reuters and AP. With the Dubai Media City (DMC) and Dubai Internet City (DIC) Free Zones being established in 2001, we have witnessed a cluster effect for technology, advertising, media and information (TAMI) companies that have located there. Although take up per tenant remains small (as regional hubs for Arabic content) we expect to witness growing demand as the millennia’s enter the workforce and drive change across the region. This change will undoubtedly lead to growth in the size of office spaces and the overall demand by the sector compared to traditional businesses. This will be exacerbated by disruptive technologies within the traditional sectors, including the financial sector. Today, Dubai has focused its economy on tourism by building hotels and developing real estate. Port Jebel Ali, constructed in the 1970s, has the largest man-made harbor in the world, but is also increasingly developing as a hub for service industries such as IT and finance, with the new Dubai International Financial Centre (DIFC). Emirates Airline was founded by the government in 1985 and is still state-owned; based at Dubai International Airport, it carried over 49.7 million passengers in 2015. The International Herald Tribune has described Dubai as “centrally-planned free-market capitalism.” Oil production, which once accounted for 50 percent of Dubai’s gross domestic product, contributes less than 1 percent to GDP today. Dubai became important ports of call for Western manufacturers. Most of the new city’s banking and financial centers were headquartered in the port area. Dubai maintained its importance as a trade route through the 1970s and 1980s. The city of Dubai has a free trade in gold and until the 1990s was the hub of a “brisk smuggling trade” of gold ingots to India, where gold import was restricted.

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