In just a few decades, Dubai has become a force to reckon with when it comes to commerce, high-end culture, investment, a tourism centre. The city is no longer a project or an experience but has become an independent civil entity that is being featured in multiple travel magazines and television networks. This has not always been the case. We take a journey through history and discover how Dubai evolved into what it is today.
Ancient Dubai history
Dubai’s history can be traced back to 3000 BC. According to archaeologists, people may have settled in the city as far back as the Bronze Age. Between the 5th and the 7th centuries, evidence points out that Jumeirah might have been a trade route that linked present-day Iraq with Oman. The residents’ livelihoods were centred on boat-building, pearling, and fishing.
Europe’s influence on the city began in the 16th century when the Portuguese started showing interest in Dubai’s trade routes.
Dubai between the 18th and 20th century
In the 18th the Bani Yas tribe settled in Abu Dhabi and took up Dubai’s leadership. However, the city later became a dependency but was rocked by multiple tribal wars. Britain began negotiating with Dubai’s local rulers on maritime truces in 1820. This is what led the area to be called the Trucial Coast.
In 1833, a member of the Bani Yas tribe, Maktoum Bin Bani settled in the Shindagha Peninsula and declared the city’s independence from Abu Dhabi. To this day, his dynasty rules Dubai. In the 1870s, the city became the Gulf coast’s primary port with the main economic activity being pearling.
In 1902, Iran imposed heavy taxes on traders using the Lingeh port causing most of them to migrate to Dubai. This, along with the discovery of oil in the Trucial States and Fateh Oil field in 1950 and 1966 respectively boosted Dubai’s trade.
What fueled Dubai’s growth?
Those who admire Dubai attribute its success to various reasons. While some claim it came about as to foreign investors such as the Arab people, others claim it is as a result of oil processing. However, oil accounts for a meagre 6% of Dubai’s economic growth due to foreign exchange. Some of the key reasons behind the city’s success include:-
Tourism
Dubai was ranked 7th among the top 10 most visited cities in the world in 2018. Tourism is a key sector in Dubai as it accounts for a huge percentage of the foreign exchange the city receives. According to the Department of Tourism and Commerce Marketing (DTCM), Dubai’s tourism sector was estimated to be worth Dh109 billion.
The city fascinates tourists due to the diverse culture, unique architecture, zoos, ski resorts, theme parks, and circuses, among others. Dubbed ‘the City of Gold’ due to the multiple retail outlets with precious metal, it is no wonder that Dubai receives hordes of visitors.
Experts estimate that UAE’s hospitality market will hit £7.6 billion by the year 2022 up from £3.9 million in 2017.
Political and social stability
Political stability has a huge influence on any destination’s success when it comes to investment and tourism. Potential investors look into the possibility of reaping reasonable returns from their investment. Political instability raises the element of risk too high such that it is difficult if not impossible to realise a return on investments.
Dubai’s economic growth can be attributed to the relative political stability in the region. The city has close ties with not only prominent Arab states but also with the United States. Foreign investors find it easy to invest in the mag projects the Dubai government plans.
In spite of the heavy presence of foreigners in Dubai, it continues to be one of the safest places to invest or work in. Also, the city’s quality of life and living conditions are quite favourable.
According to a recent news article, the UAE, of which Dubai is part, earned the 9th position among the nations with the least crime rates.
The state of Dubai’s infrastructure
Dubai set out to invest lots of money in infrastructure development and now has some best infrastructure across the world. The city has a heavy air, sea, and road network which eases transportation within and without the city and caters to more than the 5 million people who form its population. Besides, Dubai’s architecture and buildings are outstanding. The city boasts of having the tallest buildings in the world. All these factors influence investors from around the world who in turn boost the city’s economic growth.
Trade liberalisation
Dubai is one of the few regions in the world with few or no barriers to trade. This is enabled by favourable government policies. Trade liberalisation makes it easy for investors to predict the potential returns on their investments with some degree of certainty. Consequently, they find it easy to acquire financing as financiers can assess an investment’s viability. This is one of the reasons why Dubai is preferred by most investors.
How can you be part of Dubai’s success?
One of the ways through which you can be part of Dubai’s success is by investing in the hospitality industry. According to the DTCM, the number of people that will visit Dubai is estimated to be at 20 million by 2020. To meet this colossal increase, it will be necessary for the city’s hospitality industry to tap into any investment opportunities.
Dubai is set to roll out new tourism incentives such as the construction of the world’s largest wholesale city, rising service standards, renovations on existing infrastructure, and expansion of source markets.
Dubai offers you with numerous choices when it comes to business locations and premises. Whether you want to set up your hospitality business in a free zone or on the mainland, Dubai has something for you.
The city’s government regulations encourage competition by prohibiting economy. It encourages the growth of the private sector and implements liberal policies in areas such as import regulations, visa policies, and foreign exchange controls. Besides, it has maintained strong ties with trade associations such as:
a. World Trade Organization (WTO)
b. General Agreement on Tariffs and Trade (GATT)
c. Greater Arab Free-Trade Area (GAFTA) among others.
This makes it a major player in international trade and further strengthens its open economy policy.