Dubai, the second largest of the emirates of the United Arab Emirates has witnessed tremendous growth in the past few decades. The manifold growth has transformed a vast barren desert area in to a gleaming metropolis in which each entity is talked about only in the superlative. The emirate is now considered as a global commerce hub thanks to the emirate’s strategic location, the world class infrastructure the city offers, the practical and innovative leadership of Dubai and the transparent economy that the city boasts of.
Numerous factors some of which have been analyzed here will contribute to Dubai’s position as a game changer of the global economy in the year 2016.
Dubai’s Diversified Economy:
Dubai like other cities of the Gulf has always been considered as oil based economy. However, the leaders of the emirate clearly understood that depending on dwindling oil reserves would not be feasible. The leaders understood the limited nature and capabilities of the emirate’s oil resources and Dubai branched out to become a leading global contender in the banking, tourism, real estate and manufacturing sectors. This is a factor which will help Dubai to affect the global economy in a positive way in the year 2016. Even with fluctuating oil prices Dubai stands as a clear leader in the economy of the region and the world for the year 2016 and for some more years to come.
Conductive Business Atmosphere:
Dubai is ranked 10th in the list of global cities that are considered as a popular business destination. Almost all of the world’s largest companies operate from this emirate. The atmosphere is conductive to business due to a culmination of numerous factors:
- The flagship airline Emirates connects the emirate with most of the destinations around the world making the city easily accessible.
- The Dubai International Airport was considered was the busiest airport in the year 2015.
- The emirate offers cost effective business solutions such as logistics, transportation, storage facilities and world class hotels.
- The emirate is part of an extensive foreign trade network offering the investors ample and easy options to market a varied range of goods and services. The emirate is the world’s third largest export and re-exporter of goods.
- The emirate’s impressive business and work culture attracts a large diverse international work force. This brings in the cream of multicultural talent which helps the businesses well.
This kind of business environment amply aids the economy of Dubai and will help Dubai in playing a major role in the world economy in the year 2016.
Transparent and Free Economic System:
Dubai follows an open and free economic policy which has minimal governmental interference, tax benefits and lack of red tape. This augurs well for the emirate and makes it a foreign investor’s paradise. The labor costs and import duties are also quite reasonable in the emirate. A special mention should be made about the business infrastructure that is in place in Dubai. More than 20 free zones which guarantee foreign ownership and tax benefits for investors is a major draw to the emirate. Dubai also comprises of seven industrial areas, fully equipped sea ports, international airports and a well established public transport system. All these help the foreign investors to establish their commercial establishments with ease and will play an important part in Dubai’s role as an active game changer of the world economy in the year 2016.
Dubai is located strategically in a region that extends from North Africa to South Asia and from the Caspian Sea to South Africa. This region consists of 42 countries that are rapidly emerging and developing markets. This helps the emirate to offer business opportunities, infrastructure and export and import options to these countries. The emirate is considered as a regional commercial hub which will play a significant role in alleviating Dubai to have an impact on the global economy in the year 2016.
Political and Economic Stability:
In the world fraught with tension and conflicts Dubai offers a stable and secure financial market for conduct of business and trade relations. The low crime and corruption rate makes it attractive for investors across the world. The banking sector with ample liquidity, credit facilities, the ability of Dubai to bounce back from debts which was demonstrated during recession, a liberal and practical government headed by a visionary leader all favor well for Dubai. This factor will play a significant role in making Dubai a major player in the world economy in the year 2016.
This is another factor that will play a major role in helping Dubai to impact the world economy in 2016. Though Expo is scheduled to be held only in the later part of the year 2020 the preparations for it has already begun. Dubai can boast of the fact that it was the first city in this Middle Eastern region to be awarded the option to hold such a prestigious world event. This speaks volumes about the capability of the city and how the world views the emirate.
It is estimated that the Expo will generate job opportunities on an unprecedented scale in sectors such as tourism. Expo will bring in foreign direct investment and give a boost to the real estate sector in Dubai. Recent infrastructures such as the massive Al Maktoum Airport and new theme parks will help in attracting tourists to the emirate, thus improving the economic status of Dubai. Expo will also coincide with the Golden Jubilee celebrations of the city thus serving as an impetus for economical growth. It is estimated that the Expo will garner around $23 billion in revenues. Economic growth of 6.4% has been predicted for the emirate between the years 2014 and 2016 and 10.5% in the year 2020. The Expo has been estimated to attract around $150billion as foreign direct investment.
Dubai has been rated as one of the fastest growing cities in the year 2014. The per capita GDP has also increased. Although it is to be understood that Dubai holds a strategic position in the global economy it will not hurt to remember the financial difficulties that Dubai was in a few years ago during the financial recession. Dubai should put to use its strategic advantages that it has over the other emirates and GCC countries to become a leader and a game changer of the world economy in the year 2016.