Abu-Dhabi vs. Dubai

Abu-Dhabi (Father of the Gazelle in Arabic) is by far the richest of the 7 emirates of the UAE, and the one with the largest oil reserves. It is estimated that Abu Dhabi holds 9% of the world’s oil reserves, large enough to secure sufficient investment inflows for at least another 100 years. The capital state’s business culture is definitely more conservative, with strong government involvement focusing on preserving and promoting national Emirati culture. Abu Dhabi government and its main financial institution Mubadala promote joint economical and social development in the region

Dubai, on the other hand, is UAE’s most populous state and the most economically thriving. The city economical freedom and lax regulations allow for greater innovation and growth...too much, too fast at times. Foreigners (Expats) can own properties and businesses in the free-hold areas, providing a strong incentive for foreign investment and entrepreneurial activity. In fact Dubai is far less depended on oil and successfully diversified its economy into the tourism, real estate and services sectors.

Throughout our trip, from our interviews with business people and government officials, the unique identity of these two powerful states and the competition between them became more obvious. Is this inter-state rivalry healthy for UAE’s development? Strategically it could allow the two cities to position themselves and to jointly support regional economic growth: Dubai is a financial center, luxurious and extravagant, while Abu-Dhabi remains more traditional, with a focus on developing culture and fine arts . Another example is Abu-Dhabi’s young airline company Etihad, now competing with Dubai’s Emirates, pushing the industry to further innovate and improve quality standards to compete locally and internationally. However, the long term results of this brotherly rivalry remain to be seen....

Dubai's Burj Kalifa and Abu Dhabi's Yas Island future developments: Guggenheim, Louvre and Opera House

Richness in Culture, Not Currency

The population structure of the United Arab Emirates is highly unique. Eighty-five percent of the population of the country is comprised of expatriates, mostly individuals from South Asia, the Middle East, Europe, and North America. Therefore Emiratis make up a huge minority within their own country. The vast disparity was evident everywhere we went, from the local souks to business headquarters, Emirati people were found far and in between.

With a strong affinity towards Middle Eastern cultures and a firm belief in the true value of cultural preservation, all I could think was that a rich Islamic culture was losing to globalization. Dubai and Abu Dhabi are being positioned as global hubs. Dubai already possesses every department store and hotel chain the world has to offer, and soon Abu Dhabi will be home to the Louvre and the Guggenheim Museums. Globalization on steroids; my greatest concern was how to preserve the region’s culture in such a global landscape.

I felt alone in my thoughts, as everybody was heralding the abnormally quick growth of the region and attributing them to the great prowess of our increasingly global world. After voicing my concern to a number of high-ranking business people we encountered, as well as managers from Mubadala, the central government fund for Abu Dhabi, I was relieved to discover that in fact, the Emiratis shared my anxiety. Cultural maintenance is a growing concern for nationals as they recognize that their country is currently managed and fueled by foreigners.

In response, the Sheiks have installed an Emiratization program. The thought is to encourage both public and private companies to hire local Emirati people who will be trained by their foreign counterparts. Essentially, the UAE (only approximately a thirty-five year old country) is acquiring expatriate skill-sets through knowledge transfers. This ingenious concept saves both time and resources, and ensures that the local Emirati people are trained by the most competent minds the global world has to offer. The program is aimed to build a sustainable Emirati business world fueled by its own people.

I am personally excited by the project, as it appears that the country has discovered a method of accelerating the typically slow process of climbing the corporate ladder. Emirati people hired normally possess university degrees from local or foreign universities (often through subsidy programs as well) and will be hired for positions currently held by expatriates. The expatriates, who are often living in the region for short transitional periods, will thoroughly train the locals to occupy their positions.

Although I recognize certain downfalls with the program, specifically in terms of finding enough willing Emirati people and the sustainability of essentially buying foreign knowledge, I believe that if expatriates ensure to impart their soft skills as well as their hard skills to the Emirati people (specifically in terms of management, innovation, organization), next time I visit the UAE, I will be pleasantly surprised.

who you are determines what you get

The Emirates primary objective is growth through attraction of foreign investment and skills that are lacking locally. In order to enhance this, they open their economy as much as possible hence sacrificing environmental or social regulations and investments. After visiting Abu Dhabi and Dubai for the last ten days I have noticed an apparent breakdown of the social classes. At the top, with the most power and wealth are the Emiratis followed by an upper class of expatriates from Europe, India and other Middle Eastern countries. They are usually educated and hold respectable jobs with high, tax free salaries. And at the bottom a lower working class also constituted of expats but from Bangladesh, Pakistan, Afghanistan, the Philippines, Africa and India. University educated in their home country or not; they are usually construction workers, taxi drivers, fast food employees or in other service industries. Coming from the management faculty of our university; the objective of our trip was obviously oriented towards discovering the business opportunities, and the corporate life style in the Emirates. Very little focus on the underprivileged portion of the population.

I hence dedicated a portion of my free time to talk with some of these people. While the general census was that life is better here than at home with better working opportunities and conditions, many were disillusioned shortly after their arrival here. They work hard long hours for very little income for jobs often undermining their skill level. Although this is slowly changing, the lower class has difficult access to education and healthcare and are not always treated the best of ways. However, as said previously, they wouldn't be here if they had nothing to gain.

The image that was described to us by the managers of the companies we have visited was that Dubai and Abu Dhabi are going to be amongst the most important economic and cultural hubs in the future. I must admit that they had some very good arguments and I wouldn't be surprised if they are proven right in the future. However I just wanted to note the contrast between the opportunities for the upper class and those for the lower class, although both positive, are greatly disproportionate, significantly advantaging the few privileged. This is necessary to a certain extent in order to attract investment, although quite excessive here in my point of view. Given that the UAE is completely new, hence allowing incredible flexibility in its policies, I believe that it can seize this chance to not make the mistakes of others and get things right from the start.

If the United Arab Emirates is to be a leading figure in the future, I would just hope for it to not also be an example of inequality.