MCI ePortfolio

Dubai Faster, higher, wider?

Reflection of the Experiences during the MCI Study Tour 2012

Task.

Please discuss critically the development of Dubai with regard to your findings and

experiences during your visit.

Basic literature.

Balakrishnan, M. S. (2008): Dubai – A Star in the East. A Case Study in Strategic

Destination Branding. Journal of Place Management and Development. 1 (1). pp. 62-91.

Approach.

Own experiences

Presentations during the visit

Informal talks with locals

Additional information, especially statistical data.

From a pearl fishing village surrounded by nothing but sand…

…to a glittering metropolis within 50 years

Thanks to oil and visionary leadership.

Unstoppable

Growth in Dubai?

Residents 1

1953 50.000 2011 2 Mio.

Hotel guests 2

2000 2 Mio. 2011 9.8 Mio.

13% annual growth of real GDP &

6% annual growth of GDP per capita

between 2000 and 2005 3

Average income per capita US$ 47.500 in 2012 4

1 Dubai Statistics Center 2012 | 2 DCTM | 3 Government of Dubai,

Department of Economic Development | 4 Forbes

Dubai‘s visionary Leader

Sheikh Mohammad Bin Rashid Al Maktoum.

Sheikh Mohammad is said to be a perfectionist who is

always in search of new innovative projects and talents.

He seems to be omnipresent for visitors who can see

pictures of him everywhere and for residents who might

meet him personally on one of his surprise visits.

The visionary personality and empowerment of Sheikh

Mohammad align all goals and intentions in one

direction.

He wants to make „Dubai a globally leading Arab city‚.

Balakrishnan 2008: 64 ff.

Sheikh Mohammad‘s

Approach to Development

Burj Khalifa als Symbol for Dubai‘s Ambition

Managing Dubai | Some Characteristics

• Taking advantage of the spatial location (transit point, strategic hub) and the endowment

with fossil resources

• Governmental involvement in virtually every new big project (DCTM 2012)

• Fast development and implementation of creative and innovative projects

• Aspects of finance are marginal (DCTM 2012)

Positioning Dubai

Positioning Dubai | Home of Superlatives Burj Khalifa. Burj Al Arab. The Palm. Dubai Mall. And Much More.

Balakrishnan 2008: 72

Positioning Dubai | Home of luxury Dubai Mall & Gold Souk

Balakrishnan 2008: 72

Positioning Dubai | Home of luxury Real Estate & Hospitality

Balakrishnan 2008: 72

Positioning Dubai | Family Activities For Locals & Tourists

Balakrishnan 2008: 72

Positioning Dubai | Activities Cultural Experiences & Conferencing & Outdoor Activities

Balakrishnan 2008: 72

Dubai | A hyperreal dream of 1001 nights?

Branding Dubai

But Dubai is more than the sum of its landmarks!

It seems that Dubai has not yet decided

what is its key differentiator (Balakrishnan 2008: 81).

• No emotions associated with the brand

• No exact differentiation arguments

Development of Dubai

Dubai‘s Tunnel Vision.

or…

not everything that glitters is gold.

Development of Dubai

Can this lead to sustainable development?

Will the economy of Dubai be prepared for the times when oil is ebbing and

financial resources might become scarce?

Can Dubai bridge the gap between future orientation and preserving its cultural

and natural heritage?

Development of Dubai | ECONOMIC FACTS.

• Pegged Dirham to the Dollar which might close doors for US American investors

but opens doors others, e.g. European ones.

• 18% direct contribution to GDP of Dubai, 29% indirect

• Tax free zones to create an attractive environment for trade

• Liberal property ownership law

• Almost unlimited access to financial resources to realize new projects

• Constant growth of GDP and income per capita in the past which ensured high welfare

for citizens

Balakrishnan 2008: 71 ff.

Development of Dubai | ECONOMY

Dubai International Airport & Emirates Airlines.

Aim to create a hub to link the world and a port to admit people to Dubai

Ambitions to create a mega-hub with positive synergy effects for further industries:

• Manufacturing of aviation related components

• Growth of Cargo Transportation

• Attract Headquarters of Global Players

• Tourism related positive effects like events, conferences, trade shows

O’Connell 2011: 339

Development of Dubai | ECONOMIC EXTERNAL EFFECTS

Huge Impacts of the World’s Financial Crisis 2008 on Dubai, especially on the

Real Estate Sector.

Perception of Dubai as Islamic nation.

The perceived image of foreign countries depends extremly on the current global

situation. The terror attacks of September 11, 2001 for instance had a huge impact

on the image of Muslim countries. (Balakrishnan 2008: 68)

Development of Dubai | ECONOMY Burj Khalifa.

Dubai‘s financial overload

„Dubai‘s Burj Khalifa. Built out of

opulence; named for ist saviour‚ The Globe and Mail, 4 January 2010

„Offices stand empty in tallest tower,

the Burj Khalifa‚ BBC, 21 July 2012

„Dubai tops ist troubles with tallest tower.‚ Financial Times Middle East & North Africa, 4 January 2010

Development of Dubai | ECONOMY

Having the ambition to open up every year a new flagship project (DTCM 2012),

but forget to consider the demand side.

A mostly uninhabitited and empty „The Palm‚

Development of Dubai | ECONOMY & SOCIETY

• Involvement of the government in mostly every project

PRO aligning every project to the vision and guaranteeing sufficient finance

CON no possibility for different ways of thinking to emerge and establish

• No factual determination of the population due to the political framework in the UAE:

Federal presidential elected monarchy.

Balakrishnan 2008: 71 ff.

Development of Dubai | SOCIETY

Diverse cultures and nationalities due to the level of expatriates of 82%

Educational policies of PPP’s and private companies to reduce the problem of brain drain

Emirates Academy that offers a hospitality education of the highest standards

and Jumeirah as owner of Emirates Academy offers students attractive jobs in

Dubai after their graduation.

Question of how to maintain security when tourists will outnumber residents by 4:1.

Migration issues.

Balakrishnan 2008: 68

Development of Dubai | SOCIETY Dubai‘s two-tier society.

Development of Dubai | SOCIETY

Emiratis & Foreign Businessmen

Highly educated & wealthy

Dubai as first or second home

Several times higher income than

the average of US$ 47.500 in 2012

Foreign workers

Live in Dubai to earn money without their families

Bad education

Mostly Indians, Pakistani, Bangladeshi

Income below average at about US$ 1000 in 2012

Dubai‘s two-tier society.

Development of Dubai | SOCIETY

Emiratis & Foreign Businessmen

Potential consumers of tourism

and leisure facilities due to their

high income

Great international brand ambassadors

based on their strong identification

with Dubai as attractive place to live

and to do business

Dubai‘s two-tier society & the impact on the tourism industry.

Foreign workers

Cheap labour force and therefore huge

importance for the service dependent

economy of Dubai

Marginal indirect impact on tourism

Development of Dubai | SOCIETY

How to preserve the cultural heritage

in a multi-cultural society

without blocking new modes of thinking?

Development of Dubai | NATURE Use of land without respect for nature.

Development of Dubai | NATURE

Waste of the scarce resource water.

Is it ethical to build an artificial Ski slope in

the desert only because you can afford it?

Is it ethical to waste tons of water every day

on evaporation by running a huge water

fountain only because you have the money to

create an additional landmark?

Development of Dubai | NATURE

Production of Energy.

Dubai generates currently 100% of its

energy requirements out of oil.

To reduce the use of fossil burning, there

are plans of the UAE government to

implement technologies of nuclear power.

No efforts are taken to be able to use

renewable energies.

Balakrishnan 2008: 76, DTCM 2012

Development of Dubai | NATURE

Waste of land, water and fossil energies…

Is this sustainable resource management?

Conclusion Faster, higher, wider – Dubai?

Development of Dubai | CONCLUSION

Dubai unterwent an extreme development at extraordinary pace owing to its fortune and

the visionary leadership of the Sheikh with impacts on every part of life especially on

economy and tourism.

It offers a good access to finance for its governmental owned cooperations and other

companies to build up new innovative projects and tourism (related) facilities without

being to much sticked to financial issues which creates a good environment for

entrepreneurial activities.

Development of Dubai | CONCLUSION

Aspects of sustainability were not factual considered yet. Some developments seem to be

rather implemented without thinking about possible changes in and impacts on economy,

society and nature.

Dubai should portion its ambitions to ensure its competitiveness in the future and to

minimize risks of failure. The past three years and the huge impacts of the financial crisis

on Dubai showed that even in Dubai, a place 1001 opportunities, there is no guarantee for

unlimited growth.

References & Picture Credits.

References & Sources of Elaborated Thoughts

Balakrishnan, M. S. (2008): Dubai. A Star in the East. A Case Study in Strategic Destination Branding. Journal of

Place Management and Development. 1 (1). pp. 62-91.

DTCM, Dubai Tourism and Commerce Marketing (2012): Welcome to the Dubai Experience. A presentation of

Mohammad Abdullah Janahi with subsequent interview. 15.10.2012

Government of Dubai, Department of Economic Development (o.J.): Dubai Strategic Plan 2015. Available:

http://www.dubaided.gov.ae/English/ecosrch/EconStudies/MgeContentsDocLib/DSP%202015%20En.pdf

05/12/2012.

O‘Connell, J. (2011): The rise of the Arabian Gulf carriers. An insight into the business Model of Emirates Airline.

Journal of Air Transport Management. 17 (2001). pp. 339-346.

Own experiences made on the MCI Study Tour 2012

WTO (2004): Indicators of Sustainable Development for Tourism Destinations. A Guidebook. Available:

http://www.iittm.org/doc/Indicators-of-Sustainable-Development-for-Tourism-Destinations-A-Guide-Book-by-

UNWTO.pdf 05/12/2012

Pictures by Daniela Aichner und Stefanie Dietrich 2012 Slides 5, 6, 8, 11, 12, 15-20, 22, 28, 36 & 37

Title Dubai at Night http://sapgeo.deviantart.com/art/dubai-at-night-203258204

Burj Khalifa http://www.wallpaperswala.com/burj-khalifa/

http://farm3.static.flickr.com/2714/4245120861_5795f8a3a0.jpg

Brand Dubai Logo http://payload50.cargocollective.com/1/7/234103/3301234/defdubai_13_900.jpg

Oil source http://i.auto-bild.de/ir_img/5/8/6/0/1/2/oelquelle-474x316-5f5c0a20e87053ca.jpg

Satelite Pictures Dubai http://www.rhetorik.ch/Aktuell/09/10_17/entwicklung.jpg

Sheikh Mohammad Bin Rashid Al Maktoum http://www.mbrfoundation.ae/English/Pages/sheikhmohammedbio.aspx

http://www.2daydubai.com/royal/dubai-royal-family_clip_image002.jpg

Sheikhs http://www.sheikhmohammed.co.ae/Content%20for%20English%20site/

Add%20new%20content%20to%20English%20site/News/TempSheikhNews/

2011/February/02-28/02/Dubaicustom-Big-1e.jpg

Workers and Businessman http://www-scf.usc.edu/~ericsoli/DubaiLaborers.jpg

Picture Credits

Dubai Faster, higher, wider?