Asia is home to several economic tigers. Europe has a Celtic and Baltic tigers. Latin America is proud of its newly rising tiger, Chile. Even poverty-stricken Africa is promoting South Africa as a possible future tiger. The Arab world is once again the exception in terms of economic reform and vitality. It lacks a success economic story that would capture global attention and brings Arab economies into the 21st century.
The city of Dubai, the second most prosperous emirate in the United Arab Emirates with a cosmopolitan population of 1.4 million is consolidating its pre-eminent role as a regional hub while aspiring to be a global city and a possible Arab Gulf Tiger (AGT), Dubai shares a range of characteristics with world tigers, including sustained double digit economic growth rate since 1994.
In 2004 Dubai's GDP grew at a healthy rate of l7 per cent, mostly in the non-oil sector. Oil is becoming increasingly irrelevant and Dubai's oil production dropped steadily from an all time high of 450,000 b/d in 1995 to less than 100,000 in 2005. But as oil contribution to the GDP dwindled, the economy expanded exponentially. It almost doubled in size during 1991-2000 and was well over $30 billion by 2005.
This is still a very conservative reading which doesn't truly reflect the inner dynamism of the GDP and the fact that Dubai has become the "hippest city in the world".
The actual GDP could be twice or three times as high. What is, however, beyond doubt is that the economy is growing at a double- digit rate and it is by now fully diversified. More importantly, the city is also deeply pro-business and has worked diligently to attract foreign direct investment, which has grown at an annual rate of 11 per cent lately.
Regional hub
Dubai has steadily raised its global profile and marketed itself aggressively as a safe and prosperous regional hub. The marketing has reached a critical mass, since some 90 of Fortune's top 100 companies have already located their regional offices in the city.
In terms of global connectivity and sustained double-digit growth, Dubai deserves to join the exclusive club of the tigers of the world as an AGT.
All vital growth statistics confirm that it is in par with Singapore, Hong Kong, South Korea and Taiwan, the four leading Asian Tigers.
Dubai's determination to assert its credentials as a promising AGT is in doubt and in the next ten years, probably other Dubai look-a-likes will spring up all over the Gulf and the Middle East. In essence, Dubai, just like the trendsetter Singapore, is a catalyst. However, the perennial question remains, will the boom continue?
Pessimists have been talking about the Dubai bubble and gimmicks for the past two decades, yet the city miraculously defied all the odds. But even if the boom continues unabated, there is always the nagging issue of at what price? Emerging as an AGT is needlessly a source of immense national pride, but the success Dubai is currently enjoying has come at a daunting price.
The double digit economic boom has produced unwanted double digit demographic imbalance. Paradoxically, it turns out that Dubai simply does not have enough local manpower to keep up with its radical ambitions.
It is true that the citizens of Dubai have never thought in their wildest dream that their relatively small city with its extremely hot weather and inhospitable environment would emerge as a global city and an AGT.
Yet they never thought that they would one day end up as a disappearing minority in their own hometown. The current demographic disequilibria is too severe to stomach. Officially, Dubai citizens constitute 12 per cent of the total population, but will soon become 5 per cent and by 2020 zero per cent!
City of immigrants
The AGT is literally a city of immigrants hosting 140 different nationalities that are brought and held together not by common culture and history but by potential material rewards. This has created among other things a lasting identity dent for the city, which is acquiring a distinctly global image.
Regardless of the double digit demographic imbalance, Dubai relentlessly is pursuing its double digit economic growth strategy. It wants nothing less than to lead the larger Arab World out of its persistent economic stagnation and into the spotlight of the 21st century.
It is a mighty historical challenge that only a forward thinking Gulf Tiger, which is at the moment full of positive energy and determination, could accomplish.
Dr Abdulkhaleq Abdullah is Professor of Political Science at the UAE University, Al Ain.
This article was published in the new issue of Emerging Dubai 2006, Oxford Business Group.