A crucial element of Dubai's ambitious development plan

Dubai: Emirates is a crucial element of Dubai's development strategy.

The airline and Dubai play a complimentary role in each other's successes.

"We are indeed fortunate to be based in Dubai, where a visionary government is investing billions of dollars to develop the city into a major commercial, residential and tourist hub, and the Emirates Group is playing a pivotal role," Shaikh Ahmad Bin Saeed Al Maktoum, President of Dubai Civil Aviation and Chairman of Emirates Group, said in a statement earlier this year.

Up to October 2005, when the airline completed 20 years, the its contribution to Dubai's economy was Dh17.61 billion ($4.8 billion), including a direct expenditure of Dh10.64 billion ($2.9 billion), said Shaikh Ahmad.

Coming of age

"There's a sense that the airline has 'come of age' and with its solid grounding, is ready to take on even bigger challenges as a leading player in global air transport," he said.

In 2003, Emirates demonstrated its confidence in the industry's growth by announcing the largest aviation order in history. A staggering 71 new aircraft - a mix of Airbus and Boeing - were placed on order.

In 2005, Emirates announced the largest ever order for the Boeing 777 family of aircraft - 42 in all - in a deal worth Dh35.7 billion ($9.7 billion) at list prices.

In the financial year 2006/07, Emirates carried 17.5 million passengers and 1.2 million tonnes of cargo, using one of the most modern fleets in the world..

"Currently based on the Dubai Strategic Plan 2015, its objective is to prepare the emirate for the post-oil era by firmly establishing it as a leading tourist destination (including trade fairs and conferences), as a centre for financial, IT and professional services, as a location for corporate headquarters and light manufacturing, and, last but not least, as a regional transportation, logistics and distribution hub," according to an analysis by German aviation analysts Andreas Knorr and Alexander Eisenkopf.

"Many of Emirates strengths come from the right decisions taken at its foundation, and from its unique organisational structure," the duo said.

"Not only does the carrier benefit from having been created from scratch only 22 years ago, resulting in flat hierarchies and essentially no legacy costs, but, more importantly, the central role of aviation in Dubai's development strategy also guarantees Emirates a very favourable political environment."

Low charges

Also Emirates profits from the very low charges at its home airport. While landing fees are by and large identical to those at major European airports, no airline flying into Dubai has to pay any additional charges (such as noise charges). This is because the airport infrastructure and all related services are provided by Dubai's Government and fully financed from the state budget, the report says.

With the development of the $35 billion Dubai World Central airport city in Jebel Ali and the launch of the $15 billion Dubai Aerospace Enterprise venture, Dubai Government has strengthened its plans for the aviation industry which is likely to dominate its future vision for the economy in a post-oil scenario.

With Emirates continuously delivering solid dividends amid strong growth, it will definitely have a bigger role to play when all the parts of the jigsaw puzzles of the government's Vision 2020 begins to fall in place.