UAE has all to gain from Dubai-Abu Dhabi alliance

In this challenging economic climate, I, among others, have talked about the need for greater transparency, financial reforms, increased support by governments and adopting a 'time to act' approach.

All of these actions require a collective effort, be it from individuals, employers, banks or even governments. When I stop to think about how all these elements need to support each other in times of crisis, I think of a great example right in front of me, which shows how strategic alliances and long-term complementary partnerships can overcome the toughest of challenges.

I am, of course, talking of the combination of Dubai and Abu Dhabi.

This special combination in my view gives the UAE a significant advantage as a country. Why? Not many countries have two cities that can hold claim to being business hubs in a region, let alone two that have shown themselves to be visionary, open to change and dynamic in their 'can do' approaches.

Of course, it therefore goes without saying that there is an ongoing healthy competition between these two super successful cities! So which city is better than the other? In my opinion, it is not Dubai versus Abu Dhabi - it is Dubai and Abu Dhabi.

Both the cities mirror elements that not only position them as a cut above the rest but also complement each other perfectly. They collectively contribute to the success of UAE. While Dubai is known for its property boom, luxurious hospitality and shopping, Abu Dhabi, as the oil capital and industrial giant, brings the stability and backbone to the region.

According to a recent report by Bloomberg, the Gulf region produces about 20 per cent of the world's oil and the rising oil prices have provided a major boost to the economy. Abu Dhabi's oil measure has surged to an impressive 8.8 per cent during this quarter.

In line with a long-term strategy, the governments of both cities have been extremely proactive in introducing tangible measures and policies. Both the Dubai 2020 vision and the Abu Dhabi 2030 visions clearly reiterate a commitment - to be the world's leading cities.

An important perspective is that the significant aspects of these visions are in line with staying true to the country's culture and heritage, so nurturing an authentic Arab nation which the whole world can look up to.

While Dubai has quickly adapted to the accolade of the city of the superlatives, Abu Dhabi's goal is to become one of the world's largest aluminium producers. It has a broader strategy to develop energy and capital-intensive industries like steel and aluminium to take advantage of its access to oil.

Tourism is another important aspect contributing to the growth of the UAE. Dubai accommodated 6.5 million tourists in 2008 according to a report by Colliers International while Abu Dhabi is more about corporate tourism that accounts for about 80 per cent of its hotel demand. However, each city can take something from the other.

With the development of the luxurious Emirates Palace in recent years Abu Dhabi now has a truly iconic hotel to attract tourists.

Dubai has been one of the best performing markets throughout the hospitality boom in the Middle East and currently still records high revenue per available room (RevPAR) in comparison to other major world markets such as London and Paris (Source: Jones Lang Salle Vol 11).

In terms of population, Dubai has one of the world's highest ratios of expatriates to nationals (around 90:10). At the end of 2008, Dubai's population stood at 1.65 million, an annual increase of approximately 7.8 per cent from 2007.

The population has been boosted by an influx of working-age expatriates in recent years, with around 55 per cent of the population in the 25-39 age group, according to Jones Lang Salle.

On the other hand, the population of Abu Dhabi is expected to increase from 930,000 in 2007 to 1.3 million by 2013, 2 million in 2020 and up to 3.1 million in 2030, according to estimates made by the Plan Abu Dhabi 2030. These figures show that both cities are still growing and enjoying all the benefits that diversity of races, cultures and religions can bring.

If we take a look 10 years from now, the UAE flag will fly high on the numerous towers being built in the country marking the 50th anniversary of the UAE Federation. Abu Dhabi and Dubai have grown, economically, socially and politically in just a short time and so who knows what we will have achieved in another 10 years from now.

The collaboration of these two cities has already resulted in unprecedented growth and will continue to do so as it is a rare combination of strategic vision and leadership, vast amounts of natural, cultural and ideological resources and the most advanced infrastructure along with the support and commitment of a diverse population.

A country is lucky to have one successful city - the UAE has two - each of whom contributes significantly to its development. Can we ask for more? This is a strength and advantage that many countries aspire for& and one that we all too often overlook.

Hussain Sajwani is the chairman of Damac Properties.