Dubai's Political and Economic Development:

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A thesis submitted in partial fulfillment of the requirements for the Degree of Bachelor of Arts with Honors in Political Science

WILLIAMS COLLEGE Williamstown, Massachusetts

MAY 10,2005

Table of Contents


Persian Gulf Development Literature Oil Curse Literature Arab and Islamic Factors Regional Ovemiew and Historical Background Dubai's Development History



Explaining Dubai9sDevelopment Outcome Why Not Other Gulf States? Dubai versus the Development Literature


Dubai in a Cornparatbe Corntext Saudi Arabia Qatar Brunei




Dubai, a tiny, oil-exporting city-state located in the Persian Gulf, has recently undergone a remarkable transformation. As a member of a federation of small Arab, Islamic monarchies known as the United Arab Emirates (U.A.E.), its leaders have implemented a bold development strategy. In the space of four decades, they have managed to shift the city's economic focus from fishing and gold trading to tourism, mass communications, shipping, and finance. Unlike many of its regional peers which have developed unstable regimes and stagnant, oil-dependent economies, Dubai has diversified its economy to become a politically stable center for commerce and tourism. Consequently, Dubai has resisted the expectations of regional analysts and is a clear outlier from development trends in the Gulf. This observation leads to the central puzzle of this thesis: why is it that Dubai has defied the expectations of conventional wisdom and become so economically dynamic and politically stable? The answer to this question has implications for evaluating the efficacy of both development theories and policy options that emerging states may choose to pursue in their own development strategies. Walking the streets of Dubai, most visitors are struck by the fact that instead of Arabic, the most common languages overheard are English and south Asian dialects. Furthermore, most of the people that they encounter on the street are south Asians, not Arabs. This kind of experience points to one of Dubai's most surprising characteristics the fact that its nationals are only a tiny minority of the city's overall population. Compared to Dubai's official population of 1,112,000, most independent analysts

estimate its national population to be under 90,000, or only about eight percent of the total.' This situation reflects the city's growing reliance on foreign labor. South Asians are the largest expatriate group and make up $4.5 percent of the private sector according to official


~ o sof these people perform menial jobs in the service and t

construction industriese3Expatriate Arabs form another 9.4 percent of the city's s.~ workforce and the remaining 1.9 percent are ~ u r o ~ e a nThe reason that so many foreign workers have flocked to Dubai is quite simple - to make money. Although lowpaying jobs hammering steel and cleaning floors may not sound very appealing, they attract numerous Indian and Pakistani workers because they can make more money performing these tasks in Dubai than they can in their home countries, where jobs of any kind are often ~ c a r c e Similarly, Westerners who work in management positions for .~ multinationals corporations located in Dubai s free trade zones are lured by financial incentives such as high wages and tax breaks. As one expatriate in Dubai has recently stated, "We are all mercenaries here."6 Another aspect of Dubai that most visitors marvel at is the emirate's multitude of ambitious development projects. Perhaps the most well known is the Burj A1 Arab, a self-described "seven star" luxury hotel completed in 1999. Shaped like a massive sail, this waterfront hotel offers guests such amenities as bedroom suites with mirrors on the 9

Ministry of Information and Culture, United Arab Emirates,...
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