Oil wealth has helped United Arab Emirates to grow into a thriving economic center since the country was founded in 1971. Several free trade zones encourage commerce, and an official stock exchange will open in 1998.
Tradition and Transformation in the UAE
The Spirit of the Land was written by Brian Moynahan, the former EuropeanEditor of The Sunday Times and Richard Morgan, a freelance journalist specialising in Middle East affairs. Photographs by Romano Cagnoni and Patricia Franceschetti.
The United Arab Emirates is a land of contrasts. Both fast moving and modern, yet a country still steeped in the culture and customs which have sustained its people for generations. A state which vigorously promotes industrialization, but just as fiercely protects its environment, and where soaring skyscrapers sit next to ancient forts and cooling wind towers, which have softened the harshness of the desert heat for centuries. While the new office blocks are emblems of the UAE’s rapid progress, the latter signal that this will not be at the expense of traditional values.
Drive along the broad, six-lane highways and in the distance you can just pick out the once-used sand tracks and pathways of the camel herds and spice traders, part of a much older commercial heritage. In the heart of the desert’s shimmering sands lie rolling pastures, which thanks to intensive irrigation. are almost as lush and green as those of America’s Midwest. A plentiful supply of first-class hotels, good beaches, shaded city parks and duty-free shopping has given rise to another unlikely contrast – an oil state with a flourishing tourist trade.
Building such a country, where the traditions of the past coexist in such harmony with the aspirations of the future, may seem a complex task, requiring at least a century of gradual development. In fact it has been achieved in less than three decades. The UAE, a Federation comprising the seven emirates of Abu Dhabi, Dubai. Sharjah, Ras al Khaimah, Umm al Qaiwain, Ajman and Fujairah, was founded in 1971.
Few countries have grown so quickly. Oil wealth has undoubtedly been the foundation. The UAE has the world’s third-largest proven oil reserves and fifth-largest gas reserves, of which 90% are in Abu Dhabi. State-owned Abu Dhabi National Oil Company (ADNOC) has launched a major $2.5bn investment program aimed at substantially increasing its natural gas capacity. This will help to meet increased local demand from Dubai and the other, smaller emirates.
Diversification has been encouraged too; by a free trade policy, favourable terms for foreign investors and sustained government support. The non-oil sector now accounts for two thirds of GDP, with petrochemicals, construction, distribution and manufacturing at the forefront. Expanding into petrochemicals is a natural step for an oil producer. The latest development: a new $1bn, joint venture polyethylene project. set up by ADNOC in partnership with Danish-based Borealis. Another noteworthy move: the $500m expansion program completed by the Dubai Aluminium Company last year.
Today the UAE is a thriving center. The main supplier of goods to the UAE is the US – which overtook Japan last year – with a close to 10% share of the country’s total imports. The Emirates’ top export market, however, is still Japan, which has a 37% market share. Much of the trading activities are centered on the Emirates’ many free trade zones. The biggest is the Dubai-based Jebel Ali Free Zone. Once a wasteland of scrub and sea, it is now home to 1,200 companies, attracted by generous tax breaks, proximity to major markets and an excellent labour force. Dubai is the tenth largest container port worldwide, busier than New York or Tokyo.
The latest boost is Abu Dhabi’s plan to spend $3bn on building its own free trade zone, spread over 3,500 hectares on Sadiyat Island. Plans for the new zone include building a new seaport and airport, commodity exchanges and huge storage facilities. It will be connected to Abu Dhabi city by a four-mile bridge. It is planned for the Sadiyat project to have an international share issue shortly, on both the unofficial UAE stock market and in Luxembourg.
Last year there were a flurry of new issues and flotations from existing companies on the unofficial market, many of which were heavily over subscribed. The market capitalization reached $24.5bn last year – up $9bn compared to 1996 – and businessmen and bankers are eagerly awaiting the opening of the UAE’s official stock exchange, which is expected to take place later this year. Among policy makers and businessmen there is a strong commitment to efficiency. Abu Dhabi’s recently announced plans for the wholesale privatization of its power and water utilities, is an attempt to upgrade its operations and attract international participation and expertise.
The signs of the prosperity generated by the UAE’s economic policies are obvious – a car for every six people, a telephone for every three and the highest density of mobile phones in the Middle East, spacious housing and nearuniversal air conditioning. UAE citizens enjoy a wide variety of benefits from a cradle-to-grave welfare state. Healthcare services are among the best in the world. Life expectancy has risen sharply, from 53 at the time the Federation was formed, to 74 today. The UAE has been one of the first countries in the world to reduce infant mortality to less than 70 infants per 1,000.
Education is a treasured resource. All children now have school places. Youth illiteracy has disappeared and special classes have slashed adult illiteracy from 95% in the past to 15%. Abu Dhabi’s second biggest urban center, Al-Am, seat of the UAE University, is a thriving campus city, with some 15,000 students. A source of pride is its excellent medical training as is the fact that two thirds of its graduates are women.
The determination to tap all its human resources is paying dividends in administration as well as teaching and medicine. A quarter of all decisionmakers in government are women. The less intellectual are not forgotten. Eleven vocational training centers will soon be encouraging children and adults to use their free time to hone practical skills, such as car maintenance and carpentry. Money has been spent to help less fortunate nations too. The UAE has provided well over $5bn in overseas aid to more than 40 countries and has created a special humanitarian fund for overseas assistance.
In going about their daily lives citizens in the UAE have the benefit of an excellent infrastructure. Massive highways crisscross the country. There are six international airports. The two main airports, in Abu Dhabi and Dubai, are currently undergoing big expansion programs at a combined cost of close to $900m. In telecommunications the UAE is very advanced. The federal telecommunications company, Etisalat, is the largest shareholder in the AlThurayya Satellite Telecommunications Company, a joint venture with regional and international telecoms companies. US firm Hughes Space & TelecommunicationsInternational has been awarded a $1bn contract to provide the company’s first satellite system.
Despite the hectic pace of development the environment has not been forgotten. The emphasis on conservation has its roots in the Bedouin tradition of living in balance with wildlife and respecting nature. The landscape and its flora and fauna are described by environmentalists as world-class.
Sheikh Zayed bin Sultan Al Nahyan, the UAE’s president and the ruler of Abu Dhabi, realised as a young man that shooting was no more than “an outright attack on animals,” so destructive types of hunting are outlawed. Only falconry is encouraged, as it represents the intimacy between man and the wild that Sheikh Zayed respects.
He has transformed the barren island of Sir Bani Yas into one of the leading wildlife reserves in the Middle East, where rare Arabian oryx and sand gazelles breed undisturbed. Hundreds of species of birds winter in the UAE and residents include the rare crab plover and the desert eagle owl. Government-hacked environmentalists study their breeding practices and habitat while the Arabian Leopard Trust is charged with ensuring the future of this magnificent cat. In recognition of his commitment in the field of conservation, Sheikh Zayed has received many awards, including most recently the Gold Panda Award, which was given to him last year by the World Wide Fund for Nature.
Another of Sheikh Zayed’s most cherished polices has been the greening of the desert. Over 150 million trees have been planted. Ambitious irrigation projects have seen the apparent contradiction of desert farms become a reality. Some 20,000 farms have created a thriving export trade in dates, strawberries, tomatoes, roses and avocados. Fresh milk production, particularly from around Al-Am, almost meets the country’s entire needs. It is known as the Emirates’ garden city, such is the lush vegetation and greenery which flourish along its broad boulevards.
Archaeologists are pushing knowledge of early civilization back for six millennia and more. The fort at Al-Am has been carefully preserved as a museum, one of several across the country whose vivid tableaux of desert life and pearl diving remind the young of the hardy and self-reliant disciplines that moulded their past.
Given the variety of sights and sounds which the UAE has to offer it is little surprise that tourism is growing fast. For tourists the country’s natural beauty – the long landscapes of stony blue mountains, deep red dunes and clear, turquoise seas – and the eye-catching sights of urban life; the glittering gold souks and exquisite floral displays of the cities’ gardens, is a heady combination. Also, tourists need have no fear of staying out late; the street crime which plagues other big international capitals is virtually non-existent in the Emirates.
Dubai has been the focus of much of the UAE’s tourist development. During the 1990s the number of hotel rooms increased by over 20% per annum. The latest hotel to open is the 600-room Jumeirah Beach Hotel, the first phase of the Chicago Beach development. Later this year a 321-metre-high offshore hotel, the tallest structure in the Middle East, will be added. Dubai has also given the go-ahead to the Gulf’s largest leisure development, the $500m Magic World theme park. In the Emirate of Abu Dhabi, Al-Am in particular is attracting more visitors. Several multimillion dollar projects are planned for the recently named “oasis city of the new millennium”, an extensive upgrade for Al-Ain zoo, an 18-hole championship golf course and some smart new shopping malls.
Sport is another the world in power boat Dubai holds an annual in Tennis Open Championship and Golf Desert Classic, which attract players from around the world. camel racing horse racing is Dubai and world-class horse-breeding establishments. Dubai-trained horses have won Europe’s Derby and France’s I’Arc de Triomphe. The main showpiece event is the annual $4m Dubai World Cup, won in two of the last three years by American horses – Cigar in 1996 and Silver Charm this year.
In reaching for the future the UAE has not sacrificed its past. Great oil wells and refineries, modern highways and bustling international airports are all evidence of the country’s commitment to progress. Yet this is still a land of desert and dhow, of flowing robes and hennaed hands, of scented spices and splashes of intricate jewelry. It remains Arabia, a place where those who think only in terms of oil tankers and air conditioners will, as the great British explorer Sir Wilfrid Thesiger remarked, “never know the spirit of the land, nor the greatness of the Arabs.”