What Lesson Can Be Learned From The Experience Of Dubai In Terms Of Advising Other Cities On Resilient Economic Growth?
The capital city of the Emirates of Dubai is Dubai. It is also recognized as most populous city of the United Arab Emirates (UAE). The city has transformed itself into a resilient economy through diversification (Smartdubai.ae 2020). Therefore, Dubai is a model country that achieved resilient economic growth, which may assist other counties to transform and diversify themselves. The growth rate of the Dubai registered at 2.1% in 2019 and it is mainly driven by growth of non-oil industry.
The government of Dubai took decision to diversify the economy from the oil-based and trade-reliant to tourism and service-based, which resulted in magnificent growth and development for the city. Dubai acts as major transport hub for the cargo and passengers (Pathirage and Al-Khaili 2016). Previously, main source of the revenue of Dubai generated from the oil industry. As the city went through transformation and diversification, out of total revenue of the Dubai now lower than 5% generated from the oil. The main areas of specialization and economic strength of the Dubai include real estate, aviation, trade, financial services and tourism. It established itself as vital center for international and regional trade.
The particular cluster of industrial activity that currently dominates the Dubai economy include transportation, financial services, tourism, logistics and construction (Husnéin and Chakravarty 2016). The cluster competitiveness is a significant contributor of the resilient economic growth of the Dubai. Though, the country has open labor market, which brought many migrant laborers in the city. The labor market of Dubai is very competitive due to presence of the skilled laborers. The employee turnover of the Dubai remained high and it also provides opportunity to adopt new skills and technology. The population of the city registered at 3,331,420 as of September 2019. The population scaled up by 177,020 from September 2018 and the growth rate of the population remained 5.64%. It ranked twentieth out of all countries of the world in terms of most expensive. It is also the 2nd most expensive city of the UAE. The region was made up of 85% of the expatriate and 15% of the nationals of the UAE. Dubai is one of the fastest growing economies of the world.
The improved international connectivity of the helped to accelerate the tourism sector of the city. It also attracts free flow of investment in the country (Gurel and Sibley 2016). To serve all emirates of the country including Dubai, Dubai International airport plays a significant role. It stood at 3rd in terms of busiest airport of the world related to passenger traffic. Moreover, in terms international passenger traffic, it ranked the busiest airport of the world. The national airline of the Dubai is Emirates, which expands its operation worldwide. Two main ports of the Dubai also helps to build strong international connectivity such as Port Jebel Ali and Port Rashid (Amponsah and Bhavani 2019). The cost of the living related to housing is comparatively very high in Dubai. The population growth of the city created pressure on the housing availability in the city. As a result, lower availability leads to higher prices of the property in Dubai. However, recent downturn in the property market dropped the property prices in 2018 and it also scaled down the cost of living in the city. As the housing market of the Dubai is one of the major contributor of the gross domestic product (GDP) of the city, the plummeted growth of the housing market will lead to lower growth rate of the city (Mishrif and Kapetanovic 2018).
According to the forecast, the economy of the Dubai may decline by 3.3% in 2021. The unemployment rate of the city is one of the lowest in the World. As of 2018, the unemployment rate of the city remained 0.5% because of growth in business and trade. Political structure and stability is a crucial factor for the development of any region. The region can be recognized as a model city for the stability and structure of the government (Crotti and Misrahi 2015). Since 1833, the region is ruled by the AI Maktoum family and it is under the constitutional monarchy. The city is represented by its exemplary leadership quality, which enables openness, acceptance and tolerance for others. Hence, it helps to maintain the internal and external stability of the region.
The political stability, population growth, labour market and skills, housing market, industrial activity and international connectivity brought dramatic transition in the economy of Dubai. It helped to accelerate the resilient economic growth of the city through diversification of the economy. Therefore, in order to achieve resilient economic growth, other cities should also adopt these features and make necessary changes in the respective field (Al Faris and Soto 2016). It will assist other cities to achieve resilient economic growth through transformation.
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