It was still summer and I was in an Emirates Airline plane for Dubai for a social and an investment exploration visit to the famed city. I was highly anticipating this trip, as the newspapers and television accounts of Dubai were all in superlatives as far as the money, investment opportunities, and the construction activities. It has or will have the most exotic, most expensive, the tallest and the largest man-made structures in the world; and it is already hosting the Dubai Tennis Open, the Dubai Golf Classic and one of the richest horse races in the world. I surely will have enough work and materials to make the trip an enriching travel.
Dubai is one of the seven emirates of the United Arab Emirates (UAE) formed in 1971. Abu Dhabi and five other smaller emirates compose the rest of UAE. Dubai and Abu Dhabi are the more populous and progressive emirates and cities and are well-known in the world. The 2008 population of Dubai is at 2.3 million, of which only 17 percent are emirates while 83 percent are foreigners. The Indians are 43 percent, Pakistanis are 14 percent, Arabs are 9 percent, Bangladeshis are 7 percent, Filipinos are 3 percent, and the rest of various nationalities. This means that there are about 70,000 Filipinos in Dubai as construction workers, sales people and service industry workers; but going through their huge malls, it seems there are many more Filipinos as you can hear conversations in Tagalog and Bisaya as you step into or walk around the stores.
The Gross Domestic Product (GDP), or the size of the economy of Dubai at $38 billion is one fourth the GDP of UAE, and is just about the same size as the Philippine economy. But considering that there are only over 300,000 Dubai emirates, their per capita GDP is at $54,000 as against the Philippines per capita GDP of $3800, at current prices. Surprisingly, only about 7 percent of Dubai’s income comes from oil and gas. A total of 93 percent of their revenues come from trade, manufacturing, financial services and investments. Knowing well that their oil reserves will not last a long time, Dubai has invested its oil revenues in foreign corporations, and in developing Dubai into a tourism and financial center. This is the reason for all the grandiose and never ending construction projects.
Aside from the now famous Palm Islands, the Burj Dubai, the World’s Islands, the underwater hotel and the mall with a ski area, the government is also building a $3.5 billion Light Rail Transit that straddles the main highways, and a 16-lane expressway. Together with all these infrastructure construction is the consequent housing and condominium construction which are housing and will house all the foreigners in Dubai now and in the future. The lag in housing construction is fueling inflation in the housing market so that a three bedroom house now rents for P250,000 a month and will cost a buyer P25 million to acquire.
I arrived at the Dubai airport at a little past midnight in the month of May and the temperature was 40 degrees centigrade. This was summer, and the locals told me that it could get as high as 45 degrees. But a check with the weather bureau showed that Dubai is cold in the months of December to March, when temperature could fall to as low as 15 degrees. With an annual rainfall of six inches a year, there is very little rain, but some years have experienced three times the average rainfall.
Interesting facts about Dubai; the men outnumber the women 3 to 1, it used to have a lucrative pearl industry until the First World War, while Islam is the state religion, it allows other religions to be practiced as long as there is no proselytizing.
I have done my investment exploration and I have a fairly good idea of the business that will succeed in Dubai, which would be a medium size investment that will complement the big projects rather than compete with them. I am now off to the best tourist destination in Dubai which is “Dune Bashing,” a kind of “White Water Rafting” except that instead of a boat, you ride a four wheel drive Land Cruiser over endless sand dunes in the desert, and end up in a desert camp at night for dinner and some belly dancing.