The UAE: Geopolitics, Modernity and Tradition 9781350989320, 9781786731913

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William Gue´raiche is Associate Professor, American University in the Emirates (Dubai). He has been Associate Professor of Social Sciences, American University in Dubai (UAE), Lecturer in Geopolitics, University Marne-la-Valle´e (Paris), and Lecturer in History at the Panthe´on-Sorbonne University. His research focuses upon the UAE and Gulf societies, Middle Eastern security, and diplomacy in the Gulf.

‘The UAE: Geopolitics, Modernity and Tradition is a welcome addition to the scarce, serious academic literature on the study of the Emirate. Insightful, analytical and revealing, it offers a thought-provoking read that will surely add to the lively discussion of GCC [Gulf Cooperation Council] politics.’ Kristian Alexander, Zayed University, Abu Dhabi ‘This book is a precious attempt to reveal the personality of Dubai and the United Arab Emirates. The author’s personal experience, as well as his intimacy with local culture, allows him to explain the situation of foreigners in the eyes of the local population: temporary guests, with duties and constraints, within a definite status, linked to that position. But the core of his purpose is to uncover the strategy of the rulers to carve the image of their young and affluent country on the global map. Here the author offers the reader a study based on more than a decade-long presence in the Emirates, providing insights far removed from the usual infatuation or criticism displayed by too many hurried observers in the face of the breathtaking pace of building a post-modern economy and sprawling cities in the desert.’ Marc Lavergne, Head Researcher, CNRS (National Centre for Scientific Research), Middle East Studies Department, University of Tours

THE UAE Geopolitics, Modernity and Tradition

WILLIAM GUE´RAICHE

Published in 2017 by I.B.Tauris & Co. Ltd London • New York www.ibtauris.com Copyright q 2017 William Gue´raiche The right of William Gue´raiche to be identified as the author of this work has been asserted by the author in accordance with the Copyright, Designs and Patents Act 1988. All rights reserved. Except for brief quotations in a review, this book, or any part thereof, may not be reproduced, stored in or introduced into a retrieval system, or transmitted, in any form or by any means, electronic, mechanical, photocopying, recording or otherwise, without the prior written permission of the publisher. Every attempt has been made to gain permission for the use of the images in this book. Any omissions will be rectified in future editions. References to websites were correct at the time of writing. International Library of Human Geography 42 ISBN: 978 1 78453 930 6 eISBN: 978 1 78672 191 4 ePDF: 978 1 78673 191 3 A full CIP record for this book is available from the British Library A full CIP record is available from the Library of Congress Library of Congress Catalog Card Number: available Typeset in Garamond Three by OKS Prepress Services, Chennai, India Printed and bound by CPI Group (UK) Ltd, Croydon, CR0 4YY

CONTENTS

List of Illustrations List of Abbreviations Map of the UAE

vii xi xv

Introduction Invited to the Sultan’s Court The time of an invitation The pervasive perfume of modernity Disparate sources

1 1 4 6

Part I

9

A State Like No Other

1. Branding Dubai: How Dubai became Dubai and the Emirates . . . the Emirates Audacity and voluntarism Success is not enough Branding Abu Dhabi

11 12 20 28

2. The Metamorphosis of a Traditional Society Legitimisation by the state The constitution put to the test Reforms

32 32 40 45

3. The Invention of Arab Muslim Liberalism Tribal capitalism Liberalism and interventionism A successful model?

52 53 62 67

vi

Part II

THE UAE

What Place on the World Map?

4. Agent of Globalisation Space(s) of globalisation Which relations with the West? Security

73 76 76 86 93

5. Persian Janus The Tunbs and Abu Musa Economic rapprochement or the iron law of the market The unexpected effects of the economic depression

99 100 104 112

6. Arab Fraternities The UAE, within the GCC From multilateralism to bilateralism? No Arab Spring in hot deserts

118 119 125 133

7. Asian Tropism The ‘Asianisation’ of the Emirates? A new Silk Road? Capital flows

139 140 148 156

Part III The Sky is the Limit

161

8. Dependencies From food security policy to outsourcing Water and electricity consumption, overconsumption Environmental assessments and political prospects

163 163 171 178

9. What Does Identity Mean? The uncertain future of the Emirati population What identity for which nation? Emiratisation

183 183 190 195

10. After the Depression The 2008 –9 crisis, facts and representations The debt of Dubai Back in business

202 204 209 211

Conclusion The UAE: A Pole of Stability

221

Notes Index

227 261

LIST OF ILLUSTRATIONS

Figures Figure 2.1 Border disputes.

37

Figure 2.2 New border alignment, 2005.

38

Figure 3.1 UAE oil and non-oil revenues in 2012 (%).

68

Figure 3.2 UAE GDP by sector (non-oil) in 2012 (%).

68

Figure 3.3 UAE oil and gas resources.

70

Figure 4.1 UAE port infrastructures.

80

Figure 4.2 Pipeline Abu Dhabi– Fujairah.

81

Figure 4.3 UAE free zones.

82

Figure 4.4 Free zones in Dubai.

83

Figure 6.1 GCC Railway project.

123

Figure 6.2 The Dolphin project.

131

Figure 7.1 UAE trade, by groups of countries, 2014 (%).

149

Figure 7.2 Abu Dhabi crude oil export per country, 2013 (% estimate).

153

Figure 7.3 Remittances of the Emirati OFWs, 1999–2015 ($ million).

158

Figure 8.1 Distribution of agricultural land in 2013 (%).

172

Figure 8.2 Desalination stations in the UAE.

173

Figure 9.1 Age pyramid of Abu Dhabi population on 31 December 2010.

186

viii

THE UAE

Figure 9.2 Age pyramid of the Emirati population in Abu Dhabi in the mid-2010s.

187

Figure 10.1 Manpower in the emirate of Dubai, 2006–12 (in millions).

213

Figure 10.2 UAE remittances to Pakistan (2005–14) ($ millions).

215

Tables Table 4.1 Emirati military expenses 1997 – 2014, constant 2014 dollars in billions (share of the GDP, %)

90

Table 5.1 Non-oil commerce between Iran and the UAE, 2004– 14 ($ millions)

108

Table 5.2 Non-oil commerce between Iran and Dubai, 2002–6 ($ millions)

108

Table 6.1 Emirati commerce with the other GCC states, 2004– 14 ($ billions)

124

Table 7.1 Asian share of the Emirati trade (%)

149

Table 7.2 Total commerce (non-hydrocarbon imports, exports and re-exports) between the UAE and its top five Asian partners, 2004– 14 ($ millions)

151

Table 7.3 Total commerce (non-hydrocarbon imports, exports and re-exports) between the Emirates and the main industrialised countries (US-EU), 2004 – 14 ($ millions)

152

Table 7.4 Remittances from the UAE, 2015 ($ millions)

157

Table 8.1 Value of food imports in the emirate of Abu Dhabi, 2005– 13 ($ millions)

165

Table 8.2 Comparison of the population and the food import in Abu Dhabi, 2005– 13 (core index 2005)

165

Table 8.3 Crop area, 2009 – 13 (area and value of production)

171

Table 8.4 Water consumption by category of consumers, 1990– 2010 (projection for 2025) in millions of cubic metres

172

Table 9.1 Estimation of the Emirati population, 2006–9

185

Table 9.2 UAE population in 2009

185

LIST OF ILLUSTRATIONS

ix

Table 10.1 GDP in the UAE, at current prices, 2008–14 ((e) ¼ estimation)

203

Table 10.2 Annual remittances from the Emirates, 2000–11 ($ billions)

214

Table 10.3 Contributions of Dubai and Abu Dhabi to the Emirati GDP, 2008 – 14 ($ billions)

218

LIST OF ABBREVIATIONS

AAAID ADFD ADIA ADMA ADNHC ADNOC ADS ADTA ADWEA ADWEC AGEDI ASEAN BBC BP bpd BRIC Conoco DCTBP DEL DEWA DFM DFSF DIAC DIFC DMC DMCC DNATA DPA

Arab Authority for Agricultural Investment and Development Abu Dhabi Fund for Development Abu Dhabi Investment Authority Abu Dhabi Marine Areas Abu Dhabi National Hotels Company Abu Dhabi National Oil Company Abu Dhabi Sources Abu Dhabi Tourism Auhority Abu Dhabi Water and Electricity Authority Abu Dhabi Water and Electricity Company Abu Dhabi Global Data Initiative Association of South-East Asian Nations British Broadcasting Corporation British Petroleum barrels per day Brazil Russia India China Continental Oil and Transportation Company Dubai Commerce and Tourism Promotion Board Dolphin Energy Limited Dubai Electricity and Water Authority Dubai Financial Market Dubai Financial Support Fund Dubai International Arbitration Centre Dubai International Financial Centre Dubai Media City Dubai Multi Commodities Centre Dubai National Air Travel Agency Dubai Port Authority

xii

DPC DPI DTCM DTTC Dubal DUSUP EAD EC ECWA Emirates NBD EPR FAO FNC GCC GCCIA GDP GFN GRE HCT IAEA ICD ICJ IEA IFAD IIED IMF IRENA JAFZ JETRO JODCO KEPCO MW NEC NGO NIOC OAPEC OGC OOC OPEC PIA QGPC

THE UAE

Dubai Petroleum Company Dubai Port International Dubai Tourism and Commerce Marketing Dubai Tea Trading Centre Dubai Aluminium Dubai Supply Authority Environment Abu Dhabi Electoral College Economic Commission for Western Asia Emirates National Bank of Dubai European Pressurized Reactor Food and Agriculture Organisation Federal National Council Gulf Cooperation Council Gulf Cooperation Council Interconnection Authority Gross Domestic Product Global Footprint Network Government-Related Entities High Colleges of Technology International Atomic Energy Agency Investment Corporation Dubai International Court of Justice International Energy Agency International Fund for Agricultural Development International Institute for Environment and Development International Monetary Fund International Renewable Energy Agency Jebel Ali Free Zone Japan External Trade Organisation Japan Oil Development Company Korea Electric Power Corporation megawatt National Electoral College Non-Governmental Organisation National Iranian Oil Company Organisation of Arab Petroleum Exporting Countries Oman Gas Company Oman Oil Company Organisation of Petroleum Exporting Countries Pakistan International Airline Qatar General Petroleum Corporation

LIST OF ABBREVIATIONS

RERA SCAD UAE UN UOG WAM WWF

xiii

Real Estate Regulation Authority Statistics Center Abu Dhabi United Arab Emirates United Nations UAE Offset Group Wakalat Anba’a al-Emarat (Emirati national press agency) World Wide Fund

60 km

Port hub

State borders Motorway Road Airport hub

QATAR

SAUDI ARABIA

To Doha

BAHRAIN

ABU DHABI

UNITED ARAB EMIRATES

Abu Al Abyad

ABU DHABI

Jebel Ali Khalifa Port

Dubai

3

Al Ain

DUBAI

Sharjah

Umm Al Quwain

5

3

OMAN

4

3

To Sohar

1 4 Fujairah 5 5

5

To Musandam

OMAN

1

To Musandam

Strait of Hormuz

To Muscat

OMAN

SHARJAH and FUJAIRAH OMAN and AJMAN

2

Ras Al Khaimah

Lesser Tunb

Map of the UAE. Source: Laura Margueritte

Umm al-Ishtan

Sir Bani Yas

Dalma

Lower Gulf

Abu Musa

Greater Tunb

Territorial dispute UAE-Iran

3 4

AJMAN FUJAIRAH

5

2 UMM AL QUWAIN

SHARJAH

1 RAS AL KHAIMAH

Gulf of Oman

IRAN

INTRODUCTION INVITED TO THE SULTAN'S COURT

Ara ma oreed (I see what I want) Mahmoud Darwish In her analysis of behaviour between Arabs and Westerners, Margaret Nydell insists on hospitality in the Arab world.1 Arabs, especially Bedouins, cultivate an art of welcome. They know that generosity towards the traveller and the visitor is vital to a ‘good reputation’ in a culture where honour and ‘what people might say’ are cardinal virtues. The Emiratis are no exception and take their host duties seriously. The Arab host offers tea, coffee or the place of honour at his private table, and, analogously, the local or federal authorities ostensibly show generosity with the visitors.

The time of an invitation This stance of hospitality implies an obligation in return: the traveller, whose journey in the Emirates will imperatively come to an end, is a guest. The Emiratis expect behaviour compatible with this status. During summer 2008, Emirati police arrested a British couple who had sexual intercourse on Jumeirah beach in the daytime. Beyond the indecency of the act on the familial beach and on a weekend day, the culprits were found guilty of sexual intercourse outside marriage, consumption of alcohol, insult and assault against the police officer who arrested them. These offences carried a 6-year prison sentence. The Emiratis were particularly shocked that the couple, instead of admitting their errors, took advantage of the press to denounce the prudery of the emirate. In a Muslim state that prohibits all forms of nudity, the authorities and the Emiratis expect that enforcing a dress code leads to public caution and therefore decency in public areas. However, the last straw for the ‘locals’, or the Emiratis, was that guests of the country, who had enjoyed the great advantages of the Emirati largesse – like a tax-free salary,

2

THE UAE

year-round resort facilities, amenities and beaches, accessible state-of-theart infrastructures, schools, health facilities and international business – did not reciprocate generosity and hospitality with respect for cultural differences. The incident highlighted the Emirati condition as both host and guest, or even victim of globalisation and financial ascendancy in the global marketplace. While the Emiratis are amazed by and even resentful of foreigners who, after leaving the country, have reported disillusionment or disappointment with the federation,2 they are also avid consumers of the global stage. This book aims to understand the Dubai model and its effects on the UAE federation. Since 2006, in the footsteps of Human Rights Watch, the West has openly criticised Emirati labour practices, especially in its construction industry, which exploits the South Asian workforce. As in the case of sexually explicit behaviour and attitudes considered lewd and impermissible, the Emiratis do not perceive their laws and practices as flawed in any way. For them, foreign labourers, mostly from the Indian subcontinent, benefit from salaries that are not only inconceivable in their home countries but also highly coveted. Furthermore, in theory, these workers are under the protection of a sponsor, pursuant to the kafala system, namely the several centuries-long Islamic tradition serving as both the written and unwritten statute of guardianship protecting the migrant worker in the host country. Long before the global economic crisis of 2008, the Emirati authorities acknowledged that ‘an issue’ regarding the vulnerability and mistreatment of the federation’s temporary residents does exist. However, the issue remains embroiled and muffled by the dichotomy between a legacy of hospitality struggling to keep up with a mission of unprecedented achievement on the global stage, and the Western parameters, often didactic, of globalisation. The status of guest is a complex one. Most of the Western expats, whose profiles do not match those of the Asian labourers, perceive their presence in the UAE not in cultural terms but in technical terms – namely, as ‘working abroad’. These opposite perceptions are a source of friction: regardless of the tasks they perform or the quality of their service, the Westerners are, in effect, guests of the Emirates for the duration of their mission. Highly paid, and compensated by beach, weather, luxury amenities and a seemingly cosmopolitan environment, they are enticed to stay in Dubai or Abu Dhabi for years or decades. After the age of 65, the rule is that foreigners must have acquired property – although owning an apartment or a villa does not automatically qualify for a resident visa – or leave the country. In other words, the Emirati authorities expect the guest to complete a service, participate in and contribute to the wealth of the federation and willingly return to his or her home country. Furthermore, the transnational relations are organised

INTRODUCTION

3

around the divide between Emirati and non-Emirati. Foreigners – Western expatriates or Muslims from outside the Arabian Peninsula – cannot assimilate with the Emirati nation. Land open to settlement which integrates or assimilates outsider populations is an impossible model. The national crucible that authorises the children of second and third generations to adopt the host country of the parents or grandparents encounters resistance. The Arabs of the Emirates think of themselves as a subset of the great Arab nation, or the Arabian Peninsula. This is a status that no foreigner can achieve, no matter how integrated in the machinations of the country, and no matter the years spent residing in the country, neither for him/herself nor for his/her descendants. The families of the Indian merchants settled in Dubai or Abu Dhabi for many generations have perfectly understood that they are unofficial citizens but not nationals.3 The Emirati sense of national unity as well as loyalty to tribal lineage governs rules on intermarriage and determines policies on demographic accountability so that, while Emiratis make up the minority of the population, they maintain the necessary affiliation to their sheikh and continue to see themselves as owners of their land. For the scholar working within the borders of the UAE, the social contract of host and guest can be cumbersome rendering the investigative and critical enterprise strained. Often the paradigm of Arab hospitality governs information as much as etiquette whereby everybody is sure of doing right and no dialogue is possible. Conversely, as Arab culture imposes full allegiance to the patron, the challenge for the resident scholar is not to slide from the position of guest to that of client. The bibliography on Dubai and the Emirates is torn between work that denigrates the Dubai model, and work that commends it. Critics have fallen into this trap of censure or praise. In the first category is the work of Syed Ali4 and, to a lesser degree, Ahmed Kanna.5 Dubai: The Gilded Cage, from the former, evokes the contrast between the insolent success and the tragic reality of certain categories of employees. Numerous developments in Ali’s book are interesting, such as the idea of ‘permanent impermanence’, but the intention to denounce tends to empty the book of its academic substance. Outside academia, many journalists seized any opportunity to demystify Dubai during its golden decade (1999–2008). Dubai Dream: Inside the Kingdom of Bling6 developed the argument, now a commonplace, that Dubai is not what we see or what we know. In the second category, authors like Wilson Graeme,7 are reminiscent of Arab travel literature. Ibn Fadlan or Ibn Battuta documented for posterity the perfect qualities of the rulers, generous and humble, heeding the advice of a wise entourage. The sympathetic body of work on the Maktoum family, Emirates Airline or the federation’s administration of justice is informative when placed in context. Such work converges with other

4

THE UAE

journalistic works, such as the writing of Jim Krane,8 who evokes disturbing aspects of the city-state like prostitution or migrant employment, but gives by and large a positive review of Dubai. Between denigration and praise, the middle path is narrow in terms of available books on the rise of Dubai and the Emirates. Christopher Davidson tops scholarly contribution to the knowledge on the UAE.9 For a decade, he has been frequently called upon by the media, universities and research centres. His work is indispensable because he places the emergence of the Emirates in the Arab and globalised world in a historical perspective. Davidson’s focus afterwards widened to include the Gulf.10 As an academic reference during the financial crisis and the Arab Spring, he was inevitably entangled in controversies beyond his academic work. His last book on the end of monarchies in the Gulf11 is not available in the UAE. Lately, Karen Young has focused on the state-building process and, notably, on the role of institutions.12 Other professional researchers are just a handful; not only that but Frauke Heard-Bey remains the main benchmark historian even though her book came out in 1982.13 Still, it lacks in-depth analysis on matters of political culture such as monarchical/tribal succession, analysed more thoroughly by Andrea B. Rugh.14 Also, there are only a few significant contributions on the role, culture, and evolution of women15 and similarly few on Emirati culture16 but both subjects are ultimately overshadowed by the renewal of themes such as migrations,17 prostitution18 or media.19 In addition, barring Christopher Davidson, no academic scholar has ventured to offer a comprehensive explanation of the Dubai and Emirati model. The economic crisis of 2008–10 sparked curiosity in the research community and it is likely that the work of Kanna,20 which studies the response of the government of Dubai, will set a precedent. Most recently, scholars living in the country have tried to integrate the local background into the regional context of the Gulf Cooperation Council members.21 Regardless, it is legitimate to wonder why academic research on Dubai and the Emirates is still in its infancy. Moreover, we might ask, what has not yet been subject to research or analysis and why? What questions have been subordinate to others? Finally, what is the direction of contemporary research on this singular representation of globalisation in the Arab world?

The pervasive perfume of modernity Until Dubai surged on the international stage with the inauguration of Burj al-Arab in 1999, the auto-proclaimed 7-star hotel built in the sea, rare were the Westerners able to locate Dubai or the UAE on a map. Ten years later, when the economic crisis hit the country, in September 2008, unaided awareness of Dubai had reached a peak. The Gulf city-state had become a

INTRODUCTION

5

surprising and sensational landmark of modernity and globalisation in the international media, generating mixed representations, both positive and negative, but rarely neutral. It is possible to imagine that the sensationalising of Dubai in the media created make-believe ideas that in turn paved the way for the dichotomy between glowing reviews and sharp criticism. Internet sources provided such an abundance of information on Dubai and the Emirates discouraging the user from looking and thinking beyond the surface. The Emirati authorities themselves have been strategically reluctant to communicate on issues considered sensitive. This fact comes as no surprise in regional tradition where rulers are protected behind high walls and their decisions made privately within. An aura of secrecy has surrounded the successions, for instance. The ruling families are leery of evoking them in the public domain. In this regard, there is no publicity related to the decisionmaking process. Rumours are part and parcel of the mental landscape of the residents. Residents can only surmise the rationale behind the decisions of the Emirati authorities. The complex mechanism of decision-making is privy to few, and the values on which it really relies or the type of interpersonal relations it entails is only just earning credence in research. Furthermore, it remains to be seen if the decision-makers are willing to contribute to greater understanding of the mechanism for those looking from without the walls of governance. The idea that what the foreigners perceive could be different from the reality stems from two factors. First, two cultural universes coexist. The Emirati leaders, in courting the economic fruits of modernity with fervour, have found themselves exerting every means to maintain their Arab-Muslim heritage while meeting the exigencies of globalisation. The international community’s demands for liberalism, reforms, the revisiting or dismantling of century-old alliances and the formation of new alliances have forced the rulers to work with more transparency. Moreover, the booming consumer culture and population size have become great determinants in decisionmaking. Some political decisions reflecting the shift from one side to the other, sometimes putting emphasis on tradition, and sometimes on modernity, baffle the onlooker. However, upon further exploration, the Dubai (and Emirati) model is no syncretism but the juxtaposition of different cultures. Second, Dubai was the first city-state in the world, alongside Singapore, to use a rigorous and long-term marketing strategy to accelerate its international exposure and raise its profile to a top tier destination for business and commerce. This nation branding is a case study. While the media carried out orientalist stereotypes, Dubai led the way for the other Emirati emirates and neighbouring countries in the Gulf, like Qatar, which copied its model of development.

6

THE UAE

How can we describe this composite reality without caricaturing the factors at play? Traditional approaches of political science or international relations, for instance, provide little understanding, on the one hand, of the balance of power between the local emirates and the federal government and, on the other hand, the relations between the UAE and its different regional or world ‘partners’. In the first case, tribal heritage organises interpersonal relations; in the second, the way the Arabs perceive the outside world is vital. The German and the French tradition of geopolitics have defined a new discipline that has borrowed from the social sciences; it is also original inasmuch as it analyses how the tensions crystallise on a said territory. Heir of geography, geopolitics starts from the spaces in order to analyse what characterises them. This is why thinking outside the Anglo-Saxon mindset is a prerequisite to understanding logics on the basis of their own criteria and principles. The relations between Emiratis and Omanis cannot be reduced to the diplomatic relations between Muscat and Abu Dhabi, for instance; personal connections link the populations and the officials on either side of the ‘border’, whose mere existence is questionable for the Bedouins. Because the Dubai model has relied on substantial promotional campaigns abroad, its description through the nation branding process, as in any other ‘commercial’ branding in the field of marketing, is meant to be all-inclusive but psychologically pliable and evocative at the same time. Therefore, room for interpretation can both be vast and limited depending on the road taken by the onlooker. With this geopolitical methodology in mind, tourism for instance, one of the pillars of Dubai’s policy of diversification, will not be analysed as a commercial activity but as a guideline of the branding strategy of the emirate. Similarly, while oil is at the core of the Emirati economy, its importance and role is viewed as part and parcel of an evolving and globally pivotal Asian tropism. Moreover, demographics, which is at the very centre of the Emirati identity crisis, opens the chapter on identity and the development of the national sentiment. This book finds new ways to create meaning from facts that might remain silent if broached from a classical perspective.

Disparate sources Making sense of the facts raises the issue of sources. The host/guest relationship explains why there is no free flow of information. The Emirati authorities, namely the local and the federal governments, consider that information that might be considered ‘public’ outside the federation should not be disclosed because it could harm the reputation of the UAE. Thus, during the 2008 economic depression, the official statistics were barely updated. Therefore,

INTRODUCTION

7

without data on migrations, evolution of the balance of power, etc., analysis is mere opinion. An intuitive perspective that develops after living in the federation for many years may be useful if filtered on three different levels. One level is comprised of personal interviews with Emirati officials. Christopher Davidson has used this technique in his books. The disadvantage is that one cannot quote the interviewed person for confidentiality reasons. The scientific value of this testimony is arguable, but, in the final analysis, interviews with Emirati officials or Emiratis are irreplaceable while being inoperable within scholarly research. On the second level is the press, which provides an interface for what the officials say confidentially. However, the use of media sources requires caution in discriminating between the expatriate vox populi, the voice of the authorities and the restricted voices of the remaining populations that make up the complex demographic spectrum of the primary cities, Dubai and Abu Dhabi. In parallel, the journalists who work for the most prominent regional newspapers exercise a form of self-censorship. They know, on the one hand, where to collect official information and, on the other hand, to stay away from sensitive issues that might embarrass the Emirati authorities. In this regard, the Emirati press is not state-controlled but a source in line with the ideas of the decision-makers and sometimes the echo of public relations strategies. Even so, this book could not have been written without the (printed) press. The archives of Khaleej Times, a collection of folders on themes with clippings of Emirati and regional articles, official and non-official reports, notes, etc., and compiled by professionals since 1978, supplied the substance of this book. Without the Khaleej Times archives this volume would not have succeeded in tracing back the first campaign of branding, for example. In this regard, the archives of the Emirati press agency, WAM, were indispensable for the analysis of diplomatic relations. On the third level, hypotheses central to the conception and materialisation of this book has been put to the test with my Emirati (and other) undergraduate and graduate students in Dubai starting in 2006. This work was conducted in full transparency without ever having the intention to harm, only to understand. Yet, any source of information, even carefully handled, remains subjective. This subjective dimension of available or silent information exerted inevitable influence on the analytical and critical enterprise. However, this aspect of resourcefulness has shown Dubai and the Emirates to be indeed on a human scale. The population of Dubai was 2.5 million in June 2016, but the Emirati population of the Emirates was merely an approximate million when the total population of the federation ranged between 8 and 9 million. The significant difference in size between the nationals and the temporary

8

THE UAE

foreign residents of the country, be they long-term immigrants or short-term contracted migrants/expats, highlights the value of the Emirati contribution, conditional or ambiguous as it may be, to the study of the modern Emirati vision and its enactment within the larger context of the Asian and global landscape, especially as threats to its national security are building at a rapid pace. This political and economic geography of the UAE is structured around three sections. The first deals with the changes of a traditional society. The introductory chapter traces the origins of Dubai’s branding in order to understand how Dubai became Dubai, and the seven emirates the federation that we know today. Its eclectic composition, Arab and at the same time consistent with the globalised world in terms of political system and economic model, precedes the second section. How do the Emiratis perceive the world? The underlying logic that organises the Emirati relations with the other states is original because while perfectly integrated into the network of globalisation, the federation does not maintain privileged but necessary relations with the Western powers, relations often conceived as subordinate to those with the Asian states. Conversely, the close relations with the Arabs of the Peninsula and even with Iran are at the heart of the diplomatic setting. The last section puts emphasis on the difficulties encountered through the rapid modernisation of the country, regarding the dependences (agriculture, water, electricity, carbon emission, etc.), the identity crisis and the economic crisis of 2008– 10 that tested the robustness of the Emirati society.

PART I A STATE LIKE NO OTHER

History, and recently geopolitics, opened the way to analysing mental perceptions or representations. In history, the dictatorship of events ceased when historians accepted their own subjectivity in the analysis of the past. Historical reality has thus been more a quest than a truth to definitely establish. This dialectic of the facts and their representations is as important in geopolitics. The actors, especially when they are in conflict, subjectively perceive the tensions that crystallise on a territory; in fact, Palestine remains the perfect case study in this regard. The United Arab Emirates emerged on the international stage at the beginning of the twentieth century at a time when the West had no clear representations of the small state. The branding of Dubai effected a positive image of the emirate and of the Emirates, contrasting with the orientalist perceptions of the Arab world. Advertising campaigns masterfully defined and created a glossy photograph that its detractors denounced as fake when the tide turned with the onset of the financial depression of 2008. Yet this reproach does not make sense: it would be analogous to reproaching Coca Cola for emphasising taste instead of the fact that over-consumption contributes to obesity. For historians, or specialists of geopolitics, the branding of Dubai has been an outstanding phenomenon: for the first time in modern history, a state used marketing resources to hasten its transformation into a major agent of globalisation. Behind the representations, the Emirati reality is complex. A perfect snapshot of Burj al-Arab, the iconic seven-star hotel of Dubai, only towered by an A 380 aircraft with the Emirates Airline colours, enables the spectator to believe that Dubai leans towards modernity. On the surface, no doubt, from the breathtaking Terminal 3 to the city’s architectural prowess, Dubai and the Emirates reinforce the status of the UAE, the Arabian Nights country for Westerners. This first impression sometimes leads to misunderstandings because, under the veneer, the Emirates have kept alive a conservative society. In their relations to the space,

10

THE UAE

the delimiting of boundaries or the political field, the Emiratis have tried to preserve their Arab identity. What, in fact, is sustained is a state of confusion and incongruity because the ruling elite sustains a culture of secrecy at odds with the transparency that democracy implies. The Emiratis invented Arab-Muslim liberalism. Interestingly, the market economy that seems consistent with the branding of Dubai and the UAE has been brought in line with the values of the Emirati society. The exemption of taxes is the display window of the Emirati model. The authorities also show their generosity by supplying, almost for free, state-ofthe-art infrastructures. However, there is a price to pay: outside the free zones, a pecuniary partnership with an Emirati citizen is imposed; and foreigners cannot buy Emirati land (only condominiums in specific areas). The subtle game of interrelations not only did not disappear, but also remains the cornerstone of business. This syncretism that exists so tenuously between tradition and modernity generates friction between the Emiratis and outsiders.

CHAPTER 1 BRANDING DUBAI:HOW DUBAI BECAME DUBAI AND THE EMIRATES . . . THE EMIRATES

In the late twentieth century, association of the terms ‘nation’ and ‘branding’ is an astounding phenomenon. The first term refers to studies by anthropologists and historians on the advent of the national sentiment, from the mid-nineteenth century onwards, among them ‘imagined communities’ conceptualised by Benedict Anderson.1 The second one is a marketing term, used to single out products’ names in order to facilitate their commercialisation. Therefore, how do nations interact with branding when it comes to ‘national branding’? Can marketing and other advertising experts ‘sell’ nations, be they nations of states or countries, as any other brand? At the beginning of the twenty-first century, the guru of nation branding, Simon Anholt, answered yes.2 Sales techniques build and spread ‘images’ and ‘representations’ of a said country; they help the states to better control and manage their image in the world. Nation branding has even turned into a multidisciplinary field that addresses new demands by states concerned about their reputation in a globalised world. State propaganda of the previous century is dead: the advertising community has found a formidable niche alongside diplomats and other public relations officials. If nation branding is an offshoot of globalisation, it is also the offspring of professionals in tourism who promote ‘destinations’ and in the financial community who attract foreign direct investments. In this regard, Singapore under Lee Kuan Yew in the 1970s and 1980s was a pioneer city that had the intuition of nation branding even before the term was coined. Dubai, often compared with Singapore, is the perfect example of nation branding, the cornerstone of its success. The genesis of its success can be traced back to the 1980s, escalating towards the beginning of the new millennium. Nation branding strategies have worked to define icons, spaces or events as immediately recognisable. Such strategies have also been employed by the

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Maktoum family, the ruling family of Dubai, and have proven so efficient that Abu Dhabi has adopted them under Sheikh Khalifa Al Nayan, the current president.

Audacity and voluntarism During the decade following independence (1971), foreigners had little reason for landing in the Emirates. Tourism was restricted to a handful of high-class hotels. Patrimonial resources were limited compared with other Arab countries, like Egypt or Syria, because of the dominant Bedouin culture; and the waterfront, a potential tourist attraction, required reinvention. The capital, Abu Dhabi, because of its immense oil resources, had a small advantage over the other emirates: a flexible organisation, the Abu Dhabi National Hotels Company (ADNHC) promoted its network of five-star hotels. In response, professionals in the sector acknowledged the promising potential of the UAE, such as Tunay Akoglu, responsible for tourism development at the Economic Commission for Western Asia (ECWA) in the United Nations’ network.3 The Emiratis themselves raised doubts about the UAE as a major tourism destination.4 The regional backdrop hampered the exponential growth of international tourism in the 1980s. For Western tourists, the northeast of the Arabian Peninsula was indistinguishable from Lebanon, which had been in the midst of a well-broadcasted civil war since 1975; what is more, the geographical proximity to the Iran–Iraq War cast a shadow on the neighbouring countries. The creation of an airline company and the establishment of a promotion board eased the challenges facing the fledgling tourist market in Dubai. Emirates Airline, gateway of Dubai The success of Dubai in the various economic sectors, with tourism at the forefront, is intrinsically linked to the ruling Maktoum family, whose leaders have not hesitated to take risks to develop the emirate. After Sheikh Rashid succeeded his father on 10 September 1958, he ruled his emirate as a company.5 To allow easy access to Dubai, an international airport was inaugurated on 30 September 1960. Because of its open skies policy (notably freedom licensing companies) and continuously updated infrastructures easily accessible at a low cost, Dubai became a hub for 42 airline companies by 1984. Due to the rising demand from the business community, Gulf Air strove to keep pace with this influx, but Maktoum was not pleased with the airline’s progress.6 In late 1984, Gulf Air issued its schedule for the following six months showing that Dubai was neither benefiting from new flights nor maintaining or expanding existing ones. Maurice Flanagan, the director of the

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Dubai National Air Travel Agency, better known today by the acronym Dnata, recommended in a report the creation of a new airline company, a solution implemented with the creation of Emirates Airline on 25 May 1985.7 Sheikh Mohammed granted a limited budget of $10 million and five months to make it operational. This venture was a risky one because Maktoum had high expectations in terms of quality of service but provided limited means and time for enactment and results. From the very start, Emirates was conceived as one of the elite airline companies in the world and Maktoum aimed at integrating the airline into a comprehensive policy for the promotion of Dubai. In partnership with Pakistan International Airline (PIA) and two aircrafts (one Boeing 737 and an Airbus 300), the venture started on 25 October 1985. Since then, Emirates Airline has won more than 320 awards. The results are impressive. In early 1990, Emirates positioned itself as a major competitor in the Asian market. The biggest advertising board ever made, set on the Vantage West Building in London, pointed out that the company connected London to Dubai 17 times a week and was a stopover for Asian destinations (Male´, Jakarta, Singapore, Bangkok, Hong Kong or Manila). By 1994, Dubai was a hub for 33 destinations with an annual turnover of $600 million. In June 2016, its fleet of 244 aircrafts connected 151 cities. By 2020, the year of the World Expo in Dubai, Emirates is expected to carry 70 million passengers in more than 300 aircrafts.8 Born in the context of air traffic deregulation in the 1980s, Emirates Airline’s success has relied on liberal formulae: Dubai airport is open night and day, an impossible policy for the busiest airports in Europe, such as Paris or London, because of noise-related costs; Emirates can maintain its aircrafts in flight 14 hours a day instead of 11 for its main competitors. Tax relief (there are no taxes in the UAE) and the cheap Asian labour force substantially reduce fixed costs, making them the lowest of all big airline companies.9 In addition, its competitors have claimed that the government of Dubai has financially supported Emirates.10 The appointment of Sheikh Ahmed bin Saeed, a member of the Maktoum family, as president of the group since 1985 has facilitated the spread of such rumours. The calculated positioning of Emirates in the market also explains the overnight success of the airline: nothing is left to chance. Mike Simon led a transnational advertising network under the umbrella of EmPower. At the beginning of the 2010s, this virtual structure connected 120 agencies in the world to promote one objective: publicise and advance Emirates as a global brand.11 Maurice Flanagan, from the very start, cognisant of the necessity of brand awareness, wanted Emirates to join the ranks of international brands like Coca Cola and Ford.12 Its core values have not changed: Emirates must innovate. Therefore, many advertising campaigns have pitched the

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‘airline of the future’: modern, consumer oriented, and home to the highest standard of service for an affordable cost. The brand sensibility, explained Mike Simon, is that Emirates is an international airline of quality, moving forward and serving a globalised community.13 The advertising teams targeted two demographics: busy business people looking for quality services, and demanding tourists who land in Dubai for a stopover or for their final destination. Sheikh Ahmad and Maurice Flanagan had a motto: what is good for Dubai is good for Emirates and vice versa.14 Thus, Dubai and Emirates grew in a common cause, and their promotion blueprints worked hand in glove. The annual report, a forum to promote the emirate as a globalised hub,15 shows that aviation in general contributed $26.7 billion to Dubai’s GDP in 2013 (7 per cent),16 the 2007– 8 report assessed the architectural projects and the most recent urban developments.17 Emirates Holidays was established in 1992 to sell Dubai as a destination, later diversifying its activity in the whole regional market (85 per cent of its business is in the Middle East). Marketing allowed a double construction in terms of image. What advertising professionals call branding aimed to match an airline with a city. Considering this commercial and promotional agenda, it is no wonder that Emirates has been the main sponsor of high-profile events in the city, such as the Dubai Shopping Festival, taking place from mid-January to mid-February annually since 1996. Three million shoppers, mainly coming from the Arabian Peninsula and the Arab world, take advantage of packages (airfares and hotel bookings). To boost the retail sale, affected by the hot summers, the Dubai Summer Festival turns the air-conditioned malls (built on the American model) into a big souk with a structured retail activity schedule. Both the winter and summer shopping festivals put Dubai on an equal footing with Singapore and Hong Kong, famous in Asia for their duty free offerings and sales. Within the Middle East, Dubai remains the favourite destination for Arabs who feel at home. The commercial and transportation infrastructures facilitate the development of these kinds of events. Attracting customers from outside the Arab world is a challenge. In addition to competing as a vehicle for a luxury, Emirates Airline has focused on sports, a necessary leverage to access the status of a world brand,18 becoming ‘one of the most recognizable brands in global sports,’19 The company has moved away from its original ethics and has entered aggressive marketing strategies. During his visit to the UAE, in December 1988, Leslie John Martin, former president of the Australian sports confederation, said bluntly that sporting events increase the touristic potential of a region or a state. An appreciable parameter, these events are a vast potential for job creation20 for the city and considerable exposure for the airline, and the

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Emiratis learned this strategy fast. This approach has certainly paid off, placing Dubai on the world map as the sporting capital of the Middle East.21 Sport conveys an image of youth, dynamism and competition. ‘Fly Emirates’, the slogan of the company, appears on all photos of awards ceremonies for major competitions held in Dubai.22 Even the choice of events is not left to chance. The Dubai World Cup is the brand event of the emirate, the most rewarded horse race in the world ($10 million). Emirates has been the main sponsor since 1996. On a symbolic level, this race subtly associates British and Arab culture. The hippodrome of Nad Al Sheba, home to the most sought-after thoroughbreds in the world, welcomes an international elite where men are formally dressed and women are dressed in the fashion of the Ascot derby. The Dubai World Cup also serves as an opportunity to emphasise the place of horses in Arab culture and to showcase the superlative form and ability of the Emirati horses. Nine Emirati horses won the cup between 1996 and 2016; in 2012, for instance, Monterosso, owned by Godolphin Racing, the private stable of the Maktoum family, won the race; in 2015, the horse of Sheikh Hamdan bin Mohamed Al Maktoum, Crown Prince of Dubai, Prince Bishop, made a ‘historic’ victory in front of a panel of celebrities. As Carter Carnegy, who promotes British horse racing, pointed out: the World cup shapes the image of Dubai and brings influential people to Meydan; it is a good illustration of Dubai’s soft power.23 While they are becoming more democratic, two sports have kept their aristocratic values: golf and tennis. In the Emirates, they are also the two favourite sports of upper managers, who turn into spectators during two tournaments. The world elite meets in the green of Dubai (Dubai Desert Classic and Dubai Ladies Masters) or within the walls of the Irish Village (Dubai Tennis Championships in March). Emirates, the official sponsor, is also the official company for all players. Even when Dubai organises sporting events with a lower profile, such as speed racing (UIM Class 1 World Powerboat), sailing (Emirates Team New Zealand for the America’s Cup), rugby sevens (annual tournament since 2009), and football, its international exposure heightens. Football, sometimes known for its aggressive fans, however, while very popular, is not necessarily a good match for the image of Dubai. Emirates, therefore, carefully chose to sponsor the best teams in the English Premier League, which proved to be an excellent compromise. The English championship is among the top world leagues (if not the best), such as the Calcio in Italy (the Spanish clubs upset the hierarchy in the 2000s). Emirates wisely chose Chelsea to wear the ‘Fly Emirates’ motto on its blue jersey from 2001 to 2005, and paid £24 million (the second highest budget in the league after Chelsea’s eternal economic rival, Manchester United) to broadcast the global presence of Dubai and imply a rooted cultural alliance.

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In 2004, Emirates’ involvement in the English league reached new heights with the partnership with Arsenal (£100 million). In the case of Arsenal, Emirates paid £357 million, the most important transaction in the history of English football, to name the team’s stadium ‘Emirates Stadium’ for 15 years; in addition, Arsenal players, like their counterparts in AC Milan and Paris Saint-Germain (PSG), wore ‘Fly Emirates’ on their jerseys. In the midst of the FIFA succession crisis in June 2015, Tim Clark, CEO of Emirates, undaunted by the scuffle and empowered by Emirates’ now highly established reputation, made an opportunistic move when he announced that the company was looking forward to sponsoring the next World Cup.24 Aeronautics extends this marriage of convenience between Dubai and Emirates. More than two hundred exhibitors (civil and military aircraft manufacturers, etc.) attended the inaugural Dubai Air Show on 29 January 1989. From the outset, the event was hailed as a critical success. Its reputation has gained enough momentum to become one of the three leading world aeronautics shows, with Farnborough in England and Le Bourget in France, and the first in the Asian and African markets.25 In the meantime, Emirates Airline, the rising star of Dubai, has generated a steady growth of passengers. The airport infrastructures are continuously updated in light of the fact that passenger traffic broke the 15 million mark at the beginning of the 2000s and 51 million in 2010. The first extension works started in late 1989 but became indispensable as soon as Emirates ordered the new Airbus 380 at Farnborough26 as the jumbo aircrafts require additional boarding gates rather than new tarmacs. The construction of Terminal 3 started in 2004 for an estimated cost of $4.555 billion. On May 2008, a new terminal entirely devoted to Emirates began operation. This cooperation between a transnational corporation, namely, Emirates Airline, and public authorities sets a business model precedent particularly unique in the region.27 This success story is a tale of intelligence combined with audacity. In the 1980s, neither Dubai nor Emirates had a decisive advantage over the other emirates (Abu Dhabi, or even Sharjah), the rich neighbouring monarchies such as Kuwait or more famous airlines. Dubai was an oil-producer whose resources were depleted. Yet, the image of Dubai, expertly built, made a difference. Dubai Commerce and Tourism Promotion Board (DCTPB) The Dubai Commerce and Tourism Promotion Board was established to promote these two sectors in the emirate. Its policies shed a complementary light on the marketing strategies of Emirates. From 1989 to 1997, the DCTPB defined an aggressive strategy to increase the spontaneous brand awareness of the city. The business model was original because Dubai was

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not positioned merely as a tourism destination. Tourism was conceived as a leverage to attract foreign direct investments and to diversify the emirate’s post-oil economy. The professionals in this sector agreed that a structure of coordination was missing. In 1983, an expert in tourism development in the Arab world recommended that the federal government set up such an organisation.28 At this time, divergent interests favoured uncoordinated initiatives. Dnata (under the umbrella of Emirates) acted in a managerial capacity, even though this was not its initial goal. The mismatch between service demand and supply led to a loss in earnings. The commercial, industrial and sustainability potential of the emirate contrasted with its image abroad: a survey of 600 businesspeople in France, Germany, Italy and the Netherlands showed, for instance, that unsolicited awareness of business opportunities in the UAE was very low.29 Moreover, surveys from the hotel industry showed that Dubai’s commercial visibility and economic viability required a better support system for global promotion. The Maktoum family had always given the merchant community an attentive and responsive ear. In accordance with this tradition, a series of meetings was held in 1988 with officials of the chamber of commerce, the international airport, the Jebel Ali free zone, etc.30 As a result, Sheikh Maktoum bin Rashid al Maktoum, the crown prince of the emirate, established a promotion board not limited to the tourism sector. On 20 April 1989, the sheikh signed a decree organising the Dubai Commerce and Tourism Promotion Board (DCTPB). Its officials never hid their intention to emulate Singapore or Hong Kong. Incidentally, a former general director of the Hong Kong federation of industries was appointed executive director of the board. Lawrence Mills first strove to build momentum among actors and to boost existing projects. The two guidelines of his policy were to attract tourists by diversifying the entertainment sector and removing impediments to business.31 With the Emirates Airline model in mind, the ruling family created the coordination board with result-based obligations. At the dawn of the new decade, the government of Dubai and its main business partners assessed the city’s visibility and viability. The city was not only unknown abroad, but also, when it was, its image was not clear.32 At best, Dubai was associated with Gulf monarchies and their oil rents. To counteract this impression of limited commercial potential, emphasis was put on the free zone of Jebel Ali and the tax benefits attached. The DCTPB promoted this location as the perfect Middle East hub for any business headquarter because of an advantageous fiscal policy. Dubai is ideally located half way between Europe and Asia. The promotional campaign therefore points to the destiny of the emirate as a stronghold of ‘globalisation’. What is more, the desire to take on business

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opportunities at their maximum potential encouraged for open-mindedness and tolerance, complemented by state-of-the-art infrastructures. Consequently, the city emerges in the promotions as a potential top world destination. In its infancy, at the beginning of the 1990s, the promotion board had a $7 million budget aimed at winning Dubai the reputation of a luxury and high-profits business destination. This was made clear early on at a press conference held by Mohi-Din A. Binhendi, general director of civil aviation and co-president of the board. At the time, the branding of Dubai was still nascent. No one even used the term to describe the strategy. Local authorities and professionals nevertheless agreed on two very essential and consequential points, security and luxury. While belonging to the Arab world, typically associated with conflict and volatility, the emirate was supposed to evoke a positive and stable representation. Security was therefore the cornerstone of the image: Dubai is a safe city where commercial interest and, above all, peoples’ lives cannot be put in jeopardy. This postulation has structured all promotional campaigns since 1989. The Gulf War brought food for thought. In September 1990, the promotion board issued a two-page document on the stereotypes Westerners have of the region. Local media repeatedly assured viewers, listeners and readers that the emirate was far from a combat zone; promotional weekends were offered in order to cut short alarming rumours.33 Nevertheless, the late 1990s and the turn of the millennium saw the culmination of political and economic crises: terrorism and war became linked when the invasion of Iraq continued and was followed by the attack on 11 September 2001; health crises such as the bird flu in 2009 and the corona virus in 2013 affected people’s sense of secure air travel and tourism. The economic depression (2008–10) had negative repercussions on the city; in parallel, since 2011, the rise of radical Islam, with Daesh at the forefront, posing an existential threat to the federation, has topped the security issues. Each time, public relations officials have rushed to point out that the authorities take all due precautions to protect and insulate Dubai from external dangers. In parallel, the police forces combed through the city to eradicate criminality. Security has been an external regional issue as well as a domestic matter. A buoyant urban area, Dubai inevitably lured all kinds of traffickers. To clearly differentiate Dubai from competing destinations, where petty or conventional crimes poison the tourist industry, the promotion board repeatedly underlined, and to this day, that one of the main highlights of the emirate is its security.34 A carbon copy of the Singaporean policy, the repression of drug dealers has been broadly publicised. The message has been crystal clear: zero tolerance. Surveys or polls that have emphasised Dubai as the safest city on earth are the end result of a 20-year political endeavour and media campaign.35 This reputation is fragile

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and requires relentless determination.36 In addition to security, a second factor has shaped the branding of Dubai: its leaders have known from the start what they did not want. The tourism boom of the 1980s generated the destruction of the seashore under concrete like in Spain. Indeed, Spain was often noted as an inverted mirror, a foil for Dubai’s pretentions: the emirate should never become a mass beach tourism destination.37 Tourism is only beneficial as long as it attracts a targeted high-end market. The Department of Planning, in 1993, issued statistics on hotel occupancy by categories going back ten years. In 1980, out of 347,400 tourists, 241,184 and 86,013 made use of Deluxe and first-class accommodations, respectively, comprising almost 90 per cent of the market. 1988 confirmed similar trends: out of 632,903 overnight stays, tourists chose 317,151 Deluxe and 143,190 first-class hotels. The Gulf War might have affected the premium market, but top clients still represented half of the customers in 1992 (out of a total of 944,350, 317,151 slept in Deluxe and 143,151 in first-class hotels).38 This upmarket clientele benefiting from a high purchasing power enjoyed indirect triggered activities like shopping. Developers of shopping malls lobbied to accommodate this demand. Until the 1990s, these malls, such as Al Ghurair, which opened in 1981 in Deira, the ‘old town’, were built close to the top hotels and not far from the airport. The growth of the tourism sector relied both on hotel infrastructures and top consumers spending at the retail level,39 instead of visiting the historical highlights as in the Egyptian or Syrian models. Because the DCTPB streamlined its strategy to attract an aristocracy of tourists for the sake of enhancing Dubai’s image and generating opportunities, business tourism was particularly encouraged. By the early 1990s, transnational corporations had begun outsourcing their regional headquarters to the emirate. Conferences and other business seminars took place in the luxury hotels. In 1991, Dubai was the first business tourism destination in the Middle East, a privileged position that it has never lost and even strengthened, although Dubai and Abu Dhabi now jockey for that position.40 Businessmen (very few business women) who stay in Dubai to negotiate contracts or attend seminars become excellent ambassadors of the city. To subtly flatter this Very Important Persons demographic, no detail has been left to chance. For instance, in 1994, a special reception service at the airport was organised to free these busy people from all logistic constraints (from immigration to a limousine pick-up and drop-off). Selling strategies abroad was derived from this emphasis on the highend market. Visitors have stemmed from countries with high GDP per capita (Gulf States and Western Europe). After Khalid Ahmed bin Sulayem was appointed executive director in September 1993, the DCTPB geographically expanded to encompass emerging Southeast Asian countries as well as South

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Africa and India.41 Consciously keeping up with the evolution of globalisation explains this expansion and, prior to the Asian crisis in 1997, Asia appeared to be a promising market. Regardless, Patrick McDonald, general director of the DCTPB, carefully pointed out that attending international fairs in Asia was no major strategic change.42 The promotion board became a form of heavy machinery whose activity was not confined to Dubai. A transnational network spread to sell its image abroad. Employees, whose mission was to bring the limitless possibilities of Dubai and Western demand together, were appointed in London, Paris, Milan, Tokyo and Hong Kong. In short order, a permanent delegation replaced them. On 19 November 1990, the first international office opened in Philadelphia, chosen for its strategic location between New York and Washington, the two capitals (economic and political) of the United States;43 two others followed in London and Paris in August–September 1995.44 The primary tasks of these bureaus were to collect orders from tour operators, to organise seminars and presentations and to attend fairs in their respective locations.45 Today, a total of eighteen agencies have broader remit and are supposed to represent the emirate abroad. In 1992, the first comprehensive campaign, ‘Decide on Dubai’, targeted potential Gulf tourists. With the tagline ‘Anytime is a good time’, the emirate was positioned as a familial destination for short stays and a variety of entertainment activities (shopping and sporting events); a different campaign focused on business opportunities.46 Coinciding with the Palestinian–Israeli peace process in the early 1990s, the promotion endeavour yielded excellent results. In August 1993, the campaign was launched again, refined, and adjusted to other markets. In 1995, the DCTPB harvested its first tangible successes: Dubai was among the top ten destinations in the world for the British traveller.47 The aggressive strategy to capture new markets continued with the opening of new bureaus and a greater presence in exhibition spaces and professional fairs. The promotion board was swift to take new steps: it immediately understood the potential of the Internet in the late 1990s, opening a site accessible in rare languages such as Swedish and Norwegian.48 The approach paid off. Within less than a decade, Dubai magnified its international exposure and overshadowed head and shoulders not only the other emirates but the neighbouring monarchies as well.

Success is not enough From 1997 onward, the branding of Dubai exceeded the sum of all worldwide advertising campaigns. The exercise was not the mere promotion of a destination for tourism or foreign direct investments. During a press conference,

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Khalid A. Bin Sulayem stated that the success of Dubai rewarded a well-planned marketing strategy in the region and beyond, as well as a fruitful collaboration between the private sector and the local authorities.49 From Department of Tourism and Commerce Marketing (DTCM) to Brand Dubai In 1997, in accordance with Law n8 1, Sheikh Maktoum bin Rashid Al Maktoum, ruler of Dubai, established the Department of Tourism and Commerce Marketing (DTCM) which replaced the DCTPB. Vast powers were vested in this structure, more official than its predecessor; in fact, this department was upgraded to become a ministry of the government of Dubai. Its mission was to promote the image of Dubai, and to supervise the planning, regulation as well as the development of tourism and trade within the emirate.50 In a leaflet, the general director, Khalid A. Bin Sulayem, stated that DTCM was a direct continuation of the promotion board. The same commercial guidelines applied; the new department was supposed to attract foreign direct investments sustaining diversification and high quality activities.51 Tourism revenues had to overtake the oil rent (at the time, one-fourth of Dubai’s GDP) before the advent of the new millennium.52 The DTCM used the most sophisticated marketing techniques to perform its duties. The 1997 law made it clear that the organisation’s core activity was tourism and commerce. Yet, the department increasingly focused on the first rather than on the second sector. Other departments took over the responsibility of commercial aspects, for instance, the Department of Investment worked in partnership with the Dubai Chamber of Commerce. As a result, tourism represented 80 per cent of the DTCM budget. A special committee designed new projects and ensured their completion. Ad hoc workshops carried out direct and indirect activities linked to tourism: hotels, hotel-apartments, whose development had been widely successful in the emirate,53 car-rentals, tour-operators, airlines, etc. Regular meetings advanced dialogue between the different partners. Yet, the DTCM did not forget its complementary objective to facilitate commerce in general. Obstacles were identified and, as far as possible, eliminated (processing tourist visas at the airport, accepting different driving licenses to ease car-rental procedures, etc.). The search for new markets continued. New countries of the global South (undeveloped countries) became a potential market. The government of Dubai established relations with the main tour-operators and travel agencies of this new market. Promotion campaigns were launched and, in parallel, Dubai’s representatives reinforced their presence in exhibition spaces and fairs in the region. Most of the time, the professionals in the sector did the lion’s share of the work in their countries and the department operated

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in a supporting capacity. At the beginning of the new millennium, Dubai was already a brand, which facilitated its promotion.54 One key factor of this success has been the cooperation between the private sector and the Dubai authorities.55 Pragmatically, Khalid bin Sulayem recognised that the DTCM must address challenges and obstacles on an individual basis. The volume of activity rendered the planning and coordination of efforts necessary, as well as the anticipation of potential challenges. The planning of Dubai’s development was simply outstanding. The emirate is equivalent to a middle-size city in Europe (half a million inhabitants) but with the ambitions of a state. In July 1997, the Master Plan prioritised tourism. Qassim Sultan, the general director of the Dubai Municipality, explained that development was planned through 2005 and even 2020. The municipality reviewed zoning regulations and distribution in order to grant more lots for hotel construction, preserving at the same time green spaces. These guidelines seemed to follow urban development designs based on the making of European cities. The planning toward the new millennium and beyond changed the scale and growth of the urban projects. The authors of Vision 2010 made sure that the objectives complied with federal policies, namely sustaining high growth and diversification of economic activity. The plan underlined the ‘vision’ of the Maktoum family: the emirate had to reach the development level and ‘status’ of a developed country by 2010; moreover, Dubai had to be seen as the regional leader. To achieve its ambitions, Dubai needed a 5 per cent annual growth.56 The results exceeded the forecasts: it took half the time scheduled for the objectives to be achieved.57 The making of the Dubai Strategic Plan, late 2006 to early 2007, acknowledged more audacity. The philosophy remained the same: boosting local economy and attracting foreign direct investments. However, the plan took a new dimension, incorporating new aspects such as improving quality of life, and implementing sustainable development.58 The combination of a vision, planning and its implementation resulted in the success of Dubai, stated Khaleed Bin Sulayem. Once the goals were well defined, the logistics followed; the administration also provided recommendations and the best ideas were taken up in the following master plans.59 With planning, the DTCM found its right place in a global project that created its own dynamic. The last stage of implementation was reached during the 2008 economic depression. Even before Dubai relied on outstanding advertising professionals to promote its image, the government of Dubai had already devised a branding strategy; ironically, Dubai’s foresight led the way before nation branding became a trend, and even before Simon Anholt coined the term. On 12 June 2009, amidst the financial and real estate depression, Sheikh Mohamed bin Rashid Al Maktoum, ruler of Dubai, created a new administrative and strategic body, Brand Dubai, under the umbrella of the

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Government of Dubai Media Office (GDMO). It aimed at coordinating the media strategy of the emirate. Its core responsibility was to streamline and improve the image of Dubai as an Arab city with an international capacity.60 The city’s architectural prowess epitomised its spirit and became its main business card or signature, so to speak. Inventing tradition The success of Dubai, never left to chance, has been the result of the political determination, audacity and clear-sightedness of the Maktoum family. The sheikhs who succeeded since Rashid have cultivated an art of governance, picking the right advisers and officials in their entourage. While the ruling family has the final say in all strategic matters, its mindset is original in the Arab world, willing to look beyond authoritarianism. Marketing strategies were not the only strengths of the implementation of the vision for the emirate. To streamline its branding strategy abroad, officials had to bind the representations to tangible results, even if facts had to be redesigned to take the appropriate shape. In this regard, the promotion of tourism is a perfect case study. The image of Dubai weaves tradition and modernity. The first step was to redesign Western representations of the Middle East and Arabs. The succession of conflicts (the Palestinian issue, civil war in Lebanon, the Iran– Iraq War, the invasions of Kuwait and Iraq) and acts of terrorism escalating in the 1980s favoured the association of the Arab world with violence and instability. In an interview given in March 2001, Maria Kaselitz, responsible for the promotion board for central Europe in Frankfurt, recalled that the main question asked of her ten years before was a question of safety with regards to the standing of the emirate in regional security. Promotional campaigns turned the tables before 11 September 2001.61 This endeavour that had begun under the promotion board continued under the department of tourism. In 2002, the campaigns’ central brochure, Destination Dubai, presented the experience of visiting Dubai as the authentic Arabic experience.62 Advertising agencies contributed more to the content of the promotional leaflet than anthropologists or historians. Firstly, the hospitality of the Bedouins was lauded. To reinforce this image, tourism officials sought premium quality reception and services for this experience. To entertain the European tourists (the Arab tourists from the Gulf region were not the target) so-called ‘traditional’ activities were offered with all the advantages of modern comfort. Secondly, the experience of the desert became a four-wheel drive safari in the dunes followed by a camp before nightfall where participants ride a camel and appreciate the prowess of a belly dancer. Food was labelled Arab, while in

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reality it was mainly Levantine cuisine. Thirdly, as the historical footprint is very light, the Heritage Sites and Events office of the DTCM reinvented local tradition. The flexible concept of ‘heritage’ authorises ambiguities of a reconstituted past. This is clear in Awadh Al Seghayer’s, director of the Heritage service since its creation in 1997, statement: there is a niche for historical tourism;63 the Dubai Museum, as well as the house of a merchant in Deira or Hatta village are historical reconstitutions where tourists, or school children, can come face to face with a scene of everyday life from the past. Finally, the European tourists are very fond of souks. Like the ‘old’ historical buildings, the merchant quarter of ‘old’ Deira was adjusted to match the facilities and conveniences of modern shopping. The authentic Arab experience and ‘rooted heritage’64 is an avatar of nineteenth-century orientalism and perfectly fits the expectations of the upmarket clientele that ventures outside the air-conditioned shopping malls. It carries out a condensed vision of Arab-Islamic civilisation, a striking contrast to the emirate of Sharjah, which takes the transmission of this civilisation very seriously. Nevertheless, this experience reminds the tourists that they are in dar al-Islam, the abode of Islam. Promotion campaigns use mosques as an open invitation to the comprehension of Islam. Consumption of alcohol is allowed in hotels and certain free-zone areas such as the Irish village or Madinat Jumeirah, a decision taken from the very beginning of the branding campaigns.65 In another show of cultural compromise, the call to prayer does not exceed a certain volume. Thus, Western tourists, the target market, can afford not to change their lifestyle during their stay in the emirate. Yet this sacrifice to economic profit has put the traditionalists on the defensive. Conservative Emiratis and other Arabs have come to believe that Dubai sold its soul in exchange for the Sheikh Zayed Road (the main motorway) skyline. The icons Branding Dubai has relied on gargantuan projects that have transformed Dubai into a permanent show. The urban area, the opposite of a pedestrian city, is covered with individual cars, rarely by bus or metro, travelling from one iconic structure to the next. Burj al Arab, Palm Island or Burj Khalifa might be described as the modern world wonders. Burj al Arab is the icon of Dubai. The Maktoum family asked the architect Tom Wright to conceive a symbol for Dubai that would put the landmark on equal footing with the Eiffel Tower or the Sydney Opera House. The traditional boat, the dhow, inspired its design. At 321m above sea level, the Burj was built on an artificial island for an estimated total cost of $650 million. The structure is the only self-proclaimed 7-star hotel in the

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world. Its construction started in 1994 and was inaugurated in December 1999. The success was immediate. The world’s press characterised it as one of the new seven wonders. Its silhouette, easily identifiable, has widely been used by default as the city’s logo representing audacity, luxury and aesthetics. Celebrities participated in the marketing buzz: Andre Agassi and Roger Federer exchanged a few shots on the helicopter platform; Tiger Woods practised his drive facing the sea. Based on this success, Sheikh Mohammed, then crown prince of the emirate, announced in April 2001 the realisation of Palm Island, the biggest manmade island ever constructed. Its peculiar shape allows the upmarket clients to enjoy individual private beachfronts. Excitement gained momentum within the tourism industry. Beyond the luxurious villas and hotels that were planned for the ‘Palm’, the intense media coverage predicted hugely profitable business opportunities.66 Two names stand out like a leitmotiv, the first, Nakheel (palm tree in Arabic) developers (owned by the Maktoum family), and, second, Dubai Inc. The promotion of the Palm was an immediate success. Palm Jumeirah, whose construction started in June 2001, preceded Palm Jebel Ali, near the free zone, and Palm Deira (October 2004). A similar project was unveiled in May 2003 by Sheikh Mohammed: The World, an archipelago of more the 300 manmade globe-shaped islands. Promotional campaigns again made use of celebrity marketing power. Richard Branson announced in person from the ‘Britain’ island of the archipelago a direct London–Dubai flight on the new Virgin Atlantic. Michael Schumacher, seven times world champion of Formula 1, glamorously posed for photographers with Sheikh Mohammed on one of the islands in October of the same year; the singer Rod Steward and the football player David Beckham were the highlight of media rumours suggesting that they were potential buyers. The last project to be unveiled in January 2008 seemed a perfect fit with the ambitions of Dubai: the Universe, whose completion would likely take between 15 and 20 years. Even if the economic recession of 2008–10 did hit the developers full force, these projects served their purpose in terms of branding Dubai on the world stage. In the land of superlatives, it made sense that the tallest tower in the world would elevate the skyline of Sheikh Zayed Road. The construction of the jewel of the crown broke ground on 21 September 2004. Sheikh Mohammed and Sheikh Khalifa inaugurated the much-anticipated tallest building ever built on 4 January 2010. The secret regarding the building height was disclosed: 828 m. Sheikh Mohammed Al Maktoum trusted the giant of the Dubai real estate industry to develop the project, Emaar, led by Mohammed Ali Alabbar, his man of confidence and former director of the Department of Economic Development. The marketing strategy was reminiscent of the early days of aggressive branding of the city: ‘Burj Dubai. Monument. Jewel. Icon.

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THE UAE

Burj Dubai will be known by many names. But only a privileged group of people will call it home.’67 The leader: ‘Sheikh Mo’ Sheikh Mohammed bin Rashid Al Maktoum is the flagship of Dubai. All nations have had their ambassadors and international personalities, such as Bill Gates, Claudia Schiffer or Zinedine Zidane. Only a handful of politicians, however, have reached that world fame: Nelson Mandela and Hugo Chavez, before they both died in 2013, are two of the few. Yet, Sheikh Mohammed follows their footsteps. He carried significant responsibilities as a junior politician: chief of police when he was 18 and minister of defence two years later, he has accumulated a great deal of experience in all key sectors starting with security. In 1981, when Sheikh Rashid, his father, was incapacitated by sickness, he became increasingly more involved in the governance of the emirate with his brother. Sheikh Maktoum succeeded his father on 4 January 1991, but when Sheikh Mohammed became ruler of Dubai on 4 January 2006, he was already a figurehead of the emirate. His accession to power seemed to formalise a position that he had already been granted, although he was the Benjamin of the offspring (usually the cadet succeeds his brother).68 Sheikh Mohammed presents himself as an Arab who is proud of his identity. He cultivates his image as a man of letters, poet, and outstanding horse rider (2012 world champion of endurance racing in Britain). But he is especially famous as an untiring organiser sustaining audacity and the familial tradition of the Maktoum. ‘Sheikh Mo’, as he is casually called, is famous for following up on the affairs of his emirate, whether by unannounced visits to administrative meetings or by listening to those who want to be heard at his majlis. The local press never fails to follow the footsteps of the sheikh on his journeys. The last facet of his tribal chief profile is his generosity. Working to show that education is a key factor of development in the emirate and in the Arab world, Sheikh Mohammed has presented himself as a liberal-minded benefactor of the right to education. In 2007, for instance, he supported the implementation of school infrastructures in the Middle East branding the initiative, with the slogan ‘Dubai Cares’, to raise awareness and funds. The campaign’s objective was to provide elementary education for all children of poor states in accordance with the goals defined by the United Nations in its Millennium report. The following year, during the month of Ramadan, and under the auspices of the World Health Organisation, Sheikh Mohammed launched the initiative, Noor Dubai, to fight blindness in the region, a campaign that very successfully yielded more than $900 million. More recently, in January 2015, as an education-based humanitarian response to the

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2014 attack on the Gaza Strip, ‘Rebuild Palestine. Start with Education’ sent 50,000 school kits to the UNWRA schools. Arab chief, but also modern leader aware of the economic imperatives, Sheikh Mohammed directs also the destiny of his emirate. Before the economic depression, his personal wealth was estimated between 6 and $18 billion.69 His control of the parastatal companies, the government related enterprises commonly called GRE, like Emaar, Nakheel and Dubai Holding, makes him head of about twenty companies in the financial, health and telecommunication sectors. Seeking more Fortuitously, the branding of Dubai had reached maturity just before the economic crash. Its image in the emirate as well as abroad impresses the onlooker as permanently moving forward, and this is representative of forward-thinking and even pre-emptive leadership. Even before 2008, the government leaders did not take the branding success and the results for granted. The advertiser Rob Frankel, branding expert, stated that everyone knows what Dubai has to offer but that it was time for the team behind ‘Brand Dubai’ to ‘really push home the awareness that they have created, while adding something new to the mix.’70 In other words, the city-state needs to permanently reinvent itself to maintain leadership in certain sectors such as international finance and consumer markets. Prior to 2010, $275 billion in total had been invested in real estate, free zones, ports, airports and other infrastructures. Living up to his reputation, Sheikh Mohammed weathered the storm, eager to regain momentum. In 2007, the government of Dubai applied to host the 2016 Summer Olympic Games but withdrew its bid in September of the same year (Qatar also participated). Early December 2012, the emirate declared again its candidacy for the Games in 2024. This world event would be a sure sign of recognition on a global scale. In 2013, Dubai was more focused on ‘Expo 2020’, the World Fair, which would bring the ‘world’ to Dubai.71 Regardless of its singular success, the image of Dubai has been vulnerable to competition and even unforeseen stumbling blocks. The competition with other cities or states in the same league72 has been challenging at times due to the image of the city itself. The use of superlatives, namely, ‘the tallest, the biggest, the richest’ was sometimes misleading when projects did not materialise as planned.73 If the brand does not evoke a reliable and ingrained emotion, the marketing capacity may be in danger. Dubai must therefore maintain an unequivocal identity in order not to become assimilated into a generic global city in the US, China or Western Europe, for example. Human rights issues against the backdrop of the Arab Spring,74 or the controversial use of labour coming from the Indian sub-continent, might also alter the

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THE UAE

brand image of the city. Nevertheless, the branding of Dubai has set a precedent. Indeed, the oil monarchies of the region looked at their neighbour with envy and annoyance, first and foremost Abu Dhabi.

Branding Abu Dhabi The media exposure of Dubai eclipsed Abu Dhabi so much that by all accounts Dubai was considered the federal capital of the UAE. Indeed, the two cities stood in the eye of the beholder in juxtaposition until the 2010s. Sheikh Zayed, the first president of the federation and the ruler of Abu Dhabi, wanted to preserve his emirate from the excess of modernity. Until Sheikh Zayed died in 2004, Abu Dhabi was a sleeping capital, comfortably living on the oil rent. His son, Sheikh Khalifa, changed the game, as if the new president wanted to repossess the symbolic powers granted to Dubai, the star of the federation. Since 2004, Abu Dhabi has looked both strong and quiet, the first element of its branding. The new sheikh has continued his father’s policies but seems also eager to compete with Dubai. The Office of the Brand Abu Dhabi (OBAD) The Office of the Brand Abu Dhabi (OBAD) was established by the Abu Dhabi Tourism Authority (ADTA) to locate and navigate the right marketing angle for the federation’s capital city. OBAD serves as guardian of Brand Abu Dhabi and supervises its proper use. In November 2007, ADTA and OBAD unveiled the new branding of the capital before an audience of the highest officials of the emirate and more than 400 leaders of the public and private sectors.75 From the outset, a logo was designed to increase spontaneous recognition of the city, an effective element missing from Dubai’s branding. An official site was also launched, building on the same strategy.76 The brand is not only a tagline or a logo, stated Sheikh Sultan bin Tahnoon Al Nahyan, director of OBAD, but also a representation of the way in which the emirate behaves in the world and the way in which its different elements interact within.77 In the future, architects, for instance, would have to take into account the new identity of the city. The branding strategy targets first and foremost the tourists, but specifically, the upmarket interested in culture. Based on studies conducted in Britain, France and Germany, this adventurous avant-garde target group seeks the traditional entertainment of seaside tourism as well as authenticity. This upstream research produced the slogan ‘Travellers Welcome’, aiming to identify Abu Dhabi with authenticity, relaxation (sic), confidence, tolerance, authority and pride. Moreover, the capital is the treasure chest of the desert: 200 natural islands, hydrocarbons, the legacy of Sheikh Zayed, the Bedouins, Emirates Palace (see below), falconry, dates with coffee and mosques. As Mya Frazier,

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a specialist in advertising, stated: if OBAD is looking for a single word to summarise the brand, it must be ambition.78 Indeed, the ongoing projects project the emirate in tomorrow’s world. Projects and icons Two projects are planned to increase the international exposure of Abu Dhabi in the coming years. The first is linked to high-end cultural tourism. Saadiyat Island, ‘the island of joy’, is supposed to become the new cultural centre of the capital, and beyond, of the UAE and the Gulf. This 3 km2 area will gather the big names in the world of museology: Le Louvre Abu Dhabi, the Abu Dhabi Guggenheim, a national museum and a maritime museum. This $27 billion project encompasses high-standard tourism infrastructures and a highly regarded and high-profile US institution, New York University. The island, capable of hosting 150,000 people, is accessible by bridge and 5 minutes away from the old city centre.79 The second project, Masdar City, is an ironic one. In February 2008, Abu Dhabi, one of richest areas in oil in the region with one of the highest carbon footprints per capita in the world, launched the idea of a carbon dioxide-free city, where waste is 100 per cent recycled and fossil fuel-based vehicles are not permitted. The projected 50,000 residents would use solar energy and commute with a Light rail transit. With Masdar, Abu Dhabi spearheads a form of eco-development that, until then, had only existed in virtual spaces and eco-forums around the world.80 What is more, a year later, Sheikh Abdullah bin Zayed Al Nahyan announced that Abu Dhabi was bidding to join the International Renewable Energy Agency81 (IRENA). In late June of 2009, the last preparatory committee voted to make Abu Dhabi’s Masdar City the headquarters of the Agency. On 3 June 2015, highlevel officials from around the world gathered to celebrate the inauguration of IRENA’s new home.82 These two advances in eco-development upgraded the outdated image of Abu Dhabi in the eyes of potential tourists as well as leaders on the global scale. It is worth mentioning here that the branding of Abu Dhabi differs from that of Dubai. For example, Emirates Palace could have been marketed as a highly exclusive retreat in the same way as Dubai’s Burj al Arab or the Burj Khalifa. However, this luxurious hotel, unlike its counterparts, is open to the public without restriction and has become one of the shop windows of the emirate. In the same way, Etihad Airways competes with its Dubai rival, Emirates Airline. Being the national carrier is a true advantage to attract the upmarket clientele. Two emirates, two styles? It is irrefutable that Dubai triggered the agonistic spirit between the two leading cities of the federation. Meanwhile, the federal capital appears to be distancing itself from the inevitable

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THE UAE

comparison with Dubai. Yet Abu Dhabi has taken risks in order to ‘do better’ than Dubai in sporting and cultural events. In an attempt to gain precedence over Dubai, already a world class events hub, Abu Dhabi has sponsored a new ATP tournament, for instance, the first in the season and entitled to huge media coverage so as not to appear as an event after the fact. The second big success is the organisation of a Formula 1 grand prix, established in 2007. The international federation planned this race for mid-November, from 2009 to 2016. Before the start of the first event, Etihad Airways bid to be the main sponsor of the event. Abu Dhabi, Ocean Racing’s 65-foot carbon-fibre yacht, enhanced the prestige of the emirate after its victory in the Volvo Ocean Race in June 2015. Faisal Al Sheikh, the director, at the events bureau for the Abu Dhabi Tourism and Culture Authority, claimed: ‘We have put Abu Dhabi in the forefront of people’s minds as a marine centre.’83 In the cultural field, Abu Dhabi was a fast learner of events management. Before Madonna performed on stage at Yas Island, near the F1 circuit, on 3 – 4 June 2012, the capital enjoyed the media fallout in magazines, TV programmes and social networks. Programming Madonna (for an undisclosed sum) contributed to the branding of Yas Island as a tourism destination. Etihad sold packages to Madonna’s fans worldwide with the collaboration of the 13 Deluxe and First Class neighbouring hotels. The campaign launched four months before the show was so successful that the organisers planned a second date.84 In this regard, Abu Dhabi struck a deal with New York. From 16 to 18 May 2012, a tent 18m high and 12m long was erected in Times Square to celebrate the new bureau of the Abu Dhabi Tourism and Culture Authority. Illuminated signs were set around the famous place with a streaming video lauding the merits of the Emirati capital, all sponsored by Etihad. Until that moment, the audience in the West was more accustomed to that kind of an event from a Dubai-based promotion.85 The context of the oil rent in Dubai and Abu Dhabi certainly makes a difference in terms of objectives. The branding of Abu Dhabi is not intended to attract foreign direct investments in order to help the city survive financially. Abu Dhabi envisions its future serenely for the coming century, even with a barrel under $50. Conversely, it seems that since 2014, Dubai has had no choice but to move forward, innovating in new sectors like the knowledge-based economy. Since 2014, the increasing concern about the rise of radical Islam in the region has catapulted security to the uppermost priority in the eyes of the Emirati authorities, leaving little room for other policy explorations. Yet, it seems that the branding strategies detailed above have reached a cruising speed for at least two reasons. First, branding is now digital. Robert Govers is probably right when he states that personal experiences of a place, including

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tourist destinations, echoed on social media, are a new and different way of branding.86 The Emirati authorities work hard to channel the representations of the country online, and to support this medium with a legal framework. Second, Dubai, Abu Dhabi and the UAE are now world-known. Westerners, as well as people living outside the networks of globalisation, have heard about Dubai and sometimes integrate the representations in their vocabulary. A ‘Dubai’ in Algeria, for instance, is a small place or a shop for electronic goods. Worldwide, the representation of the Emirates seems positive. Even controversies have only reaffirmed the global role, importance and visibility of the two representative cities. The Emirati decision-makers have learned the new language of nation branding. In all sectors, from security to culture, they assess the consequences of their decisions on the image of the emirate(s) or of the federation. In this regard, the creation of a Ministry of Tolerance, on 9 February 2016,87 was both a way to address domestic issues and to promote an ethical picture of the UAE abroad.

CHAPTER 2 THE METAMORPHOSIS OF A TRADITIONAL SOCIETY

The United Arab Emirates (UAE) was anonymous until the spectacular success of Dubai in the mid-2000s. This oil monarchy of the Lower Gulf pre-existed, of course, the branding of the trend-maker city-state. At first glance, modernity seems to have diluted the historical legacy. A closer look, however, reveals the underlying structures of a traditional society. A brief historical reference to the transition period, between colonisation and independence, gives a glimpse of how two logics, Arab and Western, alternated to finalise the constitution, reflecting a balanced compromise. The fundamental law of the UAE embodied the traditional values of Bedouin society so as to flourish. Thirty years of political practice and economic development entwined constitutional law and unwritten rules. Over time, the pendulum has swung both ways, which is quite confusing for the foreign observer. This permanent move towards compromise even seems to be a governance model, visible in the border disputes during the last political reforms implemented by the federation.

Legitimisation by the state Since World War II, scholars have argued that using Western concepts to study non-Western societies often obfuscates the singularities of the latter. Conversely, it is disadvantageous as well to emphasise the local particularities that mask similarities with other models. This debate between universalists, better represented among the researchers in political sciences, and essentialists, dominant in anthropology for instance, perpetuates irresolution in matters of practice.1 Beyond these disputes among specialists, Westerners in general deem the Northern states’ institutions to be the benchmark of ‘development’; by this, they mean to assess states and regimes for democratic processes and governance through the successive steps of ‘progress’.2

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Nevertheless, the UAE has not followed this blueprint: the post-World War II Bedouin society did not transition as an ‘imagined nation’3 whose members aspired to live in a unified state defined by legal criteria (territory, population, a representative government and a seat at the General Assembly of the United Nations, the ultimate recognition of a state in the international arena). The Trucial States became a federation without this popular adhesion to nationalism. Genesis of a federation The British tardily claimed the end of indirect rule and granted independence to the territories in the Lower Gulf without having to battle a nationalist movement in a colonial war. If independence in the 1970s–80s was the way of the world, the British were prudent and scrupulous in the Gulf because of the geopolitical interests (oil exploitation, freedom of navigation through the Strait of Ormuz, etc.). The events showed tensions that came from two different political approaches. The history of the UAE, a name given upon independence in 1971 after the concession and unification of the various tribal regions, is often synonymous with the history of British rule in this part of the world.4 Since oral tradition left little recorded documentation prior to the establishment of the British protectorate, colonisation gave some historical visibility to this part of the abode of Islam. To secure commerce on the fringe of the Indian Ocean, the British eventually intervened in local affairs. The General Treaty of 1820 formalised the indirect rule. The local ‘governments’ administrated the territories while the British kept the upper hand in foreign affairs. The Exclusive Agreement of 1892 confirmed British sovereignty over those territories vulnerable to threatening neighbours like the Persians or the French against the backdrop of the Eastern Question. This fragile balance resulted in a relationship of a clearly understood mutual interest between the British crown and the local dynasties consolidated by an outsider’s aid. Yet, the British were vigilant not to be seen as intruders.5 The discovery of oil reinforced the special relationship. Starting in 1922, Britain made sure that the exploitation of local resources would take place under the supervision of British companies.6 Consequently, the indirect control of oil supply made the British withdrawal easy. Kuwait, the richest country of the Gulf and the first European supplier at the time, became independent in 1961. The British maintained military presence to prevent Iraqi aggression or a communist-led coup, although the small number of troops would not have been able to resist a major offensive.7 The Labour party criticised the military expenditures abroad and stated on 16 February 1967, that all military bases east of the Suez

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THE UAE

should be closed. Shortly after the devaluation of the pound that very autumn, Prime Minister Harold Wilson announced budget cuts and the complete withdrawal of British troops from the Gulf by 1972. Four years of intensive diplomatic activity were mandatory to streamline the institutions of a new state or states in the region. The negotiations turned out to be rather difficult. The Iranians claimed their sovereignty over Bahrain whose population was two-thirds Shi’a. The British opposition warned that a premature withdrawal would jeopardise British interests. However, after the victory of the Tories in June 1970, the new government did not modify the policy in the Gulf. On 1 March 1971, Foreign Minister Alec Douglas-Home confirmed that the British presence in the Gulf would end by 31 December 1971. In the Gulf, the 18 January 1968 announcement of withdrawal triggered excitement mingled with fear. The failure of the Palestinian transition in 1947 still lingered in the consciousness of people. Meanwhile, the Americans patiently waited for the British disengagement to make their move.8 The withdrawal of the coloniser offered new perspectives for the local rulers, from Manama to Ras al Khaimah.9 At the same time, the responsibility and implementation of a complete social and administrative infrastructure, combined with the virtual threat generated by the vacuum, rendered the Arabs feeling ‘betrayed’. Once the British implied that the creation of a federation would smooth the transition, political manoeuvres commenced for the leadership position. On 25 February 1968, the sheikhs of Bahrain and Qatar, and the seven local rulers of the Trucial States, gathered in Abu Dhabi. While the participants expected an informal meeting, Sheikh Khalifa al Thani from Qatar had planned a review of the first draft of a federal project.10 In the backrooms of the Foreign Office, the British diplomats implied that keeping the territories under a unified government would be a beneficial and amicable compromise. This comminatory ‘advice’ guided the review process. The new political entity would have a federal structure whose final form would consist of a balance between the traditional powers in this part of the world and the requirements of a modern state. During the following three years, the nine partners took the making of a constitutional framework very seriously. Each ruler tried to take advantage of the situation. All were aware that the constitutional provisions would determine, for a lengthy period, the political balance of powers in the region. The sheikhs hired the best constitutional experts who were supposed to pave the way for their own advantage. Representation, a foreign concept in the Arab world, was the key issue of the federation project. The Bahrainis favoured proportional representation because the island had more than 200,000 inhabitants akin to the population of the seven emirates (Ajman and Umm al Quwain had fewer than 4,000

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inhabitants, for instance). In the course of the debate on the future federation, Bahrain foresaw its establishment as a bulwark against increasing Iranian ambitions. Aided by the vehement support of the British and the organisation of a referendum by the UN, obstacles to the federation were removed, and Sheikh Isa Khalifa of Bahrain proclaimed independence on 14 August 1971. Qatar, once leader of the union project, decided to go its own way on 1 September of the same year. The United Emirates became independent on 2 December 1971. Six emirates (Abu Dhabi, Dubai, Sharjah, Ajman, Umm al Quwain and Fujairah) formed the federation (Ras Al Khaimah joined in February 1972). Competing interests gave birth to three states. Competing interests London’s position was easy to understand. Beyond the financial benefices of decolonisation, the British expected to secure the interests, mainly oil, in the region. Thoroughly acquainted with traditional Arab societies, they wanted a worthy interlocutor able to take action among tribal chiefs. Arab tribes had been rivals and had maintained an art of war. The British quelled the chronic instability of succession disputes within the ruling families, which sometimes took the form of assassination, a very efficient way to seize power until World War II.11 Anarchy caused by local tensions could have rendered the Crown’s interests in danger. Aware of possible post-colonial tensions, the British knew that creating a federation would ensure that they remain puppet masters of a weak and potentially divided government, an intuition immediately confirmed by the political gerrymandering between 1968 and 1971. From London’s perspective, this federation was considered an avatar of the indirect rule based on a fiction of local governments ultimately in support of London. The British feared that war on the Northern rim of the Gulf, always possible, and sometimes desired for the sake of showing bravery or martyrdom, might also inflame the region. Iran tried to strengthen its status of regional powerhouse and conspired to make strategic moves on the Arabian Peninsula. 10 Downing Street and the Foreign Office also distrusted Saudi Arabia. Since the end of World War II, Britain tried to contain the hegemonic ambitions of the kingdom in the Peninsula.12 A broad union, including Kuwait and Oman, might have counterbalanced the Saudi kingdom. The making of three states, however, was still considered a success and, in any case, London was an expert in using the divide-and-rule principle. If nothing could be done in the Gulf without the consent of London, the benefit of a federation was immediately understood. While centuries of war barely altered the areas of tribal domination, British withdrawal provided a unique opportunity to expand the local rulers’ control of the former Coast of the Pirates, from the Musandam Peninsula to Bahrain. Of the nine sheikhs,

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only three could possibly lead the federation: Isa al Khalifa (Bahrain), Zayed al Nahyan (Abu Dhabi), and Ahmad al Thani (Qatar). All ventured to visit the British capital in order to display their credentials to the government of her majesty.13 Whether the British made sure not to outwardly favour any of the leaders of the Trucial States, they did prefer the leadership of Sheikh Zayed whom they had helped in overthrowing his brother.14 In addition, the oil exploitation in Abu Dhabi suggested that the future would be bright with 100 billion barrels of proven reserves, equivalent to the Kuwaiti supply. This might have also been reason enough for the sheikhs of Bahrain and Qatar to choose independence, thereby escaping the domination of Abu Dhabi. The two political entities could afford it because of their own, yet more limited, resources. Conversely, hydrocarbon resources were, at best, scarce in the six other emirates. The British withdrawal unequivocally exposed the ambitions, sometimes deferred, of the sheikhs. For them, expanding their sovereignty certainly mattered, but, more pressing, was their need to secure their own power over their territory and subjects. This is the cornerstone of the Emirati constitution. The idea of a nation is secondary: the core of the constitution points to this kind of security rather than a network of invisible threads that have tied the Arabs in the Peninsula through space and time. When the constitution refers to the ‘Great Arab Nation’ in article 6, the semantic content of ‘nation’ is very far from its Western meaning. In this regard, the transnational representation of the Arabs was on a collision course with the establishment of state borders. The art of border Border delimitation was a relatively new concept in the Gulf region. The territories were apprehended as the framework for the exploitation of natural resources, without exclusive ownership or exploitation. Irrigated agriculture was the main exception because it entailed permanent settlement. In accordance with this age-old system, tribal or religious authorities solved usage conflicts between nomads and the settled population.15 Before the advent of states, the tribes exercised control over a dirah, a territory with uncertain fringes. In fact, in Bedouin societies, sovereignty was more associated with the chief of a tribe than with the territory itself.16 Throughout the twentieth century, the British rationalised the administration of the Trucial States, mapping the region. They had a double objective. First, the coloniser needed to know for a fact the exact borders of a tribal chief’s authority. For practical reasons, who, for instance, would be responsible for infrastructures such as an airport? And who would be entitled to receive oil revenues? Second, the policy of fixing borders prevented disputes between neighbours, namely the Trucial States, Oman and Saudi Arabia.17 Inasmuch

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IRAN

N

Ho r m Greater Tunb t of r ai St Arabian Gulf

uz

Lesser Tunb Abu Musa Ras Al Khaimah Umm Al Qaiwain Ajman Sharjah Dubai

Gulf of Oman

Fujairah

QATAR

Abu Dhabi Al Buraimi Al Ain

UAE

SAUDI ARABIA

OMAN

Shaybah oil field

100km

Figure 2.1

Border disputes. Source: public domain

as the colonial ruler maintained order, the pending issues were frozen under tribal jurisdiction. Not surprisingly, during the four years of intense discussions, Sheikh Zayed Al Nahyan, the favoured leader, accepted compromises so as not to derail negotiations. Abu Dhabi and Dubai, whose rivalry dated back to the previous century, agreed on common borders on 18 February 1968. The accord was finalised the following year. The British wanted a buffer space between the two emirates in order to prevent direct confrontation. Sheikh Rashid Al Maktoum, ruler of Dubai, was willing to cede precedence to Sheikh Zayed Al Nahyan, ruler of Abu Dhabi, on the condition that he was awarded a favourable border delineation. Consequently, Dubai received Jebel Ali (the current site of Dubai port) and oil resources offshore.18 The next month, Sheikh Zayed, future president of the federation, visited Qatar to discuss the coastal arrangement between the soon-to-be new states.19 Nevertheless, two disputes marred the relations between the United Arab Emirates and its neighbours. Both Oman and the UAE claimed rights over the oases of Buraimi, near the city of Al Ain on the Omani border; Saudi Arabia also

38

Figure 2.2

THE UAE

New border alignment, 2005. Source: Patrick Jones

claimed rights over the oases inasmuch as the kingdom exacted taxes there. Three islands, offshore Ras al Khaimah, Abu Musa and the two Tunbs, claimed by the UAE and Iran, comprised the second contention.20 The intense diplomatic activity carried out by Britain and the United States to contain the Shah’s ambitions over Bahrain could not prevent Tehran from invading these Emirati territories on 30 November 1971 (and they are claimed by the federation). In these cases, pride, not to cede to one’s neighbour was an important parameter in the equation. The delineation of territorial borders, matching the contours of tribal domination at the time of independence, juxtaposed areas of sovereignty inextricably intertwined. There has been no unity in these territories except for Abu Dhabi, which forms a large contiguous block of space spanning 85 per cent of the Emirati surface area. Dubai has been the second entity, with only 5 per cent of the Emirati domain, yet controlling Hatta on the Omani border. Enclaves of sovereignty within an emirate have had no serious consequences, like the five domains in Sharjah. But they become problematic when they lie within a different state, namely when their tribal allegiance and autonomy differs from the political and geographical jurisdiction within which they are enclosed (see Figure 2.2). The Omani Wadi Madha has been clamped by Fujairah; more surprising, within it, the village of Nahwa has been an enclave of Sharjah. These carvings are anecdotal because they have no political or geopolitical consequences against

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the backdrop of pacified relations between the UAE and Oman. Conversely, the delimitation between the UAE and Saudi Arabia poses problems of a different kind. Long before the independence of the UAE, contention existed between the Emirates and Saudi Arabia. Tensions occurred regarding the status of Buraimi in 1952 and intensified after the announcement of the British withdrawal in 1968.21 In 1971, the Wahhabi kingdom assessed its historical rights over Buraimi because its emissaries levied there the zakat, the absolute recognition of sovereignty for the British. At the same period, the exploitation of Shaybah-Zarrarah oil field fuelled further dispute between the two states. The Treaty of Jeddah signed under the auspices of the United Nations – but under the ‘friendly’ pressure of the British22 – was a compromise on this issue.23 Saudi Arabia renounced its prerogatives over Buraimi in exchange for full rights over Shaybah. In return, Article 5 of the Treaty stipulated that the UAE accept Saudi sovereignty over the islands of Huwaysat and those westwards off the Saudi coastline; in addition, the Saudis were granted use of the islands of Al-Quaffay and Makasib to develop infrastructures if need be. The agreement between Sheikh Zayed and king Faysal limited for a while the regional border disputes between the UAE and Oman. The final settlement of the border with Oman took some time but the final 272 km border was eventually ratified in 2011 by both countries – with limited consequences over Buraimi, which remains a buffer area between them. Three factors contributed to the tension between the UAE and Saudi Arabia in 2004 – 5. First, Sheikh Zayed, who had signed the Treaty of Jeddah, and King Fahd passed away. Sheikh Khalifa, the new president of the federation, felt less obliged to respect an accord imposed on the weak young Emirati state. Second, the UAE had become, by 2002–3, the second economic power of the Peninsula (and of the Arab world). A new geopolitical arrangement was forming to counterbalance the weight of Riyadh in the GCC and the region, for example, far-reaching cooperation between the peripheral states of Bahrain and Qatar. This effort against Saudi domination, already planned by the British at the time of the withdrawal, unravelled with the Dolphin gas project that united Qatar, Oman and the UAE. In 2005, a pipeline was planned between the Qatari North field and Abu Dhabi. The Saudis reiterated their disapproval as well as their hostility towards a planned bridge between its two neighbours. The third factor is the most important. The resources of the Shaybah-Zarrarah oil field were estimated at 15 billion barrels; yearly production exceeded on average half a million barrels per day (bpd) making annual revenues of $10 billion, whereas, the total Emirati production was then below 2.5 million (bpd). In consequence, a diplomatic

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offensive was launched. Sheikh Hamdan bin Zayed al Nahyan, minister of foreign affairs, stated numerous times in June 2005 that the Treaty of Jeddah was no longer applicable. In addition, he argued, the Federal National Council, the consultative Emirati body, never ratified it. Soon after, in December 2005, the official UAE Yearbook 2006 issued a map of the federation expanding its border up to Qatar and including the ShaybahZarrarah oil field24 (see map above). Even if this affair fizzled and was relegated to the background with the economic depression and the avatars of the Arab Spring, it reflects a certain state of mind. The validity of the treaties appears relative to the agenda of the decision makers: adherence may pivot on the side of international or constitutional law, and sometimes on the side of municipal law. Clearly, then, the peoples of the region did not enter ipso facto the era of (Western) modernity from the moment of independence and self-rule. Long-term trends have prevailed; the nomads for instance have continued to cross state borders without warnings, while the oil industry and prospection, and, more recently, alternative forms of revenue, have moved the governments in phases towards milestones suited to a globalised economy. The UAE constitution has followed a similar pattern.

The constitution put to the test When the Emiratis celebrated the birth of the United Arab Emirates on 2 December 1971, speculation on the federation’s sustainability was common amongst observers as well as certain sheikhs.25 Some analysts and onlookers allowed for the vulnerability of a transitional regime. Meanwhile, negotiations on the future of the federation generated doubts. Its leaders, in their attempts to find compromises, expanded a system initially conceived for nine partners. Concessions granted to the Bahrainis and to the Qataris were carved in the constitution. These accidents of history and, likely, the reluctance to transfer power to a federal institution might explain why the six sheikhs of the federation (Ras Al Khaimah joined it in 1972) made the constitution temporary. Only in 1996, the Supreme Council, formed by the seven rulers of the federation, decided unanimously to remove the ‘temporary’ stipulation from the fundamental law. Almost 40 years after its creation, the UAE is one of the most prosperous countries in the world. As Christopher Davidson said, in 1971 the emirates had little more to rely on than their socio-political legacy.26 The federation’s survival and empowerment, in a rather hostile environment, is largely due to the unabated reliance on the mutual Arab culture of its members, and the unified stance against indiscriminately grafting rules imported from the West. Meanwhile, foreign influence was certain, although difficult to appraise. The

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preamble to the constitution states that it was the UAE’s intention to establish a ‘representative, democratic regime in an Islamic and Arab society free from fear and anxiety.’27 The outside observer, however, almost always misses the ambiguity of the double influence, Western and Arab. Appointed executive power The president is the figurehead of the Emirates. He is, strictly speaking, the head of the state and, above all, the leader of the Emirati nation. His method of appointment and his daily powers stem more from Arab tradition than from constitutional law. The constitution organises the election and the powers of the president. In accordance with Articles 53 and 54, the president and the vice-president are elected by the Supreme Council (the seven sheikhs) for a five-year mandate, renewable indefinitely. Chief executive, the president heads the meetings of the Supreme Council and the Council of Ministers, commands the armed forces and represents the UAE in foreign affairs. He appoints the prime minister and the president of the Supreme Court. He oversees the execution of the law and has a broad regulatory power. In consequence, this legal approach implies that the UAE has adopted a presidential regime. What is more, political practice sheds light on the constitutional provisions. In theory, the seven sheikhs of the federation could run for the presidency or become the prime minister/vice-president. In reality, the supreme office must be reserved for the Sheikh of Abu Dhabi, whereas the position of prime minister/vice-president must be attributed to the ruler of Dubai. The economic domination of an emirate that is home to 90 per cent of Emirati oil resources justifies the pre-eminence of Abu Dhabi, the political capital. Dubai has been its only rival since the nineteenth century. With the accord of 18 February 1968 (see above), the two powerful emirates have worked hand in hand to run the federation. This de facto domination has been accepted by the other sheikhs because it provides resource transfer as quid pro quo. Because Abu Dhabi’s share of the federal budget is proportional to its wealth, the other emirates benefit from the federal generosity. In 2015, of the dh49.1 billion ($13.8 billion) budget, Abu Dhabi contributed nearly one-third, dh17 billion ($4.6 billion), while Dubai contributed 2.44 per cent, dh1.2 ($327 million).28 The selection of the president and prime minister is not based on elections but appointments. The Al Nahyan family has a vested right over the presidency, as the Al Maktoum family has over the position of prime minister/vicepresident. The appointment of the president is, therefore, the product of a process and not an inaugural event. The continuity of the system relies on the canon by which the sheikhs transmit their power, rather than the method by

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THE UAE

which the federal authorities eventually confirm it. The UAE is part and parcel of the traditional Arab world. In the Peninsula (except in the republic of Yemen), successions take place within the ruling families. To refer to more familiar models for the Westerners, this process is a blend of traditional monarchy (an order of succession based on male primogeniture), and autocracy, such as that of the Roman Empire, in which the emperor had the right to appoint his successor. As soon as a ruling sheikh dies, the crown prince succeeds and must appoint his successor – if his predecessor did not. The political arrangements that precede the appointment of the crown princes are among the best kept secrets, never escaping the high walls of the palaces. The Emiratis accept this fait accompli. In a fascinating and well-documented survey, Andrea Rugh tried to disentangle the dynasties’ successions in the emirates29 focusing on old periods (relative to the UAE, i.e., the nineteenth and the twentieth centuries). The appointment must abide by subtle alchemies between the different branches of the ruling families. Women are instrumental in consolidating, or, on the contrary, weakening certain potential successors, mainly through marriage. The choice of a bride combined with the ambition of a son (or his mother), in the past, were a high-risk game that led to political assassinations. From 1912 to 1928, for instance, Hamdan, Sultan and Saqr Al Nahyan were assassinated (the first by the brother of the second, and the second by the brother of the third.30 Yet, successions have not once rocked the stability of the country since 1971 because disputes over succession were sidestepped due to the stabilising effect of the federal constitution. In addition, Sheikh Zayed’s touch made a difference. The common wisdom in Emirati literature presents Sheikh Zayed as an exceptional leader. Elected president of the UAE on 2 December 1971, he was reappointed six times until he died on 2 November 2004, but his reign was not without deep internal crises like those of 1976 or 1979. He epitomised the Emirati state and transformed the federation’s uncertain fate into a powerhouse, the second economic power of the Arab world after Saudi Arabia. Even beyond this achievement, his personal leadership favoured his longevity. He ruled the country like a tribal chief, providing honours (positions in the state apparatus) and wisely distributing oil revenues.31 The tribute books that came out after he died underlined his generosity and humility; he was also a good listener. These were all essential qualities for an Arab leader. Sheikh Zayed insisted on maintaining the pursuit of falconry, claiming that this traditional hunt was the perfect framework to discuss politics; the guests freely talked and the ruler was able to allay social tensions through this exercise of direct democracy. Unlike many heads of Middle Eastern states, his leadership did not go astray towards authoritarianism. In the Gulf, he was the first (after Kuwait) ruler to use the oil revenues to boost the economy

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sometimes in bold and innovative ways. He was also the first Arab leader to empower women, for instance, with the creation of Zayed University, originally for female undergraduate students. His succession was smooth. His older son, Sheikh Khalifa, already involved in state affairs, continued his father’s policies, notably in education.32 Like the emperor Hadrian, Sheikh Zayed anticipated the issue of the appointment of the crown prince and secured a subordinate share in the realm of governance for his second son, Sheikh Mohammed. Therefore, he secured the next transitions and the stability of the country. In the regional context, the eradication of violence in the exercise of succession is the salient fact generated by this institutional syncretism. Nevertheless, this kind of reconciliation of powers does not preclude the subordination of some. Federal and local powers The balance between the federal and local powers is subtle. At the beginning of the 1970s, two opposing forces structured the debates: the unionists (wahdawis) and the federalists (ittihadis).33 Three decades later, the federal state was consolidated although resistance to centralisation never disappeared. This pattern was carved in institutional stone. The Supreme Council, the Council of Ministers and the Federal National Council representing the local forces tried to counterbalance the federal power whose lion’s share had been allocated to Abu Dhabi and Dubai. According to the constitution, the Supreme Council is the highest authority in the country. Its role, beyond appointing the president, is to define the general policy of the federation. It convenes at least four times a year. The seven sheikhs do not have equal power because those of Abu Dhabi and Dubai have veto power over all decisions. Broadly speaking, the council follows the Islamic tradition of Ijma, literally meaning assembly, and seeks consensus, expressed or not, on legal issues. This complex concept calls for conciliation rather than securing a majority, yet the two sheikhs of Abu Dhabi and Dubai have a casting voice. This rule also applies to the Council of Ministers. On 10 February 2016, Sheikh Khalifa approved the new cabinet. If the Al Nahyan family kept four key portfolios (Saif – Interior, Mansour – Presidential Affairs, Abdallah – Foreign Affairs, Nahyan – Culture) and the Maktoum family two (Sheikh Mohammed – Prime Minister and Defence, Hamdan – Finance), the 23 other members do not come from the Abu Dhabi or Dubai ruling families. The cabinet is young, with the average age of the 8 new ministers being 38 years old, comprises 7 women and is oriented towards the future with the creation of three new ministries (Tolerance, Future and Happiness).

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The constitution vests executive powers in the Supreme Council and in the cabinet. From a different angle, these governing bodies may be seen as legislative decision makers because they are at the very core of many federal laws. Coming full circle, the National Federal Council (FNC) is a consultative body in the Western sense. After independence, the local rulers appointed its forty members based on the demographic balance of the UAE. No wonder Abu Dhabi and Dubai obtained eight seats each, Sharjah and Ras Al Khaimah six, and, finally, Ajman, Fujaira and Umm Al Quwaim received four. Like in any federal structure, the distribution of power is never straightforward. Sovereign national functions (like defense, foreign affairs, currency, migration rules, etc.) should be apportioned to the federation. Yet, the seven emirates have kept local government prerogatives. Article 116 of the constitution states: ‘the Emirates shall exercise all powers not assigned to the federation by this Constitution.’ The local government can sign conventions with neighbouring states providing that they refer to local administrative issues (article 123) and inform the Supreme Council. Along the same lines, each emirate is entitled to become a member of OPEC or OAPEC.34 Constitutional arrangements aim at keeping the unity of the state without prohibiting or seriously curtailing local freedoms. The sheikhs are the rulers within their emirate; they can legislate through respect for federal positive law and even establish a judiciary branch outside the federal jurisdiction – a unique model in the Arab world. Finally, the ruling families organise majlis (counsel) in order to invite their subjects to express their opinions on all matters, in line with the Islamic tradition of shura (consultation). At the bottom of this pyramid, the traditional and specific link between the sheikh and his subjects, the members of his tribe, so to speak, is instrumental in sustaining stability and preserving the system. This permanent state of open consultation is no direct democracy because the sheikh always has the final word. This legal order stems from pre-state times. As Malcom Peck points out, the constitution merged with the longentrenched rules of tradition. The legislative and executive powers have been in the hands of an elite whose legitimacy is tribal and familial.35 This political and social setting has been strengthened by their wealth, not merely the oil rent, but also other kinds of economic revenue. Emirati society is deeply rooted in locality. For an Emirati, the relation with his/her sheikh and the inner circle is a priority. The president, the leader of the nation, is perceived as a patriarch to whom you might need to talk through the local ruler. The tribal system, based on relationships of allegiances and subordination, has never disappeared. It would be an exaggeration to state that the constitution is a framework. In practice, it exists to regulate foreign policy and relations with the foreign residents who

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comprise three-quarters of the population. Two value systems coexist in the UAE in spite of the seeming hegemony caused by urbanisation and economic growth. The continuity of tradition poses a problem for ‘democratisation’ and domestic reform.

Reforms After the Gulf War, the UAE negotiated with the United States on security issues within the guidelines of the dual containment policy, namely, containing the Iraqi and the Iranian threats.36 Meanwhile, its economic success pushed the UAE to the forefront of the international stage. The federation became a valued partner within the Gulf Cooperation Council (GCC) formed in 1981. Paradoxically, the visibility of the country made it more likely to be the target of criticism. Against the backdrop of the postCold War and the climate prior to the 11 September attack, the international community, particularly the UN, favoured ‘good governance’ instead of democracy;37 the Westerners, with the Americans at the forefront, attempted to promote the Emirates in the Middle East.38 What is more, economic decision makers lauded the UAE for its pursuit of globalisation. Yet cultural habits surprised the journalists who looked behind the scenes. The child jockeys, the rights of the workers in the construction industry and human trafficking (prostitution) gained momentum in the foreign media. Criticism reached a new level from 2005 onwards. Reforms were mandatory to show the willingness of the Emirati government to tackle these issues. The authorities enabled a show of transparency. On 4 December 2008, for instance, they announced the creation of a national commission for human rights in accordance with the Paris Principles.39 Beyond the human rights issues,40 the UAE showed its goodwill to undertake political reforms. The democratic process implemented to elect members to the Federal National Council (FNC) in December 2006 revealed the difficulty of applying modern Western concepts to a tribal and patriarchal state. Towards democracy? The first elections held in the UAE took place in December 2006. A year before, Sheikh Khalifa Al Nahyan announced that half of the FNC would be elected. The remaining 20 members would be appointed as before. The process started with the establishment of electoral colleges (EC). The number of Emiratis registered had to be 100 times the number of the elected representatives; Dubai, for instance, held four elected member seats so that at least 400 Emiratis were needed to form the college. In August 2006, a national electoral committee (NEC) was created to supervise and facilitate

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operations, and to drum up support from the electorate for this major event. In October, the schedule was set. Balloting would take place in three stages from 16 to 20 December.41 The candidates had to be among the 6,689 citizens approved by the NEC. They also had to be in compliance with citizenship requirements and residents of the constituency of their electorate. A presidential decree dated 10 August pointed out that the candidates had the right to express their opinion during engagements and campaigns in accordance with the law. The election passed smoothly and, on 13 February 2007, the FNC started its proceedings with 9 women. Adbul Aziz Abdullah Al Ghurair was elected by a secret ballot (23 votes out of 40). This experiment provided a wealth of information. The government left nothing to chance in the process. The federal authorities methodically prepared and perfectly framed the different stages. The election pertained only to half of the council in order to curb unwanted results, and even if a setback had occurred, the federal institutions would not have been damaged because the FNC was merely a consultative body. The choice of an indirect college was a safe choice. The 6,689 citizens of the electoral committees were loyal to the ruling families, concerned with the political future of their country. In contrast, a ‘democratic’ election, by the electoral body, would have resulted in a high level of abstention (as was the case in 2011). Another bone of contention had been avoided – that of political controversy. As there were no political parties, there were also no political platforms: the candidates campaigned based on their personality and not on their ideas. In terms of innovation, Sheikh Khalifa encouraged the participation of women despite strong social resistance. 1,189 women registered in the ECs (18 per cent) but only one was elected; eight others were appointed which significantly feminised the FNC (22.5 per cent). This election looked like a timid move towards the establishment of a Western democratic model, but, from a different angle, it represented a step forward. Despite the goodwill of the federal institutions, the Emirati sociocultural environment precluded any rapid changes. It would take time to deepen the democratic process. Obaid Al Muhairi, director of education and syllabi, stated in 2005 that initiation to democracy would start in elementary schools42 implying that the federation needed to prepare the next generation. Before National Day in December 2008, Sheikh Khalifa confirmed the endeavour, pointing out that discouraging or forsaking the democratic process would hamper national identity, one of his principal topics.43 In an interview, Abdul Aziz Al Ghurair, president of the FNC, underlined that democratisation is a gradual process. Pointing to the weaknesses of Western democracies, he hoped the Emirates’ pursuit of democracy would continue to value traditional

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Arab culture by incorporating concepts and practices such as shura44 (consultation). Political leaders, aware of what democratisation might entail, insisted that the stability of the country and respect for traditional values could not be scarified. Last but not least, the election stimulated a national debate on the powers of the federal council. In addition to the examination of the budget, the council might be expected to hold hearings and make recommendations. The second election was the sounding box of this debate. The second election took place in a slightly different spirit than the first one even if the legal framework was roughly identical. The motto for the federal authorities was to ‘do better’ than in 2006. Two criteria can be used to measure the progress: the number of voters and women’s empowerment, the latter being an expression abundantly used during the campaign. The federal government forced the hand of the local government by imposing a significant enlargement of the electoral body in July 2011. The sheikh selected (sic) 129,272 voters, thereby increasing the electorate to 20 times the number permitted in 2006. On 24 September, the voter turn out was lower because only 35,877 cast their ballot. The percentage of participation was 27.76 per cent, versus 74.4 per cent in 2006, although, in absolute terms, five times more Emiratis participated in the 2011 vote (6,689 in 2006). Emphasis was also put on women’s involvement. There were 85 female candidates out of 450 total candidates. In Abu Dhabi, Dubai and Sharjah, women represented more than half of the electorate (51.6 per cent, 52.6 per cent and 52 per cent, respectively). In the northern emirates, the percentage was below one third, such as 31.9 per cent in Fujairah.45 Two important points overshadowed these encouraging data. Firstly, few women voted (19 per cent), and, secondly, only one woman was elected, Sheikha Eisa Ganem Al Arri from Umm al Qaiwain.46 In the final analysis, while intentions appear laudable, the achievements were underwhelming. The elections of 2011 and 2015 brought democratisation to a new stage. The 17-day campaign of the 2011 elections was no different from the previous one. The National Electoral Committee reiterated its prescriptions to the candidates, prohibiting ideas that might offend religious, sectarian or tribal sensibilities; no form of racism or extremism were permitted either. In addition, the candidates could not use national symbols. As in 2006, political issues were prohibited and the candidates campaigned on a personality-based platform, which puts the voters in a less vulnerable place as the old relationship between patron and client still exists.47 The 2015 elections marked the entry to the age of maturity. 79,157 voters (35.29 per cent of participation) voted for 330 candidates including 74 women,48 although only one was elected among the 20 new members. However, on 16 November 2015, 8 women were appointed. Dr Amal Al

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Qubaisi, director general of the very active Abu Dhabi Education Council (ADEC) was reappointed and elected Speaker of the FNC, making her the first women in the region to head a consultative body. In addition, even before the official proclamation of the results, a disappointed candidate lodged an appeal.49 Beyond being an anecdote, the appeal as well as the growing role of women illustrates that the Emiratis use a step-by-step process when stepping outside the traditional framework. Dissenting voices Against the backdrop of reforms, the Emirati authorities had to face three types of challenges. The first stemmed from the democratisation process in the wake of the Arab Spring. The two others, the surge of radical Islam and the disputes regarding succession, were more structural. In consequence to the Arab Spring of 2011, claims for more freedom caused a reaction from the federal government, as the ‘UAE 5’ case study shows. The revolutionary movement in the Arab world radicalised repression against activists. On 9 March 2011, Nasser bin Ghaith, instructor at the Sorbonne Abu Dhabi, and a group of 133 Emirati intellectuals (professors, lawyers, human rights militants, etc.) signed a petition to organise elections based on universal suffrage for the coming FNC elections. Moreover, the petitioners wanted to transform the Federal National Council into a real legislative body. On 10 April Nasser bin Ghaith was held in custody for raison d’Etat, public order offense, and insults to the president, the vice-president and the crown prince of Abu Dhabi, offenses going back to October 2010, in line with Article 176 of the Emirati penal code. On 14 June 2011, his trial, and those of four other defendants, was held behind closed doors. Three days later, Amnesty International, Arabic Network for Human Rights Information, Front Line Defenders and Human Rights Watch demanded the unconditional release of the five prisoners of conscience, labelled the ‘UAE 5’. On 27 November 2011, the federal supreme court found Nasser bin Ghaith guilty of the facts alleged against him and sentenced him to two years in prison. The day after, the vocal prisoner obtained a presidential pardon and was freed.50 Despite the international reaction, by and large limited to European countries, the Emirati government proceeded by its own rules and considerations. Indeed, the incarceration of activists deterred Emiratis from challenging the ‘democratic’ process implemented in September 2011. The case of Ghaith is not the first in which the president retracts a court decision in favour of a verdict that retains tradition amidst compelling global considerations. In the mid-1990s, for instance, the trial of Sarah Balabagan made headlines. This 15-year-old Philippine had entered the UAE illegally.

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Raped by her 85-year-old employer, she killed him when he tried to reoffend. The Islamic court granted her $27,000 as compensation for the rape, but sentenced her to seven years in prison for homicide. President Zayed overturned the sentence to 100 strikes and a year in jail (which she had already served).51 Thus, the law is always put forward to safeguard public order, especially when it comes to religion. While practising the Sunni tradition, mainly following the teachings of the Maliki School, the Emirati authorities try to avert the overflows of radical Islam as much as the unpredictable consequences of democracy. On 6 December 2014, Sheikh Abdullah bin Zayed Al Nahyan felt it necessary to express the Emirati stance on Islam at the Manama Dialogue, organised by the International Institute for Security Studies (IISS) in Manama. ‘We are fighting for our religion, culture, heritage and our countries’52 he stated. The Emirati minister of foreign affairs meant that the federation defends a tolerant interpretation of Islam, a culture congruent with the modern world based on the legitimacy of the Gulf ruling families. The emergence of radical Islam in Egypt with the election of Morsi on 30 June 2012 and of the Islamic State during the summer 2014 justifies this surprising expression of self-consciousness. Since the ‘Arab Spring’ the UAE like its neighbours has had to deal with the spread of Islamism. After the Tunisian Revolution, on 26 September 2011, in a column in The National, Anwar Gargash took the opportunity to warn against the dangers of religious extremism and multiparty regimes.53 Regardless, human rights organisations coalesced in defence of some sixty people who had been arrested because of their involvement in Islamist groups. Even though it is known that the federal government writes the Friday sermons and strictly monitors the religious associations of and within the country,54 the arrest came as a surprise. Reuters broke the news gently. On 12 September 2012, Reuters announced that 8 Islamists were arrested including two Emirati officials, Ali Saeed al-Kindi, Attorney, and Khamis Saeed al-Zyoudi. Sheikh Sultan Al Qasimi, cousin of the sheikh of Ras Al Khaimah, was the most striking amongst the names. This eminent representative of the ruling family was the leader of Al-Islah55 (reform), an offshoot of the Muslim Brotherhood created in 1974, under strict supervision since 1995. Its members expressed their dissatisfaction with ‘the rule of law in state-society relations and the trust it generates between government and citizens’.56 The Emiratis faced major risks such as being stripped of their citizenship and, as a result, being ostracised from Emirati society. The media presented the event as a crackdown on Islamist circles. The newspapers pointed out the resemblances with the Egyptian Muslim Brotherhood and

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Salafists two months after the election of Morsi in Egypt.57 It was a strong signal sent to organisations tempted to proselytise radical ideas. From 2012 onwards, the comeback of Islamist parties in Egyptian and Tunisian politics has caused an odd reversal in perspectives. ‘International public opinion’ has neither condemned nor reproached the arrest of ‘Islamists’; conversely, it has reinforced the idea and the rhetorical platform of ‘good governance’ in the UAE. Until the late 1990s, external observers (governments, international organisations, etc.) would have insisted on denouncing or reversing human rights violations. The reactions to the verdict pronounced on 2 July 2013 were limited. Out of the ‘94’ persons prosecuted, 25 were found not guilty and the others received sentences varying from 7 to 15 years; Sultan Al Qasimi for his part will stay ten years behind bars. All things considered, the efforts of the federal government to make sure that the reputation of the country remains untouched by political or religious turmoil have coincided with global precautions against extremism. Public order is also vulnerable to the tribal rules of succession. While the two dominant emirates have worked to pacify internal tensions within the ruling families, disputes have occurred in the northern emirates like Ras Al Khaimah. On 27 October 2010, Sheikh Saqr bin Mohammed Al Qasimi died. Sheikh Khalid bin Saqer Al Qasimi, albeit officially devoted to the crown prince, his half-brother Sheikh Saud, ended his exile the same day to claim succession. The Emirati authorities took this political crisis seriously. They immediately supported Saud and issued a statement on WAM, the Emirati press agency. Sheikh Khalid made a bold move that backfired. From London, his place of exile, he had organised a two-year campaign to destabilise the official crown prince. £2 million had been spent to create a network with higher officials such as Hillary Clinton and the Israeli ambassador in London. His main argument to convince these much needed allies was the close relations between the emirate and Iran that might help the international community during trying times.58 Even before the beginning of turmoil in Bahrain, the Emirati leaders formed a common front and displayed their commitment to dynastic legitimacy, the cornerstone of social and political peace in the federation. The federal government confirmed during the two weeks of tension that it would not tolerate any misdemeanour regarding the appointed successors. The reputation of the country, again, was at stake. Both in terms of geography, notably in borders delimitations, and in politics, the UAE is a blend of tradition and modernity. Outside observers might be disconcerted by official decisions that mistakenly come across as erratic. The difficulty lies in identifying on which logic(s) these decisions rely, sometimes in compliance with tradition, sometimes abiding by written

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law. The best of the Emirati authorities’ abilities is juggling the two frameworks of action. What is more difficult to understand is the register of the ambiguities; this is part and parcel of public relations strategies as revealed by the ‘94’ case study, for instance. In the business world, which tends to clarify as much as possible the amount of uncertainty, we witness the same syncretism.

CHAPTER 3 THE INVENTION OF ARAB MUSLIM LIBERALISM

In December 1999, Dubai made a remarkable entrance in international media with the inauguration of Burj al Arab. Until the financial depression of September 2008, Dubai and the United Arab Emirates thrived during a golden decade, arguably unprecedented in the history of capitalism. No state, no city, not even the Asian Dragons of the 1980s, had known such expansive economic development in so little time; it is possible that because the emirate entered globalisation late in the game that it tried to catch up at such an exponential pace.1 Researchers seem to be experiencing difficulties typifying what has to be called success. The sycophants of Dubai display it as the bright side of globalisation;2 its critics point out that, under the veneer of Sheikh Zayed’s skyline, the city reflects the excesses of liberalism.3 Those who have written academic books or articles on Dubai and the UAE have agreed that it is the market economy that has transformed these places, and have searched for the right prefix or suffix for ‘capitalism’ or ‘liberalism’: ‘global capitalism’, ‘state capitalism’, even ‘vertical capitalism’, ‘neo-liberalism’, ‘tribal liberalism’, etc. It is capitalism and liberalism, therefore, but of a particular kind. Dubai is often compared with Singapore: two city-states, two similar economic strategies, the same urbanism shaped by globalisation4 and social policies of similar inspiration (housing for citizens, eradication of poverty).5 Strong leaders have also dignified these two cities: Lee Kuan Yew, Sheikh Rashid and now Sheikh Mohammed. In this regard, Al Maktoum and Al Nahyan contrast with the traditional culture of Arab rule in the Gulf. Sheikh Mohammed Al Maktoum even claimed that Dubai should serve as a model for all Arab states.6 In an interview with CNN in late December 2011, the ruler of Dubai summed up his philosophy in a motto: We want to be number one.7 While ranking first is the target of every aspect of the city of Dubai, this ambition is not at any cost. The path the emirate has taken to achieve its

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vision does not sacrifice ‘tradition’, a word that encapsulates the values of this Arab-Muslim society. Through compromise, the UAE has defined an original model, not only an economic one but also a social and political one: liberalism and Islamic civilisation have found a working relationship.

Tribal capitalism The expression ‘tribal capitalism’ might sound pejorative, but it draws on the meaning of ‘tribe’ as a mode of organisation of the Bedouin society. The families are at the bottom, included in subsets like clans within the tribe.8 This social structure has generated solidarities that have survived to the present day and exist even beyond the private sphere. Based on this anthropological reality, Christopher Davidson has talked about ‘tribal capitalism’ in his description of the Al Nahyan monarchy in Abu Dhabi.9 This foundation to private and public economic activity has maintained the Arab-Islamic legacy and protected the Emiratis against visibly material influxes, such as migrations, or immaterial ones, such as foreign investments. Between protection and protectionism The UAE simultaneously tries to take advantage of international trade and to contain its negative impact, as seen in its relations with the World Trade Organisation (WTO). A member since 10 April 1996, the federation was evaluated on its ten-year membership anniversary. In this first assessment report, the organisation raised questions related to foreign investments and access to the domestic market. The WTO bemoaned the unequal participation of foreigners in the country’s economic activity because the law imposes the requirement of a local partner in operations of imports and distribution. Moreover, ‘emiratisation’ (quotas of Emiratis in the national economy) distorts competition in the labour market.10 Legal dispositions restrictively encourage foreign investors to operate in the free zones, which is a reason why the bulk of exchanges generated in the 26 free zones represents 80 per cent of Emirati trade11 in that period. As always under these circumstances, when the international image of the country is at stake (as it pertains to the field of human rights, for instance), the federation adopts the posture of the good student. Criticism is willingly accepted and commitment to tackle the issues is promised. Lubna bin Khalid Al Qasimi, minister of foreign trade, underlined a federal goodwill in a 2010 report (not required by the WTO), which aimed to explain Emirati commercial guidelines and to trigger a fruitful dialogue with the WTO secretary general’s office starting in 2012.12 The preparatory work for the negotiations emphasised the government’s commitment to liberalism although the Emirati authorities defend three legacies of

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Arab-Islamic culture: sponsorship (contractual partnership), landed property and interpersonal relations. Free trade is supposed to accommodate the kafala (sponsorship) system inherited from the Islamic tradition and very much part of the Gulf culture. According to customary law during the pre-Islamic times, an outsider could temporarily stay with a Bedouin tribe of central Arabia under certain conditions. Hospitality and benevolence were afterwards carved in the Islamic law. The system was updated in the 1930s to regulate migrations. The need for labour triggered the influx of workers between British India and the protectorates of the lower Gulf.13 In accordance with the tradition of Bedouin society, the kafeel, or sponsor, is supposed to protect the migrants under his authority. The implementation of the oil economy did not alter these dispositions, which enforce payment and benefits for the labour, namely travel fees, basic wages, holidays, etc. In Bahrain, like in the UAE, cultural heritage made its way into legal stipulations detrimental to the workers.14 The kafala has a second feature related to commercial activities. It dates back to the first centuries of Islam. The different schools of law examined the subject of equity amid different persons involved in commercial transactions. The aim was to achieve an economic activity that is beyond the financial capacity or the individual workload. The Hanafi and the Maliki schools of law issued a legal text authorising the creation of associations of guilds in which each actor found his right place, and, very likely, his advantage.15 The kafala is a longterm practice intended to establish and secure a loyal partnership between the different contracting parties. Today, it is still an object of discussion in the UAE and beyond (Qatar with the coming football World Cup for instance). For the twentieth-century business and entrepreneurial communities, the historical subtleties matter less than the legal framework of a local partnership. The embassies, chambers of commerce and other private cabinets open doors to transnational corporations by mediating the historical and the legal: foreign investors willing to come to the UAE have the choice between the free zones and the common system.16 If they choose the latter, they must abide by the laws governing the activity of foreign companies, notably law n8 8 of 1984, modified by law n8 13 of 1988. Companies outside the banking and oil sectors are not subject to direct taxation (although local authorities may levy indirect taxes such as a housing tax, effective in Dubai since 2005); inasmuch as there are no income taxes, the fiscal pressure, by and large, remains light in the UAE. Yet, hand in hand with such freedoms, is the obligation to partner with an Emirati businessman who, in the role of sponsor, must hold 51 per cent of the venture’s shares. The companies, classified in the seven categories,17 are subject to governance and management rules in theory. In reality, the sponsor does not partake, or participates rarely, in the

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management of the business. This mediator is, effectively, the interface of two intersecting interests, his own personal ones and those of the local or federal authorities. Being executive agents, these sponsors facilitate administrative procedures, such as obtaining licensure or employee visas. There are two ways to pay for the service of the sponsor. The company may give him a percentage of the annual turnover, or may pay a monthly lump sum (in general between $7,000 and $40,000), the most popular option since the sponsor does not participate in the actual running of the business. In either case, the payment terms are defined in a binding contract when the company is created. To create a more enticing business environment, particularly when regional competition is at play, Dubai amended the sponsorship system in the free zones where the ministries, instead of individuals, serve as guardians of the foreign companies.18 Similarly, the status of land is under the jurisdiction of the local emirates and not the federation. However, access to property rights does not depend on the ebb and flow of supply and demand and common law stipulates that foreigners, not including GCC citizens, have no right to ownership. Emphyteutic, nevertheless, can be obtained. As in many former colonies, the UAE, self-consciously, has set in place legal provisions intended to protect its newly formed federation against neo-colonisation. Today, in the context of globalisation and transnational investments, these rules may appear anachronistic, or disadvantageous to economic growth. Dubai has been a pioneer in softening the rules. Real estate projects were an essential facet of the branding of the city in the 1990s and a strategy of diversification promoting Dubai in a post-oil economy. Real estate parastatal companies’ initial public offerings, such as Emaar Properties in 1997 or Al Nakheel Properties the following year, allowed the launch of big projects in the emirate. While foreigners were reluctant to invest in these projects, conceived at the outset on the basis of a long-term lease to fit the federal provisions, the Maktoum family took action and was daring in changing the status of land ownership in its emirate. In May 2002, Sheikh Mohammed bin Rashid Al Maktoum, then crown prince, authorised by decree that foreign investors have access to full sale property in delimitated areas of the emirate. The same month, Nakheel announced the launch of Palm Jumeirah, the biggest man-made island in the world. The Palm Jebel Ali construction site started in 2003 and accompanied the real estate boom of Dubai until 2008.19 New developers like Damac Properties, Dubai Properties and ETA Star Properties joined Emaar and Nakheel. Soon after, the new legal framework was finalised with the decree of 14 March 2006. Property rights are guaranteed but the new law does not authorise automatic residence or a work permit for the owner. The year before, the government of Abu Dhabi repealed law n8 33,

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dating to 1966, allowing GCC nationals to own real estate property in investment zones. The other emirates subsequently followed suit. In addition to outweighing neo-colonial tendencies in land acquisition rights, supply and demand is mediated through a tradition as embedded as the kafala system. Wasta, or the use of personal relations, is worth a detour to anthropology.20 The term has positive and negative connotations.21 In traditional Arab society, the word wasta refers to a person capable of mediation or intercession to safeguard common interest (families and communities). Unlike intercession, wasta, as it is still used today, is a kind of solicitation informed by the interests of the persons involved. A person may ask another to use his power to obtain an advantage, such as an administrative document, a fiscal exemption, admission to a university, etc. When there are many candidates for the same favour (position, scholarship, etc.), the applicant with the most powerful gobetween is rewarded. The web of this kind of interpersonal relationships has contributed to the making of a power game with hierarchical ties accepted not only between a patron and his clients, but also within all levels of the social pyramid. Until this day, the solicited person, in a highly symbolic position with regard to the solicitor, is meant to provide assistance; no direct contribution is required from the solicitor except total submission, which is anyway implicit.22 This aspect of the wasta system effective in the Arab market economy exists also in such mundane matters as finding a job or exploiting licensing, etc. Entrepreneurs who have acquaintances in high positions also benefit from such public bids. The newcomer, however, may find it intimidating to interfere in this power game so familiar to the local community. While liberalism implies that profit and profitability must be objective factors in the business world, wasta proves otherwise. What is more, Emiratis are given priority regardless of ‘objective’ policy making based on merit. Liberal values of effectiveness, competitiveness and merit are ultimately subordinated to this implicit social contract.23 The survival of the social dynamic privileges the Emiratis. It guarantees the deprived families assistance while it reinforces the elites in their traditional leadership and framing role in the society. The community preference, likely to be labelled ‘tribal’ or ‘national’ in a nation-state environment, sustains the allegiance network and favours the segmentation of social groups. The Emirati state seems to have necessarily integrated this organisational logic. The survival of the personal links between the members of the group might be on a collision course with liberal principles of effectiveness. Yet, it would be an exaggeration to believe that an opposition between tradition and modernity freezes this everyday social framework. This pervasive element of the social fabric unfolds, for instance, in the relations of the ruling families

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and their close associates. In a fascinating chapter on the evolution of the Al Nahyan monarchy, Christopher Davidson analyses the governmental positions (at the local and the federal levels) according to the traditional and symbolic position of each actor. The distribution of positions in the state apparatus tries to maintain the alchemy of power within the royal family; beyond the inner circles are the main representatives of the chief families of Abu Dhabi who hold key positions in head governmental departments and agencies. These dignitaries exercise a particular ‘natural right’ in monopolising the top positions but they are also tacitly accountable for their work. The phratry of Sheikh Zayed’s offspring provides a varied enough selection of leaders to combine legitimacy and competences. Subordinate positions are given to men who were not able to show their talent while exercising preliminary attributions.24 This actually solidifies the idea that the Emirati leaders, coming from the main families in Abu Dhabi and Dubai, do not have legitimacy other than the one of blood. The most competent leaders within the ruling families are likely to be in the top positions. The lower levels of federal government or the local administrations are undergoing steady transformations: a newcomer appointed by wasta may be subject to scrutiny in the workplace. In this regard, the implementation of a technocratic state renders the Emirates in striking contrast to the rest of the Arab world. The internal evolution of the public apparatus deserves further examination. A similar dynamic of tradition and evolution pervades the administration’s development projects and economic vision. Accepting liberalism as a method of growth and development, Emirati authorities have raised the question of effectiveness within the local governments. International economic organisations, such the World Trade Organisation (WTO) or the International Monetary Fund (IMF), promote guidelines serving a free market economy. The privatisation of the welfare state since the 1990s has been such that the UAE has utilised global measures of standardisation to its benefit. So how does the federation reconcile the legacies of the Bedouin society effectively with an eye on profit? With the sense that privatisation limits the capacity for public intervention the administrative structures maintain their paternalist relationship to their organisation, in some ways mimicking the patronage system previously mentioned. However, the reality in the emirates is also more complex because the two models of privatisation, liberalism and patronage, coexist: one modern, abiding by international criteria, and the other, traditional, safeguarding the ‘rights’ of the Emirati citizens to access free ‘public’ services or jobs. This is why the privatisation of certain public services has barely impacted operations in terms of human resources or credit allowances.25

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A certain idea of tolerance Two weeks after the reshuffle of his cabinet in February 2016, Mohammed Bin Rashid Al Maktoum explained why he felt the need to create the Ministry of Tolerance. The prime minister and vice-president, ruler of Dubai, quoted the tradition of the Arab world as one that has been inclusive to different communities for centuries. The future imposes the ‘reconstruction that reestablishes the values of ideological openness, diversity, and acceptance of others’ viewpoints, whether intellectual, cultural, or religious.’26 The rulers’ advancement of tolerance as a pillar of regional culture and tradition is not new in the UAE. In the introduction of Global Emirates: An Anthology of Tolerance and Enterprise, Sheikh Nahyan bin Mubarak Al Nahyan, then minister of higher education and scientific research, emphasised the official rhetoric of the UAE as a land of tolerance. The UAE is a global community whose members come ‘from all parts of the world, from different cultures and with diverse religious beliefs, [and] live in peace and harmony within our borders. We believe that we cannot afford to allow ignorance, suspicion and intolerance to erect barriers between us.’27 Tolerance is one of the cornerstones of the construction of Dubai and of the UAE. Clearly, the notion of freedom of belief has a strong economic and social impact. This freedom has had to work both ways: the Emiratis provide for religious liberty vis-a`-vis imported beliefs in the adobe of Islam but this policy of tolerance strongly implies that the non-members of the ummah respect Islam and its values even in a liberal and globalised world. Therefore, in economics, Islamic banking and the celebration of Islamic holidays are part of the Emirati identity. Islamic banking has gained momentum in the UAE. According to Sharia, or Islamic law, Islamic banks are not permitted to make profits, a teaching that certain authors doubt.28 In the 1980s–90s, Islamic decision makers perceived Sharia as a way to moralise contemporary economic practices and the world of finance. In practice, the concern was related not so much to financial products but to banks’ compliance with Islamic law. Dubai was at the forefront of the movement in 1975 with the creation of the first Islamic bank (Dubai Islamic Bank), founded to satisfy the moral and religious expectations of the merchant community against the backdrop of the renewal of the Islamic banking system advocated by the Organisation of the Islamic Conference (OIC).29 Its development by the local authorities is, however, recent. Starting in 2007, the Dubai International Finance Centre (DIFC) adjusted to Islamic transactions independent of other financial fluxes. The same year, $100 billion stocks were traded in Dubai compared with $1 billion in Manama, which had the reputation of being one of the world centres of Islamic banking (alongside Kuala Lumpur). By the onset of the financial crisis of Autumn 2008, the six banks of Dubai had a stock market capitalisation of

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$136 billion, at a time when 26 Islamic banks in Bahrain scored $28 billion. Accompanying this impetus, the two principal emirates created big banks. Noor Islamic Bank, jointly funded on an equal basis by the government of Dubai and the ruling family, started its operation in 2008 with a $900 million capital. Not to be outdone, Abu Dhabi backed the creation of Al Hilal Islamic Bank, with a capital of $1.1 billion. For those two juggernauts of Islamic finance, it remains to be seen whether their development is possible outside the traditional banking sector.30 Nevertheless, Islamic banking reached maturity despite falling short of initial hopes. Instead of putting into question the international finance system, it has become part and parcel of the global monetary infrastructure. Still, the essence of the difference remains: its regulatory bodies ensure its compliance with the moral principles of Islam, notably, using profits for charitable ventures.31 Since the beginning of the 2000s, Islamic banking favoured the advent of new financial products such as the suka (plural of sukuk). The sukuk is an alternative to fixed-interest obligations, prohibited by Islam. The purchaser temporarily becomes co-owner of a tangible good and is, accordingly, proportionally rewarded with the corresponding benefits. There are two types of sukuk, private (issued by a company like a bank or insurance, etc.) and public. The Islamic public authorities (in Malaysia, Qatar and in Dubai) thereby found a way to finance their public spending with the general interest; since it cannot by any means be invested in arms or alcohol, interest has been generally invested in heavy infrastructures, pursuant to national Islamic banking obligations.32 In March 2006, the investment company of Dubai, an offshoot of the government of Dubai, created a society of national obligations whose capital was $40 million. This very discreet structure boosted investment projects (in real estate with Dubailand and The Lagoon, for instance) and helped Dubai become a centre of the bond market. Big projects like Dana Gas or the parastatal agency for water and electricity (DEWA) had recourse to this kind of loan repository. Nevertheless, in late 2012, Dana Gas made headlines because the company was not able to repay its creditors and was forced to refinance its debt.33 The financial depression did not spare Islamic finance in the groundbreaking emirate. Dubai made a remarkable move on the Islamic banking scene in July 2015. The Dubai stock exchange (Nasdaq Dubai) announced that the financial centre surpassed all other Islamic financial centres by listing Islamic bonds on its exchanges.34 In 2013, Sheikh Mohammed bin Rashid Al Maktoum had expressed his aspiration for the emirate to become the leading Islamic centre in the world. At that moment, the sukuk exchanged on the Nasdaq and the Dubai financial market amounted to $7 billion. Two years later, it reached $36.7 billion, surpassing Malaysia, the traditional capital of Islamic banking,

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as well as Dublin and London. The state-linked companies willing to rely on these resources, such as Noor Bank, represent one of the advantages of Dubai over the European exchange centres for example. The reputation of Dubai’s financial centre has captivated investments from the Gulf States and notably Saudi Arabia. Consequently, the Nasdaq plans to introduce an ‘Islamic repo’ contract, Sharia-compliant short-term loan agreement, to expand the domain of activity. The third market after Saudi Arabia and Malaysia, the industry was estimated to be worth $127 billion in 2014, en route to achieving $263 billion by 2019, according to the World Islamic Banking Competitiveness (WIBC) report in 2015.35 Yet, the iron law of transnational capitalism has continuously undermined the principles of Islam. For the sake of profit, the business community, namely the investors and decision makers, is not averse to sacrificing morality and religion. Profit seeking may interfere with the duties of the Muslims on Fridays, the holy day, and Ramadan, the holy month, for instance. The Emirati authorities have found themselves on the horns of a dilemma. In the footsteps of Qatar, on May 2006, three years after the institution of Qatari law, the president, Sheikh Khalifa, issued a decree stipulating that all public administrations and schools will close on Saturday, formally creating the extended weekend. Before this, each emirate, likewise each company, was free to choose either Thursday (cherished by the traditional emirates like Sharjah and Ras Al Khaimah) or Saturday (Dubai and Abu Dhabi) in addition to holy Friday. Many reasons justified the new alignment with the Western calendar. The most common was that children and parents had previously spent only Fridays together as schools and places of employment did not often share another day off. To support opportunities for leisure and spending, the national department of human resources (Tamnia) issued a survey showing that a nationally recognised weekend and consistent workweek across the board would reverse a hitherto-penalised stock market, and all related business and trading institutions. The private sector lauded the new weekend policy.36 Another cost-effective decision, however, reveals that, while profit most often comes first, in some cases, religious conviction cannot be compromised. While the business community repeats the litany of financial loss during the month of Ramadan, the loss is limited in the UAE.37 In addition to the Eid holiday, which ends the period of fasting, Muslim employees, indeed all employees, may leave their workplace at 3 pm during the fasting month. This Article 65 of the labour code costs the public sector, for the loss of staff working hours alone, $600 million per year. Yet, the federal authorities are determined on the subject. No concession can be made in the matter of the holy month. In July 2012, during the month of Ramadan, the labour ministry instituted a free hotline for reporting all infractions to the amended

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labour law and warned of more inspections to enforce it.38 In this matter, religious tolerance takes on a different meaning. Religious tolerance with regards to the other religions practiced in the Emirates is not without advantages. It supports the reputation of the UAE in the West and generally highlights the sincerity of the Emirati authorities with regards to their own religious convictions too. To necessitate and maintain a respect for Islam, and provide an atmosphere of tolerance and modernity, the federation tries to prevent outbursts from extremists that threaten its reputation. Sunnism, in line with the Maliki school of law which favours pragmatism and public interest, dominates in the UAE, coexisting with Wahhabism and Shi’ism. The first are located mainly in Buraimi (near the city of Al Ain on the Omani border). The enclave paid the zakat to the representatives of the Saudi monarchy until the signing of the Treaty of Jeddah in 1974. The Shi’a are a monitored minority, whose existence reveals the longterm relations with the Persian world on the other rim of the Gulf. Since its independence, the federation has decidedly kept at a distance all violent demonstrations of the Islamic awakening, such as the proselytism of the Muslim Brotherhood,39 and the court case of the ‘94’ in July 2013.40 To ensure general abatement, a central authority writes the Friday sermon delivered to the Imams, Sunni and Shi’a alike. Social tolerance is a guarantee of social peace inasmuch as everybody can practise his or her faith. Christians and Hindus have erected places of worship in one of the main cities of the Emirates. Only the Jews cannot practise. There are not only no synagogues in the UAE but it is forbidden to recruit, in theory, Jewish employees. An anti-Israeli posture has occurred on occasion. A notable example took place before the ATP and WTC tournament in Dubai, when the authorities made a faux pas in denying visas for Israeli competitors (Shahar Pe’er and Andy Ram).41 This decision took place after the Israeli Defence Forces launched an attack on Gaza in December 2008. The decision contrasted with the moderation of the Emirati authorities, always self-conscious of the UAE’s international image, and the Emirates’ benevolence with Christians of all sects. For instance, an irenic Iftar unified Coptic Christians and Emirati officials at the opening ceremony for Saint Anthony Coptic Cathedral Church in Abu Dhabi on 29 June 2015,42 for instance. While the authorities understand the value of religion in strengthening communities, they also understand tolerance as a means of distilling the assimilation of the migrants, particularly the non-Muslim communities of South Asia. Indians, who form a majority of the population of the UAE, pursue their own lifestyle and the means to practise their religion, and remain separate from the Emiratis; this is also true of the prominent Indian families who settled in the country many generations ago.43

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The topic of religion, extremely sensitive in the UAE, has not been studied widely enough. We know little, if anything, on the anthropological practices of the diverse religious communities, including the Islamic one. From the Emirati authorities’ point of view, Islam is the benchmark of social and political action. However, globalisation has impacted the country and has questioned Arab-Muslim values. ‘Tribal capitalism’ must be understood as a means of protecting the Arab-Muslim civilisation while accepting its integration in a globalised economy and culture. The two forces, arguably systems, compete. The Emirati leaders understand the risk of global cultural homogeneity. Sheikh Khalifa Al Nahyan and Sheikh Mohammed Al Maktoum know how to contain liberalism’s requirements, such as the indiscriminate gross profit margin during Ramadan. Sometimes, we witness a certain congruence of practices: in companies, charity, more in line with the tenets of Islam, replaces social responsibility. But these convergences are more the exception than the rule. The conservation and continuation of traditional values and practices often collide with liberalism that shows little respect for local cultures. Globalisation has been accepted in the UAE, provided that the authorities are able to contain it. In a country where all actors praise the virtues of liberalism, it is curious to note that the state is strong: it seeks to be the leading regulator and never to give in to intervention capacity.

Liberalism and interventionism Against the backdrop of liberalism, the governments of Dubai and Abu Dhabi, and the federal government as well, are the project managers of the UAE. After the end of the Cold War, Martin Hvindt examined the Dubai model but hesitated to emphasise the role of ‘the state’ in explaining the success of the city. It nevertheless has to be said that the interventionism of the local authorities was instrumental in the economic success lauded by the business community. Martin Hvindt utilised theories of neopatrimonialism by authors like Peter Evans to understand the success of the UAE. The latter revealed how the nondeveloped states favoured an integrated economy sometimes detrimental to some segments of the local elites. The emergence of the Asian Dragons, such as Singapore, offered case studies on the developmental state that combines capitalism and state control. Dubai, excluded from the category of rentierstates, unlike its neighbours well off from oil resources, is therefore ‘neopatrimonial’. This neologism indicates that a leader maintains a traditional clientelistic relationship in which the patron grants his clients his protection and material benefits like rent-seeking. Patrimonial governance authorises state control (public would fit Dubai better) dependent on a small elite that

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control the economic development.44 Authoritarian decision making processes, a strong public sector and indicative planning characterise this type of governance. The decision making process Understanding the genesis of decision and adjudication is necessary to the appraisal of Dubai and the other emirates as institutions of governance formidably balancing between Eastern and Western traditions. It would be easy, yet simplistic, to answer the question ‘Who decides?’ with ‘The Sheikh’. Whether, like any head of state, he has the final say, he needs to consult beforehand. In the Bedouin culture, the chief of tribe does not share his authority; nevertheless, he is supposed to listen to the various opinions, and, so far as possible, to the elders of the tribe. In the organisational structure of the government of Dubai, an executive council is supposed to formulate strategies, to implement the local legislation, to prepare the development planning, and to supervise the 16 administrative services. This structure, created in 2003, seems to be more a body for administrative coordination than the locus for decision making. Moreover, as Hamdan Al Maktoum heads the council, the responsibility prepares the crown prince for his future role (Sheikh Mohammed Al Maktoum had a similar position in the council of his father, Sheikh Rashid). In an overview, Martin Hvidt describes the decision making process in the city-state as flexible authoritarianism, leaning on an accurate definition of the objectives: a light administrative structure, proactive interventions in the market, confidence in liberalism, and pragmatism in development.45 The emirate of Dubai has always distinguished itself from its neighbours by including the merchant community in the discourse on domestic affairs. Prior to the pearl economy of the early twentieth century and British rule, the sheikhs put themselves more or less on an equal footing with the mercantile class. Yet, the subsidies granted by the British rendered the Maktoum family less dependent than before on the business elite that had been gradually integrated into the clientelistic network. Oil revenues accentuated this subordinate relationship yet the inevitable depletion of hydrocarbon resources destabilised the hierarchical relationship. The arrival of businesspeople, lured into the emirate by new opportunities, enriched the business communities, whose members became more like partners than clients. The newcomers aligned themselves with the local merchant families like Al Ghurair, already integrated in the inner circles of the Maktoum organisational chart.46 New voices rose in the majlis, traditionally in favour of representatives of the families in the tribe.47 The Maktoum family saw the majlis as a sounding board for its emirate. Business delegates

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expressed their views and the sheikh considered the merchants’ advice.48 This face-to-face connection facilitated the resolution of issues far better than the procedural canal of the administration. While maintaining the tradition of the majlis, the sheikhs also retained their decision making power. The Maktoum and the Nahyan families, likewise the other sheikh families, were wise enough to talk with qualified advisors; they were flexible enough to shade their authoritarianism for the benefit of the community. If we had to look for a historical precedent, enlightened despotism would be the one. Decision making power encompasses not only the leading figures of Dubai but also a small group of about twenty persons forming the inner circle around the sheikh. Comprised mostly of men, this inner circle has been capable and loyal; it has been able to orient the path of economic development because it leads an immense legacy of semi-private companies. The vague contours of public and private sectors The large semi-private corporate groups enlarge the economic scope of the public authorities. In Dubai, the government-related entities (also called enterprises or GREs) spearheaded the branding of Dubai. Emirates Airline has become the flagship of Dubai in every city of its globalised network; Emaar and Nakheel have become trendsetters in the real estate sector; and, Dubai World DP has placed Port Rashid on the maritime routes of globalisation. Before the economic depression linked their names to a debt twice that of the emirate ($77 billion vs. $31.5), they were the jewels of an economic model. In conjunction with Dubai Investment Group, Jumeirah Hotels, Dubai International Capital, Dubai Islamic Bank, and Dubai Holding, they formed the strong arm of the emirate.49 Before the sovereign wealth funds, they had no counterparts in Abu Dhabi, whose wealth has rested in hydrocarbons. Dubai’s economic strategy, therefore, strikingly counters stereotypes of a rentier-state; in fact, capital diversification in new sectors such as new energies like the Masdar project, even if it is not economically viable for the time being, is a good choice for expanding the economic activity of the emirate towards a post-oil future. Christopher Davidson meticulously analysed the economic evolution of Dubai and the different strategies implemented to survive after the rentseeking era.50 The constant support of the emirate’s big corporate groups stimulated economic growth. They were an appreciable kick-start and this stimulation strategy resulted in great success at the turn of the century. The business-friendly environment downplays the critics of authoritarian decisions. Moreover, widely publicised strategic plans have thwarted the criticism of Western detractors.

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Strategic planning Dubai’s strategic plan for 2007– 11 recalls the trendsetting strategies of the Maktoum family and Sheikh Rashid’s vision. What is more, it set the trend for Dubai and Abu Dhabi which have competed for the leadership position of the federation in the global context: Sheikh Mohammed Al Maktoum promoted his city in this capacity in the Dubai Strategic Plan 2015; Sheikh Khalifa Al Nahyan followed with the Abu Dhabi Economic Vision 2030, often called Abu Dhabi 2030. Vision 2021 was a different document conceived for the UAE, more a statement of grand principles to strengthen the Emirati nation in order to celebrate its half-century.51 These documents reflect the maturity of the leading Emirati cities in the age of (nation) branding. While the Dubai Strategic Plan (DSP 2015) and the Abu Dhabi Economic Vision 2030 (ADEV 2030) both share a similar philosophy, they were drafted in different contexts in order to address specific issues encountered in each emirate. The first assesses the state of Dubai in the midst of the economic depression. Its premise and content highlight the meticulously planned results of the 2000s before the financial depression of 2008–9. The authors, supervised by the Executive Council of Dubai, refashioned the principles that have paved the way for the emirate’s success, aiming to reproduce the same level of sensational achievement. To a certain degree, the document seeks to reassure the public about the future. Its subtitle, which speaks for itself, ‘Dubai: Where the Future Begins,’ tries to reach two targets: the businesspeople who have contributed to the prosperity of the merchant-city, and the detractors who claimed during the economic depression that the city’s prosperity had been built on sand. DSP 2015 attempts to bridge the period before 2008 and the economic recovery. The message conveyed is consistent with traditional rhetoric: during the storm, trust the captain. This document’s counterpart is the ADEV 2030, based in part on the Norwegian model of development, also influenced by the country’s oil resources. In this competing plan, Abu Dhabi first and foremost identifies itself as a state, not a city or an emirate. The authors highlight Abu Dhabi as the second economy of the region after Saudi Arabia (ADEV 2030, p. 46) pointing out its exceptional economic growth, far ahead of the OECD states (ADEV 2030, p. 24). The local and federal scales of representation appear to work hand in hand in outlining the leadership quality of the city-state. Introducing the chapter on the means to stimulate a business-friendly environment, the authors point to the necessary coordination between the local government of Abu Dhabi and federal jurisdiction (ADEV 2030, p. 47). This coordination legitimises the capabilities of the ruling family of Abu Dhabi on both levels of government. Aware of its duties, the government of Abu Dhabi promises to work for the common interest. The emirate has been the principal supplier of

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Emirati wealth and the main contributor to the general federal budget. The report therefore argues that the whole federation will benefit from all fiscal changes experienced locally (ADEV 2030, p. 60). These two reports (DSP 2015 and ADEV 2030) implicitly underscore Abu Dhabi’s agenda to take over the economic leadership of the federation. Despite their differences, the two reports present the vision of liberalism tempered by strong public interventionism. Dubai has made the law of the market its benchmark principle (DSP 2015, p. 12), which has not been challenged by its neighbour. Abu Dhabi expects to widen free enterprise and to attract foreign direct investments (ADEV 2030, p. 18), transparently and within the framework of the World Bank, the International Monetary Fund and the World Trade Organisation (AD 2030, pp. 60, 129–30). In both emirates, public interventionism has been justified in different ways. First, the public authorities have pledged to fund the infrastructures’ heavy expenses. The Dubai Metro, for example, was conceived to ease motorway congestion for an amount equal to $4.22 billion. While road improvements were then well under way, the Dubai authorities spent an additional $1.6 billion to facilitate transport-reliant commerce (DSP 2015, p. 32). Abu Dhabi, not to be outdone, has made a commitment to cover the growing infrastructure’s heavy expense. Abu Dhabi’s investment is all the more significant because, while the capital of the federation, it rose to the occasion only after observing the rise of its bold neighbour. For example, Port Khalifa, the Abu Dhabi Ports Company’s flagship, officially became operational on 1 September 2012 (AD 2030, pp. 79– 87). Significantly, it is never emphasised that the private sector benefits from these world-class improvements without having to make a contribution in the form of taxes. It is nevertheless implied that there is a price to pay. In a very subtle manner, the introduction of the Abu Dhabi Economic Vision 2030 states that the objective of economic development is to promote the well-being of all citizens and residents of the emirate (ADEV 2030, p. 7). Therefore, emiratisation is justified as a moral obligation (ADEV 2030, p. 29 and ADEV 2030, p. 91). Finally, underscoring the overall value of economic development, the public authorities invest in choice companies that give impetus to the market. Domestically, these two documents reflect the ‘vision’ of the rulers of the two cities and the plans thereafter merely streamline the various allocations. In the capital, two agencies, the Abu Dhabi Council for Economic Development (ADCED) (responsible for the Abu Dhabi Economic Vision 2030), and the Abu Dhabi Urban Planning Council (responsible for the Abu Dhabi Urban Planning Vision 2030) supervised the implementation of the plans. In the case of Dubai, The Highlight of Dubai Strategic Plan (2015): Dubai . . . where the future begins52 and Dubai Vision 2021 launched in

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December 2014, did not alter the defined guidelines but focused more on the spirit of the ongoing changes. The purpose of these reports was to clarify the socio-economic priorities for the city’s beneficiaries, both the Emiratis and the residents. In these emirates, planning is not any more an exercise in style than an administrative tool for good governance. On a different scale, these strategic plans seem to be a tribute given to the market economy. To a certain degree, they are, because they confirm the inclusion of the two main emirates in globalisation. They are a vibrant homage as well to the spirit of enterprise, to the bold initiatives that have led to success. But between the lines, the local culture and the role of the local figures have not been underestimated either. Public interventions are justified by common interest. The business sector does formulate criticism but public safeguards frame uncontrolled liberalism that often bleeds developing countries (and others). Intervention expenditures and tax-free income allow foreign companies to make significantly higher profits than in the Northern states; businesspeople choose strong locations especially when they work in their favour. All things considered, the financial endeavour of the public authorities gives immense impetus to the economy. Here is the main difference between Dubai, Abu Dhabi and the Asian Dragons of the 1980s. A significant portion of the petrodollars has been reinvested in the economic machine. Are the results commensurate to the efforts made?

A successful model? The decisions of the ruling families, Al Maktoum and Al Nahyan, have shaped the economic activity in the UAE, but it remains to be seen how the two principal emirates produce wealth today. Abu Dhabi and Dubai are the main actors because they generate three-quarters of the federation’s wealth.53 Their profiles seem to converge towards a post-oil economy, posing the question of their complementarity. A post-oil economy? The two pillars of wealth production in the Emirates are the oil and the nonoil sectors. With 92.2 billion proven reserves and an average production of 2.3 barrels per day (bpd), the UAE remains a petroleum country. In 2012, according to the National Bureau of Statistics, the share from the oil industry accounted for 38.03 per cent of the GDP (as opposed to 74 per cent in 1980). Yet, it was an essential component of state revenue composing 64 per cent of fiscal income in 2014, which also makes the UAE vulnerable to market fluctuations. The diversification policy might be understood as a means to have sufficient cushion against the oil market upheaval.

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38.03

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Figure 3.1 Statistics

UAE oil and non-oil revenues in 2012 (%). Source: National Bureau of

Financial incentives and the fiscal policy of the federation have largely contributed to the development of the non-oil sector. Unsurprisingly, the underlying trading structures have been consolidated. The manufacturing, finance, transport and communication industries have become the end result of long-considered choices. These, together with construction and real estate, which followed, have rendered the Emirati economy mature. The federal and the local authorities, in two decades of interventionism, have invested in a heavy infrastructure network in the hopes of ceding more control to the private sector (in non-crisis periods, of course, keeping in mind the crash of 2008). Emphasis has been placed on a knowledge-based economy.54 wholesale and commerce trade

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Figure 3.2 p. 53

UAE GDP by sector (non-oil) in 2012 (%). Source: UAE Yearbook 2013,

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This sector encompasses up-and-coming and traditional activities, such as information technologies, media and higher education. Professionals working in this field are, in general, highly qualified. As Jamal S. Al-Suwaidi states, a knowledge-based economy is a step in the information and knowledge revolution. This kind of economy emphasising the cognitive contribution of individuals has contributed to being considered on a par with what is termed a first stage knowledge economy (data compilation, high-speed dissemination technologies, etc.).55 The public authorities called for the development and framing of these economic niches.56 A knowledge economy is presented in all strategic reports as a panacea. Yet the UAE does not perform better than its neighbours in this new field of interest.57 Ironically, in the best-case scenario, the public authorities have barely been involved; nonetheless, Abu Dhabi’s recruitment of transnational higher education institutions like New York University and the Sorbonne stands as a successful exception. Dubai initiated the trend in creating free zones for higher education (Academic City) with a few flagship institutions like Michigan State University; Ras Al Khaimah for its part invested in George Mason University. The goal of each emirate has been to attract students from the Arab world and beyond, from all parts of Africa and Asia, in order to become a world-class university hub in the Gulf region.58 In this field like in other key sectors, such as international finance or media, rivalries outweigh national solidarity. Dubai and Abu Dhabi, friends or foes? If the ruling families take great care to speak with one voice in the public sphere, they nonetheless compete for the leadership of the federation. The origin of this competition dates back to the early stages of independence.59 The two emirates have adopted different economic strategies given their own resources. Abu Dhabi, seated on a black treasure, looked confidently to the future. Conversely, very soon after independence, Dubai encountered the depletion of its oil resources and looked toward diversification for future security. As Christopher Davidson rightly argues in his comparative study of the two emirates, Dubai was compelled to elaborate a strategy of survival while Abu Dhabi enjoyed time to experiment with different scenarios.60 Oil therefore decided the divergent future of these emirates. Sheikh Rashid Al Maktoum is the founder of the global city that we know today. He used oil revenues to propel Dubai towards modernity. The merchant-city opened its doors to Iran and India, and defined its idea of cosmopolitism. With the help of the federation, diversification started in the 1980s. Dubai fervently supported industry with the intention of reducing imports and foreign dependence.61 Big corporate companies, such as Dubal

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Figure 3.3 UAE oil and gas resources. Source: Hussain Al Moosawi from The National

(Dubai aluminium), boosted economic growth. In the same vein, Dubai devised strategic options during the next decade. To place Dubai on the map of world investments, Emirates Airline, the city’s flagship, had to reach the status of a global brand, and Port Rashid, the city’s central commercial port, had to win its place as a re-exporting hub in the maritime shipping industry. The Dubai GDP accounts for one third of the Emirati domestic production. The economic depression of 2008–10 made the publication of statistics difficult for the reputation of the city.62 Consequently, official reports and statistics were sparing in the wake of 2008. Analysing partial information by cross-reference sheds light on the structure of the GDP of Dubai. No wonder that 78 per cent of Emirati trade took place in the merchant city in 2008. The same year, manufacturing industries amounted to 38 per cent of the Emirati activity. When the real estate fever peaked, construction ($7.9 billion, 42.1 per cent of the Emirati GDP in this sector) and real estate ($12.1 billion, 56.6 per cent of the Emirati GDP in this sector) dominated economic enterprise.63 When the emirate achieved its recovery,

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officials were less reluctant to release data on the state of the economy, usually reported in terms of trimesters. Arif Obaid Al Muhairi, executive director of the Dubai Statistics Center, announced during a press conference in late May 2012 that the GDP of Dubai had a net gain of $2.7 billion in 2011 reaching $83.3 billion. Growth was driven both by exports, whose volume grew by 44.3 per cent, and tourism (13.9 per cent).64 Even if Abu Dhabi were not spared by the crisis, it seems that the capital took advantage of this predicament vis-a`-vis its neighbour. Statistics on the depression were not inconspicuous, showing the vitality of the emirate. Although the price of the barrel dramatically fell to $50 in 2013, the same year, oil amounted to less than half of its GDP (55.17).65 Far behind, the most dynamic sectors were construction (8.9 per cent) and manufacturing (5.69 per cent). The distribution of activity underlines the leading role of the oil industry, although a policy of diversification has been implemented to further the growth of the capital. Both emirates have implemented strategies of diversification. Dubai is at an advantage because of the early depletion of its oil resources that left it no alternative. In many ways beneficial, the drawback has been greater vulnerability amidst the ups and downs of the world economy.66 The salient aspect of ‘tribal capitalism’, perfectly integrated into the market economy while consistent with Islamic values, is that it has relied on the traditional core-business of each emirate, meaning trade for Dubai and oil for Abu Dhabi. At the beginning of the 2010s, the new trends, such as a knowledge-based economy, remain more wishful thinking than an economic reality. Only if the Emirati authorities support these new niches, as they have other sectors, will they be successful. In times of crisis, some may be destined to disappear.

PART II WHAT PLACE ON THE WORLD MAP?

Unlike most of the former Asian and African colonies, the United Arab Emirates did not maintain a privileged link with their coloniser, namely Britain. At the same time, there is neither hostility nor indifference towards the United Kingdom. The UK is a country like others with which the federation sustains friendly relations – as friendly as with the United States, China or Pakistan. This unusual relationship in the history of independence shows that the UAE has configured and pursued its own sense of relations with the world since coming into being, so to speak. Abdul-Monem alMashat composed an enticing theory about the young country’s diplomatic preferences, seeing them as organised in concentric circles around the Emirates. The Gulf neighbours, most intimate culturally and geographically, make up the first circle around the federation. The remaining Arab states, a visual and contextual corollary, comprise the second circle, and the Muslim ones, in the same vein, make up the third circle. Beyond these three primary circles, the other states of the world would indistinctively form the fourth circle.1 This pattern, however, deserves refining because fault lines exist in the different emirates and the different circles: for instance, Dubai and Ras Al Khaimah do not share with Abu Dhabi their perception of Iran; an Arab state such as Morocco does not have the same credit as Jordan; while Muslim Indonesia and Turkey do not enjoy more privileges compared with Brazil or the Philippines. Against this backdrop, economic success transformed the Emirates into a major agent of globalisation. The transformations of the urban landscape acknowledge the inclusion of Dubai and Abu Dhabi in the networks of the globalised economy. This opening to the world, however, has imposed realities of decision making: for example, choices of commercial partners, and choices of allies willing to protect the federation in case of external aggression. While the artefacts of the globalised culture pervade the Emirati metropolises, creating the impression that congruence does exist

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between the West and this part of the world, the UAE does not unequivocally give precedence to the Americans or the Europeans. The signing of a contract for nuclear plants with South Korea showed that, first, all states of the fourth circle are on an equal footing, and second, that such a paradigm requires proper security. Prosperity leans on peace and domestic order that require international cooperation. For prosperity, the federation is willing to pay the price. To understand the relations between the Emirates and Iran we must constantly change the scale of analysis. Within the international community, the UAE performs its task alongside the Saudis and the Americans against the age-old Persian enemy. However, Dubai is also seen from the northern rim of the Gulf as a Persian city. Dubai, therefore, holds a dichotomous regional and international relationship with an important political vector that is Iran. The Iranian community and the Emiratis of Iranian origin had helped to modify the hostile rhetoric against the republic of the Mullahs. Nevertheless, Dubai benefited from the United Nations sanctions against Iran and became the gateway of a regional market. Yet, the benefits of this link were not only commercial. A subtle dialogue, which was never interrupted between Tehran and Abu Dhabi, offered the Emirates an alternative policy on the Iranian issue: instead of howling with the wolves, the Emiratis cultivated constructive relations with their neighbours. The UAE is an Arab state, part and parcel of the ‘Great Arab Nation’. The states of the region think of themselves as the members of the same family, divided by national borders. As in all families, there are conflicts but the ‘blood ties’ preserve homogeneity. In theory, the Gulf Cooperation Council (GCC) organises the relations between the six member states, but the small monarchies are wary of the hegemonic role that Saudi Arabia wants to play in it. The Emirates have therefore favoured bilateral relations with their neighbours in order to counterbalance the power of Riyadh. This evolution seems to have been interrupted with the Arab Spring, which did not bear the expected fruits in the Peninsula for the Westerners; conversely, it did strengthen solidarity among the ruling families in the region. Asian tropism has become a fashionable issue in the past few years in the Emirati press. To highlight the meaning of the official visits or acts of diplomacy, or commerce-related data that have gained momentum, an analysis of the influxes is necessary. More in vein with the discourse of geography and geopolitics than international relations, we thus examine the underlying foundations of the relations with Asia, primarily structured by the flow of resources: the role of Asian immigrants in Emirati society is a recurrent debate; and, non-hydrocarbon commerce is gaining steam. One might work on the

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assumption that diplomatic activity is a way to frame these exchanges. Yet paradoxically, while the latter gain momentum, there is little evidence of deepening relations between the federation and the Asian states. Pragmatism is required and the elusive Look East Policy seems more a careful management of resource viability than the motive to build a new geopolitical block around the Indian Ocean.

CHAPTER 4 AGENT OF GLOBALISATION

The United Arab Emirates became a noticeable agent of globalisation in the 2000s. Urbanism mirrors its inclusion in the international trade networks; beneath the transportation infrastructures and the services command centres lie more explicit artefacts of consumerist culture, like the impressive shopping malls. These spaces are the most tangible aspect of the standardisation of global cities.1 Additionally, Dubai and the UAE have entered the restricted club of decision makers within the global economy. The Northern countries cannot be indifferent to this newcomer, which also offers a promising high-end domestic market. Unlike the Southern countries that have very little room for manoeuvre, the UAE has the luxury of selecting its trading partners. Security issues sometimes influence decisions but do not subordinate them. Indeed, a country that creates and amasses wealth often falls prey to and is inevitably embroiled in disputes that overwhelm it. In this regard, the prosperity of Dubai inevitably raises the question of human rights.

Space(s) of globalisation For geographers, globalisation is a network of spaces generated by world-scale influxes. These spaces, all things being equal, are small, some just tens of square-kilometres: airports, port facilities, free zones, shopping malls, pipelines and some offices scattered in high towers, linked together by a dense network of motorways. Command centres of the world economy, they show no difference from their counterparts in Manhattan or La De´fense; they merge into globalisation precisely because they are similar. The new urban landscape in the UAE has not disturbed the local population because, most of the time, it emerges in the desert, an unlimited reserve of space, or in the suburbs of traditional urban centres.

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Integrating into the mesh of the world economy Dubai spearheaded Emirati development but, first and foremost, the diversification of its economy. Its success, as Christopher Davidson shows, has not been accidental. The Maktoum family has sustained this endeavour since the 1950s. Dubai is a good illustration of the transformation of urban space under the clout of the world economy. The diversion of goods and foreign direct investment influxes towards the merchant city materialised with the implementation of heavy infrastructures, the sine qua non condition for integration into the world economy. In the nineteenth century, the security of the commercial routes between Britain and India was the main concern of the British. The control of the Trucial States took a new shape with oil exploitation on the rim of the Lower Gulf. The first facilities linking the emirates to the world economy started in 1958, when the oil production of Abu Dhabi was enough to be exported. At the beginning of the next decade, Sheikh Rashid Al Maktoum, inspired by Kuwait and Bahrain, asked John R. Harris, a British architect, to plan the expansion of his emirate. Dredging the creek to handle the movement of 800-ton ships was the first heavy infrastructure project.2 Oil exploitation changed the features of Dubai’s development. In 1963, Sheikh Rashid signed a contract of exploitation with the US Continental Oil Company (CONOCO) creating the Dubai Petroleum Company (DPC). The revenues of the black gold that gushed from its coast three years later boosted the big projects framed in the second master plan elaborated by John R. Harris for the 1970s. The construction of Port Rashid started in 1967 and the site became operational in 1972. In September of the same year, Queen Elisabeth visited the first fair of the Lower Gulf, which took place in the new airport terminal. The development of international trade, combined with the increase in oil prices in the wake of the Yom Kippur War, stimulated investment expenditures. The main intuition of Sheikh Rashid was that the modernisation of heavy infrastructures would favour commercial activity. The main enemy of the merchant-city was no neighbour, city or state, but time. As a latecomer to oil exploitation and limited reserves, the government of Dubai accepted the challenge of diversification at a pace, scale and intensity, until then, never seen in the region. Port Rashid is a very good example. With 12 jetties in 1972, the freighters had to wait 60 days prior to unloading. Sheikh Rashid ordered a three-fold increase of the port’s capacity. In 1979, 37 jetties and a state-of-the-art crane operation system were inaugurated; a ship-repair yard and a vast domain of dry dock transformed Port Rashid into a hotspot of regional and world-class shipping. As for the World Trade Centre, whose construction started in 1974, likely inspired by the homonym project in New York, the ruler of Dubai sought globally competitive distinction and not a timid position on the regional chessboard.3

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The construction of Jebel Ali, the biggest port in the Middle East, started in 1976 and completed in 1983, became a benchmark in the development of Dubai and of the UAE. Strategic acquisitions abroad accompanied the building of heavy infrastructures in the emirate of Dubai. DP World, one of the ‘national champions’, to borrow a local expression, is a good example. The brand name Dubai Port Authority (DPA) gathers the two ports of Dubai, Port Rashid and Jebel Ali, later encapsulating the free zone attached to the latter as well. Dubai Ports International (DPI) was in charge of the acquisition of foreign infrastructures. DPA and DPI merged in 2005 to form Dubai Ports World, better known under the acronym DP World. At a time of rapid expansion, the emirate of Dubai had a policy of systematic acquisitions of port operators such as CSX World Terminal and Peninsular and Oriental Steam Navigation Company (P&O), based in more than 30 countries. However, in February 2006, when the emirate planned to buy six ports in the United States, President Bush and his administration opposed the acquisitions under the pretext of national security. On 8 March 2006, the House of Representatives blocked the transaction.4 Against the backdrop of 11 September 2001, anti-Arab sentiment had reached its peak.5 However, this debate heightened the international reputation of Dubai, and anti-Arab stereotypes as well. Soon after, DP World was one of the companies severely harmed during the depression of 2008 – 10. On 22 June 2015, Sultan Ahmed Bin Sulayem, chairman of DP World, celebrated the listing of a US$500 million conventional bond by DP World on Nasdaq Dubai (Dubai stock exchange). This ceremony intended to highlight the promising recovery of the port in the wake of the 2008 – 10 depression and to rekindle foreign investment.6 Ports and airports transformed the face of Dubai. Dubai is ideally located to become an outstanding hub of globalisation. In terms of logistics or multimodal platforms, Dubai is at the crossroads of the main maritime routes between the Indian Ocean and the Atlantic Ocean. The re-exports rely on the traditional trade between the Persian world, the Arab states of the Lower Gulf and the Eastern horn of Africa. Its port facilities (Port Rashid and Jebel Ali) place the merchant city advantageously, ranking the 8th leading port centre in the world in 2013, and 3rd for re-export trade after Hong Kong and Singapore. Air traffic movement strengthens this centrality in the shipping industry. The international airport of Dubai is the main one in the region. Despite the economic depression, passenger traffic has continued increasing from 41 to 51 million between 2009 and 2011. In 2014, Dubai International Airport was the world’s busiest for international passenger traffic ahead of Heathrow Airport, with a total of

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70.5 million passengers.7 The competition with Abu Dhabi created a multiplier effect, beneficial for the UAE in general. The capital intends to capture part of the shipping activity with Port Khalifa, inaugurated in July 2012 and operational since 1 September 2012. The aggressive policy of Etihad Airways, the national carrier, boosts the international airport of Abu Dhabi that attracts part of the international traffic between Europe and Asia, with more than 14.8 million passengers in 2014.8 The two emirates continue to charm companies and investors. The business community is aware of the strategic location, which is an additional asset for a country where international investors may optimise their profits (cheap labour, very little fiscal pressure, if any, proximity to markets, etc.). No doubt the UAE will remain an integrated hub in the near future.9 The outcome of this dual development is still uncertain. The rivalry might entail complementarity between the two emirates. In such a scenario, we would witness the creation of a corridor along the motorway that separates Dubai from Abu Dhabi. If competition prevails, one of the two cities will dominate the other in order to deprive its rival from command power, essentially in the services sector. To this equation, it is worth adding the strategic role of Fujairah, the only emirate gateway to the Gulf of Oman. Its stock infrastructures and the oil terminal boosted by the completion of the pipeline from Abu Dhabi give more importance to this maritime coastline open to the Indian Ocean. The free zones Free zones impact small countries like the UAE inasmuch as they become major sources of employment, receive foreign direct investments and operate as export or re-export hubs. Dubai led the way in the establishment of free zones in 1985, followed by Fujairah in 1987, Ajman and Umm al Quwain in 1988 and Sharjah nine years later. The executive council of Abu Dhabi followed suit more than twenty years after Dubai, in 2006, with the airport free zone and Masdar, the flagship of the emirate in terms of branding. Each emirate created at least one free zone. Three kinds of companies were established there: first, firms with a regional focus using the UAE as a springboard for re-export of goods for instance; second, businesses that promote goods without directly commercialising them; third, companies that find interest in participating in the themed free zones where all actors of a market are concentrated, such as Dubai Media City, Internet City, Academic City and Dubai Healthcare City.10 All retain total control without negotiating with a local partner who would otherwise own 51 per cent of the shares. These zones are not subject to any taxes, custom duties, exchange control or charges in capital transfers.

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UAE port infrastructures. Source: public domain

A total of 36 free zones spread in the Emirates with 21 (or 24 depending on the sources) in Dubai,11 which may be classified into three categories. The first corresponds to the free zones that have developed worldwide since World War II, like the Jebel Ali Free Zone (JAFZ), established by decree in 1980. It inspired other emirates, even states like Saudi Arabia. Opened in 1985, it welcomed 2,000 companies, created 35,000 jobs, and generated more than $4 billion of annual exports and re-exports. JAFZ was at the forefront of the policy of diversification. The second category is similar to the Western technological parks. They ease the establishment of agents from the same supply chain in order to create a synergy. Dubai Internet city and Dubai Media City, respectively, opened in October 2000 and January 2001 and mushroomed into the suburbs of Dubai, but sit geographically on the strategic axis that links Dubai to Abu Dhabi. The local authorities significantly contributed to this new urban pole, on the one hand by investing in heavy infrastructures and on the other hand by attracting universities. The American University in Dubai, for instance, situated in

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Figure 4.2 Pipeline Abu Dhabi –Fujairah. Source: Hussain Al Moosawi from The National

Media City since 1995, has benefited from favourable conditions (free land, etc.) and created a department of journalism (The Sheikh Mohamed bin Rashid School for Communication). The third category obeys a different logic that combines niches and the branding of the emirate. One such niche is the flower industry. Cut flowers are expensive in the region. Once the Dubai Flower Centre is complete, it will exploit this commercial activity in the Middle Eastern market. Other free zones are less a niche than an opportunity to brand Dubai, like Humanitarian City or Dubai International Arbitration Centre (DIAC), which aim to augment the city’s continuous public relations campaign. It remains to be seen if the returns from public investments are proportional to the financial endeavours. This issue has been discussed by international organisations. Since the creation of the free zones, observers from the World Bank, for instance, have been sceptical regarding their profitability. JAFZ requires a $2 billion public support and it poses the question of amortisation.12 Surveys, such as the one by Robert G. Picard and Leon Barkho on Dubai Media City (DMC),13 examine the operating of the free zones in

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Figure 4.3

UAE free zones. Source: public domain

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Dubai Airport Free Zone (DAFZ) Dubai Biotechnology & Research Park (DuBiotech) Dubai Car and Automotive City Free Zone (DUCAMZ) Dubai Gold and Diamond Park Dubai Healthcare City Dubai International Academic City Dubai International Financial Centre (DIFC) Dubai Internet City Dubai Knowledge Village Dubai Logistics City Dubai Media City Dubai Multi Commodities Centre (DMCC Free Zone) Dubai Outsource Zone Dubai Industrial City (DIC) Dubai Silicon Oasis Dubai Studio City Jebel Ali Free Zone Dubai International Media Production Zone Dubai Techno Park (under construction) Dubai Flower Center (under construction) Dubai Technology and Media Free Zone (under construction) International Humanitarian City (under construction) Dubai Auto Parts City (under construction, not mapped)

Figure 4.4 Free zones in Dubai. Credit: Hussain Al Moosawi from The National. Source: public domain

their entirety, financial and non-financial. The objective of DMC when it opened in 2002 was to provide the media companies a platform from which they could access the Middle East, South and Southeast Asia. There were no local needs to satisfy but the authorities wanted to lure and support the

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establishment of renowned companies. The result is indicative of the vision: ten years later, 1,200 of the most prestigious media-related companies coexist in DMC. If we stick to a traditional accounting approach, the government of Dubai did not amortise expenditures. In a broader perspective, the draw of such a grouping of corporations generated a byproduct of wealth for the city. While there are no local or federal taxes to pay, these companies need offices and employees need housing. The demand for offices and accommodations stimulated the rental market. Therefore, the staff living near Media City, the generic term for the business district that encompasses some other free zones as well (Internet City, etc.), contributed to the urban development of surrounding enclaves where they rent apartments and villas, such as Emirates Hills, Meadows, Jumeirah Lake Towers, etc. Because foreigners have not been allowed to buy land, the Emirati families, and especially big families of the inner circles, largely benefited from the real estate boom. Another source of significant income for the city is the communications sector, requiring convenient telephone, mobile and Internet networks and services. Until 2006, Etisalat, controlled by the Emirati government, had the monopoly of the telephone network. Du, a recent rival, introduced a semblance of competition (the federal state controls the company as well), the cost of international calls remains exorbitant. The new technologies, first and foremost Voice on Internet Protocol (VoIP), banned until April 2013 (and then only authorised from computer to computer), maintain the monopoly, keeping telephone bills for international companies high. Last, but not least, the non-financial element of the free zone is the reputation of Dubai. The concentration and advertising of brand names in the world of media in Dubai serves as free advertising for the whole emirate. The other emirates have perfectly understood this complex issue. There are eight free zones specialised in media all over the Middle East: three in Egypt, one in Jordan and in Oman, and five in the UAE (DMC, Dubai Studio City, Twofour5414 in Abu Dhabi, Ras Al Khaimah Media City, Creative City in Fujairah. The shopping malls International ports, airports and free zones are artefacts that represent the globalised world. Similarly, high-rises and skyscrapers carry the pulse of the global cities. In this respect, Dubai and Abu Dhabi are really ‘global cities’.15 The shopping mall phenomenon, however, must take the lead in defining the global aspect of these two cities. The malls concentrate retail commerce and transform themselves into places in which to live or by which to be entertained. There are shopping malls in all countries, even the poorest, but in the UAE they showcase the country’s openness to the world

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and its unique position as window to the world. Studies on their anthropological meaning, however, need to be conducted.16 Very few shopping malls have tried to incorporate Arab culture, whereas Ibn Battuta or Madinat Jumeirah, explicitly evocative of regional history and culture, have focused on their ‘retailtainment’ attribution, the combination of retail and entertainment. This concept started in North America, for instance in West Edmonton Mall, whose size is comparable to Dubai Mall; in this case, the extreme climatic weather of Alberta exerts influence over the indoor activities. Nevertheless, these shopping malls are, before anything else, a concentration of global franchises (coffee-shops, fast food, etc.) and of global brands, especially in fashion. Yet, we may suggest that Dubai invented a new consumption model. Although the Emiratis have one of the higher purchasing powers in the world and a large fraction of the expats are potential consumers, the retail park, consisting of more than sixty malls, is not proportional to the population size of the local consumers. The malls form a device that aims at attracting customers from the region and beyond. The government of Dubai has turned disadvantages into advantages. The local heritage is less enticing compared with other Arab destinations like Egypt or Jordan. Moreover, high temperatures prevent tourists from having outside activities. To create events, the shopping malls become themselves the highlight of the stay. Dubai Mall is the biggest shopping mall in the world outside the United States (the 6th by area). The architecture is contemporary and lustrous and the attractions numerous, like a giant aquarium within, or Burj Khalifa, the tallest tower in the world, and its fountains adjacent to the mall. Mall of the Emirates, 20 minutes away by one of the most advanced metro systems in the world, established its reputation on a ski slope, a striking contrast with the surrounding hot desert. Madinat Jumeirah recreates the atmosphere of the souks, but for wealthy customers, and Burj Al Arab provides a grand view in the background. A bit further, on the road to Abu Dhabi, Ibn Battuta Mall pays tribute to the little-known but highly regarded Arab scholar, explorer and geographer to offer a consumerist shortcut to an unobtrusive treasure trove of Arab culture. A visit to these ‘sites’, to which we might add Wafi (and its pyramid) or Dragon Mart (for its Chinese ‘exoticism’), keeps visitors busy for a good week. The Bureau of Events in the Department of Economic Development makes sure that Dubai is a destination throughout the year. Retail commerce peaks during two events, the shopping festival in January and the Dubai summer festival. These dates have transformed Dubai into a regional shopping centre. The neighbouring emirates benefit from the commercial impetus (during the Eid holiday in October 2012, the government of Dubai permitted the shops

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to operate 24 hours; since then shops and food courts may open until 3 am): Sharjah is the urban extension of Dubai but offers cheaper tourism resources; Abu Dhabi serves as a cultural getaway offering a different coastline as well, and only an hour and a half away from Dubai (many Arabs of the GCC travel by car). By focusing on shopping, Dubai has positioned itself as the benchmark for familial tourism. With aggressive campaigns abroad, 20 per cent of the shoppers (885,000 out of 4 million) came from abroad during the 2011 Dubai Shopping Festival (11 per cent Indians, 8 per cent British, and as many Saudis). Since 2011, the festival has generated more than $4 billion in revenue annually.17 All these spaces have contributed to bringing Dubai and the UAE closer to the networks of globalisation. Does this mean that the Emirates is open to the ‘world’? In the Northern states, the ‘world’ is understood as. . . the West and the interfaces of globalisation.

Which relations with the West? Abdul Monem al-Mashat states that Emirati foreign policy could be analysed as a set of different concentric circles around the UAE. The federation prefers to build relationships with their neighbours in the Gulf, then with the Arab world, and beyond, with their Muslim brothers. The rest of the world composes the fourth circle.18 This theory must be qualified: how does one place Iran or Saudi Arabia considering the religious and geographical connections? What is more, since the fourth circle represents attributes furthest from the core qualities of the UAE, namely, Islamic, Arab, Gulf culture and history, are ‘foreign’ states all on an equal footing or do alliances develop or pre-exist based on fluid or discrete criteria? Both the discretion with which acts of foreign policy take place and the clear paradigms which also guide them, shed light on the special relationship between the UAE and the West. Uncertain partnership Foreign direct investments (FDI) and trade are a good measure of a country’s economic appeal. At the peak of Dubai’s exceptional growth in the mid2000s, the UAE ranked 34 (out of 141 countries’ economies). The economic depression did not slow down this trend. On the contrary in 2010, the Emirates hosted 368 FDI projects, 13.9 per cent higher than the previous year.19 As in other emerging markets, a high GDP per capita, openness to trade and oil prices are advantageous to international investments.20 If the FDI were almost exclusively directed to oil resources, the strategy of diversification barely changed this orientation (the oil industry captured three-quarter of the total in 2005). Beyond the oil factor, the attractiveness of the federation stems from the quality of infrastructures, the stability of the

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economy and the multicultural background of the resident population.21 According to the Federal Statistics Authorities, the FDI in the country amounted to $89,671 billion in 2013. That said, the relationship between the UAE and its Western partners varies from one country to another, as the trade with European and North American partners shows. Commerce data from industries excluding oil are insightful in formulating an assessment of the relations between the UAE, North America and Western Europe. In 2014, according to the National Bureau of Statistics, trade with the top European powers (Germany, UK, Italy, and France) amounted to 11.44 per cent, and trade with the United States reached 7.29 per cent.22 Oil is not an important variable in the bilateral relations with the West. According to the Abu Dhabi National Oil Company (ADNOC), exports of crude oil to the US and to the European Union were negligible: in 2012, the United Kingdom imported 2.7 million barrels (0.3 per cent of Emirati production); in 2013, the Asian states absorbed the whole Emirati production.23 The main states of the European Union, like Britain and France, may appear interchangeable partners in matters of Emirati foreign policy. Britain, a conspicuously minor commercial partner with the UAE, is the third Western commercial partner, after the US and Germany, with $9.211 billion directed to the UAE economy in 2014. Good relations and a new strategic partnership between the United Kingdom and the UAE, highlighted by the state visit in London in April 2013, have been presented as a milestone in a history spanning two centuries. However, the former coloniser has not maintained strong ties with the federation; this statement reflects an economic reality. What is more, the UAE sees certain aspects of British tourism as a potential hazard. To prevent British subjects from being prosecuted (and condemned) by Emirati authorities, the UK embassy has issued a guide to proper conduct addressed to British tourists.24 France is another example of an uncertain partnership. From an economic point of view, its contribution has been modest, with a total commercial value of $5.36 billion in 2014. Nevertheless, France is more proactive in the cultural field. The cooperation has successfully led to the establishment of two prestigious institutions in Abu Dhabi. The university of Paris IV sold the franchise ‘Sorbonne’ to the emirate with the prohibition of opening another branch in the Arab World.25 The Louvre will open an annexe on Saadiyat Island along with the Guggenheim and the MoMA in 2015–16. As for the Sorbonne, the project caused friction notably with the mobilisation of art history professionals disinclined to partake in the commoditisation of works of art.26 The fact is that the installation of these institutions in the Emirates is perhaps more a facet of the branding strategy of Abu Dhabi rather than a desire to

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deepen the relations between two sisterly countries. Had the officials of the Louvre, however, not been interested in a contract with the Emiratis, museums like the State Hermitage Museum would not have considered twice the budget of $1.2 billion offered by Abu Dhabi. Pragmatism in the partnership between the UAE and the Western states is particularly visible in matters of security. Since independence, France has exported $8 billion of military equipment to the UAE. Along with Qatar, it represents two-thirds of French exports in this field.27 All French presidents since Valery Giscard d’Estaing (1970s) and, likewise, high officials, namely, ministers of defence and foreign affairs, have cosseted this particular ‘friend’. Arms sales have been the first benchmark of the defence accords. The first was signed in 1977. The Gulf War altered the strategic and the military equilibrium of the region. In 1991, and especially in 1995, to avoid overdependence on American protection, the Emirati federal government signed a defence accord with France, which used this opportunity to showcase the quality of French armament. The accord of 1995 mirrors the state of mind of the signatories. In the event of an attack on the UAE, France would be compelled to deploy 85,000 men, 130 fighter aircrafts and its aircraft carrier. By comparison, more than five years after the accord, France engaged 72 fighter planes, the Charles de Gaulle (aircraft carrier) and its auxiliaries, but no infantry troops, in the 2011 military intervention in Libya. In a nutshell, this accord is, militarily speaking, not applicable. Nonetheless, why did the two parties sign it? The Emiratis, vulnerable from a military perspective, need accords with Western powers; Paris, for its part, tries not to cause discontent with one of its top customers in the region. Aware of the intention to replace old Rafales with Mirages, and of the repercussions of opening a French military base,28 Nicolas Sarkosy paid an official visit to Abu Dhabi in January 2009. The defence accord between the two countries was updated. In the event of a conflict, France must engage all military means at its disposal, a promise we may legitimately doubt29 – with certainly the ulterior motive of major contracts (Rafales of course, but also on the nuclear plants, a bid the South Koreans won, or the desalination plants, won by the Germans). Emirati officials are realists regarding the countries of the ‘fourth circle’. Therefore, France and South Korea are easily considered interchangeable commercial partners. The UAE focuses first and foremost on its protection. Its defence accords are reminiscent of the offset industries in the 1980s. The government authorised foreign direct investments30 on the condition that the Emirates would benefit from them. Neo-colonialism in developing countries easily explains this caution. In addition, symbolically speaking, it matters that the Emiratis have the last word; they are aware that they carry significant clout, particularly in the form of petrodollars. Against this

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backdrop, it is preferable not to invoke ‘friendship’ in the field of international relations with the countries of the ‘fourth circle’ but relations in the best interest of both parties. The US epitomises this stance. What is to be done with the US? The state of diplomatic relations between the UAE and the US is excellent. Diplomats and businesspeople have repeated over and over that a sincere friendship has nurtured bilateral relations since 1971. Whether this rhetoric is true, official visits by US representatives and statesmen to discuss regional issues show a more complex relationship apparent in the exchanges between the two countries. The relations between the United States and the UAE grew stronger and more familiar as a result of the tensions around the Gulf and the Gulf War in particular.31 The US was the third country to acknowledge the independence of the federation. In the context of the Cold War, this former colony was inclined to align itself with the Free World, although officially President Sheikh Zayed declared the UAE neutral, in reaction and as precaution to Nasserite activism and Baathist agents.32 Moreover, before the three wars of the Gulf (Iran–Iraq, the liberation of Kuwait and the invasion of Iraq), the small oil monarchies held little value in the eyes of Washington. The regional balance relied on two pillars: Saudi Arabia and Iran. The dual containment implemented by the Clinton administration impacted the regional balance. The UAEs’ containment of Iraqi influence, more than Iranian then, implied a direct collaboration with the US military forces in the Gulf. With the Defense Cooperation Agreement, signed on 25 July 1994, the Emiratis agreed to supply a logistic support for the US Air Force in Dhafra (near Abu Dhabi) and the US Marines in Jebel Ali and Fujairah. Thus, US presence in the Gulf steadily became more visible gaining momentum in the 1990s when the federation signed new armament contracts with the United States.33 At the turn of the century, however, the Bush administration looked at the balanced policy of the UAE with suspicion.34 As Khalid Almezaini states, the Arab states that are anti-West were seen as ‘bad’.35 In the wake of 11 September 2001, the Bush administration claimed that democracy was the best response to terrorism and exerted pressure on the federation. This propaganda, that masked the less attractive war on terror, sounded hollow in this part of the world. As explains Gregory Harm, the Europeans, and afterwards the Americans, never built the Middle East as a democratic area, but rather as a fringe of the Western world whose logic was tolerated as long as it maintained stability.36 The US diplomats and media vacillated, forcing the Emirati federal government to stay in line with Washington. Incidentally, the UAE has had to be self-conscious about the fact that it was one of the three countries to acknowledge the regime of the

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Taliban between 1996 and 2001, and that 2 of the 11 terrorists that perpetrated the 11 September attack had Emirati citizenship and operated from Emirati territory.37 US diplomacy followed the guidelines of the White House on the Middle East. The generosity of grand principles fell short in Iraq. For the ‘Arab street’, the invasion emphasised the other major driving force of US foreign policy, that is, the defence of American interests at any cost, in accordance with the Monroe Doctrine. The temptation of hegemony in Washington, multifaceted as it is, has been particularly visible in trade policy. US commercial interests in the UAE have not stopped growing since the beginning of the twenty-first century. According to the National Bureau of Statistics, commerce between the two countries amounted to $2 billion in 2000 and to $21,326 billion in 2014. This astronomical increase is the highest among the Western powers. The breakdown of the economic exchange highlights the nature of the relations between the two countries. The Emirati market was negligible for US arms trade between 1997 and 2003, only becoming profitable afterwards. Starting in mid-2000s, the UAE import of American arms is unprecedented. In 2006, the US sold the federation arms to the sum of $1 billion. At this time, the US and France were rival suppliers of the Emirati army. Moreover, as Table 4.1 shows, the Emirati military expenses were around $10 billion per year from 2000 to 2007, but, in that time, decreased in proportion to the GDP, until the renewed rise in tension with Iran in 2008.38 With the economic depression of 2009, the imports fell to the level of 1994.39 2004 was a pivotal year in the commercial partnership of the two countries. Since its integration into the World Trade Organisation in 1996, the Emirati federal government has presented itself as the obedient student of liberalism, facilitating the elimination of its custom barriers and steadily working to create a friendly business environment, a stance that the Clinton and Bush administrations never failed to congratulate.40 On 15 November 2004, the Table 4.1 Emirati military expenses 1997 –2014, constant 2014 dollars in billion (share of the GDP, %) 1997

1998

1999

2000

2001

2002

2003

2004

2005

6.2 (6.8)

7.4 (8.6)

7.6 (7.7)

10.4 (8.3)

10 (5.6)

9 (4.9)

9.5 (4.7)

10.6 (4.6)

9.6 (3.7)

2006

2007

2008

2009

2010

2011

2012

2013

2014

9.6 (3.2)

10.2 (3.3)

12.4 (3.7)

14.6 (5.5)

18.3 (6.1)

19.9 (5.5)

19.6 (5.1)

24.1 (6.1)

22.7 (5.7)

Source: SIPRI Stockholm

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Bush administration notified Congress of its intent to begin commercial negotiations with the UAE. Many meetings took place to discuss a free-trade accord between the two countries. This initiative resulted in failure on 30 June 2007. The Americans blamed the Emiratis, reproaching them for dismissing demands for reforms, notably, labour reform.41 The Emiratis were also vocal on the unfair penetration of the local markets.42 Indeed, we might wonder why they would endorse an, effectively, one-sided accord as the UAE barely exports to the US market. The Obama administration redoubled efforts in late 2011 hoping that the UAE would become the 12th country to sign a free-trade agreement with the US.43 This aggressive stance speaks to the top position of power held by the United States in the Gulf. The issue is straightforward: while the Emiratis are not as dependent as the Saudis on the United States for their security, the White House intends to make the Emiratis pay for their protection in terms of commercial accords. This is certainly not a coincidence if the UAE trade with the US increased from $4.217 billion in 2004 to $21.303 billion in 2014.44 Typical of the attitude toward a ‘fourth circle’ country, the mutual suspicion mars US – UAE relations. Time and time again, the Americans have shown that, first and foremost, they must and will defend their own interests. Conversely, Emirati leaders have sought to find common ground with the Americans to facilitate pressure on Iran and restrict its influence on the region, while maintaining a congenial status quo with Tehran for the purpose of peace and therefore prosperity in the Gulf.45 Against this complex and fluctuating backdrop, it is possible that the UAE might not, in time, need the American umbrella. The sovereign funds: Abu Dhabi striking force President Khalifa and his two brothers, Sheikh Mohamed bin Zayed, crown prince of Abu Dhabi and of the federation as well as Sheikh Abdallah, minister of foreign affairs, give an impression of great confidence in the management of international issues. The Al-Nayhan family knows that it can count on 90 billion barrels of proven reserves. At an average exploitation of one billion per year, the Emirates may foresee the future of the twenty-first century with serenity. In addition, Sheikh Zayed’s sons benefit from the wise, or as the Emirati would say, the visionary, management of their father. Parts of the oil revenue were used to create the sovereign funds (in Abu Dhabi, but also in Dubai and Ras al Khaimah). With the globalisation of the financial system, these sovereign funds give the Emirates, in particular, Abu Dhabi, an (indirect) intervention capacity in the world economy and in individual state matters as well. Much like high finance, the way these sovereign funds operate is more or less opaque.

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In 2015, the Sovereign Wealth Institute (SWF Institute)46 placed five Emirati Sovereign Funds among the top 21, four funded by oil revenues. Second after the Norwegian Government Pension Fund was the Abu Dhabi Investment Authority (ADIA), created in 1976, with assets totalling $773 billion. In 12th place was the Investment Corporation of Dubai, established in 2006, worth $183 billion. Right behind, in 13th position, was the Abu Dhabi Investment Council (2007, $110 b). International Petroleum Investment Company (IPIC) ranked 20th (2006, $66.3 b) and in 21st position, the Mubadala Development Company, created in 2002, totalled $66.3 billion in assets. Far behind, in 39th position, the Emirates Investment Authority (2007, $15b) and, in 61st position, was the Ras Al Khaimah Investment Authority (2005, with $1.2 billion). The cumulative total of these Emirati sovereign funds amounts to more than $1214.8 billion, one fourth of all funds in the world ($7.368 billion). The professionals of the sector find it difficult to identify the domains in which the sovereign funds invest when there are no accounting records; in striking contrast, Norway, which has the first largest fund, has played the card of transparency. Certain economic infrastructures have acquired national companies that compete in the private sector with their comfortable financial cushions. In other words, indirect public support has allowed for such viability. The banking industry, has allowed the officials of these funds to maintain discretion in their communication policies. Yet, productive investments are easily traceable for instance, unlike speculation on the financial market. Therefore, one can get a general idea by crossing information. The two top sovereign funds in the GCC have invested in three favoured sectors: the chemical industry (35 per cent), telecommunication (26 per cent) and banking (23 per cent).47 What are the main guidelines in the use of these sovereign funds? Only two out of seven agencies are transparent: Mubadala and IPIC.48 ADIA is in an intermediary situation. Many rumours circulate about these funds, often based on incomplete information. There is only one clear fact: unlike investment banks, these funds represent a strategic dimension in three domains. First, these investment vehicles have the capacity to acquire raw material that they may lack. That is why the funds were instrumental in the acquisition of land abroad in order to ensure the food supply of the UAE after the crisis of 2007–8.49 Second, the sovereign funds facilitate the transfer of technology. At first glance, this aspect is not visible because it may look like an avatar of the diversification. In 2011, ADIA bought a significant proportion of Thames Water shares, the first water supplier in the United Kingdom, for instance.50 The development of aviation in the capital carried out by Mubadala is even more meaningful.

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Aviation is one of the sectors selected to diversify the Emirati economy. Mubadala made venture capital investments in aircraft manufacturers like Piaggio Aero, a private jet manufacturer, which plans to assemble aircrafts in Abu Dhabi, making the capital a world centre in aircraft servicing (‘MRO,’ or, Maintenance, Repair and Overhaul). To this end, sovereign funds from Abu Dhabi and Dubai (and Qatar) have invested in AEDS, the Franco-German consortium. Indeed, the UAE is a good client of AEDS through Dassault Aviation (Mirages and Rafales). Mubadala does not hide its intention to support the development and the manufacturing of aircrafts. To this purpose, it has bought parts manufacturers.51 The third and last strategic dimension of the sovereign funds is the capturing of new markets abroad, perfectly illustrated in the world strategy of DP World (see above). The strategic character of the sovereign funds, defined by the region and the holders, entails the suspicion of the industrialised countries and a protectionist reflex on their part.52 The Western countries not only see the Arab acquisition of companies or the transfer of technology with wariness and distrust, but they also project colonial tendencies in the face of seeming strategic planning on the part of the federation.53 Their openness to the world has led the Emirates not only to become an essential agent of globalisation but also a suspect of hegemony.

Security One of the objectives of the UAE Vision 2021 National Agenda aims for the UAE to become the safest place in the world.54 Security has been a key issue not only limited to the military aspect of the term, although the ability to protect the country from external threats has topped the agenda. In a context of transnational threats, the Emirati authorities continuously prioritise the security of the population. The new missions of the army In 2013, the federation’s active manpower in the army numbered 44,000 soldiers, out of 51,000 total active military personnel. The air force counted 4,500 aviators for 193 combat aircrafts, while the navy employed more than 2,500 men and women.55 Recruitment has raised issues of national identity and the role of emiratisation. While the federal government maintains emiratisation as the essential force behind recruitment, the issue is still topical.56 Even as far back as its origin, versatile recruitment has been a factor; many Omanis joined the new army after its creation on 6 May 1976, and more recently, in May 2011, the New York Times reported that Colombians had been integrated into the military.57 Regardless, the Emirati army is very well

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equipped to compensate for its relatively small numbers.58 It boasts state-ofthe-art machinery from top military manufacturers: French (400 Leclerc tanks, Mirages), American (radar-system Patriot, missiles, F16) and British (Hawk). If, as Sheikh Khalifa and Sheikh Mohamed bin Zayed Al Nahyan regularly note, the main mission of the military forces remains the defence of Emirati sovereignty, its mission seems to have evolved in recent years. Following the strategy of the other armies in the Arab Peninsula, the main task of the Emirati forces is to stand up to external aggressors, with the aid of allied reinforcements. The goal also adapts to the new ambitions of foreign policy in peacekeeping operations. This is also why armoured units can be transformed into Special Forces. In January 2014, President Khalifa ordered the cabinet to draft a bill for a new national defence and reserve force. All Emirati men who have finished secondary school or are aged between 18 and 30 must undergo military training. Those who have completed secondary education will spend 9 months in the army, while the remainder will serve for two years. The UAE therefore follows the footsteps of Qatar that took similar decisions in November 2013.59 This mandatory service reinforces the feeling of nationhood among young Emiratis, and, it is hoped, will encourage young Emirati men to complete their high school education. Regardless of this major change, the missions of the Emirati army underline the role of a small state in a common defence system. The federal government relies on the GCC but especially on the Americans who are policing the region. We also understand why the Emiratis prefer promoting peace instead of alienating the regional powerhouses like Iran – Yemen is no exception. The prosperity of the depends on peace in the Gulf. The Emiratis have limited room for action to maintain this status quo and they need the presence of the United States to safeguard the country’s external security. Internal security Security issues have been the unexpected effects of the UAEs’ success. Securing the territory in the complex and steadily evolving context of the Middle East is necessary but not sufficient to achieve the ‘sense’ of security defined in the UAE Vision 2021. Security starts at the borders. The economic lure of the federation increased the risks of disorder. In an interview with Al Ittihad in April 1997, the interior minister, Lieutenant General Mohammed Saeed Al-Badi, freely evoked the guidelines of the national security policy. For him, the prime issue in the federation was the demographic imbalance between Emiratis and foreigners: as the country deeply depends on foreign labour, the entry of questionable individuals is inevitable.60 This is why the UAE decided in

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2001 to implement systematic control at the 17 established control points of the territory (land borders, ports and airports). The Emirati immigration office was the first to use the iris recognition system. Three years later, this system, reputed the most reliable in the world, made 2.7 billion comparative assessments without the slightest error or failure. Every day, 6,500 passengers enter the Emirates and are immediately checked, in a few seconds, and matched against the profiles of 420,000 persons blacklisted in the UAE. In 2003, almost 10,000 individuals were stopped with fake identities.61 Beyond these biometric controls, outside the inner circles, nobody knows how the federation maintains its daily security. It is rumoured that certain minorities, considered destabilising, such as Shi’a, Palestinians, and lately Egyptians, are monitored. But officials do not disclose information about them. Consequently, nothing can be said without having recourse to various subjective opinions. Emirati officials are well aware that borders do not contain transnational threats like terrorism or cyberattacks. The terrorist attack against a Shi’i mosque in Al Qadeeh (Saudi Arabia) where 20 persons died on 22 May 2015, confirms that radical Islam is no virtual threat. Jihadists may strike anywhere and anytime. The UAE, let alone Dubai, is no sanctuary.62 Cyber security is one main concern of the Emirati authorities with a wide range of threats from malware to Islamist hackivist groups. The emirate of Dubai alone, namely the Cyber Investigation Department of the Dubai police, received 588 complaints in 2011, 792 in 2012 and 1,419 in 2013. A legal framework was defined in 2006 with Federal Law n8 2, updated in 2012.63 To meet the objectives of Vision 2030 in this field, a National Electronic Security Agency (NESA) will coordinate a National Cyber Security Strategy (NCSS).64 This new institution will finalise the construction of the Emirates as a modern state whose cornerstone remains security in all aspects. Undeterred growth and the ability to expeditiously catch up with enterprising world economic trends have transformed the UAE into a unique country in the world. However, it is the more recent global trend of surveillance which is dominating the markers of the modern state, equipped to ensure economic and socio-political security, and in this undertaking, the Emirates is investing its full attention and resources. It goes without saying security is everywhere in the country but without visible intervention of the police and the army (check-points, patrols, curfew, etc.). Security and human rights Human rights rhetoric is ambiguous in the Arab world, because it refers to different themes, often discussed outside their context. As Shadi Mokhtari states, the Middle Eastern governments never miss an opportunity to point out that the Westerners, especially the Americans, have double standards on

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human rights issues, using them to serve their own interests.65 The fact of the matter is that the more a security policy gains impetus, the more it encroaches on civil liberties. The 1971 UAE constitution illustrates the dialectic between human rights and security. The fundamental law looks like a carbon copy of the US constitution on rights (Article 26). Yet, these rights have limits when pertaining to issues of public order, and moral or national security. In the UAE, the legal framework is flexible enough to let the legislator define the restrictions, notably concerning religious affairs.66 Until 2006, this issue was minor. The success of Dubai drew the attention of some journalists eager to understand the roots of the city’s prosperity. The analyses of the Dubai model, complex as it is, yielded simplistic approaches: the dark side of the success story was the exploitation of workers. In 2006, Human Rights Watch (HRW) issued a report, Building Towers, Cheating Workers, Exploitation of Migrant Construction Workers.67 The NGO, one of the most respected in the field of human rights, argued that the construction industry and its employers exploit the labourers. In their conclusion, the authors indicate that the public authorities have not tackled the problems of legal wages, unpaid salaries, harsh working conditions, and the ban on trade unions. The international media took over the issue, and the government of Dubai and the federal government defined a defence strategy summed up in the motto: ‘We have a problem’. The officials acknowledged the issue and admitted the need to find solutions. The responses were selective. The Emirati authorities emphasised their goodwill to eradicate human trafficking and pointed out that they had already addressed the question of child jockeys. These children, aged 2 to 7, rode, directed and raced camels, sometimes costing them their lives. This triggered an international outcry at the beginning of the 2000s. In 2003, the Emirati federation of camel racing prohibited the employment of child jockeys under 15 years of age and under 35 kg. Robots have replaced the children since the mid-2000s. In 2009, to conclude this issue, the Emirates offered to financially compensate the children. Prostitution was similarly treated. The US State Department estimated that 10,000 women were victims of human trafficking in the UAE. In November 2006, Federal Law n8 51 dictated strong measures to fight the traffickers. A national committee against human trafficking was established and, in 2009, the first legal case ended up in court. However, all these matters, regardless of their utmost gravity and the goodwill of the Emirati authorities to solve them, did not address the particular issue of the rights of the workers. Nevertheless, the local and the federal governments granted specific improvements: workers not paid have the right to appeal to an ombudsman; labour camps with unacceptable living conditions were

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closed; and the summer rest period between 12 and 3 pm, when temperatures can peak at 508C, has been observed with more rigour. With a more encouraging record, the Emirati government felt strongly enough to launch a counter-attack against the 2009 HRW report. On 24 January 2010, it denounced the document as biased and factually incorrect. However, low wages remained the main bone of contention between the human rights NGOs and Emirati authorities. Inasmuch as real estate prices in Dubai and Abu Dhabi were as high as in any global city, before the economic depression of 2008– 10, rich families benefited from construction labour salaries five to ten times lower than those in the West. An increase in the construction workers’ salary, particularly in the midst of an economic plunge, would have stopped this source of immense wealth and its potential effect on economic recovery. In brief, in this matter, a consensus was never clearly formulated. From this angle, human rights ‘violation’ is a mere matter of money for some, whereas a matter of ethical standards for others. What is more, the concern for security is never far behind. In an article about the violations of the rights of migrant workers, Davis Keane (researcher and specialist in human rights) and Nicholas McGeehan (director of Mafiwasta, an Emirati organisation that defends the migrant wage-labourers) underscored the recalcitrance of the authorities in this central matter. Inasmuch as the parastatal companies indirectly control the construction sector, the governments use smoke and mirrors to cover abuses committed in the country. The authors made a recommendation that would increase the respect of the international community if applied; for instance, the UAE would be more stable if it authorised the institution of unions.68 For the Emiratis, accepting counter-powers such as unions or political parties would have a contrary effect. These organisations would destabilise the social and political order of the country because they would enlarge their prerogatives beyond their field. From this viewpoint, human rights are a powerful lever for disorder, and more specifically, for shared power. Human rights present a multiplicity of the socio-economic facets of globalisation. When international media highlight that Dubai has been built on low wages and the exploitation of workers, the Emiratis find this criticism unfair. In their view, the workers are, all things considered, better paid than in their own countries. The authorities remind critics that many factors have contributed to the development of the merchant-city and problems regarding the migrants are inevitable. Finally, the way the authorities have addressed these sensitive questions has, on the whole, been effective. At least in acknowledging the criticism, the federation continues to improve its international image.

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Can the international community wait for human rights ‘progress’ in the UAE? Yes, albeit to different degrees. The wages of the construction workers will increase but likely when the real estate boom comes to an end. The fight against prostitution should be more expedient but its complex social and political implications delay the process. Furthermore, human rights might be on a collision course with Islam (on the living conditions of women, for instance) and will never satisfy the external observers. The new status of the UAE, as broker of globalisation, has amplified issues that pre-existed the success of Dubai. The standardisation of culture, carried out by liberalism, the relations with the West, needed but not desired, and security imperatives, have propelled the Emirates onto the media centre stage. As for the complex issue of human rights, the Emirati authorities are compelled to react to criticism but find it unjustified. The new generation of officials have learnt to find a middle path. It accepts the constraints of public relations and branding. Emirati decision makers are aware of their assets when it comes to negotiating with the Americans or the Europeans: the Emirati domestic market, a small army, the sovereign funds that represent a stronger striking force on the economic stage, the move of the global economy towards Asia, etc. There are different registers and different ways to look at an issue, as the Iranian threat shows.

CHAPTER 5 PERSIAN JANUS

On 14 July 2015, the Emirates News Agency (WAM) issued two dispatches after the signing of the nuclear agreement between Iran and the P5 þ 1 Group (Britain, China, France, Germany, Russia, and the United States) in Vienna. In an official statement, President Sheikh Khalifa bin Zayed Al Nahyan, his brother, Crown Prince Sheikh Mohamed bin Zayed Al Nahyan and the ruler of Dubai, Prime Minister Sheikh Mohammed bin Rashid Al Maktoum, laconically congratulated President Rouhani on the milestone.1 The same day, the Saudi Press Agency (SPA) clarified its kingdom’s position (no name mentioned). Saudi Arabia agrees on the necessity of a deal, amicable neighbourly relations and no ‘interference’ in regional states issues. It also expects the continuation of the sanctions due to Iran’s support of ‘terrorism and violation of international armament treaties and agreements’.2 In another dispatch of WAM, quoting an Agence France Press (AFP) source,3 ‘a UAE official source’ underlined that the nuclear deal could be a ‘true opportunity’ to open a new chapter in regional relations. However, the unnamed author pointed out that Iran should not ‘interfere’ in Iraq, Syria, Lebanon and Yemen.4 The immediate reaction of the Saudi and Emirati authorities shows a common stance on Iran. Like all GCC countries, Saudi Arabia and the UAE contain the Iranian hegemonic influence in the Middle East and on the Gulf region. But the reaction of the federation is not as apprehensive as that of the Saudi kingdom. Abu Dhabi, in fact, implies that the turn of events could be beneficial for regional geopolitics. This wedge results from a judicious balance stemming from long-term trends in the Gulf. The relations between the United Arab Emirates and Iran cannot be reduced to the Iranian nuclear issue. The transformation of Persia into a centralised state by the Pahlavi in the twentieth century and the creation of oil monarchies did not erase the longstanding exchanges between the two rims of the Gulf. It is precisely the entanglement of the historical legacies and of the modern diplomatic issues that complicates the comprehension of Iran– UAE relations.

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THE UAE

The drawing of the states relocated in the Gulf waters a border more formal than the line that had once separated the Arab and the Aryan peoples in the Zagros Mountains. Until the making of modern states, tribes from the Peninsula, like the Qawasim, extended their domination up to the northern shores, while Persian merchants set foot in the ports of the other rim. In the eighteenth century, the Qawasim imposed their maritime domination over the Al Bu Said clan of Oman, the Persians and the British. The latter constantly undermined their authority5 with success during the next century. Persians and Arabs got to know each other well. However, the making of the states and their transformation into nation-states altered mutual perception. In the Iranian textbooks, the Arabs are represented as barbarians, marked by the Muslim conquest of Persia beginning in the seventh century. Analogously, after the 1979 Iranian Islamic Revolution, the Arabs were demonised because of their perceived blindness in adopting Western politics and lifestyles.6 Representations of the Iranians are more diverse because of different ‘national’ (meaning from different Arab states) perceptions;7 however, all accounts point out the defeat of the Persians during the conquest. These non-Arab Muslims (Mawali) developed a national culture and pursued separatist ambitions, although they would not have perpetrated national apostasy. To prevent controversies about the regime established in 1979, the theocracy is simply not mentioned. Contemporary Iran is reduced to its Islamic identity.8 This historical mistrust is visible in the background of the relationship between the Arabs and the Persians, strengthened by the invasion of three Emirati islands right before independence. Nevertheless, the geopolitics of the region encourages a reading of complementarity, rather than opposition, between the United Arab Emirates and Iran. This evolution seemed to have come to a halt in the wake of the economic depression of 2008–109 but regained momentum during the last phase of the negotiations about the nuclear deal.

The Tunbs and Abu Musa Abu Musa and the Greater and Lesser Tunbs have been a bone of contention between the UAE and Iran since the independence of the Trucial States. The withdrawal of the British from the Lower Gulf, announced by the Labour party on 4 January 1968, whetted the appetite of the Iranians. The last heir of the Pahlavi dynasty had hegemonic ambitions in the Gulf. If the covetousness of Bahrain was contained because of the vigilance of international community, Abu Musa and the two Tunbs were still under the threat of Iran. Meanwhile, the emirates of Sharjah and Ras Al Khaimah viewed them as a maritime extension of their domain; their position, at the mouth of the Strait of Ormuz, is strategic, and delimits international waters as well. While Abu Musa’s

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surface is limited to 20 km2 and the Greater Tunb to 9 km2, the islands are rich in hydrocarbons and fishing resources. The discussion between the Shah and Sheikh Khalid Muhammad Qawasim, ruler of Sharjah, resulted in the signing of a memorandum of understanding on 29 November 1971. None of the parties renounced their rights: Iranian troops were able to stay in the north of Abu Musa while the emirate kept the village in the south; fishery resources would be available to Iranian and Emirati fishermen; and oil revenues would be shared between the two parties. The next day, the Iranian troops invaded the three islands. On 2 December the proclamation of Emirati independence changed the disagreement into a territorial dispute between neighbouring states. The referral to the Security Council of the United Nations by Iraq, Algeria, Libya and the Democratic Republic of Yemen on November 9 was unsuccessful as was the concomitant request received by the Arab League. The Arabs, British and Americans explained the failed missions as a kind of wary deference to Iran, powerhouse and guardian of Gulf security. The UAE had no room to negotiate. The threat of non-recognition at the time of independence weighed heavily in the signing of the November memorandum, especially since the federation might be seen as vulnerable in its nascent stages. Diplomatically isolated, President Zayed al Nahyan postponed establishing diplomatic relations with Tehran for eleven months. Finally, in December 1975, he paid an official visit to Tehran in order to normalise relations. The final communique´ did not mention the territorial dispute. In October of the same year, the crown prince of Ras Al-Khaimah, Sheikh Khalid bin Saqer Al Qasimi, met with the Shah and the head of security services to reaffirm the historical rights of his emirate on the islands, to no avail. This rebuke encouraged the emirate of Sharjah to exert pressure on the federation to bring the case before the International Court of Justice. The president’s second official visit concluded an ultimately sterile cycle.10 From the very start, the relations between the two countries were built on a pattern of regional power deaf to its little neighbour’s protests.11 The Iranian revolution carried the hope of the handover of the islands. In February 1979, Ayatollah Khomeini mandated Yasser Arafat to deliver a message to President Zayed in response to the UAEs’ change of attitude towards Iran. The new regime was pleased with the moderate policy of the federation during the Islamic Revolution and wished to strengthen bilateral relations. The Supreme Leader pointed out that he had abandoned the expansion policy of his predecessor, the Shah of Iran. Hopes for an amicable resolution, nevertheless, did not last long. In June, the vice-prime minister, Abbas Amir-Entezam, although moderate, stated that the islands belonged to Iran. The Iran–Iraq War changed the balance of power. Opportunist, Saddam

102

THE UAE

Hussein, courting the Arab states, made the return of the islands the prerequisite to the establishment of peace with Iran. Supported by his Arab partners, President Zayed stated in January 1981 that the islands are an integral part of the UAE, a claim reaffirmed by the newly created GCC.12 On either side of the divide, positions froze against the regional backdrop and did not move until the Gulf War. The ostracism of Iraq during the war made room for negotiation between the UAE and Iran. While the Clinton administration defined the dual strategy, more emphasis was being placed on Iraq than Iran, as the former was being paralysed in the wake of the bloodiest war hitherto in the Middle East. The year 1992 witnessed unexpected events and marked a turning point in Iranian– Arab relations. In March, President Hashemi Rafsanjani visited Abu Musa, an act that might have been interpreted a posteriori as a goodwill gesture to renew the dialogue with the Emirates. Nonetheless, Iran’s attitude regarding the inhabitants and employees of the islands, perceived as petty, hurt Emirati feelings. More worrisome were the increasing violations of the November 1971 memorandum. Iran used the three islands as military bases during the US-led Tanker War (between 1986 and 1988); from 25 April to 4 May 1992, a military exercise aiming at blocking the mouth of the Ormuz Strait relied on the strategic islets. Despite the increase of military presence in late 1992, Tehran accepted new negotiations with Abu Dhabi on 27– 28 September. The Emirates laid down the principle of its rights on the islands and stated that it was willing to peacefully find a solution. This position has never changed; neither has the Iranian one, that is, its sovereignty over these territories is a prerequisite for any negotiation. Discussions, therefore, centred on subordinate issues like the administration of Abu Musa, in theory, under the rule of the November 1971 Memorandum.13 The arguments, used by both parties, differ from our perception of the negotiations. On both sides, arguments lean on history. The Arab point of view emphasises historical placements between the Modern period and British colonisation. The Qawasim, unlike other actual families like the Nahyan, formed a political entity that imposed its domination over the other tribes of the region.14 By the eighteenth century, their domination spread until Bandar Lengeh on the northern rim of the Gulf. Because of the territorial share between the different branches of the family, the Qawasim of Ras Al Khaimah and Sharjah controlled Abu Musa and the two Tunbs.15 In 1887, Persia ended Arab domination of the Persian coast with the capture of Bandar Lengeh and claimed the Greater Tunb as dependent territory. In 1904, Persia challenged the Qawasim by sending customs employees to the three islands. Following British mediation, the Qawasim recovered their authority because the Persians were not able to justify their legal claims.16 The historical argument

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is reversible from the Iranian point of view. Persia exerted its domination on these islands until the Arab conquest in 623. The Buyid, three centuries later, were still the masters of the Gulf, and the three islands were no exception. The arrival of the Portuguese in 1507 called into question the regional balance. But their eviction in 1622 restored Persian sovereignty. The British afterwards patiently consolidated their regional domination by supporting protectorates in order to stifle the Persian power.17 As always in these uses of history, historical truths are questionable. As this historical debate shows, the Iranians and Emiratis have felt reinforced in their rights; what is more, diplomatic discussions cannot lead to breakthrough. There are different ways to look at the balance of powers in 1992. The Emiratis felt that they were the victims; but Iran benefited from its advantage of being there, so that challenging this position implied a war that nobody wanted to initiate. Even if Iran did represent a ‘threat’,18 the three islands were a minor casus belli for the Arabs in general and for the Americans. On either side of the Gulf, the official rhetoric has been well defined: the federation has tried to make its point before international authorities, namely, the GCC, Arab League, UN, etc., while Iran has presented itself as victimised by the Americans who are masterminding a plot against the country, as did the British before them. Against the international backdrop, following the evolution of Iranian politics, the UAE took certain initiatives. In December 1993, President Zayed called for a dialogue with Iran. The next month, Boutros Boutros Ghali offered his mediation. In June, however, Rafsanjani firmly rejected the option of an international arbitration. Diplomats, nevertheless, maintained relations that were meant in a constructive spirit. On 22 May for instance, official discussions took place in the presidential palace in Abu Dhabi. The final communique´ emphasised that the two countries seek to reinforce their links based on Islamic solidarity and the debates turned to Bosnia;19 officially, there was not a word on the islands. The most interesting initiative started mid-November 1995. Sheikh Hamad bin Jassim bin Jabir Al-Thani, the Qatari minister of foreign affairs, invited the parties to negotiate in Doha. The Emiratis suggested examining the occupation of the two Tunbs and the strict application of the November 1971 Memorandum before discussing the question of sovereignty. The Emirati delegation tried to compel the Iranians to make concessions by stipulating that the International Court of Justice would be asked to intervene if the negotiations failed. No accord was found but the parties concerned agreed on the need for further discussion in the future. The election of Khatami in May 1997 anticipated the liberalisation of the regime, and, what is more, the new president called for opening a new chapter in the relations between the Persians and the Arabs. This was ‘a new

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THE UAE

hope for stable ties with Iran’.20 This accommodating cordiality did not, however, change the political guidelines, neither in Tehran nor in Abu Dhabi. In February 1999, new infrastructures were developed on Abu Musa. The federation attempted to mobilise its Arab partners to unlock the Iranian padlock: a quadripartite committee was created with Saudi Arabia, Oman and Qatar in June of the same year. Diplomatic contacts gained impetus. While Khatami considered paying an official visit to the UAE at the end of the year, information leaked in June 2002 that the two countries agreed not to talk openly about their territorial dispute in order to find a reasonable solution.21 Ultimately, under Khatami, no progress had been made on the islands. After 2006, the issue re-emerged on the diplomatic scene, but this time associated with the nuclear programme (see below). At first glance, it seems that the territorial dispute remains the backbone of the relationship between the UAE and Iran, and today the Emirati insistently revives the dispute whenever Iran is discussed; not a single article overlooks, even briefly, this bone of contention. If we change the perspective, the problem remains caught between an effective factor, pride, and an external constraint, bringing the economy of the two countries closer. In the first case, the Arab and Persian officials cannot give up their reliance on domestic public opinion. In September 1992, President Rafsandjani pledged a ‘sea of blood’ before the GCC Arabs and their allies if they tried to repossess the islands.22 Even if the issue has only been a verbal confrontation23 his warning was perfectly understood because it reminded the Emiratis of Khomeini’s speeches during the war against Iraq; in addition, a unit of Guardians of the Revolution remains stationed on Abu Musa. The territory of the Islamic Republic cannot be subject to any transaction. The Emiratis have a similar attitude and cannot renounce their pretentions. To avoid escalation, president Zayed and his successor, his son Khalifa, have always taken great care to underline that this issue should be peacefully resolved. For the business community, this dispute is minor.

Economic rapprochement or the iron law of the market After the Gulf War, Iran’s economic capacity sparked interest. The diplomatic momentum of 1992 is indirectly linked to the increase of trade between the two rims of the Gulf. At the close of the war, the emirate of Dubai, hub of the federation, imported $107 million from Iran and re-exported $188 million. Five years later, the exports doubled and the re-exports tripled.24 20 per cent of the imports were eventually re-exported to Iran.25 Dubai’s chamber of commerce has been particularly proactive to host Iranian delegations and to prospect new markets. The opening of the former Soviet republics of central

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Asia created new opportunities. Given their proximity and religious solidarity, Iran became the nexus between the Gulf monarchies and these new states. In the context of economic reshuffle, the government improved its railway network to the north to facilitate commercial transaction with a market of 350 million potential customers (including Turkey). Ali Naghi Khamoushi, president of the Iran Chamber of Commerce, Industries, Mines, and Agriculture (ICCIMA) at the time, did not hesitate to invite the Emirati investors to seize the opportunities of the Iranian second plan, like the Germans and the Japanese had done.26 However, the Emirati businessmen hesitated to enter the Iranian market because of the volatility of commercial policies, notably regarding consumer goods seen as not essential (electronics for instance), which are fundamental to commerce in Dubai. While these exchanges increased, in counterpoint, new geopolitical tensions arose between Iran and the United States. The doctrine of dual containment of the Clinton administration ensured an offensive stance with Iran, whose position regarding the Strait of Hormuz was perceived as continuously troublesome. Nonetheless, Dubai was an excellent springboard for the US to circumvent the embargo on Iran. On 6 March 1995, after three years of negotiations, Conoco Inc. announced the signing of a contract with Iran, the first since the hostage situation in 1980. The project planned the construction of a pipeline from the island of Sirri to Dubai.27 Two years later, in September 1997, Total, the French based international oil and gas group, signed a contract to transport the gas of Sirri to the Dugas plant in Jebel Ali. The American government, however, blocked the transaction.28 The economic partnership between Dubai and Iran was a powerful lever to ease, if not normalise, the relations between the states of the Gulf. The visits of delegations nurtured friendly links complementing the establishment of new commercial roads. In July 2001, a memorandum of understanding was signed between the organisation of maritime transport and Iranian ports, and Naif Marine Service Co. On 29 August, Hassan Qaedzada, governor of the province of Bushehr, inaugurated in Port Rashid the line that links Dubai and the eponymous port of the Iranian province. Bushehr was a commercial hub, boosted by the construction of railways towards Shiraz in the northeast, Isfahan, Tehran and beyond. This maritime connection did not require previously facilitated visa procedures. The GCC passengers who boarded at Jabal Ali 3 could process their visa at the border post without requiring consular intervention beforehand.29 In June 2002, after an official visit in Tehran, the two countries planned to sign an accord facilitating the exchange of goods and peoples. In fact, Obaid Humaid al-Tayer, president of the Dubai Chamber, pointed out that the Iranian computer companies were very interested in Dubai Internet City, a free zone, which at the time employed

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THE UAE

6,000 workers in the communication and technology industry, and was looking to expand its workforce capacity to 20,000 in the coming years.30 The pragmatism that characterised the presidency of Rafsanjani (1989– 97) struck a responsive chord in the UAE. Two issues overshadowed the two countries’ cooperation, however. First, the commerce between the two sides was unbalanced. A few years later, in 2006, Alinaghi Khamoushi, president of ICCIMA bemoaned the fact that his fellow countrymen heavily invested in the UAE whereas Emiratis did not participate in reciprocally benefitting the Iranian economy despite the fact that many economic obstacles had been removed: there was no differentiation between the foreigners and the Iranians; the investors had full ownership rights (unlike investments in the Emirates outside the free zones) and could repatriate their benefices.31 To exemplify the discrepancy, when the Iranian Business Council (IBC) was inaugurated in Dubai, on 4 May 2005, the media confirmed the strong Iranian implantation recording more than 2,000 companies and shops in the city.32 Second, the geographic proximity of the two states favoured contraband trade. In the mid-2000s, Iran– UAE commerce amounted to $13 billion. The authorities ascertained that illegal transaction represented one third of this volume and slowed down the legal commerce. In December 2004, the authorities planned to enforce the naval patrols.33 Given the topography of the coast, it was not feasible to eradicate the phenomenon, and the best-case scenario was to shrink it.34 The questions remains, how far did the different actors want to go? Even if there are no statistics on the structure of this commerce, for obvious reasons, the customs data is telling. Such commerce includes traditionally trafficked goods, from arms to cigarettes, transported by dhows, the traditional boats found in the harbour on the right bank of the Dubai creek. In addition, it is widely known that American goods, commercialised in Iran despite the embargo, have been part of this trafficking business. Indeed, the trade of American goods in the UAE saw a tenfold increase from 2000 to 2014; 30 per cent to 40 per cent of these goods are re-exported, partly inevitably reaching Iran as a destination. Goods circulated on the dhows or in containers sent from Port Rashid or Jebel Ali. Intermediaries had there their offices. The American companies turned a blind eye to these transactions, as had the American, Emirati and Iranian authorities. These transactions represented one of the loopholes of Dubai before July 2015. The question was, therefore, why had the United States tolerated illegal commerce and who benefited from it? This question underscored the irony of the local logics in light of the inflammatory speeches of the Bush administration. Considered from a business perspective, the territorial dispute is a thorn in the side of the relations between Iran and the UAE. Given the financial and

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commercial interests at stake, none really wants to exert pressure on the other. Furthermore, we might say that the issue is only brought to the table because it is inescapable, but always reluctantly. Diplomacy trails behind the business world. Normalisation is desired to give impetus to a trade already dynamic. Did the comeback of the Iranian hardliners in 2005 modify the nature of the relationship from 3 August 2005 on? In other words, did the war rhetoric alter the bilateral balance? Reversing the perspective? The analysis of territorial dispute is necessary but not sufficient to understand the relations between the UAE and Iran. To a great extent, it is the economic ties which affect the diplomatic relations between the two states, and the breakdown of investments and commerce is evidence of this elastic relationship. Three weeks after the election of Ahmadinejad, ‘Iranian sources’ questioned the flow of capital from Iran to the federation. It was claimed that 400,000 Iranians had ‘lately’ moved $200 billion, mainly invested in the Dubai real estate sector.35 Even if these data were likely exaggerated, revealing the significant presence of Iranian property owners in the emirate, the number of Emiratis from Iranian origin and the recent acquisition of real estate by Iranian nationals do give an idea of a trend. As the economic policy applied by the new president threatened to ruin the country,36 the wealthy Iranians with capital to invest in a safe and accessible place looked to Dubai (more than 200 flights per week). Commerce did not stop growing. After the conservatives came to power, and the rise of the nuclear issue from 2005 to 2013, commerce did not slow down. On the contrary, it increased and reached its peak when the UN passed the main set of sanctions in 2010. Table 5.1 shows that the volume of trade tripled during this period. While the data are incomplete for Dubai for the same period of time, it seems that the emirate captured most of the commerce with Iran. These results subtly impacted Emirati diplomacy with Iran. The nuclear programme advertised by Ahmadinejad seemed to be worrisome for the Emiratis as Sheikh Mohammed bin Zayed Al Nahyan, the crown prince of Abu Dhabi and deputy supreme commander of the UAE Union Defence Force, stated on 21 January 2006: the programme threatens the Gulf as a whole and the UAE is firmly opposed to the completion of the project.37 A week after Sheikh Mohammed’s statement, Iran was once again in the news. In November 2005, the Iranian coast guards arrested a Frenchman and a German fishing off the coast of Dubai. On 24 January 2006, they were sentenced to jail on the ground that they illegally entered Iranian waters; however, on 24 February 2007, Ayatollah Khamenei pardoned them and they

108 Table 5.1

THE UAE Non-oil commerce between Iran and the UAE, 2004 –14 ($ millions)

Year

Imports

Exports

Re-exports

2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

1 099 617 954 717 1 052 833 1 123 1 314 1 857 1 355 1 229

344 282 537 383 530 540 737 1 306 627 718 525

3 302 3 719 4 601 6 251 6 089 7 078 8 589 12 922 11 459 11 528 10 998

Total 4 746 4 619 6 093 7 352 7 672 8 153 10 449 15 542 13 943 13 601 12 718

Source: UAE Federal Competiveness and Statistics Authority

were freed. On February 29, the Iranian authorities arrested Emirati fishermen and their Indian aids on similar charges. The next day, Dr Mohammed Ali Hadi Najafabadi, Iranian ambassador to the UAE, was reassuring: understandably, many Emirati boats accidentally enter Iranian waters and the fishermen would be soon released.38 These incidents, difficult to assess from a diplomatic point of view, boded difficult days ahead while the diplomats and the journalists turned this event this way and that. On 6 March, Sheikh Mohammed, ruler of Dubai, hosted Mahdi Mustafawi, the president’s adviser; on 5 May, Ali Larijani, secretary general of the Iranian security supreme council, paid a visit to Sheikh Khalifa and sought to be reassuring on the cordial relations between the two countries. In September 2006, after the Security Council of the UN passed Resolution 1696, demanding Iran halt all forms of uranium enrichment and

Table 5.2

Non-oil commerce between Iran and Dubai, 2002– 6 ($ millions) Direct commerce with Dubai

Free zone

Year

Import

Export

Re-export

Import

Export

Total

2002 2003 2004 2005 2006

288 270 364 391 579

73 94 135 165 227

2 2 2 3 4

41 80 115 239 313

1 118 2 275 2 377 2 432 2 568

3 4 5 6 7

015 135 819 220 018

Source: Dubai Customs, Data Management and Business Research Department, DCCI

535 854 810 447 705

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correlated activities, the UAE official position was surprising in relation to the GCC states and the United States. The Emirati government considered the Iranian programme well intentioned. Minister of Foreign Affairs Sheikh Abdullah Al Nahyan expressed this opinion. He took great care to emphasise that the Emirates encouraged negotiation in general and preferred direct negotiation with its Iranian friends. This stance was a polite way of creating a distance from the anti-Iranian front in the UN that was eager to impose sanctions against Tehran.39 These sanctions, passed in Resolution 1737 on 26 December 2006, froze Iranian assets abroad. Two weeks later, the Emirati minister of foreign affairs went to Tehran to reaffirm the friendship between the two countries. Sheikh Abdullah took great care to explain that the United States did not summon the UAE to open a surveillance bureau in order to monitor Iranian activities and declared that the UAE has always been and would always be a friend of Iran and of the Iranians.40 This position, particularly uncomfortable to the Saudi and American allies, paved the way for a rapprochement with Iran. Moreover, on 13 –14 May 2007, Ahmadinejad was welcomed in Abu Dhabi, the first official visit of an Iranian president to the federation. Ahmadinejad stated that he was satisfied with the ‘balanced’ policy of the Emirates while his country was facing an international cabal. Before he left, he declared that a new page in history had been written: an inter-ministerial commission, co-headed by both ministers of foreign affairs would work on commerce, energy, and cross-investments issues. The cooperation between the two countries was indeed reaching a new stage: the following month, the Iranian minister of commerce, Massoud Mirkazemi, agreed to soften certain rules in order to facilitate commerce with the UAE, notably allowing foreign banks to invest in Iranian free zones and providing labour documents.41 As the Emirati newspapers observed, the relationship had reached new heights with the making of the inter-ministerial committee in Tehran on 30 October 2008.42 More initiatives were being introduced, particularly in connection with humanitarian questions and with regards to energy, civil aviation and the environment. The Emirati position on Iran has been, depending on varying points of view, either bold or pragmatic, and sometimes both. It upset the United States.43 In February 2008, during a tour in the Gulf monarchies, the under secretary for terrorism and financial intelligence stated that Iran could misuse the liberal banking system for its nuclear programme. Acting as a big brother, the United States invited the governments to be more vigilant.44 If the banks of the region, including those of the Emirates, were vulnerable because of their status, the political leaders were certainly not gullible: the Bush administration warned of red lines not to be crossed.

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The rapprochement of the federation and Iran was therefore fraught with pitfalls, either in diplomacy or in economics. To meet a rising demand in energy, the non-oil-producing emirates looked kindly upon their Iranian neighbour. Crescent Petroleum Co., based in Sharjah, negotiated in 2001 a gas contract with the National Iranian Oil Company (NIOC). A pipeline of 270 km (240 km in Iran) was built to bring gas from the Salman offshore field in the Peninsula for a total cost of $600 million. When the contract was signed, the price was two thirds lower than the current market and Tehran requested an adjustment before giving the green light for the delivery. Crescent reported loosing up $2 billion because of the delay.45 In the meantime, on 30 September 2007, Sheikh Abdullah launched, yet again, a diplomatic offensive for the three islands in his address at the General Assembly of the United Nations. However, in August 2008, Iran opened two bureaus in Abu Musa (a sea emergency centre and a registry office for ships and sailors), provoking the ire of the Emiratis. Resultantly, in September, Iran protested in turn the ill-treatment of its nationals upon entering the UAE. The federal government hastily dismissed the accusation; President Ahmadinejad, eager to refer to international conspiracies against Iran, stated two weeks later that there were no escalations between Iran and the UAE but more likely that rumours had spread from abroad.46 Dr Anwar Mohammed Gargash, foreign affairs minister, tried to cool down tensions and in an interview explained that immigration was justifiably vigilant with the Iranians in the Emirati airports: in 2008, 27 per cent of the drug traffickers came from Iran. Yet, long-term relations with Iran were good and the Emiratis had no intention to take a new stance.47 Anwar Gargarsh, who was also a scholar specialising in the relations between the two countries, perfectly summed up what was at stake: long-term trends mattered more than present bilateral relations. The human link, an asset or a threat? The creation of states and the superimposition of oil have not erased the longterm relationship between the two rims of the Gulf. Individuals remain the main link, superseding economics. In Dubai, the Iranians have been estimated at 400,000. Christopher Davidson distinguished four stages of migration toward the emirate. Despite the decline of the pearling economy, the Persian merchants willingly migrated to where they found a friendly business environment. In the 1920s the policy of centralisation, defined by Reza Shah, and the exaction of taxes encouraged the migrations. The third wave corresponded to the departure of Iranians against the Nazi sympathy of the regime before World War II. Finally, Dubai benefited from the Islamic Revolution that triggered the departure of merchants hostile to the republic of the Mullahs. The Ajami (etymologically ‘illiterate’, ‘that does not know

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Arabic’, that became synonymous with Persian) merged with the Arab population, so much so that half of the latter can be traced to Persian origins: talented entrepreneurs and Dubai high officials stem from this community.48 Vali Nasr goes further (without giving data): according to this specialist in Shi’ism, the citizens from Persian origins are over-represented not only in the business world but also in the Emirati government.49 The presence of an Iranian community, or a community from Persian origin, raises the highly sensitive question of Shi’ism on the southern rim of the Gulf. On 15 September 2008, the front pages of the Emirati newspapers reactivated the fear of Shi’i agitation, modelled after the Bahraini unrest. Adel al-Assadi, former Iranian ambassador and general consul in Dubai, requested political asylum in 2001. He confirmed a rumour that sensitive administrations such as the military might be infiltrated by pro-Iranians. He revealed that the Guardians of the Revolution might have put in place a network of undercover agents in all GCC countries at the beginning of the Islamic Revolution.50 Their intent would have been and might still be to collect information and, when appropriate, mastermind trouble. During a press conference held in Doha the next day, Mohammed Najar, Iranian minister of defence, denied these ‘lies’ peddled by Western media. While the UAE may have looked less exposed than Kuwait and especially Bahrain, caution was still necessary. The Emirati authorities denied the existence of a Shi’i threat; some officials qualified their position by saying that that community was under control; the Shi’a themselves gave a reserved response, simply saying they are not complaining about their situation in the UAE and that they are not treated like second-class citizens, unlike their brethren in Bahrain. In the emirate of Dubai at least, there has been no reason to call into question these assessments that correspond to the irenic vision of the Maktoum family. If the stance of the Emirates regarding Iran is surprising at first, it is soon justified: the bonds long existing between the Arab and Persian population, mutable and dynamic as they are, attest to a complex but necessarily concordant relationship, if only for the reason of sheer geographic and cultural proximity. In addition, the UAEs’ position shows, on the one hand, the affirmation of the Emirati state in view of Saudi Arabia and its main Western ally; on the other hand, it shows how the interests of Dubai, an emirate rich in exogenous components, could curb or direct the position of the federation. Finally, the stance is beneficial for everybody. World or regional diplomatic considerations do not hamper the success of the business community; talks with Teheran are an additional option for Abu Dhabi and its ruling family is not constrained by the American point of view.

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The unexpected effects of the economic depression As Caroline Cronin and Nur Mashala state, the links between Dubai and Iran have been strong even before the 1990s but the international policy of isolation has strengthened them further.51 The government of Dubai has influenced the direction of federal policy because of its commercial relations and the influence of its Ajami community. Dubai’s undeniable impact has not had negative effects because its ties with Tehran have allowed the federation to have an alternative and constructive policy unlike the other states of the GCC (Oman could be the other exception). The second official state visit of Ahmadinejad to Abu Dhabi on 29 October 2008, can be seen as the culmination of bilateral relations that some Arab and Western observers perceive as ambiguous. During Autumn 2008, this policy took a new turn because of two principal external events: the new American strategy on the Iranian nuclear issue and the consequences of the economic depression. The US further complicated the game On the surface, the US election of a Democratic president changed the deal with Iran. During his 2008 – 9 campaign, Obama discarded the military option, leaving scope for diplomatic discussion. The withdrawal from Iraq topped his agenda. However, a closer look reveals that the 44th president of the United States’ stance on Iran was not substantially different from his predecessor. Because the Iranians bought time with diplomatic negotiations, the Bush administration had decided that sanctions aiming at isolating Tehran would be the more effective measure to delay the realisation of the nuclear programme. Nevertheless, the success of such sanctions depended on the application of the Security Council’s resolutions. During the campaign for his re-election in 2012, many US scholars critiqued the Obama administration as a reincarnation of the Bush years in disguise.52 In Middle Eastern issues, authors such as James Mann are particularly convincing: Obama has not been less belligerent than his predecessor: intensification of the conflict in Afghanistan, war in Libya, and the use of drones in Pakistan and Yemen. The War on Terror has continued, and against the ‘rogue’ states as well. Maintaining high officials of the Bush administration such as John Brennan (counter-terrorism), and ministers like Robert Gates (defence) and Stuart Levey (terrorism and financial intelligence) has bridged the Republican and the Democratic administrations.53 On 18 November 2008, two weeks after the election of Barack Obama, Stuart Levey travelled to Abu Dhabi to discuss the financial and commercial arrangements to strengthen the isolation of Iran; during his previous visit, in February of the same year, criticism was soft. It is hard to believe that during

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the last moments of the Bush administration, the under secretary took the liberty to pursue a sanction policy without previously informing the newly elected president. The US suspected that shipping companies like Mayrow Company will keep on trading with Iran despite the ban passed by the Security Council. Emirati banks, however, because of the business opportunities that took place in the 1990s between Dubai and Iran, were under the microscope. The name of Emirates NBD (National Bank of Dubai) regularly came to the attention of the media. Stuart Levey openly mentioned the Mellat and Saderat banks. While the federal government took great care to underline that it had complied with requirements of the international community, it was the first time that a US dignitary openly, and firmly, recommended serious scrutiny of certain commercial activities: clearly a challenge, because of the financial, commercial and familial links that bound the two rims of the Gulf together,54 however, a significant amount of vigilance was necessary. The under secretary’s euphemism was intended to reproach the Emirati authorities for their leniency and to strongly recommend that they support the international community thereafter. The policy of sanctions, defined by the Americans, was an extension of the previous period until the turning point of 2009–10. Obama wanted to tighten his grip on the Iranian issue and puppeteer a subtle game between the three countries. No wonder that the official visits and statements of US and Emirati high officials enhanced the diplomatic line defined by Washington. That was the intention of Dennis Ross, Obama’s special envoy in the Persian Gulf and Southeast Asia, when he toured in Egypt and the Gulf (with the exception of Kuwait) in April 2009. Nonetheless, it seems that the Emiratis did not want to take a firmer posture on the Iranian issue. In July 2009, for instance, President Khalifa conferred the Order of Independence on the Iranian ambassador to the UAE. Hamid Reza Asefi was thanked for his contribution to the strengthening of bilateral relations between the two Gulf States. The outgoing ambassador declared during the ceremony that these relations, especially cultural and economic, have never, in thirty years, been so good55 – an accurate reference particularly in the case of trade between Iran and the UAE (see Table 5.1 above). That was a worrisome moment for the Americans who, since the beginning of that year, had no longer hesitated to single out the Emirates as a transit country for illegal goods (including warfare materials). Of 30 seizures, in fact, half had transited through the UAE.56 Criticism grew to a crescendo. In spite of the above, the United States had little room for manoeuvre. Indeed, in April 2008, the first economic power in the world competed with Canada, France, Japan and Russia for a bid for the construction of nuclear plants in the UAE. In the United States, the contract that represented more

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than $20 billion dollars (between $20 and $40 billion in total) involved congressional authorisation. The Obama administration stood between the foreign affairs guidelines and the prospective multi-billion dollar contract. This backdrop brings to light the full aspect of the American attitude towards foreign policy. In May, Obama asked Congress to think about the terms of a nuclear contract between the US and the UAE. After an internal debate of the Foreign Affairs Commission of the House of the Representatives, Howard Berman, its president, reported on 8 July that many representatives worried about the close links between Iran and the UAE. It did not prevent the Commission from approving a resolution authorising cooperation between the United States and the Emirates on the nuclear issue (not limited to the commercial aspects).57 The final text took effect on 17 December of the same year, although the South Korean of Korea Electric Power Corporation had won the bid a few weeks prior, because of lower cost, a better schedule for completion, and, first and foremost, more efficient lobbying.58 From 2010 onwards, the UAE federal government seemed more inclined to support the United States on the Iranian issue. The turning point in the bilateral relations occurred on 9 June 2010 with Resolution 1929 of the Security Council that ensured the isolation of Iran on the international stage. Robert Gates took no time to rejoice during his visit to Abu Dhabi on 11 March. The new restriction froze the assets of 41 companies, including 15 linked to the Guardians of the Revolution and 22 involved in the supply of arms and nuclear components. The banking sector was especially scrutinised.59 Capital transfer was not free anymore to associate, directly or indirectly, with an Iranian partner. As Sultan bin Nasser Al Suwaidi, governor of the Central Bank of the UAE, stated, closing certain companies shows the goodwill of the federal government in collaborating with the international community.60 Stuart Levey organised a tour in the Gulf to explain how the GCC states should apply the sanctions. On 15 August he repeated his litany. The under secretary for terrorism wanted to make sure that the US partners in the region perfectly understood the measures necessitated by the United States61 and passed by the international community in the Security Council. The Central Bank of the UAE was mandated into taking concrete action. A committee on anti-money laundering and a suspicious cases unit was held responsible for finalising the UN resolution, notably with the signing of memoranda of understanding with ad hoc institutions such as the chambers of commerce.62 The ultimate question posed in late 2010 was to what extent the set of fines and penalties would affect commerce between the UAE, in particular, Dubai, and Iran. The federal institutions wanted to be reassuring especially since not all trade was confined to the restrictions imposed by the UN. Nonetheless, commerce as a whole was penalised because of the

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constraining procedures and the climate of suspicion. Sanctions increased costs and slowed down exchange, although without stopping them.63 A delegation of businesspeople met with Sheikh Ahmad Bin Saeed Al Maktoum, director of civil aviation, and Mohamed Ibrahim Al Shaibani, director of the ruler’s court, early November to submit grievances.64 A contrasting picture The clouds were gathering over Dubai Creek as sanctions against the Emirati companies progressed during spring 2011. On May 2011, James Steinberg, US deputy secretary of state, announced sanctions against the companies that supplied refined oil to the Iranians. The State Department targeted Venezuelan and Emirati companies.65 The next month, US departments of finance and justice accused six Emirati shipping and transit companies of engaging in illegal trade with Iran. A new clampdown was instituted late 2011. The banks accepting transactions with Iranian partners would be denied access to all commercial operations in the United States. This certainly had a deterring effect. Institutions like Nour Islamic Bank renounced its partnership with the Iranians, a strong signal sent by the Dubai banks to other banking institutions. In September 2012, the European Union followed in the footsteps of the United States in the key sectors, meaning banks and refined oil. The branches of the transnational companies which violated the international rules were punishable by European laws.66 The numerical result of these sanctions partly contrasts with policies of firmness mediated by the American foreign affairs agenda. During Summer 2011, data on commerce in 2010 provided by Saeed Al Awadi, director of Dubai Exports in the Department of Economic Development, were promising. Exports to Iran amounted to $490 million (for linking the Tables 5.1 and 5.2 above, $227 million in 2006); re-exports increased reaching $6,539 billion ($4,018 billion in 2006). In sum, the UAE remained the main trading partner of the Islamic Republic after India.67 In addition, it was likely the more legal steps taken by the international community, the more prosperous the contraband became. The ill-practices would take place directly between the two countries or by proxy via Central Asian states.68 Indeed, 2011 was the best commercial year between the two countries ($15,542 billion) but trade steadily decreased from 2012 onwards (see Tables 5.1 and 5.2). According to the Financial Times, the sanctions started to impact the commerce in 2012, coinciding with the punitive measures declared by the European Union and one year after the US initiated those measures: commerce reached $601 million, one third of the number achieved in 2011.69 During his official visit to Abu Dhabi on November 2013, it was said that John Kerry had noted that the UAE paid the price for the isolation of

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Iran: the bilateral commerce declined from $23 billion to $4 billion dollars.70 From a US point of view, the efforts had been crowned with success, but from the Emirati perspective, and Dubai in particular, the picture was more mixed. The election of Hassan Rouhani in June 2013, the emergence of the Daesh and the unrest in Yemen the following year reset the regional balance between the GCC states, including the UAE, and Iran and the US.71 A joint committee between the UAE and Iran renewed cooperation between the two states. This official yet discreet structure working on economic affairs was formalised on 29 October 2008, after Ahmadinejad’s state visit a year before, holding its sixth meeting on 11 October 2011.72 When Sheikh Abdullah, the UAE foreign minister, paid a visit to Hassan Rouhani in Tehran on 28 November 2013, both countries agreed to revive the structure. The business community understood the message. The looming possibility of the lifting of sanctions with the Joint Plan of Action signed in Geneva on 24 November 2013 bode well for, at least, the return of a status quo and perhaps the development of the Iranian and Central Asian economies. Although the world leaders dared not publically foresee the outcome of the negotiations at that time, Sheikh Mohammed bin Rashid al Maktoum made clear, in a BBC interview on 13 January 2014, that the international community should alleviate the sanctions against the Islamic Republic.73 The Obama administration was not keen on hastening the process and acted carefully. Undersecretary For Terrorism And Financial Intelligence David S. Cohen reiterated, before the US Senate Foreign Relations Committee on 2 February 2014, that the American government had to maintain ‘significant pressure’ on Iran.74 He addressed barely veiled threats to the UAE business community. But the impetus of the regional dynamic was by then out of US control. As Mohammad Javad Zarif Rouhani’s foreign minister pointed out, ‘What we [Emiratis and Iranians] share in this region is far bigger than what could divide us.’75 On the regional stage, the UAE’s good intentions were tempered with the expanding influence of Tehran in Iraq against the Islamic State, and in Yemen in support of the Houthi’s offensive against the regime in January 2015. However, it would not be surprising if the Emirati realism would associate a proactive economic cooperation between the two countries and, at the same time, more careful diplomatic relations with Tehran to contain its hegemonic implication in the regional affairs. The strict implementation of sanctions hampered the growth of commerce between Dubai and Iran after 2011 because of the heavy administrative procedures and the scrutiny of banking operations. Upon acceptance of the embargo resolutions, the government of the emirate sought new business opportunities in South America, Central Asia, and even Europe. Even if the statistics cannot show the reverse trend since the 14 July 2015 accord, it is a

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fair assumption that the emirate will become a pivotal partner in the Iranian development. Dubai might be an even stronger partner than before because the structures of the business partnership already exist and will prosper in a more transparent framework. The relations between the UAE and Iran has hinged on Dubai. Pressure exerted on the federal government by the latter explains the original stance of the UAE with regards to its neighbour. A change was discernible during the years 2009 – 10; it did not only stem from the new diplomatic setting designed by the Americans but also from the impact of the economic depression that had affected Dubai since Autumn 2008.76 In The Economist, Christopher Davidson disclosed a public secret in Dubai: the financial support of Abu Dhabi downgraded the economic power of the flagship emirate of the UAE77 and, consequently, the scope for manoeuvre that the government of Dubai had around the Iranian issue. All things considered, Abu Dhabi and the federal government did not take a 1808 degree turn with Tehran. They became, for a while, more in line with the US requirements without giving up a certain degree of unabashed flexibility on Iranian affairs. Unless the situation changes drastically, the bone of contention of Abu Musa and the two Tunbs will last longer and the UAE will exhaust all legal remedies to recover their rights. Beyond the role-playing game for the federation but also for the other GCC states,78 ties that bind in the long run and the involvement of the Dubai Ajami community in Emirati affairs have transformed Iran into a partner rather than a foe. The nuclear issue, against the international community backdrop, reinforced the divide between Arabs and Persians but it could not downplay the culture and the economic interests that the two countries have in common. Like Oman, the UAE is a reluctant partner with the United States. In this regard, Abdul-Monem al-Mashat’s idea that the UAE gives priority to the Gulf and to the Muslim states over the other partners of the ‘fourth circle’ is undeniable with respect to the Iranian issue.79

CHAPTER 6 ARAB FRATERNITIES

The Emiratis define themselves as being Arab. Moreover, Article 6 of their constitution underlines that they form a subset of the ‘Arab nation’ regardless of migration influxes or tribal origins, dynamic characteristics qualified today as transnational. Personal ties between the families, sometimes separated by national borders, are important to understand the subtle bilateral relations between the United Arab Emirates and its direct neighbours. Likewise, the Persian roots of the Ajami community condition, consciously or unconsciously, the relations between Iran and the UAE. The origins or the marriages between elite Emirati and Omani or Qatari families, for example, forward personal contacts between the Emirati state and Oman and Qatar. In this regard, Yemen would be the exception: while diplomatic relations have been interrupted, there are strong familial ties between the two states and a Yemeni community, comprised of Yemeni citizens or Emiratis from Yemeni origins. Therefore, reducing the state-to-state relations to simple diplomatic links is as simplistic as stating that all Emiratis are on an equal footing without taking into consideration their social status. The making of national states pacified the tensions within the ‘Arab nation’. Before 1970– 1, the relations among the tribes of the northeast Peninsula were protean and sometimes tense. The conflicts dissipated when the Emirates, Oman and Saudi Arabia reached agreements on border disputes, collaborated within the Gulf Cooperation Council (GCC) and tried to create nation-states. These pacified relations that circumvented armed conflict are a big step forward but need careful management. In line with the tradition of group feeling or endogenous social cohesion (asabiyya), the Emiratis display a quiet face to the external world, the circles beyond the ‘Arab nation’. The relations among the GCC states, however, are not straightforward. The organisation defines a priori the framework of a unified economic market; its members ostensibly share the endeavour to deepen their relations whilst under the thumb of this economic rubric. The ambitions of Saudi Arabia, the

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dominant member, have cast a shadow over its neighbours in the Peninsula, for example. Against this backdrop, it remains to be seen if realism is the key word of Emirati diplomacy. Interestingly, the avatars of the Arab Spring and of the Iraqi invasion have raised the question of the principles that the Emiratis want to promote in the spirit of neighbourly relations.

The UAE, within the GCC The Gulf Cooperation Council (GCC) formed by Saudi Arabia, Kuwait, Bahrain, Qatar, the United Arab Emirates and Oman was established on 25 May 1981. Saudi Arabia and Kuwait took the initiative. All the members have a common history, faith and ambition. Their friendship brings them together to form a structure that is not supposed to compete with the Arab League.1 As the press highlighted in 1981, the GCC was not created ex nihilo. Transnational projects were implemented prior to 1981, such as Gulf Air with Bahraini, Qatari, Emirati and Omani capital, and the Arab Shipping Company, established in 1976.2 Created in the wake of the Iranian Revolution, the council has never had influence on major decisions regarding the Arab-Muslim world, likely because its members have been reluctant to transfer part of the sovereignty power to a supra-national structure. From outside the Peninsula, even from Yemen, it has been perceived as a club of wealthy states, undermined by internal matters never clearly formulated. The six members gather in late December in one of the capitals to review Peninsular and/or Arab-Muslim issues. Its annual summit, called the Supreme Council, is a forum where the heads of the states and their delegations express their points of view behind closed doors. Like the former European Economic Community, the regional organisation favours long-term relations. Two agencies were implemented with the Charter. The secretary general deals with logistical issues and the ministerial councils, comprised of the ministers of foreign affairs, convene every trimester for the purpose of generating more discreet action. Yet, the ministers of each country cooperate on specific themes. Through the prism of the Emirati press, the role of the GCC has evolved: it was, at the outset, an institution whose main task was to ease cooperation in security matters; regional integration projects gave impetus to the GCC since the Gulf War, and from the 1990s onwards, its role became more elusive, buffeted by domestic events in the Peninsula. Until the Gulf War, President Zayed Al Nahyan, and all Emirati officials, following in his footsteps, praised the GCC. The period that started on 25 May 1981, and ended on 2 August 1990, was indeed promising the security of the Peninsula. During the inaugural summit held in Abu Dhabi, the heads of state took great care to reassure the international observers that

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the GCC was no military treaty against other Arab states or against the West. Nevertheless, in light of the Iranian Revolution, the invasion of Afghanistan and the Iran– Iraq War, international policy-makers sounded a note of utmost caution. The two geopolitical threats at the time were the closing of the Strait of Ormuz and the contagion of the Iranian turmoil in the Gulf monarchies; in addition, all the members had to grapple with domestic Shi’i minorities (a majority in Bahrain).3 However, the members all opposed the deployment of British or American troops to tackle regional challenges. This leitmotiv, repeated during the summits, compelled the Arabs to ensure their own defence.4 In late September 1984, the first joint military exercises that took place on Emirati territory resulted in a ‘great success’,5 prompting further exercises in Saudi Arabia the next year. The haggling on security issues pushed economic endeavours, such as the creation of a free-trade zone between the states of the Arab Peninsula. Close to the fifth anniversary of the GCC, Arab leaders spoke with one voice to celebrate what they characterised as a success. The Emirati defence minister at the time made the stakes bolder in stating that Europe took more than two hundred years to achieve what the GCC accomplished in five years.6 As the Iranian threat steadily faded, the activity of the GCC reoriented its activity towards the economic sector. The 1983 accord cleared the way for a common market. The member states collaborated in the Gulf Investment Corporation to consolidate transnational economic activities. In late May 1990, optimism reigned: the GCC had entered a new era that enacted its new status on the international stage, and certainly in the Muslim world.7 The invasion of Kuwait was a clap of thunder in a calm sky. The threat was where the GCC did not expect it and therefore was dismayed, not to say discredited. Beyond the blame put on the invader and the unconditional support of one of its members, the council exhibited its weakness in the final communique´ of the annual meeting held in Doha that year.8 The liberation of Kuwait by an international coalition opened a period of flux in the region defined by dissolution of unity and uncertainty. Iranian journalists were invited to the Doha summit but the GCC merely mentioned the possibility of trading with Iran. Yasser Arafat’s support of Saddam Hussein led the Gulf States to revise their aid policy to the Palestinians (at least, officially, until the end of the decade for the UAE).9 On the tenth anniversary of the GCC, the states and the Emirati media expressed that the war of liberation had given a new status to the GCC. This self-celebration was of course a cover for lost illusions. The fact was that the GCC states had not been able to provide for their own defence. In March 1991, the signing of the Accord of Damascus between the Gulf States, Egypt and Syria that scored an Egyptian and a Syrian military intervention in case of aggression was no credible option. Oman’s

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Sultan Qaboos proposed a 100,000-man army that was not even mentioned in the final communique´ of the annual summit held in Abu Dhabi in December 1992.10 What is more, the border dispute between Saudi Arabia and Qatar disturbed the organisation the preceding year; the former had coerced the latter into the temporary suspension of its GCC membership. Despite Sheikh Zayed’s mediation efforts, these dissensions paved the way for the United States’ bid for power in the Gulf. The Gulf War made clear that only the US army was in a position to repel an external aggressor. As no common position was possible to define, each state of the region, led by Kuwait and Saudi Arabia, negotiated a bilateral arrangement with the US, the inescapable partner. The rupture of Arab unity paved the way for ‘dual containment’ coined by Martin Indyk, senior director of Near East and South Asian Affairs at the US National Security Council, on 18 May 1992. This doctrine aimed at weakening Iran and Iraq simultaneously in order to preserve the priority of interests in the region. The policy encountered two obstacles. First, the Gulf States did not make the alliance in order to battle alongside the Americans. None had the same perception of the Iraqi and Iranian threats, and even Kuwait was fearful of Iraq, not of Iran, while Bahrain perceived the threat in reverse. In addition, internal quarrels undermined the policy. In 1994, Iraq attempted to break its isolation by courting Oman and Qatar. In the face of failed rapprochement, this manoeuvre divided further the GCC partners.11 Second, the attacks against American interest in Riyadh on 13 November 1995, and in Khobar on 25 June 1996, attested to the anti-American resentment widely spread in the region.12 The US’s limited confidence in its Arab allies was the inevitable counterpart of the containment policy. The Emirates, a pacifist state oriented towards economic development The ‘War on Terror’ after the 11 September 2001 attacks took place within this context of mutual distrust. As David Mack, former US ambassador in Abu Dhabi, admitted, the Gulf States, first and foremost the Emirates, curbed emotional response in favour of logistical assistance in the fight against Al Qaeda and in the intervention against the Taliban in Afghanistan.13 Sheikh Zayed always insisted on the need to combine security and stability. In a context of uncertainty, the UAE reinforced its identity as a pacifist state. This stance, before the invasion of Iraq in April 2003, was of particular significance and can even be interpreted as a bold statement. On 26 March 2003, Abdul Rahman Al Attiya, secretary general of the GCC, visited the Emirati president, who suggested a peace conference between Arab states to avoid war.14 The GCC, including Kuwait, backed the initiative and opposed any military intervention against an Arab or a Muslim country.15 Two factors

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justified this Emirati, and even Arab, diplomatic position. First, a new war in the Gulf would jeopardise economic growth and, second, the false neutrality was an opposition in disguise against new US interference in the affairs of the region. Sheikh Zayed, and behind him the whole of Emirati diplomacy, assessed that the region has nothing to gain in this adventure – as events would later demonstrate. A certitude gained momentum after Sheikh Zayed passed away on 2 November 2004: the Gulf Cooperative Council was no political decision making body but a mere tool promoting regional integration. The summit of 2004 showed the spirit of the times. The tensions between Saudi Arabia and Bahrain, the latter of which negotiated at the time a free-trade agreement with the United States, eclipsed the war in Iraq. The internal divisions were not hidden any more but openly discussed.16 The two main regional integration projects, not linked with energy, were the creation of a common currency and the creation of a railway network. The first project, the instituting of a common currency, dates back to 1975–8. Bahrain, Kuwait, Qatar, and the UAE wished to use a Gulf dinar. Moreover, the charter of 25 May 1981 stipulated that the member states would cooperate in a financial and monetary system. The double advantage of this monetary union would have increased the weight of the Gulf States in international negotiations and would have boosted intra-zone commerce. On 1 January 2003, a free market was established for a three-year interim period (finally confirmed in 2005); this same year, the member states pegged their currency on the dollar with the objective of unifying a monetary zone by 1 January 2010.17 Several obstacles hindered the implementation of a common currency. In October 2006, Oman announced its withdrawal; the next year, because of inflationary pressures, Kuwait decided to remove its instituted peg on its dinar. At the same moment, Saudis and Emiratis jockeyed to house the new central bank. In May 2009, the first announced its creation, triggering the withdrawal of the second. Beyond pride, always underlying negotiations, a certain economic vision was at stake. Saudi Arabia was conservative, striking a contrast with the Dubai and/or the Emirati models).18 As battle for top position between the Saudi kingdom and the UAE threatened the project, the ministers of foreign affairs of Bahrain, Kuwait, Qatar and Saudi Arabia signed a monetary accord the next month. The directors of the member states’ central banks gather every three months, but this coordinating body harbours limited powers because it does not benefit from any transfer of sovereignty.19 The pretext of the economic depression that harmed the economies of the Peninsula henceforth justified a policy of small incremental steps, without a deadline, leading towards a monetary union.

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Figure 6.1

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GCC Railway project. Source: Patrick Jones

The second regional integration project, while not spectacular, is promising. The creation of a speed train network on the Peninsula does not entail transfer of sovereignty. Originally anterior in priority, it was put on the agenda of the Abu Dhabi summit in December 2005, not surprisingly as part of the discussion on a regional electric network.20 Abdul Rahman Al Attiyah, secretary general of the GCC, qualified this plan explaining that the population of the council expected more tangible realisations on the regional scale.21 Indeed, the project favouring the development of regional infrastructures is less polemic than security or common currency issues and favours the deepening of Arab identity. A railway network would link all GCC countries with possible extensions towards Syria and Turkey (see map 6.1). Should the creation of this modern Berlin–Bagdad be a long-term objective, rapid realisations would materialise, and as all states are supposed to gradually develop their own railway the subject of coordination is essential. The Emirates has been particularly interested in this project because of the total lack of train network in the federation. Federal Law n8 2 of June 2009 authorised the creation of a railway the goal of which was to promote passenger traffic and movement of freight. A National Committee for Railways met for the first time on 29 April 2015 to review the federal law regarding the railway.22 The second stage will cover 628 km, linking the UAE to Saudi Arabia. While it was suspended on 26 January 2016, the project aims at creating a corridor from the Emirati ports to Ghuweifat.23

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While the GCC project faces sensitive border disputes, such as the one between Saudi Arabia and Qatar, it will inevitably reinforce cooperation between the different members of the GCC, at least among certain members24 and serve as a reminder that the council is less focused on security issues on the international scale, working primarily to promote regional sustainability and partnerships. As a result, the GCC is now perceived as a tool for such market-centric alliances and a flexible framework open to partners with a similar profile. Intra-GCC commerce According to the National Bureau of Statistics, commerce between the UAE and its fellow members of the GCC amounted to $26.469 billion in 2014 and represented 9.1 per cent of total (non-oil) commerce. The oil producing countries have a low exchange ratio amongst themselves because they have a similar profile. Their policies of diversification, not (yet?) coordinated on the regional scale, reduce reciprocal commercial opportunities. Nonetheless, intra-GCC commerce slightly increased since 2008 (7.2 per cent) because of the step-by-step construction of a common market, established on 1 January 2008, after the 28th summit of Doha. No wonder that Saudi Arabia was the first economic partner in the Gulf because of the size of its economy in 2004 (51 per cent of the total); nevertheless, while the kingdom remains the principal partner, its contribution in relation to the whole of the council decreased ten years later (36.20 per cent), closely followed by Oman (26.75 per cent). This inversion of the trend occurred before the Table 6.1

2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

Emirati commerce with the other GCC states, 2004 –14 ($ billions) Bahrain

Kuwait

Oman

Qatar

Saudi Arabia

Total GCC

0,896 1,845 1,106 1,185 2,391 1,899 2,471 2,373 2,566 2,476 2,405

0,639 1,173 1,859 1,698 1,578 1,832 2,022 3,074 3,044 3,807 3,916

0,286 0,564 0,957 1,070 2,365 2,448 2,307 2,395 5,501 7,067 7,064

0,591 0,936 1,312 1,923 3,511 3,119 2,346 2,096 2,713 3,123 3,519

2,528 3,149 4,582 5,162 5,875 5,845 5,756 7,273 8,154 9,735 9,565

4,943 7,669 9,817 11,040 15,721 14,943 14,902 17,211 21,978 26,208 26,469

Source: 2004– 8: UAE, Ministry Foreign Trade, Features of UAE Foreign Trade with Gulf Cooperation Council States, Abu Dhabi, 2009, p. 6; 2009– 14: National Bureau of Statistics

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economic depression (26.79 per cent in 2008). It seems therefore that the Saudis do not necessarily dominate the GCC economically but that the organisation is more a collection of member states guided by their national interest. What is more, if we scrutinise the commercial indicators, we better understand why the Emirati government is in a position to negotiate with a commercial partner that in all represents 2 per cent of the total trade volume. In the very unlikely case of the breaking off of diplomatic ties, Emirati commerce would not be penalised. What is yet to be understood is how the UAE deepened its relations with the other member states in the late 2000s and if there was a correlation with the distancing of a necessary partner.

From multilateralism to bilateralism? Since 1981, the Emirati decision makers have never expressed criticism against the GCC. It must be said that the incapacity of the organisation to ensure the security of its member states has transformed it into a tool of economic development. Saudi Arabia should have benefited from a multilateral partnership because of the size of its economy. But because it failed, we might wonder if the main interest of the GCC is to give impetus to bilateral, and therefore unequal, relations between the Gulf States. The higher joint committees, a policy of small steps? The federation created a series of higher joint committees with their direct neighbours and the other members of the Gulf council. In late 1999, Sheikh Zayed went to Muscat in order to create a higher joint committee, inaugurated on 25 February 2000. On 4 April of the same year, a similar structure was established in Bahrain (the first meeting occurred on 1 October 2001) and in Qatar (inaugural meeting held in Doha in May 2001). The operating procedures do not differ from one country to another. The delegations meet in the capitals of the GCC on an alternating basis, under the tutelage of the ministers of foreign affairs. Sheikh Hamdan and Sheikh Mohammed Al Nahyan have headed the work of the Emirati delegations with their counterparts in each country. The frequency of the meetings varies, directly related to the joint affairs handled by both countries of the particular joint committee. In this respect, the meetings are a very good benchmark of, perhaps not the state of the relations, but the degree to which both states are willing to cooperate. The delegations comprise diplomats, civil servants, and sometimes businesspeople. They meet on average twice a year between Abu Dhabi and Muscat; the efforts of Qatar and Bahrain are more fickle, averaging fewer than once a year. The meeting is a highlight, following the preparatory work of individual departments (for example, fishing policies with Bahrain or

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unified car insurance with Oman) or, on occasion, ministers, somewhat in the manner of their European Union counterparts. Memoranda of understanding are then signed, most of the time by the ministers of foreign affairs tracking milestones and continuity of action. The content of the dialogue is not public. The final communique´ merely mentions the themes discussed. Once an agreement is concluded, the press outlines the new guidelines. These meetings proved so successful that similar committees were formed with Kuwait on 24 April 2007, Iran on 14 May of the same year, and Saudi Arabia, which attended its first meeting on 24 March 2009. Anterior committees have existed, like a committee on commerce, but have not been covered by the press. Saudi Arabia may view in a negative light these higher committees whose activity doubles, in some ways, the one of the GCC. This is probably the reason why, at the time of the committees’ founding, the goals were primarily stated as reinforcing the relations between the two partners in the interests of both peoples and working under the guidance of the GCC.25 During the inaugural session of the higher committee between Bahrain and the Emirates, Sheikh Khalifa (then crown prince of Abu Dhabi) stated that Bahrain and the UAE would benefit from the committee, and that the cooperation would strengthen the GCC.26 This subtle balance was proportional to the Saudi susceptibility to its small neighbour. The higher joint committee of UAE – Oman is the best example of consistent and fruitful collaboration. However, the bilateral relations between the two neighbours were tense during the first three decades of the federation because of the border disputes that peaked between 1978 and 1992.27 Nevertheless, in 1993, Investment Company UAE–Oman was created, an initiative that bridged the differences between the two countries. With a small amount of operating capital of 30 million Omani Rial (less than a million dollars) and 60 per cent of stocks held by the two states (Emirati and Oman nationals bought the remaining 40 per cent), it supported cross investments; the number of Omani companies grew from 107 in 1987 to 765 in 1998.28 The high committee favoured the creation of joint ventures at the beginning of the 2000s. Under the tutelage of Investment Company UAE– Oman, common projects took shape, like a date-based sugar factory and Dhofar fish processing.29 This partnership has not been solely a response to the law of supply and demand. The public’s influence on the direction of bilateral cooperation has guided the company towards sensitive issues like agriculture, only second to matters of energy and transport. To meet the Company’s needs in gas, the construction of a $119 million pipeline was launched on 9 March 2005. On 15 December, a bilateral accord was signed to build an aluminium plant in Sohar, Oman, for a total cost of $2.4 billion.

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The Abu Dhabi Electricity and Water Authority (ADEWA) invested $900 million in Sohar Aluminium. Meanwhile, in the area of transportation, the new president of the UAE offered $100 million to fund the motorway Nizwa– Salalah, on the north-south axis, vital for control over the southern territories of the sultanate. On 15 January 2005, the Abu Dhabi Fund for Development (ADFD) granted a loan of $52 million to the Omani government for another road project, not less strategic, to ensure the continuity of the costal road from Sur to Qurayyat, southeast of Muscat (the main road follows the relief of the Al Hajar ash Sharqi in the hinterland). It is therefore not surprising that Emirati– Omani trade multiplied six times between 2004 and 2008 (see Table 6.1). The close cooperation took place in the context of 2005. The signing of the gas agreement on 5 September (see below) aimed to forge sustainable ties on behalf of both countries sharing a politically and commercially strategic border. Against this backdrop of good faith agreements, tension was growing on the regional scale: the dispute between the Emirates and Saudi Arabia over the Al Sheyba oil field re-emerged; moreover, the conservative faction in Iran took power with the election of Ahmadinejad in June, resulting in the resurgence of tensions in the Gulf over the Ormuz Strait. Amidst this uncertainty, the Sultanate of Oman conveyed to both the federation and the Islamic Republic an unwavering guarantee regarding the continuity of economic activity and collaboration should tensions escalate. The port of Sohar, ideally located less than 150 km from Al Ain, the border city between the Emirates and Oman, is an industrial hub, home to aluminium, methanol and fertiliser factories, as well as an oil refinery (producing 120,000 barrels per day) and gas plants. Very conscious of the economic potential, in April 2008, the Islamic Republic and the sultanate agreed to commonly exploit the gas field of Kish Island in the Strait of Hormuz. The two countries finalised an accord on 12 September to construct a 200 km pipeline that could link the field to the Musandam Peninsula and beyond to Sohar, where the Iranian gas is liquefied before export.30 Like the Emirates, the sultanate has always maintained close relations with Iran, both under the Shah and the republic of the Mullah. This is why a higher joint committee regularly gathers between Teheran and Muscat.31 Since 2008– 9, the bilateral relations between the UAE and Oman have been more difficult to analyse because of their subordination to regional and even national contexts. After the 17th session of the joint committee, held on 11 March 2010, in the Omani capital, the relations looked as promising as they had been during the five years of industrial partnership. After three days of meetings, on 16 April the governments announced that civil defence exercises and operations against undercover agents topped the agenda, and

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cooperation in bilateral development of industry seemed to be put on hold. The economic depression and the Arab Spring of 2011 instigated caution on the part of the UAE government. Another incident may have cooled down the relations. On 30 January 2011, the Omani press announced that a network of Emirati spies had been discovered.32 The same day, the Emirati Ministry of Foreign Affairs hastened to express a formal denial and indicated its willingness to uncover this matter;33 no information has been released since. Sultan Qaboos met president Khalifa in Al Ain for a state visit on 11 –12 July 2011, and the January affair seemed to be forgotten, likely marginalised by the context of the Arab Spring. Nothing of note leaked from this meeting except allusions to mostly minor projects such as electricity and car insurance.34 There have been geopolitical issues at stake under the veneer of these higher joint committees. The final communique´s, celebrating the eternal friendship between Oman and the UAE fail to account for them. Nonetheless, the level of activity of a higher joint committee denotes a modification in the regional balances, at least a bilateral balance, well illustrated by Qatar. Sheikh Zayed always questioned the way Al Thani ascended to power in 1995 and felt insulted when his mediation was rejected.35 Until the former passed away in 2004, the relations with Doha remained friendly but limited. The higher joint committee, inaugurated in 2001, worked at a very slow pace until 2004 on side projects such as agricultural and municipal cooperation. On 21–22 December 2004, President Khalifa, newly invested, paid an official visit to his counterpart, Sheikh Hamad Al Thani. After the usual mincing of words, the two heads of state recognised the accomplishment of the 25th session of the supreme council of the GCC that stimulated their joint action. The highlight of the visit was the creation of a joint venture that would oversee the construction of a bridge between the two countries. The UAE and Qatar deemed it necessary to breathe new life in the higher joint committee.36 On both sides, Qatari and Emirati officials warmly welcomed the project; plans for the bridge represented a new step forward in terms of regional integration under the auspices of the GCC. Saudi Arabia’s reaction was otherwise. Prince Nayef ibn Abdulaziz Al Saud, minister of interior, expressed reservations because, on the surface, the bridge would cross the Saudi waters. Under the surface, there was more at stake. In August 1974, the young Emirati federation and its Saudi ‘mentor’ had signed the Treaty of Jeddah delineating their common border. Riyadh gave up its historical rights over the oasis of Buraimi, while Abu Dhabi ceded Khour Al Adeed, a 25 km strip separating the Qatari peninsula from the Emirates. This gerrymandering tightened the Saudi grip on Qatar that became de facto enclosed within the territory of its powerful neighbour. This territorial dispute that became, once

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again, the order of the day in June 2005, was entangled in other geopolitical issues.37 The bridge was not perceived as a mere continuity of the transportation network within the GCC, but a strong signal of mistrust regarding Riyadh. The bridge implied the making of an anti-Saudi axis that would counterbalance the Saudi power over the Arab Peninsula. It needs hardly be emphasised that this project remains, nowadays, unacceptable to the Saudi monarchy. All things considered, the higher joint committees that maintain the continuity of bilateral relations between the federation and its neighbours form an original and subtle interstate cooperation. No wonder that the 6th session of the Joint Higher Committee UAE –Qatar on 2 May 2016, and the announcement of the creation of a similar structure with Saudi Arabia three weeks later made the headlines of the Emirati newspapers (see below). They highlighted the diplomatic priorities of Abu Dhabi. That said, these higher committees are a powerful lever that gives impetus to the partnership between the private and the public sectors. One of the main realisations of the joint committees of Doha, Abu Dhabi and Muscat was the Dolphin project. This first large-scale integrated regional project tackled the energy sector. Dolphin project, necessity is the mother of regional integration The Dolphin project was the first energy-related strategic partnership between three Gulf States. This promising project nonetheless found its limitations. Qatar has been defining its own energy policy linked to its diplomacy. Emiratis and Omanis were the project managers of this idea driven by consumer need. While the UAE sat on one of the top twenty global proven reserves of natural gas in the world, the resources had been allocated to the Emirati basic demand, first and foremost, desalination plants. In the late 1990s, the development perspective suggested that the UAE would not be able to accommodate imminent demographic growth that required new desalination plants and other industrial needs: for instance, new industries such as aluminium necessitate a 24-hour gas supply seven days a week. Driven by the increasing demand, the Emirati government switched to foreign import, namely the Qatari supply, the third largest reserve in the world after Russia and Iran. Qatar, the gas producer monarchy, during a GCC meeting in November 1989, therefore proposed the implementation of a transnational gas network with the collaboration of its neighbours.38 The Dolphin project was an initiative of the UAE Offset Group (UOG). The UOG, established in 1998 and dominated by Dubai and Abu Dhabi, intended to channel investments in strategic sectors such as armament. Therefore, transnational corporations in the armament business, like GIAT Industries, for instance, were compelled to invest 60 per cent of their sale

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amount in the Emirates in a non-oil sector.39 The Emiratis expected transfer of technology and diversification of their economy as well. For the Dolphin project, the UOG negotiated between 1998 and 2000 with the Qatar General Petroleum Corporation (QGPC). With the signing of a memorandum of understanding in June 1999, the Dolphin project was officialised at the International Defence Exhibition (IDEX’99) held in Abu Dhabi. While negotiations continued, disagreement on prices already occurred, only unblocked by intervention at the highest level.40 The project proposed the construction of logistic infrastructures upstream, for the supply from the North field and for the implementation of a network of pipelines able to deliver 3 billion cubic feet daily. The main customers, downstream, would be the Dubai Supply Authority and the Abu Dhabi Water and Electricity Co. (ADWEC), a partner in the negotiations.41 The initial project, aimed at modernising the gas network infrastructures in order to improve delivery to the UAE, was scheduled for completion by 2006 for a cost of $8 –10 billion. From the outset, the project considered regional extensions and re-exports to the Pakistani and Indian market.42 The discussions with the emerging Asian powers came eventually to an end. There was no doubt that the main parties interested were the emirates of Dubai and Abu Dhabi, the second monopolising the distribution. On 28 October 1999, the UOG and the Abu Dhabi National Oil Company (ADNOC) stated in a joint declaration that Dolphin Energy Limited (DEL), created in March by the government of Abu Dhabi, would be the exclusive supplier of the emirate through ADNOC. The wealthy emirate, specifically Mubadala Development Company, the sovereign fund presided today by Sheikh Mohammed bin Zayed Al Nahyan, crown prince of the emirate, held 51 per cent of DEL. In March 2000, a tripartite agreement with Total Fina Elf and Enron, allowed Western corporations to enter the capital of Dolphin Energy Limited (each to 24.5 per cent), bringing their expertise to the project.43 The International Pipeline Accord (IPA), signed on 9 September 2003 between Oman and the UAE, confirmed the ownership rights to DEL and its status of sole operator of the underwater export pipeline. The longest pipeline in the Middle East (364 km, see map below) connects Qatar and the UAE, giving Abu Dhabi a decisive advantage in the implementation of this transnational network.44 Gas coming from Ras Laffan Industrial City in Qatar arrives in Taweelah in the Emirati capital before being dispatched to Dubai Supply Authority (DUSUP) and Union Water Electricity Company (UWEC), the two main customers that signed a 25-year agreement on 3 May 2005. In January 2003, Oman was included in the project. On 6 February, Ahmed Al Sayegh, CEO of Dolphin Energy Limited, his counterpart at the Oman Oil Company (OOC), David Douglas, and Mohamed Saif Al Mazrouei

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Figure 6.2

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The Dolphin project. Source: Patrick Jones

of the Union Water and Electricity Company (UWEC) signed a memorandum of understanding.45 Prior to the delivery of Qatari gas in 2006, desalination plants (100 million of gallons per day) and electricity plants (656 Mw of UWEC) on the east coast had used Omani gas provided by a 182 km pipeline linking Al Ain to Fujairah. The Oman Oil Company made sure to deliver its gas to the Emirati border with a pipeline from Fahud to Sohar; in addition, the Oman Gas Company (OGO) built a 45 km derivation from Mahda to Al Ain. However, the supply of Omani gas from January 2005 onward became temporary. The modernisation of the infrastructures was more effective in the long run. From 2006 onwards, Oman would receive Qatari gas, to be processed and re-exported to the Asian markets.46 What is more, DEL entered into an agreement with Oman in September 2008 for the supply of 200 million cubic feet of gas, meaning 10 per cent of the total volume delivered, needed for enhancing output and industrial development. In July 2007, Dolphin Energy announced that, for the first time, Omani gas had arrived in the UAE. Sheikh Hamdan bin Zayed al Nahyan stated this success was historic because it materialised the efforts made by his father nine years before and rewarded the brotherly cooperation between three countries.47 The first objective, in terms of production and delivery of 2 billion cubic feet, representing the equivalent of 350,000 barrels of oil, was met in February 2008. Since 2008, DEL has been delivering 2 billion standard cubic feet (scf) per day to the UAE (and Oman), meeting 30 per cent

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of the federation’s energy requirements. In February 2016, it announced that it ‘has reached the major production milestone of 6 trillion scf since the company began’.48 Despite a bullish oil market, a governmental accord on the stability of selling prices of gas keeps the wellbeing of the company, in the meantime, level. The Dolphin project is so far the best example of regional integration. Nevertheless, as Jim Krane and Steven Wright explain, pricing and politics stalled the project’s potential.49 While becoming the first gas exporter in the world, Qatar has been more reluctant to sell to its neighbours at a fixed and under the market price. Technically, the Dolphin pipeline could have increased its capacity, but no agreement was found on the price. The UAE, as well as the five other GCC members, has invoked Arab fraternity to maintain a fixed purchase price while Qatar prefers to sell to the world market (Asia) at a higher price. The emirates of Dubai, Abu Dhabi and Kuwait had no choice but resort to LNG imports. Abu Dhabi adopted this option, waiting for the completion of four nuclear plants scheduled for 2017–18.50 On this issue, the Emiratis and Saudis speak with one voice. The Saudi shadow and the Saudi stimulus? The Saudi and Emirati officials like to publicly recall and affirm an indestructible friendship that binds the two countries. This ostensible cordiality sometimes hides difficult relations between the two main economies of the Peninsula. The rivalries are, unpredictably, not about economics. The Saudis have always considered themselves superior to the other families in the region and, since the 1960s, they have looked at the creation of a federation with jaundiced eyes. The UAE, indeed, limited its territorial ambitions. The Saudi kingdom took advantage of the divisions of the Trucial States to express territorial claims that the British found unjustified, behaving like Iran under the Shah’s rule to ensure its status of regional power.51 The Saudis were partly responsible for the late admission of the emirate of Ras al Khaimah to the federation in 1972;52 in addition, they have constantly tried to maintain a special relation with some of the ruling families, for instance, in Sharjah.53 The oasis of Buraimi was the most visible bone of contention between the two states from 1971 to 1974. The Saudi kingdom used this lever not to acknowledge the creation of the federation. The signing of the Treaty of Jeddah on 22 August 1974 established diplomatic relations between Riyadh and Abu Dhabi, favourable to the Saudis. This relationship of dominance was particularly visible at the beginning of the federation’s history and has barely evolved since. In 1992, President Sheikh Zayed ceded the oil field of Zarrarah to the Saudis in order to put a permanent stop to their claim over the oasis of Buraimi.

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An event, largely ignored, served as a benchmark of the strides made by the Emirates. According to the International Monetary Fund, the federation became, in 2002, the second economic power in the Arab world, ranking above Egypt and Algeria, but below Saudi Arabia. The gap between the two countries was wide: the Saudi GDP was two and a half times higher than its neighbour ($185 vs. $71 billion).54 Although the dispute over the exact statistic continued afterwards (whether the UAE ranked second in 2002, 2005 or 2008) the Emirates had reached a new status that conditioned the bilateral relations. Against this particular context, King Abdullah and Sheikh Khalifa came to power. The latter opened Pandora’s box of territorial disputes,55 likely less to change the status quo rather than to flex the muscles of a rising power. The numbers speak for themselves, largely in favour of Abu Dhabi. In 2006, the Emiratis overtook the Japanese to become the first non-national investors in the Saudi kingdom.56 President Khalifa lauded the friendly relations between the two neighbouring states in September of the same year,57 but this rhetorical gesture did not prevent the glitches in trade matters starting in 2005. Emirati trucks were blocked at the border and the Saudi customs levied taxes to admit some goods; the following year, the Emiratis retaliated with countervailing trade measures in the import of Saudi dates.58 Despite the implementation of the free market on 1 January 2008, incidents continued at the border checkpoints of Ghuwaifat and Al Batha. No fewer than four meetings with higher officials were needed to approach a semblance of an agreement in July 2012.59 This irruption of bitterness was symptomatic of a poorly treated pathology between the two countries. If they cannot agree on the implementation of free trade, the cornerstone of the enterprise of regional integration, there can be no genuine deepening or mending of relations. A dispute such as the establishment of the Arab central bank is a facet of a more global issue. Before the Arab Spring, the UAE did not hesitate to brazenly confront the kingdom. Its active diplomacy with the other GCC states structured a potential counter-power to Riyadh. But the consequences of the Arab Spring reorganised the geopolitical background.

No Arab Spring in hot deserts As the saying goes, every cloud has a silver lining. The ‘events’ of the year 2011 that scholars are still struggling to qualify,60 with varying degrees of success, forced the Gulf States to wonder which type of governance or of society they want. Would a Western democracy be feasible? What is the price to pay to maintain, as such, the underlying structures of the regimes? While research to better understand the meaning of the Arab Spring is ongoing, it

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has to be noted that specialists (diplomats, journalists, researchers) did not see this ‘revolution’ or Arab ‘awakening’ coming. Gregory Gause provides a plausible explanation: researchers have agreed on the fact that the stability of the states was linked to the authoritarian nature of the regimes.61 The downfall of Ben Ali and Mubarak, and the wars in Libya and Syria, clearly showed that reality was more complex, like in the Emirates. The overwhelming wave of rebellion did not spare the UAE. Ingo Forstenlechner, Emilie Rutledge and Rashed Salem Alnuaimi emphasise that the stability of the Gulf monarchies relies, before anything else on the perennial tribal structures (notably because of the principle of local allegiance), and on the social contract that unifies the local populations to their regnant ruling families.62 On the federal scale, this pattern might need to be clarified. Heritage has laid the foundations of the modern state. The Emiratis seem content with the composite paradigm of tradition and modernity. They have no doubt that the policies of the sheikhs do fall in the category of ‘good governance’. Almost unanimously, the Emirati population does not want ‘more’ democracy, a foreign concept in the local culture. A welfare state has brought stability, evident in the gratitude of other GCC citizens, for instance, who have received free housing from the federation. Security is the other pillar of the federation. The authorities anticipate religious and political agitation by controlling the emerging ‘civil society’. In other words, the redefinition of the private and public spheres, with of course the subordination of the former to the latter, is the price to pay for stability. On the regional scale, the ‘events’ reshuffled into a new regional order. It is too early to analyse if they mark a turning point in the relations between the different state members, but it is obvious that the challenges stimulated the sense of being ‘as one’: all ruling families have agreed on the inviolability of the dynastic principle in the region. With opportunism, the Saudis claimed the leadership of the counter-revolution to regain their status of powerhouse, not without the opposition of the small states. The intervention in Bahrain The chronology of the events that took place at Pearl Square in Manama evokes a direct parallel with the Egyptian protests, which had formally begun as a ‘day of rage’ in Tahrir Square. On 14 February 2011, demonstrations were organised outside Manama to celebrate the tenth anniversary of the national action charter, preparing a constitutional monarchy (one never really applied thereafter). The police killed two persons and unrest spread to the capital on 16 February. Sunnis and Shi’a converged towards the strategic roundabout, Pearl Square, near Bahrain

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Financial Harbour. They represented diverse groups like the National Islamic Accord Associations (Al-Wefaq) and the National Democratic Action Society (Wa’ad).63 After dark, tens of thousands of people gathered, celebrated national unity and called for the downfall of the ruling family (Al Khalifa). The jubilation was short-lived. At 3 am, the security forces rooted out the demonstrators, leaving four dead and hundreds of wounded, including the medical staff that came to the assistance of the first victims. Later during the day, on 17 February, the GCC ministers of foreign affairs gathered in Manama. Like the Al Khalifa family, they denounced an Iranian plot, downplaying the complexity of the social matter and political claims (notably for constitutional reform) to a simplistic fight between Sunnis vs. Shi’as. Social unrest was not on the wane. On 25 February, a demonstration for democracy called for the resignation of the prime minister, Khalifa bin Salman Al Khalifa, and gathered 200,000 participants, of whom one out of six was a Bahraini national.64 The opponents of the regime were the targets of repression. On 14 March, one month after the first demonstration, the GCC expressed its solidarity with Bahrain’s ruling family by sending the Peninsula Shield Force (although its disbandment was announced in December 2007). 1,000 Saudi soldiers and a 500 Emirati security forces arrived in the capital after a state of emergency was declared. The protagonists used different arguments to justify the intervention in Bahrain. Saudi Arabia, to no one’s great surprise, waved the flag of Iranian danger, transforming the smallest state of the GCC into arena battlefield for the two main regional powers.65 Anwar Gargash, the Emirati foreign affairs minister, pointed out that the UAE had favourably answered the request for assistance by a brotherly kingdom. The final communique´ encouraged the Bahrainis to accept the invitation to a national dialogue proposed by the ruling family.66 This statement sent the motive of the intervention to the background: the unconditional support of the ruling families in the Gulf. Kristian Coates Ulrichsen sees an obvious link. On 9 March 2011, 132 Emiratis signed a petition calling for the implementation of universal suffrage for the election of the Federal National Council, the consultative body of the UAE. If this initiative appeared innocuous from the outside, the Emirati authorities took it very seriously because, in the long-term, it may put at risk the legitimacy of all ruling families in the Gulf.67 The next week, the intervention in Bahrain showed that the federal government was determined to take all necessary measures to maintain orderliness in the Emirates and in the Gulf. The fact is that, regardless of the quarrels, the monarchies of the Peninsula agree without reservation on the dynastic principle. Saudi Arabia is no exception.

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Saudi Arabia, seeking the Arab leadership If the Saudi kingdom worried about the domestic troubles at the beginning of 2011, its intervention in Bahrain, as guarantor of the regional order, increased its credit, at least in the Arab world. On 27 February 2016, Hafar Al-Batin hosted the largest military drill, gathering troops from 20 countries, including the UAE. ‘North Thunder’ was more than a military drill. It showcased Saudi Arabia’s ambition to regain the leadership of the Arab and Muslim world.68 Mehran Kamrava has suggested a Saudi counterrevolution.69 His reasoning relies on the theory that Saudi Arabia spearheads Arab unity. The idea is not new. The Arabs, since Nasser passed away and Egypt weakened, have been looking for a leader. Henceforth, the Saudi kings have expected to fill that void. The Arab League has voiced reservations on the Syrian issue and other concerns during half a century of agitated events in the Middle East. The Saudis, with the ulterior motive to secure and perpetuate their position as leader, have used the council to promote their interest. Theoretically, in an opportunity for the GCC to take precedence over the Arab League on the Middle Eastern stage, the Saudis suggested the enlistment of Jordan and Morocco to the GCC on 10 May 2011. The debate about the legitimacy of the ruling families crystallised around the Muslim Brotherhood that challenges it. The presidency of Mohamed Morsi (30 June 2012– 13 July 2013) in Egypt favoured a rapprochement between Abu Dhabi and Riyadh. Qatar sympathetic to the Muslim Brotherhood70 was the only support of the Egyptian regime in the GCC. The Emiratis tightened the grip on radical Islam. The authorities prosecuted the ‘94’ members of Al Islah, an offshoot of the Salafi organisation in the federation, arrested a week before the intervention in Bahrain in March 2011. The verdict pronounced on 2 July 2013, was relatively lenient. Out of the ‘94’ persons prosecuted, 25 were found not guilty and the others received sentences varying from 7 to 15 years. But it was a clear signal to the followers of the Muslim Brotherhood. The next day, a new era in Emirati–Egyptian relations began. High Emirati officials such as Sheikh Hazza (brother of Sheikh Mohammed bin Zayed al Nayan and national security adviser) and Sheikh Abdullah reiterated that the stability of Egypt was vital not only for the Middle East but also for the world.71 It is therefore no wonder that the UAE has been one of the top supporters of Sissi’s government since 2013; indeed, Emirati aid in support of the Brotherhood’s replacement crossed the $10 billion line.72 At the same time, tension rose between Abu Dhabi and Doha. After a meeting of GCC foreign ministers held in Doha on 5 March 2014, Bahrain, Saudi Arabia and the UAE decided to withdraw their ambassadors from Doha. The support of the Muslim Brotherhood was perceived as a risk threatening security and stability of the other states.

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Sheikh Tamin bin Hamad Al Thani, new emir of Qatar since 25 June 2013, visited Saudi Arabia in July 2014. Two weeks later, the Saudi National Guard minister, Prince Mitab bin Abdullah bin Abdul Aziz reciprocated.73 Even if the quarrel was not deep (Saleh bin Mohammed al-Amiri, the Emirati ambassador returned to Doha in September 2014) a veil clouded the relations with Doha. But the emergency of the situation in Iraqi Kurdistan and in Yemen hastened the reconciliation process. In 2014, the fight of radical Islam became the top priority of the GCC states and the UAE was no exception. Faithful to the asabiyya concept of forgetting internal disputes when an external threat jeopardises the existence of the group, the Arab states of the Peninsula declared to fight to the death, and in the case of the UAE this represented a serious change in regional foreign policy. Security topped all priorities and induced the Emirati authorities to streamline their objectives. Sheikh Abdullah made clear in Bahrain that the Emiratis will fight for their religion – implying that the Islamists have no right to speak on behalf of Islam.74 Instead of adopting a defensive posture, the UAE has positioned itself to take the lead abroad in order to repel any backslash internally. There is no room for petty dispute; striking in Libya, Iraqi Kurdistan and in Yemen has followed the same rationale. Emirati jet fighters participated in the first air strikes on 23 September 2014. The federation showed the same determination to join the coalition Hope Restoration Operation led by the Saudis in Yemen, in April 2015, this time with the Qataris. For Sheikh Mohammed bin Zayed al Nahyan, the Houthi rebels who brought chaos to Yemen were one of the three major threats to the security of the region along with the Islamic State and the lifting of Iranian sanctions.75 The joint committees with Qatar and Saudi Arabia held in May 2016 could be interpreted as a new start in the diplomatic relations. The partners do not hide their differences or disputes. Sheikh Abdallah Al Nahyan, the foreign affairs minister, pointed out that the regional tensions ‘can’t be isolated from the overall challenges we are currently facing’.76 It remains to be seen how the small monarchies of the Gulf are going to conceive the Saudi role in the GCC and in the Arab world. As far as the UAE is concerned, the ‘new’ joint committee is likely to be the main tool of regional cooperation.77 In sum, three salient guidelines organise the UAE relations in the Arab world. First, although it has embarked on military operations like in Yemen and Libya, the UAE has, in its wariness and vocal push for diplomacy and trade, been consistent with its reputation of a pacifist and tolerant state. On the Palestinian issue, for instance,78 the attitude of Abu Dhabi is generous. Second, Arab friendship, sometimes marred by petty feuds, is a solid cornerstone of Emirati diplomacy. Tensions may rise to a breaking point

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such as with Saudi Arabia on trade and the implementation of a central bank prior to the Arab Spring, or with the withdrawal of diplomatic representation in Qatar in 2014. But the crises quickly subside when an outside force threatens the interests of the Arab regimes. Third, this family-like management of state affairs loses momentum outside the Peninsula. The diplomatic relations with Egypt since the end of the Mubarak era have illustrated the physical and mental distance between Arabs of the Peninsula and other Arabs, sometimes very distant (under Mohammed Morsi) and sometimes less so (under Abdel Fattah el-Sisi) but always inside the inner circle. On the fringes of the Arab world, namely Morocco or Sudan, ‘Arabness’ seems to fade and in turn so does preferential treatment, compared with certain Asian states.

CHAPTER 7 ASIAN TROPISM

By geographic convention, most of the Arab world in general and the United Arab Emirates in particular belongs to Asia. However, neither the Arabs nor the Emiratis perceive themselves as Asian, an adjective they associate with the cultural areas East of the Indian sub-continent. While Islamisation spread to the Pacific periphery, the Ottomans and the Arabs look down on the Indian, Chinese and even Japanese civilisations, not to mention the Malayan cultural areas. Even in Muslim states such as Pakistan, Indonesia and Brunei, the populations are not perceived as equal. Indifference, coupled with a certain level of mistrust, characterises the mutual perception of the Arabs, and the East Asians and Far East Asians, despite reciprocal influences, subject to speculations among researchers. However, the inclination of the Gulf States towards Asia has gained momentum throughout the last three decades. It may be still premature to speak of the tide of history, meaning the mutual recognition of the Arab world and Asia (Indian, Chinese, Southeast Asian and Japanese/Korean cultural areas), or the long-term structures valued by Fernand Braudel. The first oil crisis of 1973 is a benchmark to date the genesis of a new arrangement between these geographical entities. In 1984–5, the first initiatives were launched under the auspices of the Gulf Cooperation Council (GCC). In October 1984, two days of conference gathered in New Delhi Indian personalities and representatives of the GCC; the following month, mainland China declared that it was ready to start diplomatic relations with the six member states;1 in February 1984, Thailand tried to initiate a dialogue between the GCC and the Association of Southeast Asian Nations (ASEAN). Of the six GCC states, the countries of ASEAN courted Saudi Arabia, the first oil producer in the region. Henceforth, the Arab states quickly understood the importance of bilateral links with Asia: diplomatic relations between the UAE and China were officialised on 1 November 1984,2 and at the beginning of the 1980s, Japan laid down diplomatic milestones in the Gulf countries. In fact, two thirds of Japan’s oil consumption stemmed

140

THE UAE

from Middle Eastern powers; strengthening relations was considered vital for its economy. China and India, the Asian ‘dragons’, and other ‘tigers’ followed in its footsteps. Even if the states tried to cover their tracks by pretending that they needed to develop the cultural relations between Eastern and Western Asia, the focus remained on energy issues. The wars of the Gulf (Iran –Iraq; liberation of Kuwait and the invasion of Iraq) triggered an acute awareness of the germinating dialogue with the East shaped by diplomacy. The countries of the said ‘emerging Asia’ were unanimously hailed as a model of development, at least until the Asian crisis in 1997– 8. Yet, the foreign direct investments coming from the Middle East and particularly the Gulf region increased in these countries while the contrary was not true: the industrialised Asian powers such as Japan marginally invested in Western Asia. The Arab states tried to compel Japan but with limited qualified success. The invasion of Iraq reinforced the foundations of a dialogue between the Arab capitals, Beijing and New Delhi. Meanwhile, the GCC was not the privileged interlocutor of the Asian partners. In fact, in January 2004, a forum of cooperation between the Arab states and China was established under the tutelage of the Arab League. This overshadowing reflects the growing complexity of the relations between the Arab world and Asia since the 1973 Arab –Israeli War. Against this regional backdrop, the UAE has looked east. Before the economic depression of 2008, journalistic literature intuited a displacement of world economic centres of gravity towards Asia. The Arabian Peninsula and the Gulf would be one of them. If we perceive the UAE as the test for this projection, an analysis of the oil and financial fluxes will serve as evidence; yet the pendulum in this case swings both ways because migration and commercial flux highlight a reverse movement whose origin is anterior or, at least, concomitant. It remains to be seen if the variety of links summed up in the concept of dialogue, have favoured, and if so, to what degree and in which fields, a partnership between the Emirates and Asia.

The ‘Asianisation’ of the Emirates? In all Gulf States, the influx of Asian migrants has largely contributed to the negative perceptions of Asians and consequently of Asia in general. The local populations, aware that they have depended on foreign labour, have felt under siege. This feeling has rarely been verbalised, even if some rhetoric on occasion has betrayed this way of thinking. The conclusion of an article written in a Bahraini newspaper in 1984 perfectly depicts the Emirati mind-set: no nation is willing to employ foreigners when some of its nationals are unemployed, states a Pakistani who lived in the Gulf for many years. He continues,

ASIAN TROPISM

141

‘we should not stay there forever, our place is in our country’.3 The city-state of Bahrain preceded the Gulf States in certain aspects of the oil economy, and even post-oil economy, such as labour. To cope with the lack of local human resources, the authorities massively recruited Asians, first and foremost Indians and Pakistanis, triggering a phenomenon of rejection barely veiled.4 Whether the same causes produce the same effects, this feeling of having become a besieged fortress has spread in the neighbouring monarchies with the development of the oil industry. Migrations Talking about migration in the Gulf is a continuing challenge because the official statistics must be treated with circumspection, when they are available. These data are sensitive because they are political; they nurture a debate on the role of foreigners in the Arab society of the Gulf. Moreover, public opinion has indirectly echoed the policies implemented. Recent research, such as Andrew Gardner’s on neighbouring states like Kuwait, is limited and does not provide a regional perspective.5 Emirati statistics give an inkling of an idea, but never without ulterior motives.6 In official statistics, the breakdown of the non-Emirati population (in contrast to the Emirati or local population) is always missing. Yet, the press might release scattered information, like in October 2009. A newspaper commented on two surveys conducted on visas and the working population that updated the Emirati census data of 2004, in anticipation of the 2010 survey. In five years, the population increased by 50 per cent, from 4 to 6 million, including 5 million expats. Indians and Pakistanis are the first two nationalities of the foreign workers (respectively 1.75 and 1.25 million), the Bangladeshis are half a million, the Chinese, Filipinos, Thai, Koreans, Afghans and Iranians together comprise one million; the rest of the expat population, Western, amounts to half a million; the Emiratis remain at just under one million. In other words, 5 immigrants out of 6 were Asian, and 1 out of 2 came from the Indian subcontinent. The census, organised in 2004, pointed out that Dubai seemed to be anticipating the regional trend, meaning the Asian permeability of the Emirati population. In an emirate of 2 million people, the Indians and the Pakistanis represented two thirds of the migrants (67 per cent). The Asian domination was indisputable because with the Bangladeshi (9 per cent), the Filipinos (3 per cent) and the Sri Lankans (2 per cent), the Asians formed four fifth of the population according to the Ministry of Labour. This window to ‘eastern’ Asian migration poses the inevitable question: how does the Emirates consider the ‘Asianisation’ of its population? To begin answering the question, we must look back at the origins of these migrations prior to and soon after independence.

142

THE UAE

In 1975, the Emirati population amounted to 292,400 inhabitants, including 84 per cent non-nationals, the highest proportion of foreigners in all Gulf States (followed by Qatar with 83 per cent).7 The breakdown by countries of origin shows that more than half of the migrants (163,000, 56 per cent) came from countries to the east of Central Asia (100,000 Pakistanis, 6,150 Indians, and 2,000 ‘other Asians’). This influx intermingled with more visible migrations within the Arab world, potentially more dangerous from a political point of view. The British authorities, for instance, monitored with care the Jordanians/Palestinians, who amounted to 14,000 before independence, a community of the same size as the Egyptians (12,000). The 42,000 Arabs living in the UAE represented less than one sixth of the population but were pivotal for the local economy because they held middle and upper level positions in the private sector. We see them, however, in the lower earnings category as well.8 In the regional context of the post-1973 Arab– Israeli War, the UAE was one of the oil monarchies that barely used Arab labour. According to other sources, the 62,000 immigrants coming from the Arab world represented 24.7 per cent of the Emirati population, a similar statistic to Bahrain (21.2 per cent) and Qatar (27.7 per cent). The old Trucial States contrasted with the other oil producer countries of the region that gave priority to Arab solidarity (90.5 per cent of workers in Saudi Arabia were Arab, 93.4 per cent in Libya.9 The geographic location of these states might explain the gap, because they could rely on abundant regional labour (SouthSouth migrations: Yemen for Saudi Arabia and Egypt or Maghreb for Libya). The Emirates anticipated in the 1970s a trend that gained momentum in the region two decades later: the Asians replaced the Arab labour. The structure of the migrations in the 1980s–90s in the Emirates and, broadly, in the Gulf, attracted the attention of the demographers. In 1978, the Emirates were already rich, with a GDP per capita over $14,000, an output in the same range as the Northern states. Petrodollars allowed the implementation of a welfare state. The construction of heavy infrastructures (motorways, bridges, hospitals, schools and universities, etc.) required labour and qualified staff as well, both lacking locally. In the meantime, the policy of diversification had been started. The Maktoum family decided to transform Dubai into a re-export port with the enlargement of Port Rashid and a trading hub for the regional market (World Trade Village).10 Like in the neighbouring states, the Emiratis barely participated in the economic development; half of the population was under 15; those of working age were not educated or skilled and preferred working in public administration. These pull factors, nevertheless, are not sufficient to explain the direction of migration. Officially, all Arab states expressed preferences for Arab labour. In reality, tensions, political rivalries, and strong suspicions against the

ASIAN TROPISM

143

Palestinians and the Egyptians as far as the Emirates was concerned, ground the intra-Arab world to a halt. Asian workers were more docile and less dangerous because they did not preach ideologies such as Nasserism or Baath pan-Arabism. They did not claim, on behalf of Arab or Muslim solidarity, rights to which it was difficult to say no. Getting the Emirati citizenship was out of reach for them. They not only accepted the jobs that the Arabs did not want but also easily accepted the poor working conditions. In addition, suited for intermediate occupations, the Pakistanis and the Indians spoke English, which was a decisive advantage over other migrants like the Chinese, Koreans or Thai.11 Even before the Gulf War, a new stage in the ‘Asianisation’ of labour in the Peninsula had begun. The Yemenis and the Palestinians were expelled from Kuwait and Saudi Arabia because their leaders supported Saddam Hussein. To replenish the vacuum, more Asian workers arrived in the Peninsula. They had the profile that we know today. First, they were cheaper to hire, easier to dismiss, and perceived by their employers as more reliable, obedient and easier to manage than the Arab migrants. Second, unlike the Arabs who considered their employment as the first step in the process of family reunification, they accepted their condition of transient migrants.12 The Emirati authorities and the governments of the emigration countries accepted this tacit contract that reflected on law and practices. The Emirates, like most of the Gulf States, has adopted the kafala (partnership) to regulate migrations (and the investments as well).13 One of the main guidelines of the system has been to secure the control of those fluxes through Emirati sponsorship. Outside the free zones, foreign companies wanting to set up business in one of the seven emirates must accept a partnership with an Emirati that receives 51 per cent of the benefices. Afterwards, the companies process the visas of their employees in the immigration department. While certain labour contracts are not limited to time, visas are provided, at best, for three years (one year for domestic helpers, for instance). In theory, the Emirati sponsor supervises recruitment of the employees and, subordinately, of the persons that they can themselves sponsor (domestic helpers, for instance). Following Andrew Gardner’s footsteps, Sayed Ali rightly underlined that the kafala system generates ‘permanent impermanence’ for the imported or migrant labour population.14 Recruitment agencies play a key role in the framing of migrations. Since the federation’s independence, they have ensured the supply of Indian and Pakistani labour in the country. Located in the Emirates but in the emigration states as well, they have to meet the demand for workers, not qualified or semi-skilled employees. The Philippine case study is better known.15 These agencies have doubled within the last decade. In 2001, the 179 officially

144

THE UAE

recognised agencies in the UAE made sure of the deployment of 50,000 Filipinos; by the end of the decade, the number rose to 398 recognised agencies to manage 200,000 Philippine migrants. These data, obviously, do not take into account the non-accredited agencies (by the Philippine or the Emirati governments). Those are more inclined to exploit the immigrants, asking them to pay fees (transportation, visa, administration procedure, etc.) that are solely the responsibility of the sponsor under the kafala system. These agencies, widespread throughout Asia,16 form the main channel of recruitment, but not the exclusive one. Companies, notably in construction, may have their own networks. It is not yet possible to quantify one other option of recruitment: familial or regional solidarities allow migrants to enter the country with a tourist visa and, after finding a job, to transform it into a labour visa. During the economic growth period, UAE employers needed this flexibility to rapidly fill up the vacant positions. Today, the Emirati authorities as well as some emigration countries, such as the Philippines, are more reluctant to accept this tolerance. Negligent supervision of migrants upon departure from the country of origin or arrival in the UAE may lead to more human trafficking. Transnational communities Given the structure of the Emirati population, it is surprising that the high proportion of East Asians has left so superficial a footprint in the urban landscapes of Sharjah, Dubai and Abu Dhabi. Indians, Pakistanis, Bangladeshis or Filipinos do not attend the events that ‘make’ Dubai or Abu Dhabi in the media. Conversely, Arabs and Western expats are really well represented. This mere statement questions the transnational nature of the Emirates. Asians are, by and large, confined to specific urban spaces. The construction workers, for instance, traverse a limited geography of the hosting country. They barely leave the housing camps17 and only use the local convenience stores or the services (hairdressers, etc.) attached to the compound. The cost of transportation might be a hindrance to venture beyond the camps. In addition, some are located on the fringes of the cities, even outside, and the lack of a transportation network from the periphery straightjackets the workers’ mobility. The material conditions augment the obstacles already mandated by the non-written rules. Entertainment spaces, such as big shopping malls, are accessible by car or by public transportation, preventing the workers from going there. In the smaller shopping malls of ‘old’ Dubai (Deira), security agents make sure to bar the labourers. Indeed, the implied reputation of any shopping mall depends on the proportion of rich Arabs and Western expats among the customers. Even in open spaces like public

ASIAN TROPISM

145

beaches, under police surveillance, the workers understand through gestures and remarks that they are not welcome. This mental and spatial segregation creates what Yasser Elsheshtawy calls forgotten urban spaces. In Dubai, the districts of Baniyas, Sabkha, Ghubeiba and Satwa are activity, housing, and entertainment areas of the low-income employees, mainly Indians, Pakistanis and Filipinos. They present common features. Because of the structure of migration by gender, men dominate these spaces. The Emiratis have deserted these areas characterised by the media or the tourist guides as ‘exotic’. Public spaces like squares are, therefore, transformed into spaces of social leisure during the workweek or Fridays (the only day off granted to the workers and the non-skilled employees). As these areas are well integrated in the urban spaces, they are easily accessible by public transportation.18 Economic segregation also works against a cultural melting pot. Workers and employees socialise within their national community, similar to the upper classes, rarely bridging the ethnic gaps. The Emirates, first and foremost Dubai, while home to a transnational society, is socially segmented in the urban space and not cosmopolitan. Cultural syncretism, in fact, would endanger the Emirati local culture and, so, the authorities are careful to sustain the ‘permanent impermanence’ state.19 National communities adapt differently to the local constraints, as we can see in the Bangladeshi and the Indian communities, representing two aspects of the integration of Asians in the country. Bangladeshi migrant workers, the subject of a special investigation,20 have been emigrating in large numbers since the 1990s; the country has supplied 7 million workers (for a current population of 160 million inhabitants) globally, including 5 million to the Gulf. The UAE has been their second destination after Saudi Arabia. The increase has been exponential: 55,000 Bangladeshis migrated to the federation in 1997 and 420,000 in 2008. Official statistics recorded half a million workers in the Emirates at the time, while other sources reported 700,000 individuals in 2007. The profile of the Bangladeshi migrant is a young man (half of them between 25 and 30 years old), without certified skills and Muslim. The Bangladeshis work in construction, the services industry (including low wage jobs such as taxi drivers or car washers) or agriculture. They might have been recruited by a Bangladeshi agency, which ‘sold’ visas for $2,000 (average cost for an Indian) or $3,000 (average cost for a Pakistani)21 per worker depending on the country of origin. Although the law prohibits this transaction, the would-be candidates pay the fees of recruitment (airfare, visa and local agency fees, adding up to between 6 and 10 per cent of the cost of migration) to the agencies. Before landing in the Emirates, the migrants are heavily in debt. Women earn between $137 and $190 per month, while men earn on average $376.22 The gap between debt and revenue heightens the precarious situation of the workers who cannot afford to

146

THE UAE

return to their country without on the one hand having paid back the debt and on the other hand having earned enough money to benefit from the migration. In addition, their revenues and their living conditions make family reunification the goal. All young men think about the return. The Bangladeshis share with other South Asia migrants similar working and living conditions. Yet, while the ‘Gulfans’ (Indian workers of the Gulf)23 share some characteristics with the Bangladeshis, the Indian community seems to be more diverse and its functioning more complex. The Indians of the Emirates differ from other similar communities because of their number and because of their role historically in the current situation. In 2010, according to official statistics, 1.75 million lived in the Emirates and represented one-third of the immigrant population. The data and a fortiori the surveys on the structure of this community are either incomplete or dated. Even if the Ministry of Overseas Indian Affairs (MOIA) has tried to frame the emigration,24 statistics as simple as composition of the household or the distribution of the active population are still missing. In 1995, for instance, the Indian population consisted of two groups: 80 per cent arrived with a labour visa (mainly workers) and 20 per cent arrived as family members.25 60 per cent came from Kerala, although this Indian state represents only 3 per cent of the whole Indian population.26 This data should be updated, especially since the economic depression of Autumn 2008 impacted the recruitment of unskilled labour, first and foremost Indian labour. Yet the steady influx of construction workers masks the diversity of the migrants from the sub-continent. The Indian presence in the Emirates can be traced back prior to British colonisation. Because of slavery and the seasonal workforce from the Gulf (notably from Baluchistan) the commerce of pearls prospered under the Trucial States. Indian merchants, sometimes acting on behalf of the British companies, settled in the Emirates, mainly in Dubai and Sharjah. At the turn of the century, there were 50 families living in Dubai and 75 in Sharjah. The decline of the pearling industry did not dry up the exchanges with the subcontinent; in the first years of Indian independence, more than 150 families were living in Dubai.27 Unskilled workers did not migrate to the Trucial States because the regional human resources supplied enough labour; in addition, the British Indian Emigration Act forbade unskilled workers’ migration.28 The Indian merchants and the Arab partners organised the reexport trade around Dubai. The activity encompassed traditional re-exports such as fabric and carpets, but also illegal trade like gold, transistors, watches, etc. By the 1980s, 3,000 families were living in Dubai; the Sindhi Hindus controlled the textile sector, while the Gujarat Hindus had the upper hand on gold. When the oil industry began to dominate the economy, Dubai

ASIAN TROPISM

147

Petroleum Company, for instance, recruited Indians to replace the British and the Americans. They were paid between 20 per cent and 25 per cent less for equal work.29 Meanwhile, the Indian workers participated with other Asians in the replacement of Arab labour in the wake of the 1973 Arab–Israeli War. Yet, the Indian community is strongly structured, even segregated, from a social point of view. Neha Vora’s recent research on the middle and upper Indian classes reveals why there has been no ‘Asianisation’ of the Emirates: the Indian families have never been assimilated. The rich merchants of Dubai and Abu Dhabi have had access to the inner circle of power; they have benefited from significant advantages in the business sector because of their wasta (relations). Moreover, although federal legislation imposed a non-retractable partnership with Emiratis (on the basis of a 49/51 distribution of profits) in the 1980s, there were exceptions. Indian merchants obtained a more favourable repartition (80/20) or were only subject to pay annuities, while for the oldest companies, the partnership was simply not required. This gesture of assimilation in the business world might have nurtured a hope for this Indian elite. However, this hope did not come to fruition, because, at the same time, the elite immigrant society unequivocally chose to cultivate its Indian identity. Beyond the social life animated by clubs, like the Indian Association, created in 1941, or regional associations (for the migrants from Kerala, Hyderabad, etc.), the community has its shops, supermarkets, schools and temples. Employment regulates the community life. Foreign companies are penalised when they do not diversify the recruitment of their employees. Indian companies prefer recruiting Indians, and even their compatriots from the same region who share the same culture. The visas are more expensive but the Indian managers restore the financial imbalance by paying lower wages, although the federation imposes minimum wages. In some way, immigration has been privatised. These abuses have been tolerated because they are harmless to economic development; they are considered regulatory measures within the Indian community. As Nehra Vora perfectly words the dynamic of this Indian community, the Indian businessmen are ‘unofficial citizens’ who seem to behave on behalf of the sheikhs.30 On 8 January 2012, Prime Minister Monmohan Singh capped off the privileges of this elite circle when he announced that the expat Indians would be able to vote in their mother country. In the final analysis, the Indians, with or without means in the Emirates, are tied to the destinies of their country and never assimilate into the Emirati population. The idea of permanent impermanence is right but it does not mean that all Asian immigrants (and others) live in the same precarious state. Social status is the main divide among Indians. Workers and employees are precarious and

148

THE UAE

do not benefit from the same guaranties as the elite – even if this Indian elite must play the role defined for it with no room for manoeuvre. For the middle classes, the situation is, by definition, intermediate. Because of the ambient racism, all Indians according to Neha Vora have adopted a low profile to safeguard their stay in the Emirates.31 As in other communities, the children could be required to define temporary strategies of migration in order to return and work there.32 The only certitude outside the business world is that the Emirati and the Indian communities are hermetic. Mixed marriages are the exception that proves the rule. For example, when Muslim Indians, who speak Arabic and sometimes whose families originate from Yemen or Saudi Arabia, marry an Emirati, they are the second, third or fourth wife.33 The Emirati society and authorities keep their distance vis-a`-vis the Indians, the Western expatriates likewise. Racism glimpsed by Neha Vora, mild but tangible in the Emirates, contributes to the spatial segregation and the edification of mental fences. Research has just started on the Asian communities in the UAE (first the Pakistanis, the Filipinos and the Chinese), and it seems that other national groups have adopted the model of coexistence between Indians and Emiratis, abating any possibility of the ‘Asianisation’ of the Gulf. The culture of globalisation has furthermore influenced the country. It is not perceived as intrusive simply because it is linked to a certain vision of modernity, embodying the consumerist model on which Dubai and Abu Dhabi have built their success.

A new Silk Road? Labour migration, together with commercial exchange, is the most visible aspect of the link between Asia and the UAE. In 2014, non-oil commerce (imports, exports and re-exports) with Asia made up 41.02 per cent of the UAEs’ total trade, far ahead of trade with the West (Europe accounts for 23.61 per cent, 9.6 per cent for America) or its Arab partners (the GCC accounts for 9.06 per cent, the remaining Arab countries account for 6.55 per cent). Non-hydrocarbon commerce The breakdown of the non-hydrocarbon commerce underlines the diversity of the trading partners and the enviable place of the Asian countries among them. According to the Federal Competitiveness and Statistics Authority, the 25 first commercial partners represented three quarters of the exchanges in 2014 with no country capturing more than 10 per cent of the exchanges. Topping the hierarchy, India (1st partner, 9.78 per cent of total commerce), China (2nd, 8.43 per cent) and Japan (6th, 3.81 per cent) represented one fifth

ASIAN TROPISM

9.62

9.06

6.55

149

CCG Other Arab states

9.6

Asia (non Arab) Europe 23.61

America

41.02

Other

Figure 7.1 UAE trade, by groups of countries, 2014 (%). Source: Federal Competitiveness and Statistics Authority

of the exchanges (22.02 per cent), competing with Western countries such as the United States (3rd, 7.3 per cent) and Germany (5th, 4.19 per cent). Over the last years, commerce with Asia contributed significantly to development in the UAE comprising almost half of the commerce (Table 7.1). It increased before and during the economic depression (2008–10) but seems to have steadily decreased since then. The structure of the commerce delineates its evolution. Based on 2010 data, the imports from Asia have followed the furrows dug by globalisation, with few variations for the three main importers (which have been, of course, the first three main commercial partners). India exported almost $1 billion worth of cereals to the UAE, exceeding Pakistan or the United States, whose value of exported goods was respectively three times and ten times less. Unexpectedly, the first commodity imported was not food but pearls, gems, and precious metals for a total value of $17.2 billion (a value of $13.507 billion is re-exported). Industrial goods such as electrical machinery stand in third position, in the same range as cereals ($1 billion). Industrial goods form the backbone of Chinese and Japanese imports. While the construction sector was struck after the depression of 2008 – 9, Chinese aluminium and Japanese steel continued to supply the sites. The land of the rising sun has dominated, head and shoulders, the

Table 7.1

Asian share of the Emirati trade (%)

2007

2008

2009

2010

2011

2012

2013

2014

46.84

48.07

46.75

50.5

50.46

44.3

42.93

41.02

Source: Federal Competitiveness and Statistics Authority

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THE UAE

automobile market. In 2010, Japanese imports accounted for more than $4.678 billion, far ahead of Japan’s first competitors in the market, Germany ($1.595 billion) and the United States ($1.462 billion). The structure seems to stay the same with no major notable changes. In March 2015, Dubai Customs released information about trade in 2014. China dominated Dubai’s trade with $47.68 billion, topping India. Telephones and computers were the main traded goods.34 A number of Asian states became a firm anchorage during the fast economic expansion of the 2000s. Beyond statistics by zones, China, India, Japan and, more recently, South Korea, have served as Asia’s foremost commercial representatives. In the top 25 trading partners of 2014, Malaysia came next in the nineteenth position with $3.846 billion; Thailand followed with $3.521 billion, and Singapore came in 22nd with $3.158 billion. These states barely reach 2 per cent of the exchanges (respectively 1.32 per cent, 1.21 per cent and 1.08 per cent) and appear interchangeable like Pakistan, a longterm Emirati partner, overwhelmed by the globalisation competition. The policy of diversification regarding the supply of raw materials (notably food) may also explain the breakdown per country. The fluctuations are often related to the signing of contracts, like the big industrial or military agreements; the deal on the nuclear power plants propelled South Korea to the top five partners, for instance.35 By and large, from 2004 to 2014, all top Asian countries increased their commerce with the UAE, each one at its own pace and within different timelines (Table 7.2). The rich industrial countries sustained a similar increase until the 2008 depression and largely contributed to the inclusion of the UAE in the world economy. During the depression, trade with the Indian sub-continent, mainly reliant on imported raw material, increased. At the same moment, the United States and Europe (Table 7.3) lost market shares to the Asian countries, regaining them afterwards. Because of their aggressive commercial policies, the Americans multiplied by 5 their commerce over the decade. Consequently, the statistics do not confirm a new orientation of commerce but mirror the ebb and flow of the global economy. The Western powers try at least to maintain their positions. Last but not least, the weight of the Americans and the Indians on the Emirati trade spectrum may skew the interpretation of the data. The energy nexus Christopher Davidson stated that energy was the main pillar of the relations between the Persian Gulf and Asia. The figures seem to bear out this statement. Every year, the oil sales from East to West Asia amount to $200 billion36. The matrix of these flows is simple to understand. The routes of the oil monarchies intersect with the primary Asian workshops. China and India

10 5 4 1 1

975 589 571 738 192

13 6 4 1 1

848 655 800 834 443

2005

13 8 5 2 1

220 883 949 144 647

2006

Source: Federal Competitiveness and Statistics Authority

India China Japan South Korea Pakistan

2004 21 687 12 752 8 171 2 901 1599

2007 32 18 13 4 2

137 510 147 485 221

2008 29 13 7 4 2

444 449 412 673 626

2009 44 14 7 3 2

524 217 852 434 867

2010 52 15 8 6 2

899 654 332 460 724

2011

39 151 17 914 9 977 6 685 3 889

2012

36 270 19 249 10 003 4 777 1 869

2013

28 588 24 643 11 131 6 180 1 581

2014

Table 7.2 Total commerce (non-hydrocarbon imports, exports and re-exports) between the UAE and its top five Asian partners, 2004 – 14 ($ millions)

4 3 3 2 2

217 728 249 251 782

5 4 4 2 2

750 955 658 450 476

2005

6 6 4 3 2

956 192 449 455 505

2006

Source: Federal Competitiveness and Statistics Authority

United States Germany Britain Italy France

2004 9 7 4 4 3

011 444 998 916 244

2007 13 10 8 6 4

339 618 132 626 067

2008 12 219 8 455 5 534 5 165 4 062

2009 12 161 8 405 5 410 4 477 3 894

2010 15 595 8 770 6 597 5 960 4 840

2011

19 869 10 417 7 023 6 858 4 361

2012

21 405 10 950 12 778 5 859 4 557

2013

21 303 12 253 9 211 6 603 5 369

2014

Table 7.3 Total commerce (non-hydrocarbon imports, exports and re-exports) between the Emirates and the main industrialised countries (US-EU), 2004 – 14 ($ millions)

ASIAN TROPISM

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established long-term relations with the Gulf Cooperation Countries37 (GCC). The Emirates, in reality the emirate of Abu Dhabi, representing 95 per cent of the federal resources in oil and 92 per cent of its resources in gas,38 is the second fossil energy supplier to Asia, worth $65 billion dollars in 2008, meaning almost one third of the Abu Dhabi’s exports. Since independence, oil commerce seems to have been oriented towards Asia. According to Gerald Butt, more than 90 per cent of the production was sent to Asia in the 1990s.39 The International Energy Agency confirms the finding, supported by OPEC data as well. Without giving the breakdown of the total exports, a 2005 report specifies that almost the whole amount of crude oil was sold to the Far East, and half to Japan. Quality and regularity of the Emirati supply (although it represents only 1/6 of the flow between the Middle East and Asia) have been a benchmark: the 2 million barrels per day (bpd) structured the spot market in Asia (total: 13.3 million bpd).40 The Statistics Centre Abu Dhabi (SCAD) confirms the Asian tropism.41 In 2013, the Abu Dhabi National Oil Company (ADNOC) exported one billion barrels of crude oil (1,016,671) through the ports of the emirate, meaning a production of 2.73 million bpd. The top 9 clients were Asian (Australia at number 10 with 3,339 million barrels, 0.3 per cent of the exports), responsible for 99.1 per cent of the volume. Japan was still the first customer, with more than 371 million barrels (269 million in 2009, 37.9 per cent of the total export). The Emirati refineries are modest. In 2013, out of 10 metric tons produced in the UAE,42 half were exported to Asia. The Asian countries have therefore become the main partners of UAE – Abu Dhabi in hydrocarbon commerce.

4.8

2.7 0.9

Japan

0.9

India

6.7

South Korea

7.2

36.5

Thailand Singapore

10.3

China Pakistan

13.2

16.8

Taiwan Bengladesh Other

Figure 7.2 Abu Dhabi crude oil export per country, 2013 (% estimate). Source: Statistical Yearbook of Abu Dhabi 2013, p. 36

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THE UAE

Asian countries compete to ensure their edge in fierce competition. All expect to win the favours of Abu Dhabi. Discussions on the oil markets are deliberately opaque but two certitudes emerge: on the one hand the oil producers charge surtax per barrel aimed for the Asian market, under the label Asian Premium, and on the other hand the states (associated with companies, and not necessarily national companies like Total in France) have all been organised to secure the supplies. The Asian Premium oil is, by definition, the difference in price between the barrel sold in the Far East and the one sold in Europe or in the United States. In theory, the Westerners have had a wide choice of suppliers, whereas Japan, China and South Korea (to mention a few important ones) have depended on Saudi Arabia and the other oil monarchies in the Gulf. Since 1957, the Asian customers have ensured their supply and to this end have been willing to purchase the barrel of Arabian light at $1 to $1.50, a rate higher than the average.43 However, by 2008, just before the economic depression, the Asian Premium yielded $3 more on each barrel. This soaring price of oil reversed the deal: the Asian market was more interested in buying on the futures market than on the spot market. According to Petroleum Intelligence Weekly, the Asian Premium corresponded in April 2010 to a surcharge of $6 per barrel. The Asian demand therefore created tensions on the futures and spot markets because all the states needed to secure their supply in the short and in the long run.44 Lower oil prices, reduced from more than $100 to $50 in 2014 – 15, have reopened the debate between the Middle East producers and the Asian customers. The competition on the market, with newcomers like Nigeria, gives more bargaining power to the Asian states. In June 2015, the Indian Oil minister Dharmendra Pradhan asked OPEC to stop this unfair surcharge.45 Thus, the regional context determines the general framework of bilateral negotiations, corrected marginally by the profile of the Emirati petroleum industry. The definition of the oil policy does not belong to the federation. The constitution stipulates that each emirate elaborates its own strategy. This is the reason why the Supreme Council of Abu Dhabi has more power than the federal Ministry of Energy; although Sheikh Khalifa is the president of the federation, as head of the Supreme Council, he is not accountable for the Abu Dhabi policy. Under its authority, the Abu Dhabi National Oil Company (ADNOC), created in 1971, decides on the development, production and commercialisation of the 90 billion proven reserve barrels (7 per cent of the world reserves). The main guideline of ADNOC is to export as much as possible (like the other Arab producers, ADNOC has maintained its level of production since summer 2014). Its edge over other national oil companies in the Gulf region is the forward thinking policy of partnership with foreign

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companies.46 The idea at the outset of the oil boom was that the participation of the international groups would allow a transfer of state-of-the-art techniques, and consequently the acquisition of a crucial competitive edge over the other oil producers. This idea is perfectly illustrated in the ADCO concessions in 2015 (see below). The young federal state was the only one in the region to open the capital of the local oil companies to foreign investment on the basis of shared production (up to 40 per cent of the capital/ production.47 If big Western corporations like British Petroleum (BP) or Shell had the advantage of already being settled in Abu Dhabi, they had to come to terms with new Asian actors (states or their national companies). Energy partnership, the fine balance Japan is the first Emirati customer, historically and in exchange volume. In 1973, British Petroleum sold 45 per cent of Abu Dhabi Marine Areas (ADMA) to a Japanese consortium, Japan Oil Development Company48 (JODCO). JODCO was jointly formed by seven Japanese companies, which collaborated in the exploitation of the two main off shore areas of Umm Shaif and of Lower Zakum, off Dubai (with ADNOC, BP and Total Fina Elf). In 1977, it joined forces with ADNOC to develop three new oil fields (Upper Zakum, Umm al Dalkh, Satah).49 After the first oil shock, the main Asian powers laid the foundations of a close relationship with Abu Dhabi. Without knowing all the provisions, the Japanese entered this restricted inner circle with the British, the Americans and the French, all of which share the exploitation of the concessions. In 2011, a Japanese consortium led by Cosmo Oil negotiated new off shore contracts for the three coming decades. The contract signed by BP, Total and JODCO in 1973 expires in 2018 when new negotiations will be organised. The Japanese group is already preparing for these negotiations.50 The tsunami of Fukushima in March 2011 changed their supply needs to the benefit of the Emiratis. The Japanese authorities closed two nuclear power plants and the imports of crude oil rose from 278 million barrels to 301 in 2011. Japan ranks third in oil consumption (behind China and the US) with 4.3 million bpd and oil supply remains a top security issue for the archipelago. On 27 April 2015, ADNOC and INPEX (a subsidiary of JODCO and Japan’s largest oil and gas exploration and production company) signed a 40-year concession agreement with ADCO (Abu Dhabi Company for Onshore Petroleum Operations Limited, established on 8 December 2014) regarding the 15 onshore oil fields in the Emirate of Abu Dhabi or ADCO, named after the exploiting company. The $1.1 billion agreement gives the JODCO-INPEX 5 per cent of the 40 per cent ADCO stakes (60 per cent controlled by ADNOC) and transforms the Japanese companies into the second partner in the joint venture behind Total.51

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Even in the depressed market since Summer 2014, the oil trade remains of strategic interest in the geopolitics of the Gulf and between new and old industrialised nations. The set of sanctions taken against the Islamic Republic made Abu Dhabi oil more attractive. In addition, to strangle its neighbour, Saudi Arabia pledged that countries like China, which have traditionally imported half a million Iranian barrels per day,52 would not suffer from Saudi supply disruption due to the sanctions. Nonetheless, the shift of suppliers has complicated the dependence issue since the Arab Spring of 2011. The new bids for common exploitation took place in this context. The renewal of contracts witnessed the arrival of new competitors such as South Korea. In 2012, Korea National Oil Corp took 40 per cent of the share in the exploitation of an oil field intended to secure a supply of 17,000 barrels per day in 2014. South Korea’s needs amount to 239,000 bpd.53 In May 2015, two weeks after JODCO-INPEX signed an agreement with the Emirati company, ADNOC and Korea GS E&P Pte Ltd (a subsidiary of GS Energy Corporation) agreed on a 3 per cent in the ADCO joint venture.54 China was also among the bidders for 40 per cent stakes in ADCO. The Emiratis are particularly interested in the enhanced oil recovery techniques (EOR) that allow the recovery of 70 per cent of the oil resources instead of the usual 30 per cent. The Chinese themselves, adventurous in South Niger, Angola and Nigeria, need to secure their supply.55 All things considered, Japan, South Korea and China seem to represent the orientation of the energy concession policy. But the first 40-year agreement was signed with Total on 29 January 2015, giving the French company 10 of the 40 per cent of the stakes for $2.2 billion.56 It remains to be seen if the 2015 bid for ADCO illustrates the Emirati energy policy. As Robin Mills57 explains, the Asian exports make Japan, China and South Korea strategic partners, which cannot be excluded from the interstate arrangement. However, sought after advanced technologies as well as their experience with major companies move the Emiratis toward compromise between East and West. In hydrocarbon commerce as well as in non-oil trade, there are no clear intentions to favour the Asian partners, but there is also no resistance inasmuch as they are in the eyes of the Emirati decision makers as valuable as the Western powers.

Capital flows With the synthesis of migration and commerce, the capital flows encompass the remittances of Asian workers and the cross-investments that go with commerce.

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Poorly understood remittances According the World Bank, remittances going out from the UAE from 1997 to date have increased. In less than two decades, the flow has known a fivefold increase. The workers and employees remitted more than $30 billion in 2015. The top five countries of destination (India, Pakistan, the Philippines, Bangladesh and Egypt) represented more than 80 per cent of the total remittances. The Philippines and Pakistan are good case studies because this transfer of revenues is one of the main forms of income for these countries. In 2015, the Philippine diaspora sent $25.767 billion back to the archipelago (when the GDP amounted to $290 billion for the same year). Since the institutionalisation of emigration in 1971 under the dictatorship of Marcos, the central bank of the Philippines has issued monthly statistics of this revenue (volume and breakdown by countries). Public policies rely on this data.58 Pakistan, in the late 2000s, joined the top ten countries benefitting from remittances according to Pakistan’s central bank; this transfer of revenue increased from $2 to $10 billion from 2000 until 2009. One of the first initiatives of the Ministry of Overseas Pakistanis and Human Resource Development, created in 2009, was to ease the transfer of money (for free, through the channel of official agencies).59 In both case studies, exposure to the data allows greater appreciation of these flows in general – even if they are underestimated (see the differences above). The Emirati remittances have been increasing in the case of both countries. The data of the Philippine central bank (Figure 7.3) shows that the remittances exponentially increased at the beginning of the twenty-first century. The depression of 2008–9 did not impact the transfer of money to the archipelago. The embassy of Pakistan accounted for $3.8 billion in such unidirectional transactions in 2011 (they were only $2.2 billion the previous year); the remittances stabilised at above $3 billion (3.109) in 2014. The divergent evolution of the Philippines and Table 7.4

Remittances from the UAE, 2015 ($ millions)

Country 1. India 2. Pakistan 3. The Philippines 4. Bangladesh 5. Egypt Other countries Total world Source: World Bank, Annual Remittances Data

Remittances 12,573 4,761 3,505 2,700 1,873 4,758 30,170

THE UAE

158 2500

2193 2000 1714 1500 1263 1000 775 500

0

427 21

28

67

140 160 183

529

877

961

621 644

257

1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015

Figure 7.3 Remittances of the Emirati OFWs, 1999 –2015 ($ million). Source: Central Bank of the Philippines

Pakistan might be related to the labour demographic of the migrant employees and ultimately to the scale of the remittances: Pakistani workers in the UAE are mostly unskilled or semi-skilled; whereas the Filipino workers are on the whole garnered for middle management and more and more for upper management jobs, therefore remitting a greater revenue.60 The structure of these remittances is still largely unknown because surveys, at the grass root level, are missing. There are only a few exceptions, like the one of George Naufal and Carlos Vargas-Silva carried out on 1,577 foreign workers.61 These workers decided to migrate to the UAE because of higher salaries compared with their country of origin. Moreover, the workers and many employees have housing. They are young (under 40), and half is able to send between $1,300 and $2,700 to their family every year. There is a striking gap, however, between the construction workers living in camps and the professionals. Look East policy Without taking into consideration the community aspects mentioned above, the UAE has deepened, from an economic point of view, its collaboration with the Asian states against the regional backdrop.62 The commercial interests pave the way for diplomatic relations. The chambers of commerce of Dubai and of Abu Dhabi have stimulated initiatives and maintained the continuity of the human links. Since independence, the local and the federal authorities have tried to reduce the barriers (legal and otherwise) between the commercial partners. Because of the proximity with India, the Emirates established in

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1975, at a ministerial level, an Indo– UAE Joint Commission for Economic, Technical and Scientific Cooperation.63 The rising star of China invited the Emiratis to create an Emirati– Chinese committee in 1989.64 While Japan was the main commercial partner of the federation, it was only in December 2007 that a similar structure was organised. Like the higher committees of the GCC states, these organisations formulate the meetings of the ministers (foreign affairs and trade), and the official visits of the Emirati president and prime minister. Increasing visits from high profile Asian leaders, such as Shri Narendra Modi in August 2015,65 implies a materialisation of the Look East Policy. In an interview given on 3 June 2007, Sheikh Abdullah bin Zayed Al Nahyan shared his thoughts on what the Emirati journalists began to call the Look East Policy. At the same moment, the GCC was negotiating the free trade agreement between India and the Gulf States. The foreign ministry was very careful on the topic. While the federation has maintained century-long relations with the sub-continent, the foreign minister did emphasise that the UAE has tried and continues in the same vein to define a balanced policy between Western and Eastern Asia, without restrictions.66 The statement lacked warmth or particular emotion: diplomatic activity is proportional to the volume of exchanges. Since 2004, numerous initiatives have been instituted with India as the first economic partner (in volume, above Saudi Arabia).67 Opportunities of investments did not change the nature of the relations between the two countries.68 This principle could apply to all Asian states, even to the Western states. Beyond the Peninsula and the Arab world, there is an overwhelming feeling that partners are interchangeable. Treaties of friendship or cultural projects are, most the time, wishful thinking. The Look East Policy, if it does exist, attests to the move of the economic centres of gravity towards Asia with the emergence of China and India.

PART III THE SKY IS THE LIMIT

In 2007, when Emirates was in the process of becoming a world brand, one of the taglines was that the sky was not the limit. This statement, perfectly befitting an airline, also applies to the emirate of Dubai, land of opportunity where everything is possible. The impressive achievements of Dubai and Abu Dhabi have encountered various obstacles: domestic constraints, linked to the extreme shortage of non-oil natural resources; constraints generated by rapid growth that sometimes unsettles the Emirati population entering ‘modernity’; and last, but not least, external constraints in different disguises, such as the financial depression of 2008 –10. The inclusion of the Emirates in the globalised world prompted an alignment of its economic activity and lifestyle to the yardstick of the Northern powers. If oil was no central issue in an oil-producing country, other energy issues came up. Gas, to produce electricity, is imported to meet rising demand, such as in the unguarded use of air conditioning. Desalination of water requires more and more plants. Water is a central issue. While agriculture is the main consumer of water, this sector does not secure food autonomy. The local and federal governments have to face these dependencies. The transformation of the UAE has impacted Emirati society, whose customs and habits date back to the Bedouin lifestyle. Entry into modernity prompted an identity crisis rooted in demographics. Nowhere in the world is the ratio of foreigners to locals this high. To put the Emirati reality into perspective, it is as if the whole Chinese and the whole Indian population (1.3 and 1.2 billion) lived in the United States (322 million inhabitants). As in all other rich countries, the Emiratis have adopted new demographic behaviours. Inevitably the role of women has been discussed in the media. To address nameless anxieties, the federal government has designed emiratisation programs in to order to give the Emiratis back the levers of economic control. The financial depression of 2008– 10 exacerbated the social malaise but worldwide turbulence mainly questioned the branding of Dubai and Abu

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Dhabi. Emirati authorities injected massive amounts of money into public life and infrastructures, becoming more interventionist to contain the damage of the crisis. During the same period, Dubai had to face virulent attacks against its model. When the economic tsunami withdrew, it left on the foreshore a debt whose shape remains uncertain until today. This depression had expected effects. The speculative bubble burst in the real estate sector without, however, bringing it to the ground. All things considered, the two emirates have refocused on core business, but it seems obvious that Abu Dhabi, throughout the crisis and thereafter, reigns as capital of the UAE even with the low price of the barrel on the international markets since 2014.

CHAPTER 8 DEPENDENCIES

From an economic perspective, the success of the UAE relies both on hydrocarbons and the ability to diversify its economy in a globalised world. While the federation is rich in oil, other necessary natural resources are unavailable to accompany the rapid development. Northern powers like Japan have developed strategies to compensate for lacking resources; likewise, the UAE has had to invent a new model under the pressure of two factors. First, traditional agriculture, promoted and intended for preservation under President Zayed (1970– 2004), is a legacy already endangered in a desperate attempt to reach the objective of food security. Second, as demographic growth and the adoption of Western lifestyles (individual cars, air conditioned spaces, etc.) continuously escalate the demand for water and electricity, the federation and the local governments are compelled to assume environmental collateral damage as the price of modernity.

From food security policy to outsourcing According to available data, the UAE only produces between 10 per cent and 30 per cent of its food needs. The hot desert environment determines the agricultural production, but beyond the geographical determinism, policies have impacted Emirati agriculture. From the first years of independence, Sheikh Zayed sought food self-sufficiency to stabilise and ensure the security of the country. This guideline was never questioned throughout the three decades of his rule, ending in 2004, and different strategies were implemented to reach his objective. No dependence To increase food production the expansion of agricultural areas and the modernisation of production, techniques are necessary. Under Sheikh Zayed, the number of farms rose from 7,759 to 37,550 and cultivated areas from

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60,000 to almost 100,000 ha.1 These impressive results are attributable to the federation’s strong support of the producers. All Emiratis are entitled to land allotments. The Ministry of Agriculture follows-up on operations and development, and farming needs (fertilisers, pesticides, seeds) are supplied at half price and reserved for the local market.2 This subsidised agriculture aims at securing food as well as perpetuating a certain national agricultural tradition. Nevertheless, the combination of many factors has constrained the evolution of agricultural policy. Since entering the World Trade Organization on 10 April 1996, the UAE has had to fully adopt the laws of the market, emphasising efficiency. With limited water resources and arable land, the producers have been encouraged to abide by the rules of commercial agriculture. Date palm trees, whose numbers increased from 1.7 million in 1977 to 40.7 million in 2003, showcase the federal commitment to the industry. However, for-profit pursuit has altered the way the public authorities have intervened. In April 2004, the Ministry of Agriculture finalised a three-year strategic plan to adjust the agricultural production to the market’s constraints3. For the first time in the federation’s agricultural strategy, there is a conscious use of the language of sustainable development; the expression may seem an oxymoron, however, inasmuch as the agricultural sector is careless about water resources and the indiscriminate use of fertilisers and pesticides that pose public health issues. Aluminum phosphide, for instance, kills harmful larvae common to date palm trees but is also absorbed by the fruit.4 Organic farming seems to be the alternative to the wide-range chemical agriculture employed predominantly thus far. Yet, emphasising quality necessarily impacts quantity.5 The objective of self-sufficiency would, therefore, have to be reconsidered. What is more, population growth has been higher than agricultural production. According to an Emirati official, the annual growth of food consumption before 2012 had been between 12 and 14 per cent.6 These factors have contributed to a reliance on more food imports as the data has shown for the emirate of Abu Dhabi (Tables 8.1 and 8.2). The breakdown of consumption by communities would show (if available) the foreign labourers do not have the same diet as the Western expats, for instance. Meanwhile, regardless of the high concentration of labourers in the UAE and the relatively small number of Western expats, the Emirates has been the largest Gulf importer of Western-style food. In parallel, there has also been a market for cheap Pakistani mangoes for the South Indian consumers in the federation.7 There is little doubt that the different communities, varied as they are, have been considered as individual consumer demographics and have been accommodated as such.

DEPENDENCIES Table 8.1

165

Value of food imports in the emirate of Abu Dhabi, 2005–13 ($ millions)

2005

2010

2012

2013

903

1,825

2,293

2,033

Source: SCAD, Statistical Yearbook of Abu Dhabi (Abu Dhabi 2014, SCAD), p. 272

Even before the 2008 depression, the Emirati authorities and the importers worried about the rising cost of food staples, but the food crisis of 2007–8 changed the perception of food security.8 While, at the outset, this crisis had been superficially analysed, all experts agreed on the upstream factors generating the hike, like the soaring oil prices, the falling dollar, the higher demand for biofuels and the protectionist reflexes of China and India.9 These factors most likely fuelled rumours of supply disruptions in the UAE and instigated major decisions rapidly taken. As Arab states in general, and the UAE in particular, all depend on foodstuff imports, they were particularly vulnerable to the markets’ fluctuations.10 Against this backdrop of a misjudged crisis and of price increase – 40 per cent within a year – Emirati agriculture was evaluated. Underlying structural factors were as important as the triggering event. For example, in May 2005, the Ministry of Agriculture waged a war on corruption,11 a by-product of partially problematic subsidised farming policies. Article 62 of the constitution stipulates that civil servants should not be involved, in any way, in commercial transactions. This strong statement of intent, however, was ineffective. Although in June of 2005 it was announced that private wholesalers would thereafter supply the farmers instead of the public agencies, officials used their intermediary positions to distort the law of the market and sometimes to control it. What is more, on the one hand the Ministry of Agriculture determined that closing 34 agricultural supply storehouses would reduce operating costs, on the other hand the ministry’s budget policy affected competitive agricultural practices and farmers were compelled to access the private sector.12 The tension, therefore, between government intervention and private alternatives drove the government to look elsewhere for self-sufficiency. Table 8.2 Comparison of the population and the food import in Abu Dhabi, 2005 –13 (core index 2005)

Population of Abu Dhabi Food import in value

2005

2013

100 100

175 225

Source: SCAD, Statistical Yearbook of Abu Dhabi 2014 (Abu Dhabi 2014, SCAD), pp. 117 –18, p. 272

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New strategies The political decision to ensure food security created a dynamic that started in 2007 and gained momentum in the media in spring 2008. Different actors, public and private, already existing or adequately created, devised a response to the regional demand.13 Indeed, similar changes were taking place across the Gulf, first and foremost in Saudi Arabia, but in Qatar and Kuwait as well. The emergence of an Arab front on the agricultural world stage triggered intense diplomatic activity, merging enthusiasm with fear, be it wariness of or on behalf of the emerging countries and the international organisations involved. In May 2008, the federal government announced that it had purchased farms in Pakistan, using Abraaj Capital, an investment company based in Dubai whose $5 billion assets capacitate the prospecting for Middle Eastern and Asian land. Talks had been held by the Pakistani government to define a new partnership. The core principle was to increase productivity of existing lands and to develop new ones, while ensuring the local farms were not compromised. As far as the Pakistani government was concerned, it pledged to alter its legislation in order to ease the food staples exports to the Emirates. Although legal obstacles lingered, other parastatal structures, such as the Emirates Investment Group, indicated their willingness to follow in the footsteps of Abraaj Capital, in Pakistan, Sudan and Somalia.14 The Pakistani negotiations were a preview of the kind of operation that would soon take place in other prospective countries. What is at stake in buying land abroad to ensure food self-sufficiency or, at least according to official statements, to reduce one fourth of the supply cost in a rising market,15 does not necessarily uncover all the repercussions. In May 2012, the Land Matrix Group indicated that the UAE had contracted around 40 accords with third world countries. The Emirates was the only country in the world, along with Brazil, not publicly verifying these contracts.16 Clearly a sensitive issue for the contracted parties, diplomatic activity promoting land sale or lease brings a high level of unwanted visibility: the federation would have to qualify this activity to its agricultural lobbies and the producing countries are likely to fear the reaction of their farmers. Consequently, bilateral relations must remain at least discreet and not limited to traditional diplomacy. Organisations like The Arab Authority for Agricultural Investment and Development (AAAID) act as useful intermediaries in linking partners. AAAID, created in 1976, is an independent organisation with twelve Arab members whose objective is to contribute to the food security of its members. Inasmuch as its headquarters lies in Khartoum and its regional office is in Abu Dhabi, no wonder that the latter planned in summer 2008 a project of 20,000 hectares along the irrigated banks of the Nile River.17 In April 2014, Ayman Abu Hahid, Egyptian minister of agriculture, stated that Egypt

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planned to lease 25,500 ha to Arab states in 2014 with the help of AAAID.18 Public agencies have led the offensive, in the footsteps of the Abu Dhabi Fund for Development whose mission was, at the outset, development aid. Other names are regularly mentioned in the media. Gulf Finance, Al Ihmar and Abu Dhabi Investment House joined forces in August 2008 to organise Agricapital with a capital of $ 3 billion.19 Al Qudra Holding stormed onto the public stage a month later. The Bahrain Tribune announced that the investment company, based in Abu Dhabi, planned to acquire 400,000 hectares of land in the Middle East and in other parts of Africa and Asia. According Sultan Al Mansouri, food imports are expected to rise from $100 billion in 2014 to $400 billion in the coming ten years. The federal minister of economy pointed out that the UAE had prospected in Latin America, Eastern Europe and other Arab states but most of the countries were not ready for that kind of foreign investment in terms of rules and regulations.20 Not surprisingly, information on the content of the negotiations or the ties between the structure and the authorities did not leak to the public. Nevertheless, this global issue has been part of the discourse on development in international circles, including international organisations, NGOs and public opinion.21 The opacity of these transactions has generated legitimate fears. In principle, the acquisition of agricultural land abroad is a solution to food dependency in the Peninsula. Yet, it crystallises tensions of various natures. In the first place, states must agree on the terms of the contracts. The entity placing the order has the upper hand in negotiations with the global South countries whose officials might be tempted to take a commission on the transactions. Secondly, a state covers the whole spectrum of resistance. Pakistan, for instance, was a more challenging partner than the Emiratis had probably imagined. While Al Qudra Holding had been the lead negotiator since 2008, Waqar Ahmed Khan, the Pakistani investments minister, stated in May 2009 that he expected a return from foreign investors equal to half of the agricultural profits. A month earlier, Nosir Khose, secretary general of the provincial government of Baluchistan, froze the accords between the local farmers and the Emiratis.22 In this unstable region at the Iranian border, Islamabad was the first to back off. In another example, Al Dahra entered negotiations with Serbia, a newcomer to UAE diplomacy. In October 2012, the Abu Dhabi company bought 9,000 hectares in Serbia for 300 million euros.23 In March 2014, a $400 million joint-venture project was discussed.24 A few months later, Al Rawafed Agriculture, another Emirati company, signed a contract to grow hay, animal feed, wheat, corn and alfalfa, stipulating that the Republic of Serbia had a 20 per cent stake and no obligation to invest in the joint company while its Emirati partner had to invest 140 million euros over the four coming

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years in the host country. The project signed in July 2014 involved two indebted production units in the province of Vojvodina that would maintain half of the employees (80 out of 160) and would create 300 jobs over the next four years.25 The Serbian peasants, afraid of losing their livelihood, protested: ‘the most fertile lands is given to Arabs’.26 Milos Perisic, Serbian ambassador to the UAE, in an attempt to quell resistance, explained that Al Rawafed complied with all the rules. He also insisted that this ‘internal matter [will be resolved] amicably’.27 Yet again, like in Pakistan, the media lost interest in the outcome. The Moroccan government, by contrast, less inclined to heed the protests of the local farmers and to negotiate compromises, has been willing to give ground on all aspects. In November 2010, the Abu Dhabi investment firm Tiris Euro Arab (TEA) signed a contract for the cultivation of 700,000 hectares of agricultural land. To compensate for the harassment and slow administrative process (sic), Moroccan officials offered the Emiratis full rights to oversee the whole production and to ensure exports. Ahmed Al-Houti, director of the Regional Investment Centre, stated that his country only expected to reap the benefice in terms of job creation.28 The Moroccan government has in fact anticipated and accommodated Emirati wishes by changing state rules to ease the investments. During his visit to Abu Dhabi in April 2015, Minister of Equipment, Transport and Logistics Aziz Rabbah sought the support of the UAE for the development of the Moroccan port facilities associated with the agricultural projects.29 Domestic tensions have remained a key factor in the equation of the bilateral relations between the wealthy Gulf States and global south states.30 The Baluch have always been anxious about their autonomy regarding central authorities – Islamabad and Tehran as well; in Western Africa, customary law might not recognise the right of sale of agricultural land. Most sensitive is the issue of subsistence farming operations because ultimately this kind of farming is the only viable means to livelihood for the rural communities and that is what is at stake. The Pakistani government understood that it would be held responsible for landgrabbing, potentially creating rural unrest. International agencies such as the Food and Agriculture Organization of the UN reacted sharply in support of the peasants, sometimes speaking out against their government. These organisations predict that the massive acquisition of agricultural land by Arab or Asian states (South, if not China) will likely give birth to a new agrarian issue.31 Likewise, domestic Emirati tensions exist: outsourcing agricultural production on such a scale sacrifices the local agricultural sector, and poses not only the question of the reconversion of Emirati farmers but also of the food import/export business community. For the federal

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government and the main emirates such as Abu Dhabi, Dubai, Sharjah and Ras Al Khaimah, it also remains to be seen how the private sector may take over parastatal activities. Semi-private companies or joint ventures may alter the law of the market, and may also generate new dependencies. Controlling land abroad has been a Pandora’s box for the UAE as well as several other GCC States. In this scenario of land acquisition for food security – not satisfying for all parties – private companies would buy arable lands in Africa and Asia to benefit from the low cost of labour and tax-free import to the UAE. In other words, this kind of land acquisition would ensure the supply of agricultural commodities at the lowest cost. However, the outcries caused by the land transactions since 2008 have underscored underlying problems sure to plague the projects throughout their lifetimes. In addition to local opposition from the purchasing country and the selling country, wars, natural disasters (like in Somalia during summer 2011), chronic instability (like Sudan before and after the independence of the South in 2011), or civil disobedience and other social crises pose a great risk to Emirati investments. Therefore, buying land abroad is not the panacea that the Emirati officials dreamt about before 2007. The evidence was thrust forward in February 2011 in the wake of the overthrow of Hosni Mubarak. An Egyptian administrative court moved to nullify the contract established between the turbulent country’s Ministry of Agriculture’s general body of agricultural development and Al Dahra. The latter had won competitive bids launched by the Emirati government: food imports and land acquisition abroad, including a comprehensive project of 43,000 hectares in Toshka, southeast of Aswan in July 2008 (for a total amount of 500 million dollars).32 Sultan Al Mansori underlined in 2015 that the UAE had a clear strategic plan to increase its food security by increasing investments in the agro-food sector but ‘unfortunately most of the countries that obtain these resources are high risk’.33 Meanwhile, alternatives to outsourcing to the Southern states are in progress. First, Northern countries like Canada have entered the game. As planned in Abu Dhabi Economic Vision 2030, the Department of Economic Development signed a partnership with the state of Alberta in order to facilitate the transfer of technology;34 in addition, Al Dahra was diversifying its interest abroad in Canada, the US, Europe, Africa and Southeast Asia with a capital amount of $272 million.35 Yet a secure supply and a stable environment for operations have a price: the cost of Western labour is up to ten times higher than that in the global South. Outsourcing in the Northern states is not necessarily profitable. Consequently, for instance, Mubadala explored more feasible options, making a noteworthy entrance in the BRIC (Brazil, Russia, India, China) market in 2011. The Abu Dhabi sovereign fund

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announced its intention to invest thousands of dollars in agriculture and in other strategic key sectors like bauxite.36 Second, the beginning of the 2010s saw a new trend in the making of partnerships. In May 2010, for instance with the private sector, the Namibia Development Corporation (NDC) teamed up with Al Dahra to produce dates and grapes. The project amounted to $80 million.37 The production of dates is surprising at first glance because the UAE is the fourth producer in the world, but NDC and Al Dahra officials focused on out-of-season production and market destinations mainly in the West. Seen from a different angle, the project might imply that the Emirati authorities might not be inclined to support their local producers at any cost. This partnership shows that the authorities use shell companies while remaining the key players. The Emirati authorities prefer to team up with partners they consider reliable, like their Qatari neighbours. After the dispute that clouded the relations between the two countries, Qatar and the UAE explored in May 2016 mutual investment opportunities in food security.38 In this regard, transparent projects have been also discussed with the Australian authorities.39 Third, Emirati officials have been exploring new options. The UAE, like the rest of the Arab world, has little control over production for and regular supply to their domestic markets. Conversely, they weigh in on the markets substantially. In November 2010, the Emirati media revealed that Abu Dhabi was preparing the launch of a commodities trading platform. A new company, Abu Dhabi Sources (ADS), was created, whose goal is not only to ensure the commodities supply in a bull market, but also to speculate. Continuity of supply against any backdrop is a central guideline in the Abu Dhabi Economic Vision 2030. This is why silos have been built not in the capital but in Fujairah, the only maritime fac ade open to the Gulf of Oman, and not constrained by the Strait of Hormuz.40 The creation in 2005 of the Dubai Tea Trading Center (DTTC), a branch of the Dubai Multi Commodities Center Authority (DMCC), set a solid precedent. In the same vein, the Jebel Ali Free Zone (JAFA) became one of the world’s trading hubs for tea, taking, in 2010, the second position for the re-export of Indian and Sri Lankan tea. ADS intended to continue and amplify the work of Dubai with the ambition of becoming an agribusiness giant like Glencore, Cargill and Dreyfus. To compete on equal terms with the first giant of agribusiness in the world, Aabar, an Abu Dhabi investment company bought Aabar capital worth up to 1.4 per cent, meaning $850 million. In the future Glencore and Aabar might manage common projects although nothing clearly defined has leaked to the public.41 These initiatives have aimed at better controlling the food market. Locally, research has been used to improve productivity. Syed Tariq Husain, CEO of Emirates Investments Group in the UAE, and a key speaker

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at the Agribusiness Outlook Forum (part of AGRA Middle East,) stated, in March 2011, that Saudi Arabia had ‘made a mistake’ by shifting from cattle farming to production of wheat. The UAE should explore alternatives such as ‘investing in agricultural land abroad or leasing land to a professional who can manage it more efficiently with better practices.’42 The food security issue has undoubtedly impacted Emirati agriculture.43 The statistics (Table 8.3) show that 2010– 11 was a turning point in the domestic exploitation of land. The distribution of land also reflects this trend (Figure 8.1). Yet, policies are not yet permanent and new guidelines might still be set. Regardless, there is no doubt that that the UAE will carry on buying land in the global South countries despite the risks linked to political and social instability. This is the price of security and it seems that Emirati decision makers have concluded that securing the federation’s own supplies is time-consuming, unfeasible and ultimately ineffective.

Water and electricity consumption, overconsumption The Emirati lifestyle and the federation’s ambitious development agenda require high water consumption. Historically, water has been associated with the prestige of the rulers in the Arab world. As the sultan made water sparkle in Ottoman cities, the Emirati sheikhs display their power by ‘turning the desert green’, an expression particularly used to characterise Sheikh Zayed’s presidency (1971– 2004), and abundant wealth with regular extravagant fountain shows at Burj Khalifa. The Emiratis and the middle and upper class expatriates display consumer behaviour comparable with that of the populations of the developed world for whom fresh water is sourced with far less difficulty. The growing population of the Emirates demands, therefore, a parallel increase in water consumption. As Table 8.4 shows, the local farmers are the first water consumers, overtaking individuals; nevertheless, water consumption by the latter has almost doubled since the frantic expansion of the 2000s. Table 8.3

2008 2010 2011 2012 2013

Crop area, 2009 – 13 (area and value of production) Area (ha)

Value ($ million)

69,579 75,960 70,978 48,903 48,322

1,100 1,034 686 526 566

Source: Ministry of Environment & Water

THE UAE

172

16

Fruit trees 33

Field crops Vegetables

24

Forests Temporary fallow

3 22

Other land

2

Figure 8.1 Distribution of agricultural land in 2013 (%). Source: Ministry of Environment & Water

How to cope with the demand? In 2007 – 8, from a political point of view, Emirati authorities had to take three imperatives into consideration. Emirati families must have (free or cheap) access to public water because this bounty is at the core of the social contract between a local sheikh and his people; the economic growth must be sustained in the shadow of Dubai without penalising individuals, least of all the upper class expatriates for whom restrictions such as water supply cannot be applied; finally, farmers must be allowed to maintain their efforts towards food security against the backdrop of the world food crisis. Choices had to be made. Abu Dhabi, the most populous emirate of the federation (1.8 million for a total 8.26 million in 2010) has a very high consumption per capita, as measured by the Ministry of Environment and Water, and Environment Table 8.4 Water consumption by category of consumers, 1990 –2010 (projection for 2025) in millions of cubic metres Year

Domestic

Agricultural

Industrial

1990 1995 2000 2005 2009 2025

513 540 555 570 911 1,100?

950 1,300 1,400 3,323* 3,320* 2,000?

27 95 100 105 110 115?

Source: DEWA Emirati Ministry of Environment and Water; * Shahin et al. 201544

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IRAN

N

St

r ai

Ho r m t of

uz

Arabian Gulf Ras Al Khaimah

7

Umm Al Qaiwain Ajman 6 Sharjah Dubai 5

Gulf of Oman

Fujairah

QATAR

4 Abu Dhabi

1 2 3 UAE

OMAN

SAUDI ARABIA 100km

Abu Dhabi 1 Al Mafraq Water Treatment Plant 2 Al Wathba Waste Water Treatment Plant 3 Allahamah Waste Water Treatment Plant 4 Al Hayer Water Treatment Plant Sharjah 5 Sharjah Water Treatment Plant Ajman 6 Al Kafaah Water Treatment & Reverse Osmosis Ras Al Khaimah 7 Ras al Khaimah Sewage Treatment Plant

Figure 8.2

Desalination stations in the UAE. Source: public domain

Agency Abu Dhabi (EAD). Until the 2007 report Sustainability: Our Challenge our Opportunity, data on individual consumption was not available. That year, the emirate set a world record with 590 litres per capital daily. The following year, consumption slightly decreased (550 litres per capital daily).45 If we compare the numbers with consumption rates in France, for instance, the Emirati consumption is four times higher. While the method of calculation is unclear (was it the total consumption divided by the whole population or a different indicator?),46 the rate was alarming enough to take immediate action. The

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authorities therefore defined objectives for the two following years. Water saving tactics targeted individuals, but especially farmers, by monitoring of all wells used in the agricultural sector.47 This first step paved the way for the second, namely, the making of a comprehensive plan for water resources. The Abu Dhabi Water Resources Master Plan of 2009 assessed the management of water in the emirate. Farming was at the very core of the rapid increase of water demand. The policy of ‘turning the desert green’ led to the planting of forest barriers and the extension of arable areas around the traditional oasis in Liwa and Al Ain, where new aquifers had been exploited. Accordingly, the increase of water stress was in proportion to the use of non-renewable stocks and, so, the decreasing levels of fossil water triggered salinisation. Meanwhile, 95 per cent of water for agriculture and 82 per cent of forestry relied on groundwater according to the 2013 statistics.48 What is more, water quality rapidly deteriorated in conjunction with the massive use of fertilisers and pesticides, generating all the environmental nuisances that modern agriculture entails (pollution, threat to biodiversity, etc.) (EAD, pp. 18– 19). Scarce rainfall (78 mm per year)49 and depleted fossil waters pressed the authorities to rely on desalination plants. Energy used to desalinate sea water, supply water throughout the emirate and extract water from the aquifers comes entirely from fossil origins (gas and oil). In addition, the cogeneration plants (production of two secondary usable energies and/or water from a primary energy fuel)50 produce, alone, 21 million tons of carbon dioxide yearly. In the breakdown, the production of desalinated water emits 20 per cent to 40 per cent of the CO2 volume, meaning 4 to 9 million cm3 of CO2 yearly (EAD, pp. 19, 36– 40). The 2009 plan defined three clear objectives: to assess as accurately as possible water consumption in the emirate, identify the possible improvements in the environmental field, and better control water management (EAD, pp. 103–12). The Abu Dhabi Strategic Plan for 2030 went further to require a strategy for improvement of water sourcing and environmental management: decrease preventable loss of energy and reverse the marginalisation of this issue. The current situation is critical but forecasts are more alarming because the demand keeps on growing in the two main cities. The Emirati authorities, however, barely communicate on water consumption. In 2014 local media announced that world water day would be observed on 22 March. At the time, the average consumption for a resident was still estimated at 550 litres a day.51 Before the economic depression of 2008, the public authorities took drastic and costly decisions to catch up with the rising demand. Unable to source water from neighbouring countries equally starved of resources and barred from building storage tanks due to the technicalities of decontamination, the federation considered its options: build new desalination plants (perhaps a new

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generation in the future of small size nuclear heat-only plants52) and reconsider the issue of agriculture. Against the backdrop of economic depression, the government took a closer look at its projected investments. In August 2010, a press campaign announced that Dubai plans to increase its fleet of sea water desalination plants in partnership with the private sector,53 a trajectory which inevitably entails a hike in water prices because consumers would have to pay the real cost of water production. In December 2014, Abu Dhabi finalised a $1.5 billion project with GDF-Suez for the improvement of the Mirfa plant. This gas-fired power and water project will generate 52.5 million gallons per day.54 These examples show that in spite of the intentions of the authorities to save water or energy, the two main emirates see the enhancement of their previous policies as the only viable solution to face rising demand. With this perception of limited room for manoeuvre, there is only one sector where they can intervene – and that is agriculture. The rising demand of urban dwellers, technically including the growing tourist population also at the heart of the country’s economic growth, is considered an unquestionable urgency. This demand, as well as the scarcity of resources, was central to redesigning the existing policy. In the late 2000s, the Emirati newspapers no longer hesitated to point the finger at the farmers’ overconsumption.55 In the same vein, electricity is a major issue in the political and social fields. This sector is highly strategic for the economic activity of the country. To catch up to a continuously growing demand, the Emirati authorities have an obligation to meet demand feasibly and profitably in the short and long run. Production and distribution of electricity The total installed capacity (production capacity) was 9.6 gigawatts (GW) in the Emirates in 2001. It doubled during the next decade to reach 18.5 GW in 2008, increasing to 19.4 GW in 201056 and reaching 27.37 in 2013, according to the State of Energy Report 2016.57 Electricity production, generated by power plants using gas (97 per cent, with 3 per cent from diesel engines and solar energy), was 80.9 GW per hour (GWh) in 2008 and consumption was 70 GWh the year before; according to the federal authorities consumption rose to 101.5 in 2012. With the greatest populations, wealthiest residents, and busiest industrial as well as commercial spaces, it is no wonder that Abu Dhabi and Dubai are the main producers and consumers of electricity in the federation. The breakdown of the consumption underlines the post-industrial profile of the Emirati economy and society. According to the 2010 data, in Abu Dhabi, individuals were the greatest consumers (32,359 GWh, 37 per cent), followed by services (23,190 GWh, 26 per cent), and finally ‘other’ factors

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(23,885 GWh, 28 per cent, including sea water desalination) for a bottom line of 86 138 GWh. In 2014, in the emirate of Dubai, individuals had a similar share (10,835 GWh, 28.20 per cent) but commercial services had a higher consumption (18,397 GWh, 47.89 per cent); and water desalination was not a negligible expense (3,247 GWh 8.45 per cent). That is to say that individuals and services consume three quarters of the electricity production in Dubai.58 Forecasts are not optimistic because annual growth, for the ten coming years, has been assessed at 3 per cent to 7 per cent, depending on population growth. While the evolution of the two city-states explains the growth of production,59 the breakdown of the consumption has rarely been a focus of study. As in the whole Low Gulf region, economic growth and electricity consumption are interrelated.60 Clearly a certain lifestyle has led the Emiratis to become the first energy consumers of the planet. Private cars (not to mention the four wheel drives which are an outward sign of belonging to an ‘elite’) have been given full priority instead of public transportation. The Emirati has taken for granted the limitless use of electricity. Air conditioning represents 40 per cent of the demand; 53 per cent during the summer season, June to September, when temperatures reach 508C.61 Yet AC has not been used conscientiously or prudently.62 The State of Energy Report is a yearly reminder to save energy. Nevertheless, the demand in the coming years will be principally correlated to the increase in population size. Solutions for growing demand Amid different scenarios, the UAE has focused on two options: starting a nuclear programme; and deepening cooperation with its Gulf Cooperation Council neighbours. While economic growth was in full swing before autumn 2008, the government had authorised the construction of nuclear plants to cope with the growing demand in electricity (April 2008). Given the current rate of growth, the government explained, the Emirates would not be able to meet future demand via gas supplies to make electricity; alternative energies might at best provide 7 per cent of the national electricity balance. Since nuclear energy appeared to be a solution by default, the federal government highlighted its peaceful intentions against a tense regional background. The government stressed that the building of the nuclear plants will be completely transparent, under the control of the International Atomic Energy Agency (IAEA), and in accordance with safety regulations.63 The appointment of the agency’s previous director, Hans Blix, to chair an advisory board provided an ostensible guarantee to the international community.64 For more than two years, France and the United States notably competed for the

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new bid. Yet, in December 2009, the UAE signed a contract with Korea Electric Power (KEPCO) for $20 billion. Four units of 1.400 MW each (5.6 GW in total) are planned. The construction of the first started in July 2012. After completion, planned for July 2017, the country will reportedly no longer use its own gas resources. As Ali Oguz Dirioz and Benjamin A. Reimold highlighted, the nuclear plants also present a geopolitical dimension: they mitigate the risk of closure of the Strait of Hormuz and increase Emirati independence in the energy sector.65 The Gulf Cooperation Council network The relations between the domestic electric grid and similar structures in the neighbouring states are not well assessed. Paradoxically, whereas the media laud the regional integration in this field, local and national authorities seem not to pay attention to this regional dimension. There is no doubt that all lower Gulf States display a similar profile in terms of energy consumption in general and electricity needs in particular. From 1980 to 2008, they have witnessed a tenfold increase in electricity usage, with a 5 per cent growth on average per year. This common pattern led to different forms of regional integration projects, including a power grid in the 1980s. A year after the creation of the GCC, in 1982, a team of professors at King Fahd University (KSA) considered initiating such a collaboration between Saudi Arabia and its neighbour, Bahrain. In 1986, a study confirmed the technical feasibility of a regional electrical network for an estimated cost of $1.6 billion. Saving by pooling resources would cover and more than compensate for this amount ($2 billion). The networking of the GCC was planned in three different phases, the last of which was scheduled for 2013. Nevertheless, in the course of two decades, the decrease of financial profits and the Iran– Iraq War diverted the Arab partners towards other security issues. At the same time, gas exploitation gained momentum, notably in Qatar. To a certain extent, investments in heavy infrastructures in gas have competed with the projects of the power grid, although the two are inextricably linked: excepting Saudi Arabia and Kuwait, electricity production in the GCC depends up to 80 per cent on gas.66 The promises of the Arab gas network were stifled by border disputes. The regional clashes of 1992 and 1994 surrounding the long-standing border disputes incited the Saudis to take uncompromising decisions, such as the prohibition of a right of way in its territorial waters for pipelines between Qatar, Bahrain and Kuwait. New projects were examined in the mid-1990s but only began to take shape during the next decade. In May 2001, an intergovernmental agency led a new project. The headquarters of the GCC Interconnection Authority was established at Damman (KSA). Three years

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THE UAE

later, the six countries of the council agreed to fund the project for a total cost of $3 billion. The last phase, having begun in 2011, was scheduled for completion in 2015 but no information has been released since then.67 The benefits of the electricity network are multiple. The general agreements of 23 April and 7 July 2009, laid down rules and procedures of use. In its current phase of development, the network is mainly used as an emergency rejoinder. A state might supply power to its neighbour when the demand exceeds the offer on the basis of an ulterior reimbursement with a similar nature of service. The supply security is therefore in its infancy stage of cooperation between the members. Beyond, because the infrastructures have been set, yet are largely underused, an electricity market is possible.68 In the case in point, the success of the project might alter the national energy policies. Gas producing states such as Qatar or the UAE with their nuclear plants could locally produce electricity for the transnational market. These economies of scale would reduce the costs of production and also change the relations between the GCC states. On a different level, the building of nuclear plants could also reshuffle the cards. The opening of the market implies cooperation with the private sector. In the Emirates, before the economic depression, talks had been held to determine how the public sector could renounce its monopoly. Billing is the main obstacle. The public authorities cover a large share of expenditure, particularly when it comes to heavy infrastructures. Companies would be compelled to charge the real cost to the consumers. All things considered, the electricity market has been prone to technical constraints such as harmonisation of equipment, as well as legal and commercial dispositions.69

Environmental assessments and political prospects Until 2006, environmental issues had never grabbed the headlines of the Emirati newspapers. Interviews with researchers and reviews of scientific reports examining the limited capacity of water resources and the risks of desalination plants to marine life70 were few and far between. The strongest ecological footprint in the world The publication of the 2006 World Wildlife Fund Living Planet shifted the parameters of the equation. The Emirates had the highest ecological footprint on earth. The demand of the population impacted the biosphere whereby land and maritime areas absorbed uncontrolled amounts of consumption related waste. Assessed in global hectares, the consumption of cultivated lands, fishing zones, etc., was almost 12 global hectares per capita, ahead of the United States (below 10 ha) and other industrialised countries (between 5 and

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8 ha per capita). In material terms, if the world population adopted this consumption style, a sevenfold increase of the whole world resources would be needed.71 Since the publication of the first report, the WWF has unrelentingly pointed the finger at the UAE for its emissions rates of carbon dioxide.72 In Living Planet 2004, the Emirates had already scored second, behind Kuwait, with almost 8 global ha. This bad publicity encouraged the federation to confront the problem. To reduce the environmental footprint, the federal government launched a three-year initiative in October 2007, Al Basama Al Beeiya (ecological footprint), whose objective was to continue the national effort towards a sustainable future, measuring and understanding the impact of the country’s populations’ lifestyles on the planet.73 To showcase its goodwill to cooperate with the global effort, the federal government involved four partners in the project: two official agencies (the Ministry of Environment and Water and Abu Dhabi Global Environmental Data Initiative, AGEDI) and the two NGOs that co-authored the report (the Emirati World Wild Fund for Nature (WWF) and the Global Footprint Network GFN). The programme aimed not only to increase ecological awareness but also to supply more reliable data on the ecological footprint of the UAE. The first reaction of the government in 2006 was indeed to point out that the 2006 report used 2003 data. At a conference on the most recent discoveries on ecological footprint, the delegates of the WWF and GFN summarised the conclusions of the governmental programme. The first year comprised checking data.74 This work continued the next year with strong emphasis on fishing. Research teams identified the main causes of the deep ecological footprint: household consumption (57 per cent), formation of capital (30 per cent) and government consumption (12 per cent). During the same year, an awareness campaign targeting the general public was launched to decrease water and electricity usage in that sector (‘Heroes of the UAE’).75 The two following reports, 2008 and 2010, showed a certain evolution. The reigning global hectares per capita (10 ha) finally decreased, although the Emiratis kept the world record of highest ecological footprint.76 In 2014, the UAE decreased its global ha to 7.8, ranking third after Kuwait and Qatar. The improvement was noticeable but the carbon dioxin emissions did not move below 6 ha.77 As far as overfishing was concerned, for instance, the research teams of Al Basama Al Beeiya came to the conclusion that the catches taken into account in the 2006 report were overvalued by 46 per cent.78 Criticism expressed by the federal government was not totally justified because fishing was a minor factor in the making of the assessment – less than 10 acres, meaning 1/100th of the total amount – in the meantime, emissions of carbon dioxin represented 3/4 of the global hectares.

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From Masdar to IRENA Paradoxically, thanks to the inadequate energy balance, the government of Abu Dhabi seized the opportunity to launch a promotion campaign. Firstly, the Masdar Initiative (source initiative, in Arabic) was integrated in the emirate’s urban strategic plan in the form of Masdar city. This project was characterised as a chance for the capital to become the world leader in low consumption energy and renewable energy.79 Furthermore, the emirate and Mubadala, one of the most important sovereign funds in Abu Dhabi (and in the world) of which the Initiative is a subsidiary, established an agency. The Abu Dhabi Future Energy Company, whose tagline is ‘pioneering future energy’, aims at identifying renewable energies and promoting Masdar City, in the southern suburbs of the capital, where state-of-the-art discoveries would be implemented towards Abu Dhabi’s global ambitions. The Masdar Initiative is divided into five units, most notable of which is the university aspiring through graduate and postgraduate research to become the world centre for renewable and clean energies. Masdar city showcases the ambition of the government of Abu Dhabi. Its challenge: to produce zero carbon dioxin and waste. Some observers have been sceptical of the conception and implementation of the project. Why does an oil producing emirate, seated on one of the world’s most sought after resources, 7 per cent of the world’s proven reserves, feel compelled to invest in ‘clean’ energies? The official response presents different arguments. Moneywise, renewable energies could potentially cost less than subsidised fossil energies in the long run.80 In addition, Abu Dhabi has a major role in the hydrocarbons world market and is determined to keep its leading position in the race for energies of the future. Oil exploitation boosted the economy of Abu Dhabi. As the master plan, Abu Dhabi Economic Vision 2030, underlines, the prosperity of the emirate cannot rely only on fossil energy but knowledge, innovation and exports of advanced technologies. In fact, Abu Dhabi intends to signify a better awareness of environmental issues in the Gulf.81 Despite the good intentions of the emirate, however, the UAE has kept its record of highest consumption of fossil energies and therefore of emission of dioxin carbon. This is a fair assumption, therefore, that the promotion of the clean energies is a message targeting potential investors in this field. Finally, while Masdar promotes a positive image of Abu Dhabi,82 many scholars believe that this aggressive, albeit limited, transition to clean energy will be, at best, difficult to implement, mainly because of the structure of the decision making in the federation. The top to bottom decision did not invest in raising sufficient public awareness of the necessity to adopt clean energies.83 In the field of renewable energy, Abu Dhabi was already rewarded for its steady financial support, directly by the government and indirectly through

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the parastatal agencies. The UN agency, International Renewable Energy Agency (IRENA), was established in the capital’s Masdar city, not surprisingly. We can trace the origins of the project to the conference of Nairobi held in 1981; in Bonn, in 2004, the participants called for the creation of a permanent international renewable energy structure. The idea finally took shape in April 2008 with the first preparatory conference of IRENA in Berlin gathering 170 participants from 60 states. Two months later, again in the German capital, its charter was drafted and finalised in Madrid on 23–24 October. IRENA was finally born in Berlin on 26 January 2009.84 It goes without saying that the bid for housing the organisation triggered diplomatic activity. The Germans, intensively involved since the beginning of the project, expected to welcome the agency on their territory. The SPD MEP, Hermann Scheer, was the first to work on the creation of an agency in the 1990s. The city of Bonn offered to house the new structure in the old governmental administration building with a budget of e4 million.85 In June, the Emiratis applied for the hosting position. They suggested during the meeting held in Berlin to shelter, at no cost, the agency in Masdar City whose eponymous project had been positively received. The government pledged to fund the organisation until 2015 ($135 million) plus $50 million yearly from the Abu Dhabi Fund for Development.86 Emirati diplomacy was highly proactive during the final decision making phase. The US, but also France, supported the UAE. Many factors affected the negotiations. First, as a result of trying times, the European states were more prone to establish the agency in a country so willing to cover all the necessary funding. For France, in particular, there was hope such support would yield economic and political dividends. France’s vote would help the French transnational corporations in their bids for new markets: Areva and Suez competed with the American and the Korean counterparts for international tenders on European Pressurized Reactors (EPR); and Total competed for the renewal of oil concession in 2015.87 In addition, military contracts were also at stake and an environmental agency located far from Europe would also please the nuclear lobby preparing the renewal of French power plants. Finally, a French official, He´le`ne Pe´losse was appointed Interim Director-General of the agency. Its official inauguration by Sheikh Abdallah bin Zayed Al Malkoum and high-level representatives from all over the world on 3 June 2015 showed that the agency had already found its place on the world stage.88 A UN agency increases the prestige of the UAE and legitimises decision making processes in the international arena. Besides, Masdar and IRENA showcase the ‘vision’ of the emirate of Abu Dhabi and abate criticism of the Emirati lifestyle.

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From a branding and political viewpoint, the investments were thought to be effective. The management of the different issues has shown how the UAE has orchestrated information campaigns to prepare public opinion for major changes. ‘Public opinion’ is split into two groups, the Emiratis and the foreigners. The authorities are more careful with the first because the Emiratis have expectations. An abrupt change, even when it makes sense in terms of water resources management for instance, is difficult. The local governments are also sometimes necessarily compelled to adjust, even if reluctantly, to changes in attitudes to governance: free access to water and electricity has led to abuses that were reasonably called to an end. The message conveyed since 2008 has been that the sheikhs are generous, but under certain conditions. For foreigners, more accurately, for middle and upper class expats, the problem is different. Given its public image, the Emirates cannot afford disruption of the food, water or electricity supplies. The UAE has an obligation to meet these needs despite the costs. The art of the federal and of the Abu Dhabi governments has been to transform these structural issues into a positive outcome. Masdar and IRENA have become, to that extent, benchmark case studies.

CHAPTER 9 WHAT DOES IDENTITY MEAN?

The Emiratis have tried to maintain the Bedouin traditions with a strong sense of community. Nonetheless, foreigners, both Asian migrants and expatriates from the Northern countries, have a different perception of their hosts. This discrepancy stems from the propensity of the communities to exist exclusively. In this unchanging social dynamic, the Emiratis are the bad guys: the expatriates reproach them for their aggressive driving, disdainful attitude and prohibitive and punitive social codes. Christopher Davidson would add a jumping-the-queue attitude and a flagrant judicial bias in favour of the nationals in all legal disputes.1 The forums on the Internet are replete with negative anecdotes on Emiratis, most of the time written by expatriates who had already left the country. This cultural sideswipe could be the sign of an identity crisis. Indeed, against the background of accelerated economic prowess, the Emiratis have had to cope with the pace at which they often reluctantly entered ‘modernity’. Demographics first and foremost generate an elusive discomfort. Being the minority in their own country, Emiratis present themselves as being under siege while witnessing their traditional world crumbling. As the debate on national identity grows in presence and significance, Emiratisation, meaning the participation of the Emiratis in the federation’s mission of economic activity, has been the main response of the authorities.

The uncertain future of the Emirati population Like in many Middle Eastern states, demographics is at the very core of geopolitical tensions in the Emirati territory. The Emiratis have had the overwhelming feeling of being a minority in their own country. It affects the relations between the nationals and the migrants regardless of their status, be they Western ‘expats’ or Asian ‘migrants/immigrants’, the latter comprising the South Asian labourers, who make up by far and visibly so the majority of

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the foreign population, as well as immigrants from India and Pakistan in particular who have maintained residency for many years and work in the various industries in the country. The Emiratis, a minority in the UAE Data are lacking to analyse the Emirati population as a whole. Yet, there are many parastatal structures that offer detailed information. The ministries of the federal government, including its specialised agencies like the Bureau of Statistics, and their counterpart structures in the emirates of Abu Dhabi and Dubai are very careful to scale down to essentials statistics such as the size of the population and its distribution, including gender, in the emirates. International organisations like the World Health Organization (WHO) and the United States Bureau of Population, Refugees and Migration (PRM) have noted Emirati cautiousness, observing that official data is just not available. However, key tools for planning and censuses have been organised. The last one dates back to 2004, an essential reference for many scholarly surveys for lack of other reliable data. The next census was organised in spring 2016. Nevertheless, the Emirates have had different strategies to gather demographic data.2 The situation does not only hinder the demographer but also the specialists of public health, for instance, who have difficulties leading epidemiologic surveys3 and gauging the accuracy of results.4 Two main causes justify the reluctance of the Emirati authorities to expose demographic details. The first is prompted by the exponential growth of the UAE, an essential and much targeted result of the two main Emirati cities’ branding – but not of the Emiratis. As the first table shows (Table 9.1), the population grew steadily from 5 to 8 million in four years. Although the economic depression of 2008– 10 harmed the federation, its impact seems to have been limited because the UAE did not lose inhabitants, unequivocally contributing to an economic rebound. The second cause is contextual. The dynamism of the Emirati population parallels the uninhibited flow of immigration, not in volume, as in Table 9.2, but in percentage. Indeed, facing the steady influx of migrants, the Emiratis may feel that they are a shrinking community within the UAE population. A census is likely to underscore this phenomenon and exacerbate the identity crisis of the Emiratis. There are no official recent statistics for the population of the federation. The CIA World Factbook supplies two estimates: 5.779 million in 2015 (no sources) and 9.157 (United Nations).5 The exact number lies probably somewhere in between. In June 2016, Abu Dhabi had 2.657 million inhabitants (Statistics Center Abu Dhabi) and Dubai 2.516 million (Dubai Statistic Center). According to the official UAE Yearbook 2013 (p. 151) the population of Sharjah crossed a million inhabitants in 2009 and the other four

WHAT DOES IDENTITY MEAN ? Table 9.1

Estimation of the Emirati population, 2006 – 96

Estimated population Previous of the Year of Natural Net year previous year estimation growth immigration 1 2005 2006 2007 2008

185

4 106 5 012 6 219 8 073

2 427 384 006 626

2006 2007 2008 2009

56 60 61 68

486 275 024 577

3 849 471 1 146 347 1 793 596 57 793

Estimation of the population 4¼1þ2þ3 5 6 8 8

012 219 073 199

384 006 626 996

Source: UAE National Bureau of Statistics

emirates totalled 700,000. Therefore, it is likely that less than 8 million people reside in the UAE. Figure 9.1 shows the singularity of a population that has no equivalent in the world. Abu Dhabi’s population is young; its median age is 30.2. The top of the pyramid shows that the elderly are a tiny minority. The migrant population is marginally represented because the immigrants are allowed to stay in the UAE only if they contribute to the prosperity of the nation. Wealthy expats who are also property owners in Dubai or Abu Dhabi might retire in the country due to their purchasing power. The federation, however, underlines that the Emirates is a transient place for non-citizens. In addition, it does not need to take care of the fourth age population of foreigners that has inevitable health issues and cannot afford the available health care system. For young adults, the gender groups are asymmetrical. Out of 2.3 million inhabitants, men between 20 and 40 almost reach a million (942,213 exactly).7 One might assume, even if no official statistics confirm it, that unskilled manpower or poorly skilled workers form the bulk of this age group. The bottom of the pyramid is unusual for a developed country because the demographic growth is very dynamic, a direct result of expanding families, a reverse characteristic of developed countries. Immigrants contribute to this quality both because the Asian middle class employees bring their families for long-term reunification – Asian and Arab families do not change their demographic behaviour (large families, at least larger than in Table 9.2

UAE population in 2009

Emiratis Non-Emiratis Total Source: UAE National Bureau of Statistics

933,381 7,266,615 8,199,996

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Figure 9.1 Age pyramid of Abu Dhabi population on 31 December 2010. Source: Statistics Centre Abu Dhabi (SCAD)

the developed countries) – and because the upper classes appear to revive probirth behaviour once settled in the country. No in-depth examination has been carried out on the demographic behaviour of the expatriates. Yet, it seems that a cultural environment which is family friendly, in the sense that it easily allows for live in maids and nannies for every household and holds a high purchasing power, etc., is conducive to having more children. It remains to be seen if this analysis applies to the other emirates. It is reasonable to consider a similarity, marginally corrected, in the other six emirates. Westernisation of the demographic behaviour The population survey of Abu Dhabi reveals, first, a steady shrinkage based on age from birth to old age (Figure 9.2), and second, a declining birth rate characterised by the rounded shape of the pyramid. In sum, the table shows that the Emiratis have entered the last stage of demographic transition common to developed countries, namely a transition from high rates of fertility and mortality to low rates of fertility and mortality. According to the data of the 2010 census, the birth rate in the emirate of the capital was 12.6 per thousand, equivalent to the range of Northern states. The breakdown

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Figure 9.2 Age pyramid of the Emirati population in Abu Dhabi in the mid-2010s. Source: Statistics Centre Abu Dhabi (SCAD)

in terms of nationals and foreigners points out a clear dichotomy: the first still have a high birth rate (31 per thousand) and the second a low one (8.4 per thousand). The labour force, made of young workers, predominantly bachelors, explains the low fertility rate. It would be interesting to examine the situation of the immigrants settled with their families. For Emirati women, despite the overall high fertility rate, the total fertility rate (the average number of children per woman at the end of their childbearing years) stands at 2.4 children.8 Research shows that young Emirati women have and will have fewer children than their seniors. To explain the evolution of the Emirati population, and ultimately the birth decline, Mouawiya Al Awad and Carole Chartouni studied 13,992 Emirati households.9 According to the study, changes in demographic behaviour within the Emirati population stem from two factors. First, the educational level and empowerment of women has reduced the fertility rate. A young Emirati woman who did not attend college is likely to have on average between four and six children; the number is between one and three for those who have pursued a university degree. Second, the age of the first marriage is a crucial variable. The total fertility rate decreases with age: the younger the age of marriage, often coinciding with the high school drop-out rate, the more children the Emirati woman will have; on average 6.83 if she gets married between 13 and 15; 2.44 if the marriage occurs after she turns 30. Domesticity (having maids and nannies) extenuates this ‘calendar effect’, an expression coined by European geographers; in other words, women postpone their first maternity for a few years giving priority to their jobs. The further on in marriage a woman chooses

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maternity, the fewer children she will have. These field surveys testify deep transformations in Emirati society. The empowerment of women in the national economy is a strong leverage of change. Since independence, the feminisation of labour is spectacular. It has known a tenfold increase between 1975 (2.6 per cent) and 2005 (27 per cent).10 Mortality and morbidity rates of the Emiratis resemble those of the Northern states. According to Iain Blair and Amer Ahmad Sharif, one must be careful in analysing the data on mortality because there might be some confusion regarding real causes of death.11 Nonetheless, the Ministry of Health reported that in 2008 the first two causes of death were injuries (mainly car accidents) and cardio-vascular diseases, which is actually the first killer if one adds circulatory and other cardiac illnesses that make up two separate categories. Car crashes are a scourge that affects young Emiratis. The causes are very well-known: violation of rules of good conduct and especially excessive speed.12 While fatal accidents have been reduced by a quarter in the span of a few years, they amounted to 720 in 2011, making the Emirati roads among the most dangerous in the world.13 The high rate of cardio-vascular diseases also characterise the fast transformation of a country that has adopted the consumerist lifestyle. The national media regularly relay the campaigns of the federal authorities on life hygiene.14 The university hospital in Al Ain, the second city of the Abu Dhabi emirate where half of the Emiratis of this emirate also live (202,266 out of 495,368 in total in 2013), produces medical surveys on the growing problem of diabetes obesity and tobacco consumption in the city.15 The findings of these academic surveys conclude that one third of the population is obese and another third is overweight; one in five Emiratis is diabetic (type II caused by unhealthy eating habits) and one quarter of the population is considered pre-diabetic. Food high in saturated fat and fast sugars, hand in hand with lack of physical activity, even among children, is at the core of the health crisis. The local authorities are supposed to pay for the medical cost of this cultural behaviour. Every year, the emirate of Abu Dhabi pays a billion dollars for the expenses of the diabetics16 so that 2009 was decreed the year of diabetes control. While genetic predisposition to diabetes does exist among members of the population, it is lifestyle, poor diet and lack of physical activity that has had the greatest effect on the health status of the population and risk levels for diabetes.17 However, according to the World Health Organization, the global burden of disease indicator, meaning the years lost because of premature mortality and/or poor health, classifies the UAE (11,858) in the same range as developed countries such as Britain (11,102) or the US (12,840). While illnesses like diabetes represent a higher risk factor (respectively 1,024 vs. 674 and 715,18 the overall health status of the population and of the Northern powers are comparable.

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Spatial segregation The distribution of the population is the last element of human geography that feeds the Emirati identity crisis. Yet again, because of the data released, the analysis of Abu Dhabi is more advanced than that of Dubai. According to SCAD, the Emiratis represented in 2013 only 20.2 per cent of the population of the emirate of Abu Dhabi: 53.1 per cent (263,207) live in the Abu Dhabi region, and 40.8 per cent (202,266) in Al Ain.19 This difference illustrates an underlying trend: the Emiratis are settling on the fringes of the globalised spaces. Al Ain looks like an ideal provincial city whose urban organisation complements a traditional lifestyle far from the urban spaces of the capital that are facing real estate competition. On the local scale, the Emirati population has deserted all city centres. For example, certain quarters, like Satwa in Dubai, had been converted into ‘forgotten urban spaces’. The ‘locals’, in the past, occupied this neighbourhood of deteriorating housing. The housing policy of the local authorities hastened the transformation of the urban framework, as Al Ain shows.20 In the emirate of Abu Dhabi, all (male) Emirati citizens born and residing in the western region are entitled to housing aid, for themselves and their families. They may obtain a 45 m2 house on a land or a 60 m2 piece of land to build a house with governmental financial aid (1.2 million dirham paid back over 40 years). Low income Emiratis, sent away to the periphery of the urban spaces like Al Daher, have not assimilated in these new artificial communities and the families feel isolated. As sociability is at the core of the Arab and Emirati cultures, some authors venture to talk about social disintegration.21 Nostalgia for a lost time, inevitably better, comes back as a leitmotiv in the conversations of the elders. Before the displacement, members of the community met after daily or Friday prayer. They sat together and dissected the news. Some slept under the stars, a form of healthy living.22 Today, the villa walls do not only protect from intruders but also friends and neighbours that do not have the same liberty to cross the street and take coffee or tea.23 From the outside, the post-modern societal issues do not seem to affect the Emiratis more than they did the Westerners, even less. The speed of the structural changes to the society is the main difference. The demographic transition in the Emirates took place over two generations while it took a century in most of the European countries, for instance. Women who work have fewer children although a large family is a synonym for familial happiness; the Bedouin and tribal lifestyle that necessarily lives in harmony with the environment has been diluted in the urban culture. The debate on identity has crystallised these tensions.

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What identity for which nation? Dubai’s fast-paced growth in the mid-2000s, as with Abu Dhabi afterward, exacerbated a resentment amidst the Emirati people. The fact that the UAE faced an identity issue became commonplace even among college-age students.24 Sheikh Khalifa Al Nahyan addressed the nation on 7 December 2007, and acknowledged the crisis, decreeing that 2008 would be the year of national identity: the UAE aims to be a model of an open modern society, firmly rooted in its historical values, its beliefs and its heritage.25 The decree was a repeated attempt at reinforcing traditional values, with special emphasis on loyalty, and incorporating the full scope of the impositions of modernity. ‘Who are we?’ Among numerous conferences, round tables, and forums that were held in 2008, the one organised on 21 and 22 April by the Higher College of Technology of Sharjah was pointedly titled ‘Who am I? Who are you?’ One of the participants, Abdul Khaleq Abdullah, professor of political science at UAE University, used an argument that he would later develop at the Federal National Council (FNC). The Emirati identity has been caught between two opposing world views: belonging to the ‘global village’ and belonging to an emirate with a singular tribal history with patronymic allegiance. Between the two, there has been little room for the emergence of national consciousness. An Emirati needs not ask ‘Who am I?’ because the answer is simple: the son or the daughter of my father, the loyal representative of my tribe and of my emirate. The crisis instead begs the question ‘Who are we (the Emiratis)?’ This interrogative questions the nature of the link between the Emiratis and the federation.26 Inasmuch as the citizens deal with the federation through their local governments, even after forty years, allegiance to the first is more theoretical and intangible than the second. The vocabulary used to name the Emirati citizens is significant. The UAE is the only Arab country to have adopted a name and a structure that encompasses its diversity. In Arabic, we speak about Dawlat al Emarat (the state of the emirates), but in general, Al Emarat is the more common usage. The term ‘Emirati’ is barely used because it refers both to the local and the federal states. Arabic and English language media have adopted the use of ‘locals’ to distinguish the Emiratis from the foreigners. This term, widely used, overshadows muwatineen (citizens), a term that might be confusing because it is used in the other GCC states.27 In addition, among the Emiratis, citizenship is perceived as one of three categories: Emirati belonging to a family with a family book that might trace its origins prior to 1925; Emirati

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without the khulasat al-said who have been naturalised and the bidoon (bidoon jinsiyya, without nationality), a stateless individual living in the federation.28 The debate on identity is ultimately a macrocosmic discussion about the Emirati nation. This imagined community29 revolves around the factors defined in Article 6 of the constitution. The union (a theme that refers to the debate in the years 1968–71 between unionist (ittihad) and federalist (wahda)) has been part and parcel of the Great Arab Nation, meaning the Arabs of the Peninsula, linked together by ‘blood’ – and beyond the individual ties, their religion, language, history and shared destiny. In 2008, emphasis was not placed on religion but on the edification and supervision of the population in response to the advent of Daesh. In 2014, the Federal National Council (FNC) and the General Authority of Islamic Affairs and Endowments made recommendations. In June 2015, the cabinet adopted 12 of them, including a strategic plan to emiratise jobs in preaching, iftaa (issuing fatwas and religious rules), and fiqh (Islamic jurisprudence), and greater powers of regulation for the General Authority of Islamic Affairs and Endowments.30 Given its location and its history, the Emirates, particularly Dubai, has been the locus of many languages. Rather than shrinking the debate to bilingualism (Arabic/English), it would be more accurate to insist on the multilingualism of the federation where Farsi, Hindi and Urdu are even more common. Since the 1970s, like Singapore, the inclusion of the Gulf States in the global economy favoured the use of English as lingua franca.31 The use of English exists in all levels of Emirati society, not confined to the business world. This invasiveness has generated a fear among the Emiratis of losing one’s identity: ‘The people have a stereotype that knowing English makes you English’.32 President Zayed’s decision in 1976 to make English the language of higher education and complementary to Arabic from elementary to high school (grade 1 – 12) has inadvertently set up a precedence for the language among the locals. A survey of female students at Zayed University shows that only 22 per cent of those questioned would encourage teaching in Arabic.33 This preference for English has created a diglossia favouring English. Arabic is less spoken and gradually less well spoken. Given its status of vector of the Arab civilisation, the Emirati authorities have worried about its depletion as far back as the 2008 debate.34 In 2010, the Abu Dhabi Education Council (ADEC) announced a ten-year strategic plan to improve the quality of education in both languages, English and Arabic.35 In Dubai, the National Strategic Plan of 2016 aims to strengthen the use of formal Arabic by compelling all administrative offices to prepare official documents in Arabic, for instance. However, in the private sector, English remains dominant. The symbolic rivalry between Arabic and English might turn out in favour of the former if only for the issue of the lack of uniformity of the Arabic language.

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Standard modern Arabic (fusHa) and its dialects (ammiyah) are very different and, as is common in the Arab world at large, the Emiratis do not use modern Arabic; moreover, inasmuch as opportunities to speak dialectal Arabic within the community grow scarcer, the local dialect impoverishes. Despite the authorities’ concerns and plans, English is likely to remain the language of communication in the UAE.36 The reinvention of ‘heritage’ as a catalyst for Emirati identity has taken different shapes. In the first place, the authorities have contributed to the making of a national sentiment by restoring and showcasing archaeological or architectural heritage.37 In this regard, the emirate of Sharjah deserves special attention. Over the last years, it has defined a comprehensive museological and pedagogic policy, focused on history and culture.38 The Emiratis in general are not only committed to maintain traces from the past but also to create new spaces such as Dubai Heritage Village, founded in 1996. With this project, the objective was to bring together the legacies of the past with entertainment suitable for promoting tourism.39 This kind of reinvention of heritage has revitalised traditions that have fallen into disuse. Traditional forms of entertainment and sport such as camel races and falconry have proven the most successful.40 The Emiratis have deliberately made their traditional dress a resonant symbol of their status as the nationals in their country and hosts of the foreign population. In a sea of foreigners in their land, the dishdash (also called kandura) is a self-conscious symbol of the Emirati status. Although men of the gulf region wear the garment as well, the Emirati man wearing his immaculate white costume and a scarf on his head commands the immediate attention of people in the public space. Wearing the national costume is a social act, and an exhibition of ethnic and cultural pride. Indeed, some locals consider it an act of resistance against globalisation and the intrusion of foreign cultures. Last, it nurtures socialisation among Emiratis in the public spaces.41 Women in the Gulf wear the equivalent, the abaya, a long black coat made of light fabric. While some Western feminists point at patriarchal oppression, Emirati women have turned their traditional dress into a fashion accessory starting in the 2000s with the peaking of Dubai’s commercial and tourist industry as well as presence on the world stage. Designer-made, the abaya has become a complex and sophisticated symbol of syncretism between tradition and modernity; the most conservative Emiratis have criticised this ambiguous play on tradition.42 Women, order and disorder The national debate has underlined both the responsibility of Emiratis in transmitting tradition as well as their contribution to the modernisation of

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the country, performing a sort of balancing act at three levels, the public domain, the family, and migration practices and conditions. Within this framework, the role of women in the definition of the Emirati national identity has come under scrutiny. Public spheres are not a priori a woman’s chosen field in the Islamic world in general. In its 2015 report on gender difference, the World Economic Forum ranked the Emirates in the 119th spot (out of 145), based on empowerment of women in public and economic life, and on education and health. While the ranking has not significantly changed since its creation in 2006 (101st), the Emiratis have narrowed the gap between genders (from 0.5916 in 2006 to 0.646, given 1 is equality). It is important to note that the federation is close to Kuwait, top performer in the Gulf (117th, 0.646) but ahead of Qatar (122nd, 0.645).43 The federation has engineered reforms leading to these relatively encouraging results.44 If, as in any Northern states, the health of women, especially mothers, is correlated to the wealth of the country, the UAE has promoted the status of girls and women in conjunction with its commercial wealth and global presence. The endeavour to send girls to school and afterwards to university has not weakened since Sheikh Zayed. What is more, females have been more successful at the college level than their male counterparts on average.45 Nevertheless, the political empowerment of Emirati women has been at the hand of the goodwill of the rulers: for example, the appointment of 8 women to the National Federal Council in 2015 (one was elected, making 9 women out 40 members) and 7 ministers in the 2016 government. While different sets of rules have been passed, the private sector, over which the authorities have little control, remains the weakest link. Resultantly, we come to two conclusions. First, empowered women come from the liberal bourgeoisie: Susan R. Madsen shows that Emirati women access high positions when they have an open-minded father and good education.46 They do not jeopardise the social order because they implicitly interiorise their social roles of teachers and suppliers of care. Nevertheless, in the long run, they become role models for the younger generations. Second, accepting the idea that women may have a life outside their home is a risk of disruption assumed by the federation. While there have been unabated discussions in the FNC on the changing role of women, sometimes coming from women themselves, Najla Al-Awadhi, one of the icons of political empowerment, herself appointed by the body, pointed out that it was better to have Emirati women in high positions instead of foreigners.47 Thus, in accordance with the importance placed on national identity, national preference outweighs gender so to speak. The participants in the national debate have used the idea of the threat of the foreigner (even here differentiating between the migrant worker and

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white expat) to accentuate their views on family and tradition. One argument posits that the migrants represent a threat to the family unit. As Rima Sabban has already noticed, literature on female housemaids highlights the negative aspects of foreign influence (never the positive one).48 Some Emiratis accuse nannies and housemaids of eroding the use of the Arabic language to the core. Nevertheless, the fact of the matter is the more the parents delegate their responsibilities, the less they transmit their own culture. Young children, regardless of their nationality, in the care of a nanny, acquire a language that is not their mother tongue. As the Philippines provide the backbone of domesticity in the UAE in the form of house help, Emirati children may speak better English, or even Tagalog, than Arabic. In the same vein, the argument that foreign labour especially poses a threat to national identity and the stability of the Emirati family touches on the threat of foreign religions; since the overwhelming majority of the Filipinos are Christian, Emirati intellectuals and social leaders reproach them for dimming the values or the norms of Islam. Such criticism expressed against the domestic labour population exacerbates the effects of the disengagement, real or imagined, of mothers within families. The role of women in the Emirati family has been thoroughly discussed in the media (but very little by the scholars). While the authorities, local and federal, have consistently placed the empowerment of women on the agenda, this policy has encountered resistance within the families. The Emirati family is the basic social structure: it is the only framework for procreation, and, in addition to tribal-based monarchic rule, it preserves the essential social order. Women are the recipients of Islamic values. This patrilineal and patriarchal model makes men (fathers, husbands and brothers) the guardians of women (qiwamah). In the traditional Emirati society, gender difference is emphasised from childhood. For instance, for a child’s birthday, the family kills two goats for a boy, and one for a girl.49 However, it is simplistic to believe that Emirati women are victims of a patriarchal model. They may bring their stones to the edifice through associations and groups under the tutelage of the state50 but, as some scholars note, they also encounter resistance.51 Regardless of their age, Emirati women all agree on the fact that Islam is the cornerstone of their society; its values cement family life and unity. However, there are differences among the generations. On issues such as marriage and equality between genders, the young Emiratis have divergent views compared with their mothers, let alone their grandmothers. They get married later, control their fertility and choose a husband who would share the parenting responsibilities. Almost unanimously, adolescent girls and young women of university age desire to have a career, unlike their mothers.52 It is a fair assumption to believe that the fear that women trigger and the social role they play is

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intrinsically linked to the diminishing power of men within the family and, beyond, in the society. The marriage of an Emirati woman to a foreigner represents her growing social empowerment, thereby intensifying the society’s anxiety of identity loss. Legally speaking, only men may get married with a foreigner. This scenario, while resented, is tolerated under certain conditions (that the bride preferably be Arab and Muslim, or from one of the religions of the book; that the man be unmarried; that the age difference does not exceed 25 years; that the husband be able to support his wife; that the spouses have no sexually transmitted diseases; that the spouse is not blacklisted in the UAE). The Abu Dhabi marriage fund makes it clear that the divorce rate is very high for such marriages (2 to 4 divorces in ten marriages),53 even organising information sessions in 2014.54 For women, marriage to a foreigner is not allowed and they risk losing their citizenship. Yet some commit the forbidden, get married and have children who automatically gain the citizenship of their father. With a gesture of openness, not to say boldness, on 2 December 2011, for National Day, Sheikh Khalifa granted Emirati citizenship to children born to Emirati mothers and foreign fathers. Hessa Tahlak, director of development and research at the Dubai Women Establishment, rightly commented that the president of the federation wanted to show that all Emiratis, men and women, are equal and that they may enjoy the same privileges.55 In January 2012, the Ministry of Interior issued a list of 1,117 new citizens,56 106 in August 2014,57 152 in May 2016.58 Women (and families) are the most visible sign of change in Emirati society at the beginning of the twenty-first century. The women crystallise the tensions because they are, beyond a doubt, the main vector of change in the country. No wonder that the emiratisation programmes emphasise their role.

Emiratisation The identity crisis, real or experienced as such by the Emiratis, evolved from a diffuse fear to an unease echoed by the media. In 2013, the Emiratis comprised 60 per cent of the public sector but only 0.5 per cent of the private sector’s workforce.59 This rate is the highest account of dependence on foreign workers in the Gulf (just ahead of Qatar). Emiratisation can be understood as a pragmatic response to the identity crisis resulting from the foreign labour’s highly increased implication in the public but especially in the private sectors.60 This attempt to nationalise the economy does not characterise the UAE alone because it is widespread in the other countries of the region.

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Nevertheless, emiratisation takes different aspects and remains difficult to appraise. Nationalisation, a regional issue Emiratisation had taken root even before independence. In the 1930s, while the term was not yet in use, the sheikhs expressed their desire to see the local population incorporated in the country’s oil exploitation. The inhabitants of the Trucial States had to be educated to participate in the country’s newborn economic activity. However, the decline of the pearl industry and distrust in the cultural value of the new oil industry stalled the full participation of the Emirati people in the oil exploitation.61 Prior to the major turning point of the Gulf War, two states had already prepared the nationalisation of their economy. Kuwait, first, looked like an exception in the region. During the first census of 1957, Kuwaitis represented 55 per cent of the total population. In 1985, they had dropped to 40 per cent of the total population but represented one fourth of the labour force. Kuwaitisation started in 1978, aiming to counterbalance the growing influence of immigration. Emphasis had been put on the need to change the attitude of the population regarding manual labour. Second, omanisation started in 1988. The lack of vocational and higher education was the main issue. Sultan Qaboos was willing to find solutions and favoured the development of education in general.62 In the context of the 1990s, the socio-economics of the region had changed. Two factors stimulated saudisation and bahrainisation. First, the economies since the beginning of the decade had relied on Asian migrants. The resulting dependence turned into resentment towards the immigrants in general. The demographic imbalance was first perceived in the Saudi monarchy. Foreigners represented one third of the total population and 95 per cent of the employees in the private sector. After the Gulf War, the Saudi government defined its first policy of saudisation. Second, foreigners were prohibited in certain occupations while the percentage of nationals was set at 5 per cent for the companies that have more than 20 employees.63 The consequences of the Kuwaiti invasion badly hit the small neighbouring state of Bahrain (whose population was comparable with mid-range European cities – less than a million inhabitants). Shi’i unrest inextricably linked to the increase of unemployment compelled the government to diversify the economy. Bahrainisation started at the beginning of the 1990s. Companies were supposed to yearly increase the percentage of nationals among their employees, especially the young nationals.64 Officially, 12 per cent of young Emiratis were unemployed, although one third made the choice not to work.65 To what extent does the emiratisation programme differ from the other policies of nationalisation? Firstly, all programmes have intended to reduce

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the use of foreign labour and to replace it with local workers. This logic seems to apply in the Emirates but with a difference that few authors underline. Mervyn J. Morris makes it clear that local and federal authorities have selected ‘suitable’ sectors for the employment of Emiratis.66 Secondly, emiratisation has become part of the policies of higher education with the aim of increasing the participation of Emiratis in the labour force, but first and foremost in preparing them for managerial positions.67 It therefore seems that qualitative nationalisation prevails over a policy of increasing numbers at any cost like in countries such as Oman or Kuwait. Emiratisation, instructions for use Different ad hoc structures have been created since the 1990s to implement the emiratisation programmes. At the outset, the Ministry of Labour and the Ministry of Social Affairs were the architects in the field. To ease the heavy administrative procedures, The National HR Development and Employment Authority (Tanmia) was created on 15 November 1999. The objectives of the agency are to multiply employment opportunities for Emirati citizens, to lower their unemployment rate, to increase their skills and productivity and to guide the federation in these matters. Locally, some emirates have established their own agency, such as the Abu Dhabi Tawteen Council, founded in 2005 by Sheikh Khalifa. The same year, the Emirates Nationals Development Programme was also created with strong emphasis on the private sector. In a nutshell, there are various institutions working in the same field. Coordination of these structures remains the main issue. Higher education was considered a vital tool for the emiratisation of the nationals. Their assimilation in the managerial tier of the professional workplaces was therefore understood as a central mean to narrow the gap between skills and needs. The Emiratis not only attended colleges for free but hundreds took the step to study abroad with federal scholarships. A local university system was necessary. Federal Law no 4 of 1976 established the UAE University in Al Ain whose mission was, from the beginning, to supply higher and middle managers for the country. Its first years were promising but it struggled to translate the mission into action because the university supplied, at best, one fourth of the national needs. By the close of the 1990s, the academic landscape had radically improved. In the private sector, the president had bet on the future and the insertion of Emirati women in economic life. Zayed University, initially created for young women, diversified its recruitment within the local society. Vocational schools gained momentum. Four Higher Colleges of Technology (HCT) created in 1988 spread in the country. Today 17 HCT in all major cities of the federation deliver degrees in four tracks (trade, technology, communication and health).

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According to Tanmia, the HCT are the main providers of degrees at the college level: half of the Emiratis with a degree in hand (12 per cent of the total population)68 attended a HCT, meaning 47,887 students in total.69 In the meantime, private universities mushroomed. However, if the higher education provided satisfies the expectations of the families, it does not necessarily address the needs of the federation.70 The federal government alternates between restraint and the promotion of emiratisation. Nevertheless, key sectors had been identified to facilitate the process. Insurance companies, for instance, became laboratories. In 1994, Decree no 38 organised a follow-up committee for planning and qualification in the Emirati insurance companies. With sessions and workshops, the proportion of nationals increased in the sector. In 2002, a decree imposed a quota of 15 per cent and a 5 per cent increase per year in each company.71 The banking sector was also identified as a springboard for the integration of the ‘locals’. In 1999, Decree no 47 imposed a quota of Emiratis in the 47 private banks. In addition, the authorities expect a 4 per cent increase every year. In the insurance sector, the results were not published, unlike in the banking sector, probably due to contrasting results. At the end of 2000, 19.66 per cent of insurance/bank employees were Emirati, reaching 26 per cent in December 2003. Certain banks played the game particularly well while others tried to escape the constraints.72 While the quotas appeared mandatory, the extent to which this obligation was met is not clear. Legal provisions are clear. Emirati laws oblige companies to recruit Emiratis exclusively for reserved functions, such as liaison officer with the authorities and company representatives in court. According to Decree 259/1 of 2004 on the education and the employment of Emiratis in the private sector, commercial companies of 50 people and more outside the free zones must ‘emirate’ their staff at a pace of 2 per cent a year. Another item of legislation (no 1187 of 2010) classifies companies into two categories: banking and insurance. The first category must incorporate at least 20 per cent Emiratis. The second category has a lower quota of 15 per cent. Following the decrees, a set of rules redefined the general framework of emiratisation. Legal guidelines grant the Emiratis substantial rights in the private sector compared with their expatriate counterparts (office hours, maternity leave, etc.). In January 2011, the Ministry of Labour imposed a minimum wage for the nationals (12,000 dirhams or 3,269 USD a month) for a student with a Bachelor degree in hand). Finally, the debates in the Federal National Council starting from 2009 onwards moved the labour minister, Saqr Ghobash, in November 2014, to put forward a comprehensive law that replaces the previous legal provisions. To achieve higher emiratisation in the

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private sector, the salaries paid to the Emiratis will match the range of those given in the administration.73 This legal arsenal is also fortified by local and federal support, financial especially. In 2011, the education of Emirati engineers received $150 million, for instance. In addition, to sustain public interest, forums and conferences are regularly organised, such as the Emiratisation Forum. All in all, the authorities take the emiratisation projects very seriously, even if the legislation behind the 2014 policy remains unclear. The question remains: how do we pursue the evaluation of these policies? Hopes and resistances In the administration, emiratisation advances. In the private sector, it encounters resistance. Some managers consider it a form of indirect taxation. In June 2012, the media released information from The National HR Development and Employment Authority (Tanmia). In 2011, the authorities had achieved the 50 per cent Emirati employment in the administration they had hoped for (total 53 per cent; 47 per cent in 2010). In the governmental agencies, there was some encouraging progress (36 per cent in 2011; 34 per cent in 2010). These results did not take into consideration the ministries where Emirati citizenship is mandatory (Foreign Affairs, Interior). With the support of Tanmia, Sheikh Mansour bin Zayed Al Nahyan, in charge of the emiratisation project, defined an emiratisation plan for the public sector for 2011 – 13. The ministries were classified in three categories: those which reached the bar of 80 per cent Emiratis; those which attained between 60 and 79.9 per cent nationalisation; and those which reached under 59 per cent Emiratis. Given this classification, the authorities adjusted measures such as targeted recruitment, workshops, internal education, etc.74 A comparative survey of the UAE, Oman and Saudi Arabia highlights the resistances to nationalisation. In the UAE, the Emiratis see themselves as managers or representatives of upper classes. They refuse jobs that do not fulfil their expectations. Therefore, they tend to pursue positions in the public sector, where they consider the working conditions more favourable than in the private sector: higher salaries (the most determining factor for a young Emirati in February 2015),75 fewer hours, flexible schedule and social advantages. In public service jobs in particular, such as the civil service and the parastatal sector jobs, the personal or face-to-face relations are significant determining factors for Emiratis as they secure a comfort zone of familiarity and tradition: it is these relations, or wasta, which are on a collision course with the trends of globalisation and the meritocracy system newly invading the Emirati cultural sphere. Sheikh Mohammed, in an attempt to endorse the

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institution and proper functioning of the meritocracy system, randomly visits his services in Dubai. In addition, employers require accountability and efficiency. The productivity of the Emirati employees is lower than that of the expatriates or immigrants in general;76 moreover, managers prefer to recruit skilled workers from South Asia with a subservient demeanour in a hierarchical structure. Managers always point out lesser effectiveness in the recruitment of Emiratis.77 There are also three commonplaces regarding the Emiratis: they are not well educated (particularly citing that their English language is poor in a world of global communication); their work ethic is questionable; their cultural background sometimes collides with the globalised enterprise culture (they resign when they do not get the fast promotion they believe they deserve or they have unreasonable expectations).78 Therefore, it is little wonder that many managers try to circumvent the legal parameters: for instance, instead of recruiting an Emirati when the staff reaches the 50-person mark, the company opens a new subdivision or structure to keep the number of employees below the limit. Some CEOs claim that the Emiratis disrupt the organisation of the company and prefer to pay the fine for refusing to emiratise, or even recruit an Emirati and request that he/she not come in to work. Emiratisation lies in this dialectic of public endeavour and the resistance of the private sector. Quotas and women are the keys of success. Quotas are measurable. However, if they show the determination of the authorities, they might hamper the economic activity. If the emiratisation policy approved in November 2014 entails higher salaries for the new recruits, the management community is likely to request federal subventions in order to maintain competitiveness in the market. Foreign companies invest in the UAE because of the friendly business environment. Public intervention would favour relocation to less constricting countries like Qatar. Consequently, local and federal authorities are compelled to cope with divergent views, between coercion and laissez-faire. That women are the solution to a societal issue is a commonplace and often a myth. Nonetheless, it does not apply to emiratisation inasmuch as female participation in the workforce is on the rise. In 1996, they represented 11.8 per cent of the labour force, and in 2004 they reached 15.4 per cent, far behind the average of the GCC (27.8 per cent) (likely ahead of Saudi Arabia, which officially provides no data), or Kuwait, the most advanced country in terms of women empowerment (40 per cent).79 Obviously, emiratisation empowers women and women boost emiratisation. A new official rhetoric seems to have taken shape since 2012. In an interview during the annual fair on education held in Dubai (Getex), Ahmad Al Ahmadi, director of Tanmia, noted the generational gap regarding the attitude of the young Emiratis: in the time of his father and his grandfather,

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there was no shame in working regardless of the job and time was ripe to reinvigorate this spirit. Against the international and competitive backdrop, an entire generation comfortably leant on the Emirati welfare state. Now, Emirati decision makers are mindful of the constraints of demanding and selective education that should become the benchmark.80 The 2008–10 depression induced the local authorities to review their assistance policies and consequently to exercise greater care in funding projects even related to emiratisation. Abdullatif Al Shamsi, managing director of the Institute of Applied Technology, declared that the time that Emiratis obtained a job because of their citizenship or their status is over.81 It remains difficult to foresee how the Emiratis will overcome their identity crisis. Given the demographics of the UAE, its population will stabilise. It is also likely that because of the downturn of construction and infrastructure development (after the Expo 2020?), fewer immigrants will come work in the country. The emiratisation will continue and thanks to women, more Emiratis will access managerial positions that would give them – and the whole population – the feeling that they have more control and they are more integrated in the economy. Other options are possible. The resentment towards foreigners might impose more restrictions on migrations. It is still too early to predict one scenario over another.

CHAPTER 10 AFTER THE DEPRESSION

The warning signs of the subprime crisis of 2007 did not alter the confidence of the Dubai business community. The newly arrived expats were more concerned about finding an apartment, any accommodation, because the rent offers were very low with regard to growing demand. The frenetic construction sector, dynamism of the real estate market and positive economic indicators (6.6 per cent growth in 2007) were no bad omen, at least for a large audience. The crisis invited itself to the iftar (the meal eaten after sunset to break the daily fast during the Ramadan period) in September 2008. The bankruptcy of Lehman Brothers became the topic from 11 to 14 September; the downturn of Goldman Sachs stocks on the 16 September confirmed the scale of the crisis and created frenzy at stock exchanges globally.1 The meaning, causes or consequences of the crisis that all ‘experts’ put immediately on an equal footing with the depression of 1929 remain until today a point at issue among scholars, journalists, experts of international organisations and private cabinets. Complex by its very nature, it had been foreshadowed by Paul Jorion before it started in February 2007.2 The crisis is still wrapped in ideologies because, in the background, it questions the control and the regulation of the financial market by states and international organisations. It appears as a teratological birth of globalisation throughout which the facts and their representations are not easily discernible. The most basic representation and assessment of the crisis, in the UAE, however, can be seen and measured, respectively, in the slowing down of economic activity measured by the GDP growth. If the depression materially corresponded to the slowing down of economic activity, thereby revealing causality, its effects were of limited duration (Table 10.1). After the strong growth of the 2000s, a period of recession succeeded (last trimester of 2008 until late 2009), followed by recovery. In 2011, the Emirates, and in particular its two flagship cities, Dubai and Abu Dhabi, recovered their ability to create wealth similar to that before the

– 192.159 –

% (y 1 1) Abu Dhabi* % (y 1 1)

2 15,9 145.759 2 24.15

253,547 2 19.63 79.189

2009

* SCAD ** Dubai Statistics Center (2008 – 12); ***City Bank

315,474 – 94.146

2008

3.0 174.525 19.74

286,049 12.82 81.543

2010

3.9 230.543 32.10

347,354 21.43 89.736

2011

GDP in the UAE, at current prices, 2008 – 14 ((e) ¼ estimation)

UAE ($B)* % (y 1 1) Dubai**

GDP

Table 10.1

4.1 247.707 7.44

372,313 7.22 90.913

2012

402,340 8.06 90.670 97*** 4.6? 253.712 2.42

2013

399,723 20.65 92.034 107*** 3.8? 259.404 (e) 2.24

2014

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depression, yet at a slower pace. What is more, the emirate of the capital was seriously hit but seems to have recovered faster and better than its neighbour. It nevertheless remains difficult to disentangle the cross-linked events because the facts are sometimes on a collision course with their representations.

The 2008– 9 crisis, facts and representations The depression in the UAE hinged on three factors: the first reactions of the Emirati authorities until the close of 2008, the wait times and the pending definition and arrangements of the debt in November–December 2009. From panic to restoration of confidence During Autumn 2008, a subtle game started between the different economic actors. While the financial markets panicked, the businesspeople, investors and professionals in vulnerable sectors such as construction and real estate scrutinised the decisions taken by the public authorities echoed by WAM, the Emirati press agency. On 12 October, President Sheikh Khalifa Al Nahyan and Prime Minister Sheikh Mohammed Al Maktoum presented a united front to reassure the observers. The Emirati economy was doing well. However, a series of preventive measures (sic) were decreed. Among them, without further details, the Emirati government announced its support to the Emirati banks. They would not be exposed to the risk of a credit crunch; moreover, the deposits and the interbank loans would be guaranteed. If need be, sufficient liquidity would be introduced into the system.3 Two days later, WAM announced that the central bank had already injected $13.6 billion into the banking system. Officially, $32.7 billion supported the Emirati banks in September. Sheikh Mohammed ordered again the transfer of $19 billion from the Ministry of Finance to the banking sector. No details on the breakdown were made available – which banks benefited from public aid or how the banks were supposed to pay back the bailout package. All things considered, one can modestly conclude that $50 billion were injected to float the banks during the economic crisis. For the federal government, the objective was to protect the banking institutions from the world financial depression. It was also a ‘fast answer’ from the Emirati government.4 The US deputy secretary of the Treasury lauded this state interventionism when he visited the Dubai Financial Market for a conference in late October. Robert K. Kimmitt pointed out that the decisions of the federal government were in harmony with the G7 group that also decided to massively inject money into the financial system to restore confidence.5 The media conveyed the idea that the Emirati leaders immediately took the right decision to contain the world financial disorder.6 Even if some information was not made available, the facts

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205

showed that the decisive actions of the Emirati leaders and institutions gained the trust of the local and international business community. The financial tsunami did not submerge the Emirates, which entered a new phase of waiting. The authorities made it known that they were keeping a close watch on the situation and guarding the Emirates’ interests. On 26 November 2008, the Coordination and Economic Cooperation Committee gathered under the chairmanship of Sultan bin Saeed Al Mansouri. The heads of central services, the deputies of the Central Bank of the UAE and of the Ministry of Labour coordinated their efforts to contain the effects of the crisis.7 Two days before, Sheikh Mohammed Al Maktoum, who was little inclined to give interviews, answered the questions of the journalists of the Egyptian daily Al Ahram stating unequivocally that there was no reason to panic about the health of the Emirati economy. Nevertheless, as the federation had by then become fully integrated in the globalised world via Dubai, the aftershocks of a worldwide economic downturn were bound to hit locally. The UAE was more than doing well considering foreign powers had called on the federal government for help.8 Concerns were not about the Emirates in general but Dubai in particular. Rumours had spread: laid-off employees abandoned 3,000 cars in the parking lot of the international airport because they could not afford to pay their personal debts back; passengers leaving the Dubai airport with a one-way ticket were blacklisted and therefore unable to return to the Emirati territory;9 there was an unabated exodus of immigrants sent back home (20,000 Indians in February 2009, according to the only available information).10 Consequently, the government of Dubai wanted to reassure the general public and in some cases did so in a surprising way. For instance, Nasser Hassan Al Shaikh, director general of the Department of Finance of Dubai, declared that the local government would give a helping hand to companies by a 20 per cent increase in public spending; therefore, the growth in 2009 was expected to rise from 4 per cent to 6 per cent11 (it was – 15.9 per cent, cf. above). If the professionals of badly struck sectors such as construction of real estate were not optimistic privately,12 they still maintained that Dubai had escaped the depression. The Sharjah Economic Development Department organised for its part a seminar on the depression and its effects. Professor Nadir Abdul Rahim, a consultant for the Sharjah authorities, explained that the economic policies like the ones implemented by the federal government before September 2008 cushioned the negative effects of the world depression before it impacted the country.13 The first months of 2009 were perceived as crucial. The inhabitants of Dubai witnessed two immediate consequences of the crisis. Firstly, there was no traffic during rush hour as there had been before and, secondly, some construction sites stopped before delivery, a striking contrast with the previous period. In fact,

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the professional in construction postponed completion as long as possible in the hope that recovery of economic activity would ensue starting early 2009.14 But the contractors exerted the same pressure on the developers as the ordering parties did on the developers. The collapse was brutal. In October 2009, the media announced that the value of the construction contracts had dropped by half since the beginning of the year.15 It was henceforth difficult to deny the obvious. Beyond a doubt, the crisis impacted construction and real estate. According to the Dubai Statistics Center, construction and real estate contributed to almost one-third of the Dubai GDP (respectively 13.6 per cent and 17.5 per cent) in 2008. The next year, these sectors were deeply affected with a negative growth of 30.9 per cent and 31.1 per cent respectively, a shortfall of almost 10 billion ($20,214 billion instead of $29,291 billion) for the GDP. The official accounts state that all private sectors were affected except transportation (certainly because of the sound business of Emirates Airline (see below) which maintained its position (þ0.5 per cent). The financial corporation sector lost for its part only 3.3 per cent with the help of the Emirati authorities. In late 2009, for more than a month, Dubai became the focus of attention in the international media. On 25 November, the government of the emirate called for a six-month deferral of the payment of the interest on its debt. The solvency of Dubai caused anxiety in the financial markets. The Dow Jones lost 150 points on 27 November. The spectre of a hidden debt on the Russian model in the 1990s or Argentina at the beginning of the 2000s appeared on the horizon. The financiers were convinced that, regardless of what might happen, the government of Abu Dhabi (with the proxy of the federal government) would safeguard its neighbour. Moreover, even if Dubai had become a stronghold financial market in the Middle East, its bankruptcy would not jeopardise the international financial system as a whole, inasmuch as the foreign banks’ total cross-border exposure of, American or British, was only 0.4 per cent. Dubai World was the main parastatal indebted company. Its main creditors were Emirati banks of Dubai and Abu Dhabi.16 Three days later, on the 30th, the government of Dubai announced that it would not guarantee the debt of Dubai World. The news triggered an immediate panic in the financial markets. The Dubai stock exchange lost 6 per cent on 6 December and continued to decrease until 8 December. After holding its decision in abeyance, Abu Dhabi announced that the UAE would give $10 billion to its neighbour to secure its debt. The financial market saw this bailout as a sign of positive activity and recovery but there was reluctance and dismay on the streets of the weakened and now publicly ailing city. The same day, the main sovereign fund of the capital, Abu Dhabi Investment Authority

AFTER THE DEPRESSION

207

(ADIA), started to file a case against City Bank to try to block a transaction of $7.5 billion in 2007. The government of Abu Dhabi was gaining control of the city’s once extravagant and seemingly impervious funds. During this period, rumours spread about the federal capital’s buyout of Emirates Airline, the jewel in the Dubai crown. To add fuel to fire, igniting tension and selfconscious demotion on the part of Dubai, the tallest tower in the world, another accolade for the city, initially named Burj Dubai, was inaugurated on 4 January 2010, Burj Khalifa, after the president of the federation. The causal link between the 14 December $10 billion rescue and the renaming of the Dubai’s newest architectural wonder appeared obvious, although evidence and reactions remained mute in response to the deal between the two main rulers of the UAE. Dubai under the microscope Shakiness generated by the crisis vindicated the flood of criticism that positive economic results had contained until then. The growth of the previous decade put the Dubai model to the test and questioned the effectiveness of ArabMuslim liberalism. The turbulences that agitated the emirate from September 2008 onward raised awareness about the depression itself but also the validity of the political and economic choices of the Emirates. More than the facts, partial and subject to interpretation, new representations of Dubai were born in this context. It took more than a year to ameliorate the sharp criticism that had altered the image of Dubai. During the annual Doha Debate, Simon Jenkins, former chief editor of two prestigious UK newspapers, The Times and the Evening Standard, trivialised his previous criticism that ‘Dubai was a bad idea’.17 In retrospect, however, it is no wonder that a celebrity of the British media had stated such a definitive assessment. As criticism of human rights issues persisted unabated since 2006, the economic model, in the aftermath of the crisis, was henceforth also put to question. Dubai was charged with all the excesses of capitalism. The British intellectuals and media crossed swords with their Emirati counterparts. In The Economist, Christopher Davidson demonstrated, with solid arguments, that Dubai lost its economic autonomy after the Emirati central bank bought $10 billion of Dubai bonds (to be paid back in 5 years)18 on 22 February 2009. Davidson, who also authored Dubai: The Vulnerability of Success,19 went further in stating that Dubai lost at the same time its diplomatic leverage that its government had had on the Iranian issue.20 These statements raised the ire of Abdulkhaled Abdullah who wrote a column against Davidson in Gulf News. The professor of political sciences at UAE University reproached Davidson for being short-sighted and for using scientific incoherence to criticise the city. The accusations of Davidson

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THE UAE

appeared groundless in this article but in reality made sense. Beyond Davidson, Abdulkhaleq Abdullah pointed at the Anglophone and especially British media, namely the Sydney Morning Herald, Los Angeles Times, Newsweek, the Financial Times, the Guardian and The Economist, which appeared keen on criticising the transfer of money from one emirate to the next. The columnist vituperated his colleague at the University of Durham, whose rhetoric on negative aspects of the Dubai model was music to the ear of the media.21 During the following weeks, participants in the discussion forum unleashed their sentiments on Dubai, as if a speech, contained for a long while, was all of a sudden liberated. The Independent’s ‘The dark side of Dubai’ (7 April 2009), an invasive investigation by the centre-left British daily, referenced ‘the secrets [that] are slowly seeping out’. The issues presented by author Johann Hari, such as the working conditions of the labourers, the environment, the hierarchy among the communities, the lifestyle of the expats, etc., exposed the realities of the city’s population and the impact that exponential growth has had on the environment. The details of Dubai’s ascendency in the global arena recall stereotypes of the Western expats and observers. But by recounting inaccurate details, such as the neglect of the public authorities in the case of water management or the Philippines Consulate’s turning a blind eye to housemaids harassed by their employers, Johann Hari intended to tarnish the image of Dubai to justify his conclusion: Dubai was fake and its success forged. If the denunciation had proceeded, perhaps, from a genuine investigative perspective, the description of Arab culture seems intended to sensationalise the article’s conclusion by insinuating homophobia in cases of homosexuality and ‘slave[ry]’ in the case of the migrant workers.22 This article prompted an outcry in the Emirates. John Wilkes, an official spokesperson for the British Foreign Office, was compelled to intervene the same day the article was released. He declared to the press that Johann Hari had exaggerated in his criticism. He also emphasised that his government will keep on developing its business opportunities in the region.23 Has Dubai made some people ‘jealous’24 or is the attack representative of underlying cultural and historical attitudes that have only transfigured in a seemingly postcolonial world? Or is the critique a well-earned retort to capitalism as new money that seemingly cannot, hard as it tries, earn the same stature and respect as ‘old’ capitalism? A few months following Hari’s article, The Guardian, a respected left-wing newspaper hastily followed in the footsteps of the Independent. The inauguration of the Atlantis hotel on the Palm Jumeirah, on 24 September 2008, coming on the threshold of the economic crisis, made the headlines. This new five-star hotel contrasted with the prevailing depression. Noting the different indicators of the crisis

AFTER THE DEPRESSION

209

(construction stopped on the artificial islands and the stock exchange indicator slid), Steve Rose declared that the bubble had burst. Furthermore, fewer tourists could afford to go to Dubai and those who could were reluctant because of the alien attitude of the authorities: a British couple was put behind bars for having sex on the beach during daytime.25 Three similar affairs succeeded in 2008 – 9 involving British couples. The intransigence of the Emirati authorities had far-reaching consequences in Britain, a prime supplier of tourism to the city. What is more, there were suspicions that the vulnerable emirate, representing the brazen success of an Arab state, was unleashing its defence mechanisms against the harsh criticism that was perceived as reckless and unjust.

The debt of Dubai The melting of the facts and their representations obscured the debate around Dubai, the Dubai model and the crisis in the Emirates. Between the zealots of the governmental action, represented by the Emirati press, and its detractors in some Western media, scholars have had some trouble finding their right bearings. Once again the lack of reliable data does not allow for accessible means of analysis. The origins of the crisis and its depth are also questionable. The structure of the debt In its 2012 report, the International Monetary Fund (IMF) appraised the effects of the 2008 – 9 crisis, notably in terms of public debt, encompassing the local governments, the federation and the parastatal companies. For the year 2012, the public debt (individuals, companies and governments) reached $32.2 billion, 8.9 per cent of the GDP. The two local governments of Abu Dhabi and Dubai cumulated respectively $17.2 billion and $10.5 billion in debt (86 per cent of the Emirati debt). The investigators of the IMF appraised the debt of the government related entities (enterprises, GRE) such as DP World and Nakheel at $15.8 billion and $14 billion respectively. The debt of Dubai was twice that of the capital ($252 billion and $108 billion, respectively). The indebtedness of parastatal structures was huge: $100 billion in Abu Dhabi and $76 billion in Dubai.27 With 90 billion of proven reserve barrels, Abu Dhabi may afford to wait in order to absorb the debt; what is more, the price of oil rose in 2010 and stabilised at more than $100 a barrel until 2013 (before the decrease to $50). This is the reason why the debt of Dubai has drawn more attention. The IMF estimated the direct debt of the local government at $31.5 billion, 38 per cent of its GDP. The Dubai Financial Support Fund that has supported the parastatal companies like 26

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THE UAE

Dubai World and Nakheel was responsible for half of the debt ($18.5 billion). In 2015, the IMF was less explicit on Dubai’s strategy. IMF’s auditors stated that several GREs made early repayments of upcoming maturities. Dubai World for its part agreed with its creditors to reschedule a large maturity due in 2018. However, unlike the Abu Dhabi parastatal companies, Dubai’s GREs have not substantially reduced their debt. With the government of Dubai, the total debt was 136 per cent of the emirate’s GDP28 (between $92 and $107 billion, see above). The debt of Dubai, past and future Research on the debt of Dubai is still in a primary phase. Although international organisations like the IMF or the rating agencies acknowledge the efforts of the government of Dubai, they continue to request reliable data on public accounting and the GREs.29 As a result, scholars struggle to provide comprehensive analyses of the debt. Research has slowly grown on the origins of the crisis and its consequences.30 In an article on the debt of Dubai, Hassan Zubair stated that the origins of the crisis stemmed from the United States. Without quoting his sources, the author assessed that the vulnerability of the emirate was linked to the Emaar real estate operations (second to Nakheel in the urban development and construction sector) in the US. The collapse of the real estate market there likely had a domino effect on the UAE.31 If Sheikh Mohammed had authorised commercial real estate developments on the other side of the Atlantic Ocean, it remains to be seen the extent to which such projects impacted the economy of Dubai. Presenting the issue in that way, Zubair postulated the United States were the main culprit in the crisis. Two years later, Rahim Bah, Zaki Ehab and Ananth Rao made a more detailed analysis of the triggering factors in the banking sector. Prior to September 2008, the Emirati economy had shown signs of exhaustion. While growth had been strong (above 6 per cent), inflation had reached 10 per cent in 2006 and the foreign liability of the Emirati banks had gone from $23 billion in 2005 to $87 billion in 2007. These ominous indicators, known in the business circles, triggered the crisis in Dubai.32 The two articles nevertheless agree that the intervention of Abu Dhabi in 2008 – 9 mitigated the crisis and the Emirati recession at large. Little can be unrecovered when the emirate of Abu Dhabi is home to the 5th hydrocarbon reserve in the world. Yet, as Hassan Zubair states, the crisis altered the reputation of Dubai: the onlooker might now imagine the fetishised city as an idol with feet of clay33, especially its banks.34 From 2008 onward, the Emirati authorities, namely, the governments of Dubai and Abu Dhabi, worked in unison to restore confidence. By spring 2012,

AFTER THE DEPRESSION

211

the sky was clearing. In April the IMF handed out high marks to the Emirates. The fiscal policy aiming at consolidating the economy was efficient. Careful management, the abandonment of expensive projects and supervision of the banking system contributed to renewal with growth.35 Evidence of a normalisation was given mid-June 2012. Within two weeks, two loans were paid back. Jebel Ali Free Zone (JAFZ) announced, on 12 June 2012, its debt refinancing. Eight banks accepted a loan of $1.2 billion.36 The same week, DIFC Investment that governs the Dubai International Finance Center (DIFC) paid back a loan of $1.25 billion (sukuk).37 These transactions were part of the continuing process to pay off the domestic debt that started in February 2012. Dubai Holding Commercial Operations Group, of the group Dubai Holding, owned by Sheikh Mohammed Al Maktoum, cleared a $500 million debt. The government of Dubai and its external structures, however, still have loans. The original plan to refinance the reimbursement of the $10 billion debt in bonds and loans over 5 years seems to have given way to a more complex strategy of diversification.38 In February 2015, the local Emirati media lauded the new schedule for the repayment of the Dubai World’s debt facilitated by the emirate’s rapid economy recovery and Abu Dhabi’s support.39 Beyond the financial aggregates, one thing is certain. Five years after the crisis started, the Emirati authorities succeeded in restoring confidence, although the image of Dubai did suffer. The fall of oil prices since 2014 has impacted the repayment of the debt. The federal government, first and foremost the government of Abu Dhabi, has been more scrupulous in supporting, for instance, the development of real-estate projects. The longer oil prices remain around $50, the longer the GREs will take to repay their debts. In addition, in a period of federal and local budget restrictions, Abu Dhabi is less inclined to grant loans to its neighbour. The rebound of the debt could be a consequence of the financing of the coming Expo 2020.40

Back in business When the real estate bubble burst, speculation on the real estate market stopped; now the Abu Dhabi and Dubai authorities will have to closely supervise the construction and real estate recovery boosted by the Expo 2020. Nevertheless, these sectors do not encompass the whole economic activity. In terms of creation of wealth, the oil industry and the new niches backed by the authorities for the purpose of diversification have continued regardless of the crisis. This dual economic movement has resulted in a new alchemy. Does it mean that it undermines the established Dubai model?

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THE UAE

Have the forceful lines changed? If the crisis shook the foundations of the Emirati economy, the functioning of the substructure barely changed. World turbulence stimulated more than ever public interventionism. The reaction of the top officials, namely, of the president and the prime minister, was swift, consistent with a certain conception of state dirigisme, warmly applauded by the private sector. In a nutshell, the main decision was to support the banking sector to prevent a credit crunch whose effects would have badly damaged all the companies settled in Dubai. Secondly, the creation of ad hoc structures created a permanent monitoring system focused on the issues caused by the depression. The federal government announced on 25 December 2008, the creation of a committee whose mission was to coordinate the government policy,41 in association with government officials, such as the ministers of finance and economy and the director of the central bank. However, these structures did not encroach on the decision making process, left to the sheikhs. On the contrary, they consolidated the leaders of the ruling family in the role of sole decision makers. In the same vein, planning was revisited at the beginning of 2009 to ensure compliance with the uncertainties born of the crisis. No wonder the Dubai strategic plan of 2015 was adjusted downwards in February – March. No stone had been left unturned, stated Raed Safadi, in charge of the Department of Economic Development of Dubai. The emirate sought to focus on its core business activities that made it successful. Public aid intended to sustain economic activity and save jobs.42 On this sensitive issue, the Emirati authorities were at the forefront. It seems logical that the Emirati authorities continued supporting economic activity with the injection of public funds. But on the matter of employment, they had no predetermined position, leaving the companies a great deal of room to manoeuvre. Employment figures began to appear after the growth or profit targets. First, in terms of the number of layoffs, uncertainty prevailed. The vox populi spread rumours of the exodus of construction workers back to South Asia. In early January 2009, for the first time, Gulf News risked reporting a number. 3,200 persons had been laid off during the last trimester of 2000 out of a working age population of a million,43 meaning less than 1 per cent. In 2013, Dubai Statistics Center issued data on the workers in the emirate. The breakdown confirms how badly the construction sector was hit. At the peak of the Dubai boom in 2007, the companies employed 716,005 workers. This number steadily decreased until 2012 (464,711). Inasmuch as more people were working in the emirate, it means that the other sectors like retail, tourism, and manufacturing had absorbed the effects of the construction depression. It was an unexpected and highly welcome effect of the

AFTER THE DEPRESSION

213

2500 2274 2144 2000

1500

2330

2379

2112

1953

1472

1000

500

0 2006

2007

2008

2009

2010

2011

2012

Figure 10.1 Manpower in the emirate of Dubai, 2006 – 12 (in millions). Source: Dubai Statistics Center

diversification policy. In 2014, the breakdown of Dubai GDP ($92,008 at constant price, reference year 2006),44 construction represented only 7.6 per cent of the total, far behind commerce (28.9 per cent) transports (15.5 per cent), manufacturing (13.8 per cent), real estate (13.3 per cent), financial sector (11.1 per cent); therefore the development of new urban projects has weighed on 20.9 per cent of the emirate’s economy. Second, companies tried, sometimes for survival, to reduce payroll either by lowering salaries or laying people off. In the first case, the authorities never intervened in the negotiations that most of the time impaired the rights of the employees. In early December 2008, 300 drivers of Al Ghazal Transport signed a petition against a loss in income of 260 to 800 dirhams (out of an average salary of 1,500 dirham). The employees could not afford to leave the company for fear of being charged and sued for breach of contract.45 Vocally committed to the principles of liberalism, the Emirati authorities did not officially interfere in the process. In contrast, the federal authorities held on to their prerogative on the issue of Emirati employment, exemplified in a particular case that made the headlines in Dubai in February 2009. Taking advantage of the crisis, some employers tried to dismiss the Emiratis integrated with great difficulty into the private sector through emiratisation.46 Twenty employees of the substantial Al Futtaim Group (owned by the family of the same name with prestigious franchises and investments in automobiles, construction, real estate, technology, financial services and even education) made a case before the Ministry of Labour after their layoff.47 The high authority on employment (Tanmia) immediately understood the threat of the Emirati employment demographic. Three days

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THE UAE

later, Tanmia put forward a recommendation to make illegal the dismissal of Emiratis. In early March, the Federal National Council (FNC) was requested to weigh in on the proposal. Since the beginning of the crisis, only 64 Emiratis had been laid off, out of 15,000, and only half in an unjustified way. The Emirati authorities, therefore, did not pass any new legislation despite the attempts of the labour minister to steer the FNC’s position, but chose to send a strong message instead: the dismissal of Emiratis is a red line not to be crossed.48 Maintaining the same pattern of public interventionism, the Dubai and Emirati model not only did not change during the depression, but was also strengthened. One must look elsewhere for the main changes, perhaps within the main communities that coexist in the UAE. Remittances and mobility Remittances are, paradoxically, an excellent indicator of the vitality of the Emirati economy. In late 2008, the World Bank projected a 9 per cent reduction of the remittances in all GCC countries for the coming years49 confirming the sense of a world depression. Facts contradicted this prediction. The Arab Monetary Fund (AMF), headquartered in Abu Dhabi, is a discreet international organisation. One of its missions is to compile accounting data for the Arab states. According to the AMF, the Emirati migrant workers remitted no less than $49 billion between 2006 and 201050 – and certainly more because these data take into account only official channels. The breakdown revealed that the 2008–10 crisis minimally impacted the progression over a decade. After the rapid growth until the mid-2000s, the remittances stabilised in 2009 followed by the biggest increase of the decade in 2010 (Table 10.2). The remittances of the Filipino and Bangladeshi workers shed some light on the surprising evolution during the trying times of the depression. According to the central bank of the Philippines (Bangko Sentral ng Pilipinas), the exponential growth of the remittances coming from the UAE weakened in 2008–9 ($527 million in 2007; $621 million in 2008; $644 million in 2009), but the transfer of income increased after 2010 ($775 million) and continued to take off until 2015 ($2.19b).51 The structure of employment might explain this evolution. Excepting the ‘domestic helpers’, the one million Table 10.2

Annual remittances from the Emirates, 2000 –11 ($ billions)

2000 2001 2002 2003 2004 2005 2006 2007 2008 2009

2010

2011

3,67 3,91 4,13 4,38 4,64 5,37 6,07 8,68 9,99 9,53 10,543 11,226 Source: Arab Monetary Fund, Economics Statistics Bulletin 2015, Abu Dhabi: 2015, p. 175 (no data for 2013 and 2014)

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Filipinos are the backbone of tertiary economic activity. As in the Gulf in general, Filipino nurses are essential to the health system. What is more, in the tourist industry and the retail sector, Filipino workers’ excellent command of English and their ability to interact peacefully in different cultural environments, have made them valuable employees. Likewise, Bangladeshi workers, although mainly unskilled (in construction, for instance) continued to send increasing remittances as the central bank of Bangladesh (Bangladesh Bank) shows (Figure 10.2). All in all, the UAE has been the second supplier of remittances in these countries (after Saudi Arabia). The other countries of South Asia benefited from a similar dynamic. According to the World Bank, out of $30.170 billion remitted from the UAE in 2015, the Indians took first place, with $12.57 billion, and the Pakistanis second, with $4.76 billion.52 Regardless of the causes, such as a strong dollar, or the simplification of transfer transactions, the fact is that the crisis did not slow down the transfer of remittances but, conversely, seemed to give impetus to them. Not yet studied, this contradictory evolution requires two remarks at this stage: first, it is likely that the bulk of the construction workers, severely hit by the crisis, were not the main remitters – in value. Construction and real estate represented more than 30 per cent of the manpower before 2008 and it seems the diversification policy softened the blows of the crisis in this sector. 3000 2750

2830

2680 2700

2500

2000

1890

2002

1754 1500 1135 1000 804 500

442

561

0 2005

2006

2007

2008

2009

2010

2011

2012

2013

2014

2015

Figure 10.2 UAE remittances to Pakistan, 2005 – 14 ($ millions). Source: Foreign Exchange Policy Department, Bangladesh Bank, Annual Report (July 2010 – June 2011), Dhaka: The central bank of Bangladesh, 2012, appendix 2 Bangladesh: Some Selected Statistics, p. 250,53 WB statistics for 2012 and 2015, BMET statistics for 2013 and 2014

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Second, the governments of countries like India or Pakistan channelled the influx of money by facilitating the transfers. It is possible that the informal sector slipped into banking transaction, visible from an accounting point of view. The depression hastened the reorganisation of the real estate market. This effect of the crisis is as obscure as the factor of the remittances. Between 2005 and 2008, rents were surging in Dubai (and in Abu Dhabi afterwards). The landlords did not hesitate after a period of low rent to considerably increase the rent when the tenants were up for the renewal of their annual contract (before the depression, it was possible to double the rent from one year to the next). The tenants had no recourse against the landlords. The situation was so critical that the government of Dubai created the Real Estate Regulatory Agency (RERA) on 31 July 2007. To find an acceptable compromise between the two parties, Law n8 26 of 2007 formalised the contracts. Law n8 33 of 2008 amended this text and established a ceiling, the 5 per cent rent cap that the landlord cannot exceed. The perspective of easy money caused a frenzy of construction. It had been estimated that before the 2008 crisis, the planned projects exceeded $1,000 billion of property value, meaning one third of the real estate projects in the world (only $14 billion in the US at the time).54 The fall was therefore most dramatic. The delivery of the new buildings combined with a collapse of the demand caused a decrease of 50 per cent in property value. The Emirates, with Dubai in the lead, was the third country most damaged in this sector after Latvia and Estonia.55 Late 2010, the landlords had no choice but to decrease the rent, between 20 per cent and 30 per cent, so as not to let their properties remain vacant.56 Tenants took advantage of the collapse of the market to upgrade their housing or move closer to their workplace. This is why commuting residents of Sharjah (responsible for the heavy traffic during rush hours between Dubai and Sharjah) moved to the emirate of Dubai. For rents similar to those of Sharjah, the commuters could henceforth afford urban areas such as International City (the least expensive in Dubai). In parallel, International City residents moved to the Gardens or TECOM and so forth. In the upper market, tenants of the Marina at Media City ventured to rent a villa.57 The complete recovery punctuated by the win of the Expo 2020 seems to have stopped this evolution. Of all these evolutions since 2008, the most noticeable was the new balance of power between Abu Dhabi and Dubai. Abu Dhabi is again the capital of the Emirates The competition-partnership between Dubai and Abu Dhabi has been a central theme for those investigating the two models of globalisation in the

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Gulf. Davidson, in particular, describes the two models as differentiated by the central adjustment variable, namely oil.58 As one emirate sits on 90 billion of proven reserve barrels while the other compensates for the lack, the recent evolution of the two main cities in the UAE has been shaped by this contrast. Nonetheless the branding of Dubai overshadowed Abu Dhabi. For years, prior to 2008, foreigners believed that Dubai was the capital of the UAE. How did Abu Dhabi re-conquer its symbolic supremacy during the crisis? From mid-November 2008 onward, after the injections of capital into the banking system, speculations continued over the relations between the two cities. On 18 November of that year, the Financial Times was the first newspaper to evoke a transaction between the two flagships of the federation.59 According to ‘sources’ not mentioned, the parastatal companies (the GREs) were likely to benefit from a support plan (mainly cash in the banks) that was about to be announced. While Simeon Kerr and Roula Khalaf underscored that, according to the officials, the financial situation of Dubai was healthy, the opposite impression spread. The implication of this rumour was that Abu Dhabi and the federal government would not ride to the rescue of Dubai for free. As no information at the top level was forthcoming, the business community was compelled to interpret omens. A week later, one of the right-hand men of Sheikh Mohammed, Mohammed Ali Alabbar, member of the Executive Council of Dubai and chairman of Emaar gave a press conference in the DIFC. To be reassuring regarding the steadfastness of Dubai’s economy, he formally denied negotiations between Dubai and Abu Dhabi, thereby making his assurance suspect,60 as the government was not known to provide disclaimers. Consequently, the business community understood that negotiations were indeed taking place, be they regarding the merging of groups or companies, such as those operated by the banks. The rumour that Abu Dhabi was ‘buying’ Dubai persisted until March 2009, when Sheikh Khalifa gave an interview to the Abu Dhabi newspaper Alrroya Aleqtisadia. The message could not be more explicit: Abu Dhabi did not buy Dubai companies. The president of the federation took advantage of the occasion to reiterate his confidence in the active recovery of the Emirati economy, but it was more likely that his aim in speaking to the press was to stop the rumour about the buyout of Dubai. Emirates Airline continued to attract the attention of the business media and community with regards to interference by Abu Dhabi. In line with its long-standing communication strategy, the government of Dubai created a marketing buzz on 21 May 2009, with the publication of the annual report of its airline. The Emirates Group announced excellent results in contrast to global depression: a net profit of $406 million (a decrease of 72 per cent compared with the previous year);

253,547 79.189 31.23 145.759 57.49

2009 286,049 81.543 28.51 174.525 61.02

2010

2011 347,354 89.736 25.83 230.543 66.38

* World Bank ** Dubai Statistics Center (2008 – 2012); ***City Bank **** SCAD

315,474 94.146 29.84 192.159 60.92

2008 372,313 90.913 24.41 247.707 66.53

2012

Contributions of Dubai and Abu Dhabi to the Emirati GDP, 2008 – 14 ($ billions)

UAE ($bn)* Dubai** ($bn) % UAE GDP Abu Dhabi ($bn)**** % UAE GDP

GDP

Table 10.3

402,340 90.670 97*** 22.53/24.11 253.712 63.06

2013

401,646 92.034 107*** 22.91/26.64 259.404 (e) 64.59

2014

AFTER THE DEPRESSION

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its turnover contributed to a fourth of the GDP of the emirate. Sheikh Ahmad Al Maktoum, president of the civil aviation in Dubai and general director of Emirates, foresaw the future with confidence.61 Nevertheless, regardless of Dubai’s attempts to portray itself as economically self-sufficient and selfreliant even in crisis, in the business circles some people still believe that Abu Dhabi (the government, a sovereign fund, etc.) acquired Emirates during the depression. Many indicators show that Abu Dhabi exercised greater control over its neighbour than it did prior to 2009. During the 2000s and prior to the crisis, the contribution of Dubai to the Emirati domestic product did not stop growing (Table 8.3). However, the crisis consolidated Abu Dhabi as the locomotive of the federation with almost 2/3 of the GDP contribution; Dubai reached cruising speed with 1/4. The structure of the GDP shows the predominant share of oil even with a barrel price around $50. The policy of diversification, implemented in Dubai, continued as well in the capital.62 Last but not least, the sovereign funds are a strong asset, even if their power is more elusive. The financial cushion that they represent allows Abu Dhabi not only to lead the federation but also be an active player abroad: land buying is the perfect illustration.63 On a symbolic level, Sheikh Khalifa and his brother, Sheikh Mohammad bin Zayed, crown prince of the emirate, restored Abu Dhabi’s status of capital. The techniques of branding that propelled Abu Dhabi to the forefront in the UAE also helped it to increase its international reputation. The inauguration of the tallest tower in the world might also mark a shift in the international exposure of the two cities abroad. The original name was indeed Burj Dubai, the tower of Dubai, particularly well-chosen to increase the spontaneous notoriety of the eponymous emirate. Burj Khalifa reversed the dynamic. Like the Petronas Twin Towers in Kuala Lumpur, the name does not evoke a destination (unlike Taipei 101 that took after Petronas). Choosing such a name over the name of the branded city may benefit the president of the federation or the Malaysian oil giant, but the structure and its symbolism is overshadowed by the ambiguity of the provincial affiliation. The leadership of Abu Dhabi will not alter the nature of the economic activity in the UAE. Sheikh Khalifa and his brother Sheikh Mohammed, the Al Nahyan crown prince, will keep on exploiting the immense resources of their emirate and diversifying the capital’s activity but at a slower pace than that of Dubai at the height of its acceleration. A certain complementarity exists between the two emirates, a benefit for the federation, which has the most diversified economy among the GCC states.64 Isolating the effects of the crisis in the UAE emphasises the effects on the local scale – and not on the transnational consequences of depression.

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THE UAE

Academic surveys, far from the sensational speculation, still do not show to what extent the crisis rocked the foundations of the country, if the damage was greater or lesser than in the other states of the region for instance. Before Dubai won the Expo 2020, the emirate was confident, attracting visitors, commerce and attention. In June 2012, The National, the main Englishlanguage newspaper, published an investigation without ambiguity: ‘The UAE: the land of opportunity for Europe’s struggling jobseekers’.65 The southern Europeans are looking eastwards to find job opportunities. It is yet too early to state that these migrations mirror a new trend. Nevertheless, the temporary effects of the crisis are entangled with the structural evolutions of the world economy. In this blurred evolution the UAE has had an enviable position, even if only in the short run. The durable decrease of oil prices since 2014 may represent a new threat though.

CONCLUSION THE UAE:A POLE OF STABILITY

What is in the forecast for Dubai and the UAE? As the emergence of Daesh and the civil war in Yemen remind us, unexpected or seemingly abrupt destabilisation of certain areas in the Middle East is not uncommon and the United Arab Emirates is not necessarily immune to mercurial developments at its periphery. The alchemy of the battle of wills between the states, the political as well as the religious forces and the differing populations should prompt caution. Nevertheless, conflict with Iran, perennially touted, appears very unlikely especially since the election of President Rouhani and the 14 July 2015 agreement, and while a regional war would negatively affect the southern rim of the Gulf, all things considered, the greatest danger that hangs over the federation is economic, such as the financial crisis of 2008–10 or the cyber-attacks on Emirati companies. More threatening for the Emirates are the low prices of oil, rather than the escalation of tensions in the Gulf. Notwithstanding the political uncertainty that characterises the Middle East, the UAE has been a pole of stability in the Peninsula since the 2000s and a mild-tempered neighbour for decades before. Many factors have led to the conciliation of tensions. In the first place, the Abu Dhabi oil reserve, 90 billion proven reserve barrels that will last a century given the actual production, buys time for the emirate of the capital. In the second place, successions do not cause open confrontations, at least for the two main emirates of the federation. Sheikh Mohammed bin Zayed Al Nahyan, crown prince of Abu Dhabi and of the federation, is a competent leader, respected in the Emirates and abroad. His brothers, Abdallah, minister of foreign affairs, and Hazza, national security advisor, have built a core group within the inner circles of the federal power. In Dubai, Sheikh Hamdan bin Mohammed Al Maktoum is the young crown prince of the emirate. The policies of his father will stand the test of time. Appointing the most competent Emiratis to key positions, like Anwar Gargash, minister of state for foreign affairs, or women, even against domestic resistance, is not an insignificant force in political Islam

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THE UAE

or security issues and therefore one of the greatest strengths of the federation. In the last place, one cannot but recognise that the overwhelming majority of Emiratis support their leaders. The acceptance of the system cannot be reduced to the appeasement of a populace in a welfare state, although the consumerist model which Dubai in particular has embraced has certainly empowered this form of appeasement. Still, the Emiratis, for whom the historical authority of tribal allegiance is still very much a commanding presence in their lives and in the making of their identities, feel at one with their local rulers and the representatives of the federation as well. Criticisms expressed in the Federal National Council, for instance, are more about the form rather than the content of the governance. In this regard, contradictory voices that have risen since 2011 are more the exception that proves the rule. Recent events, like the trial of the ‘94’ held in 2013, show that tensions do exist. Yet there is no social unrest like in neighbouring countries such as Bahrain. Emirati society as a whole is conservative. The bold policies defined by the Dubai and Abu Dhabi leaders have led to a reconsideration, adaptation and transformation of long held traditions as well as lifestyles. This dialectic of heritage and modernity has spawned extremely sensitive debates on immigration, intermarriage, and emiratisation. Acutely conscious of being a minority in their own country, Emirati society is torn between participation (in the form of emiratisation) and proprietorship. Against the current backdrop, foreigners are indispensable in maintaining the dynamic economy and the enticing image of the central city-states. Without taking too many risks, we can easily state that it will take one or two generations of Emiratis to take over the tasks required to sustain the status of Dubai and the federation. The price to pay will be high because it will impose a dose of meritocracy modelled on the Singapore pattern. The selection of the best skilled and the most willing to work for their income will inevitably impact the social contract that links the Emiratis to their rulers, thereby possibly challenging their authority. Authors like Christopher Davidson1 perceive the increasing tensions resulting from the whole range of responses that the Emirati government has implemented since 2012 – 13. Nonetheless, coming to the conclusion that the regime will collapse is arguable and the title of Davidson’s book, After the Sheiks: The Coming Collapse of the Gulf Monarchies, exceeds its content. However, like the other states in the region, the GCC governments are keeping a wary eye on the domestic issues. Possible Ultimately, Dubai has self-consciously appeared as a talisman of pride for the Arab world. The success of the city-state, and in its wake the federation, built on

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the nation branding strategy whose effects have created ripples across the world, has clearly given the Emirates a stature competitive with the Saudi kingdom, once considered the only imposing power of the Arab world, credibility as an economic and even cultural partner to the West, and an irreplaceable economic partner to the East. Dubai and Abu Dhabi henceforth exist in the landscape of globalisation. That the representations are right or wrong is secondary to the main objective: attract media attention and diversify commercial opportunities globally. That said, without being far from the truth, the image is globally positive. No wonder that young Europeans and job seekers from Mediterranean Europe have sought this culturally and economically viable hotspot: for a change, the media has celebrated a segment of the Arab world without referring to violence, terrorism or religious obscurantism. Dubai is a collective success of which the Arabs, Emiratis, and those of the Peninsula and beyond proudly speak. Not only did the Arabs of the generation of and after World War II suffer mistrust and discredit in international public opinion despite coming out from under the cloak of colonialism, but the current retort of extremist Islamic movements with Daesh at the forefront has sent the Arab world reeling in public opinion. By reversing the perspective, even if only on this limited geography, Dubai has attracted young and middle age professionals worldwide. All migrants, regardless of the country of origin, land in Dubai and Abu Dhabi with hope for a better life and, most of the time, with certitude that the realm of possibilities (other than permanent residency or citizenship, in contrast to the United States, for example) is unlimited in the UAE. This hope converges with the variety of messages that the communication campaigns have carried out. However, the main experience that the newcomer learns in the Emirates is precisely that everything is not possible. Tourists can afford to remain detached, unless they cross certain lines and are penalised for their indifference or naivete´. For the resident, the image of an Eldorado is rapidly blurred, transforming into a more complex reality. Dubai and Abu Dhabi provide opportunities in exchange for a personal contribution to the image and economy of the federation. These industrious cities do not tolerate idleness in the foreigner. Relatively high salaries and a chance to boost a career faster than in the West compensate for long hours and working conditions given to the employer’s discretion. Outside of the work, entertainment is controlled. The young professionals who relocate to jumpstart their career learn within a few months that the Emirati authorities do not tolerate the excesses of mass tourism: despite appearances and the unrelenting drive toward the pinnacle of a global economy, the Emirati authorities work unsparingly and unabashedly to hold on to the federation’s cultural and religious roots. Thus those who assimilate best are financially stable or welloff couples with young children. For them, the UAE is the perfect place with

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THE UAE

no equivalent in the world: exceptional infrastructures (fully equipped and protected high-end housing developments, parks, hospitals, schools, malls, recreational facilities, etc.), affordable domestic help on the model of the European servants of the nineteenth century, a family-friendly environment, and geographic accessibility to travel beyond the typical European destinations. All things considered, foreign employees who have renewed the initial contract period in the UAE have perfectly understood that they must trade the word ‘possible’ with ‘limits’, knowing full well that the status of guest denotes lines that cannot be crossed. Expo 2020 on the agenda 27 November 2013 was a milestone in the history of Dubai and of the Emirates. Competing with Izmir (Turkey), Yekaterinburg (Russia), and Sao Paulo (Brazil), Dubai won the contest on the third ballot against its Russian rival for hosting the world fair in 2020, commonly called Expo 2020. In many ways, the atmosphere prior to the announcement of the final result was reminiscent of autumn 2008, when the financial depression hit the Emirates. Detractors of Dubai expressed in advance their schadenfreude for the outcome of a competition that the city-state could not win – because of the bad publicity around the football world cup in Qatar, the debt of the emirate and the personal implication of Vladimir Putin in the competition to support Yekaterinburg. But the enthusiasm of the Emirati population overwhelmed the disgruntled people. Right after the final result, this enthusiasm metamorphosed into pride; somehow, international opinion acknowledged the endeavour of a transnational community without equivalent in the world. The rumour had spread a week before the final vote: Sheikh Mohammed bin Rashid Al Maktoum decreed the day following the outcome a holiday in the public sector and in schools. The victory of Dubai merged, then, with the celebration of National Day (on 2 December). A week of ‘national’ jubilation ensued. The organisation of the world fair immediately raised issues about the economic, social and logistical implications of Dubai’s win already tangible to the city’s residents. The Dubai stock market attained its best record in five years, even dating before the financial depression. The professionals of the sector feared a new real estate bubble. As a matter of fact, landlords took advantage of the Expo 2020, running to increase rents: 28.5 per cent since the beginning of 2013, the strongest increase in the world during this period.2 In addition, the development of infrastructures expected to host between 25 and 100 million visitors triggered a frenzy of projected construction, evoking the unprecedented years of growth in the mid-2000s. Additionally, in terms of daily life, the 24 hours a day, seven days a week activity is projected to cause

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massive traffic issues on the main motorway towards Abu Dhabi despite the creation of serious alternatives. Funding is also a central concern in hosting Expo 2020. With a total debt assessed at more than $100 billion by the IMF in 2015, the financial package can easily become an amorphous burden. A wide variety of figures is bandied about, some of which are possibly deliberately issued to serve particular interests. Nonetheless, the investment expenditures for the extension of the metro lines and the expansion of the new airport in Jebel Ali in the suburbs of Dubai towards the industrial Jebel Ali could exceed $20 billion. According to the IMF, either the Dubai authorities or the parastatal companies should pay back $85 billion before 2017.3 It sounds obvious that the emirate will call on federal solidarity, namely, Abu Dhabi’s goodwill, to honour commitments. Expo 2020 is not likely to sink Dubai in over-indebtedness. With a minimum of 25 million visitors, this six-month exhibition will continue to position Dubai as one the best destinations worldwide and the most important hub for business in the Middle East. Seen from that angle, the Expo is a logical stepping-stone in the development of Dubai. According to the current projections, economic activity will escalate in tourism and construction. Experts predict between 250,000 and 270,000 jobs will be created before the inauguration on 1 October 2020. The $20 billion of additional generated activity will give a 20 per cent impetus to the GDP of the emirate. The government of Dubai will excel in a field where it has proven itself before. It will use Expo 2020 to reinforce its image of a dynamic city, reflecting the most sought after aspects (or myths) of globalisation: modernity, progress, and economic growth. But to attract too much the attention of international media will generate issues similar to those discussed in 2006, such as the rights of migrant workers. A firewall has already been built, however, with the official announcement, on 27 November 2013, that all workers in Dubai will get a form of social insurance. In a similar vein, one of the most voracious consumers of energy in the world per capita (if not the most), has deliberately decided to turn ‘green’: Expo 2020 will comprehensively use the new clean technologies. The question: Where is Dubai/UAE going? may not be answerable at the moment. Nevertheless, it is certain that, first, the government of Dubai is preparing for a new golden age, which might even include a bid for the Olympic games, and, second, that Abu Dhabi is following a parallel, although different, path of ascent comprising long term economic, cultural and political security. In both cases, diversification is still the key to security and self-sufficiency; and political pliability and pacifism are equally central to the federal and local governments’ strategies as are the marketing strategies of the two city-states.

NOTES

Introduction

Invited to the Sultan’s Court

1. Margaret K. Nydell, Understanding Arabs: A Guide for Modern Times (Yarmouth, Nicholas Brealey Publishing, 2012), pp. 5 – 7 and 47– 8. 2. Michael Schindhelm, Dubai High: A Culture Trip (London, Arabian Publishing Ltd, 2011); Nabil Malek, Dubaı¨, la ranc
on du succe`s (Nantes, Amalthe´e, 2011). 3. Pardis Mahdavi, Gridlock: Labor, Migration, and Human Trafficking in Dubai (Palo Alto, Stanford University Press, 2011). 4. Syed Ali, Dubai: The Gilded Cage (New Haven, Yale University Press, 2010). 5. Ahmed Kanna, Dubai: The City as Corporation (Minneapolis, University of Minnesota Press, 2011). 6. Raymond Barrett, Dubai Dreams: Inside the Kingdom of Bling (Yarmouth, Nicholas Brealey Publishing, 2010). 7. Graeme H. Wilson, Rashid’s Legacy: Sheikh Rashid (Dubai, Media Prima, 2010). 8. Jim Krane, City of Gold: Dubai and the Dream of Capitalism (New York, St Martin’s Press, 2009). 9. Christopher Davidson, The United Arab Emirates: A Study in Survival (Boulder, Lynne Rienner Press, 2005); Dubai: The Vulnerability of Success (New York, Columbia University Press, 2008); Abu Dhabi: Oil and Beyond (New York, Columbia University Press, 2009). 10. Christopher Davidson, Persian Gulf and Pacific Asia: From Indifference to Interdependence (New York, Columbia University Press, 2010). 11. Christopher Davidson, After the Sheikhs: The Coming Collapse of the Gulf Monarchies (London, Hurst, 2012). 12. Karen E. Young, The Political Economy of Energy, Finance and Security in the United Arab Emirates. Between the Majilis and the Market (New York, PalgraveMacmillan, 2014). 13. Frauke Heard-Bey, From the Trucial States to United Arab Emirates (New York & London, Longman, 1982 edition, 2004). 14. Andrea B. Rugh, The Political Culture of the Leadership in the UAE (New York, Palgrave Macmillan, 2007, 2nd edition, 2010). 15. Wanda Krause, Women in Civil Society: The State, Islamism, and Networks in the UAE (New York, Palgrave Macmillan, 2008); Vania Carvalho Pinto, Nation-Building, State and the Genderframing of Women’s Rights in the United Arab Emirates (Reading, Ithaca Press, 2012).

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NOTES TO PAGES 4 –16

16. Sayyid H. Hurreiz, Folklore and Folklife in the United Arab Emirates (London, Routledge, 2002). 17. Pardis Mahdavi, Gridlock. 18. Neha Vora, Impossible Citizens: Dubai’s Indian Diaspora (Durham, Duke University Press, 2013). 19. Matt Duffy, Media Law in the UAE (New York, Kluwer Law International, 2014). 20. Ahmed Kanna, Dubai, the City as Corporation. 21. Kristian Coates Ulrichsen, Insecure Gulf: The End of Certainty and the Transition to the PostOil Era (New York, Columbia University Press, 2011); The Gulf States in International Political Economy (New York, Palgrave Macmillan, 2016).

Chapter 1 Branding Dubai. How Dubai became Dubai and the Emirates . . . the Emirates 1. Benedict R. Anderson, Imagined Communities: Reflections on the Origin and Spread of Nationalism (London & New York, Verso, 1983). 2. Simon Anholt, Competitive Identity: The New Brand Management for Nations, Cities and Regions (New York, Palgrave Macmillan, 2007); Places: Identity, Image and Reputation (New York, Palgrave Macmillan, 2009). 3. Raman Kapoor, ‘UAE’s tourism potential good, says expert’, Khaleej Times, 10 February 1982. 4. Abdulla Ali Al Saadi, General Manager of ADNHC, acknowledged it in an interview given to Fiona J., Emirates News, 22 September 1991. 5. Andrea Rugh, The Political Culture of the Leadership in the UAE (New York, Palgrave Macmillan, 2007, 2nd edition, 2010), p. 114. 6. Graeme H. Wilson, Rashid’s Legacy. The Genesis of the Maktoum Family and the History of Dubai (Dubai, Media Prima, 2006), pp. 478– 9. 7. Graeme H. Wilson, Emirates. The Airline of the Future (Dubai, Emirates Printing Press, 2005), p. 14 seq. 8. WAM, ‘UAE ranks first in quality of air transport infrastructure’, 27 May 2015. 9. CNN, ‘Money, Rise of the Emirates Empire’, 1 October 2005. 10. Cf. Tim Webb, ‘Emirates keeps flying high’, Guardian, 16 November 2008. 11. Emirates Group, Annual Report, 2008/2009, pp. 48– 9. 12. Graeme Wilson, Emirates., p. 116. 13. Ibid., p. 113. 14. Ibid. 15. Emirates Group, Annual Report 2011/2012, p. 9. 16. Emirates Group, Annual Report 2014/2015, p. 1. 17. Emirates Group, Annual Report 2007/2008, pp. 26– 7. 18. Graeme Wilson, Emirates, p. 234. 19. Emirates Group, Annual Report 2015/2016, p. 25. 20. C. Prasad, ‘Sport Events will Help Tourism’, Khaleej Times, 19 December 1988. 21. ‘Sporting edge to Dubai holiday’, Gulf News, 12 February 1995. 22. The official sponsoring on the site: http://www.emirates.com/ca/English/about/ sponsorships/sponsorships.aspx (accessed 20 June 2016). 23. Dan Boylan, ‘Sheikh Mohammed rides Dubai World Cup horse race to sell UAE image’, Washington Times, 30 March 2015. 24. ‘Emirates keen on sponsoring Fifa once corruption scandal is cleared up’ The National, 10 June 2015.

NOTES TO PAGES 16 –21

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25. There is a correlation between economic development and increase of air traffic. Dubai has become a benchmark case study. Mariya Ishutkina and R. John Hansman, Analysis of the Interaction between Air Transportation and Economic Activity: A Worldwide Perspective (PhD thesis, Massachusetts Institute of Technology, March 2009), pp. 168 – 72. 26. Graeme Wilson, Emirates, p. 232. 27. Kristian Coates Ulrichsen, The Gulf States in the International Political Economy (New York, Palgrave Macmillan, 2016), p. 152. 28. Nibal Kameira. ‘Higher Council should direct tourism for all emirates: Dr. Rabah’, Gulf News, 1 April 1983. 29. ‘Business and Tourism Development Board for Dubai’, Dubai Overlook, 1 June 1988. 30. ‘Government-baked authority body: A must’, Gulf News, 5 March 1988. 31. ‘DCTPB to promote trade and tourism’, Khaleej Times, 15 October 1989. 32. ‘Marketing Dubai to the world’, Dubai 90: Spreading Wings Across the Globe (London, EMAP Business Information). 33. Sudhakar Rao, ‘Dubai tourist board launches assault on negative publicity’, Gulf News, 20 September 1990. 34. ‘Need to project Dubai’s tourism further’, Gulf News, 2 October 1992. 35. ‘Dubai voted safest destination by leading travel magazine’, Khaleej Times, 12 October 2003. 36. Awad Mustafa, ‘UAE ranks 5th in world for order and security’, The National, 29 November 2012. 37. Emirates News, 1991. 38. DCTPB, ‘Dubai hotel guests soar by 170 per cent in ten years’, Dubai Travel & Tourism News, September 1993. 39. ‘Potential for the tourism industry in UAE’, Emirates Industrial Bank, 5:3 (March 1990). 40. Nihal Kaneira ‘Travellers target Dubai’, Gulf News, 25 November 1991. For a more recent development, cf. DTCM’s brief, 30 April 2008: ‘Dubai: Top destination in MICE [Meetings, Incentives, Conferences, and Exhibitions] Market’. The ministry pointed out 1 million, which are likely the overnight stays. 41. ‘DCTPB set to explore new markets’, Khaleej Times, 16 September 1993. 42. ‘DCTPB “slight shift in direction”’, Khaleej Times, 18 March 1995. 43. ‘Dubai Tourism Board opens office in US’, Khaleej Times, 20 November 1990. 44. ‘DCTPB opens office in London’, Emirates News, 3 August 1995. ‘Dubai promotion in France’, Emirates News, 22 September 1995. 45. ‘Dubai promotion campaign aims at new business’, Gulf News, 1 September 1991. 46. ‘DCTPB unveils new advertising campaign’, Emirates News, 8 December 1992. 47. ‘DCTPB strategy is a winner. Dubai tops table for holiday destination’, Gulf News, 10 December 1995. 48. ‘DCTPB made big progress in 95’, Khaleej Times, 9 January 1996. 49. ‘Dubai among leading tourist destinations: WTO report’ Khaleej Times, 6 March 2003. 50. Government of Dubai. Department of Tourism and Commerce Marketing. DTCM Brief (‘A monthly digest of government regulations and commerce and tourism news of the UAE and the neighboring countries’), 1 January 1997. 51. Destination Dubai [s.l.], December 1996. 52. ‘Tourism revenue set to equal oil income’, Khaleej Times, 10 June 1997. This stage was reached only in 2005 (19 per cent) and above in 2007 (30 per cent). 53. These hotel apartments supply similar services but allow the families to travel with their domestic helpers (to cook and look after the children). New landed managers may also rent these apartments, waiting for the apartment or a villa.

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54. Interview with Mohammed Khamis bin Hareb Al Muhalry, executive director of operations and marketing, Saifur Rhaman, ‘Promoting Dubai all over the world. Mohammed Khamis of the DTCM has played a key role in developing the emirates’s tourism potential’, Gulf News, 23 November 2002. 55. Cf. Martin Hvidt, ‘Public-private ties and their contribution to development: The case of Dubai’, Middle Eastern Studies, 43:4 (July 2007), pp. 557 – 75. 56. ‘Department of Economic Development: Development plan puts Dubai on course’, Gulf News, 1 November 2000. 57. The economic objectives of the plan underlined that in 2010 Dubai would have a GDP of $30 billion and a GDP per capita of $25,000. 58. ‘Dubai aims for another goal’, Gulf News 5 February 2007. The sectors concerned: economic development, social development, infrastructures, territory and environment, security, security and justice, excellence in public service. 59. ‘DTCM seeks big push for Dubai promotion. Future strategy under review at 10-day meeting’, Gulf Today, 12 September 2004. 60. WAM, ‘Mohammed bin Rashid creates Dubai Media Affairs Office “Brand Dubai”’, 12 June 2009. 61. ‘Emirate has broken stereotypes of the region. Tourism official: “Dubai had shattered myths’’’, Khaleej Times, 7 March 2001. 62. It was the subtitle of the 2002 commercial Discover Dubai. 63. ‘Dubai a center for heritage tourism’, Khaleej Times, 23 December 2001. 64. Marcus L. Stephenson, ‘Tourism, development and “destination Dubai”: cultural dilemmas and future challenges’, Current Issues in Tourism, 17:8 (2014), p. 730. 65. Cf. the interview of Patrick MacDonald in Emirates News, on 26 June 1991, for instance. 66. ‘Tourism industry . . . Palm Island plan’, Gulf News, 20 May 2001. 67. http://www.burjdubai.com/ official site (accessed 20 June 2016). 68. Christopher Davidson, The United Arab Emirates: A Study in Survival (Boulder, Lynne Rienner Press, 2005), p. 101. 69. Forbes magazine regularly publishes surveys on this issue. 70. ‘Building Dubai’s image’, UAE Interact, 16 January 2007. 71. See conclusion. 72. Robert Govers, ‘Brand Dubai and its competitors in the Middle East: An image and reputation analysis’, Place Branding and Public Diplomacy, 8 (2012), pp. 48 – 57. 73. Melodena Stephens Balakrishnan, ‘Dubai – a star in the east. A case study in strategic destination branding’, Journal of Place Management and Development, 1 (2008), pp. 62 – 91. 74. Ingo Forstenlechner, Emilie Rutledge and Rashed Salem Alnuaimi, ‘The UAE, the “Arab Spring” and different types of dissent’, Middle East Policy, 19:4 (Winter 2012), pp. 54 – 67. 75. WAM, ‘New Abu Dhabi brand identity unveiled’, 8 November 2007. 76. For a while, the branding strategy was accessible online but not any more. 77. WAM, ‘New Abu Dhabi brand identity unveiled’. 78. Mya Frazier ‘Abu Dhabi: A city rich in branding’, BrandChannel.Com, 10 November 2008. 79. Himendra Mohan Kumar ‘TDIC’s investment at Saadiyat Island stands at Dh10b’, Gulf News, 29 February 2008. 80. Li-Chen Sim, ‘Re-branding Abu Dhabi: From oil giant to energy titan’, Place Branding and Public Diplomacy, 8 (2012), pp. 83– 98. 81. WAM, ‘UAE signs statute establishing the International Renewable Energy Agency, IRENA’, 26 January 2009.

NOTES TO PAGES 29 –36

231

82. WAM, ‘Abdullah bin Zayed inaugurates International Renewable Energy Agency headquarters’, 3 June 2015. 83. Andrew Scott, ‘Abu Dhabi set fair after victory at Volvo Ocean Race’, The National, 23 June 2015. 84. Laura Collins, ‘Madonna gigs are music to Abu Dhabi’s ears’, The National, 27 May 2012. 85. Marie-Louise Olson, ‘Abu Dhabi to go on show in New York’s Times Square’, The National, 10 June 2012. 86. Robert Govers ‘Rethinking virtual and online place branding’, in M. Kavaratzis et al., Rethinking Place Branding (Cham, Springer, 2015), pp. 73 –84. 87. WAM, Mohammed Bin Rashid Al Maktoum ‘Why Ministers for Happiness, Tolerance, Youth and the Future?’, 27 February 2016.

Chapter 2 The Metamorphosis of a Traditional Society 1. Vincent Geisser, ‘L’autoritarisme des “domine´s”: un mode paradoxal de l’autoritarisme politique?’, Olivier Dabe`ne, Vincent Geisser and Gilles Massardier (eds), Autoritarisme de´mocratiques et de´mocraties autoritaires au XXIe sie`cle (Paris, La De´couverte, 2008), pp. 181 – 212. 2. Cf. my paper ‘A new way of thinking national and transnational: French geopolitics’, The Communicative Construction of Transnational Political Spaces and Times, 27 – 29 April 2007, Bielefeld. 3. Benedict R. Anderson, Imagined Communities: Reflections on the Origin and Spread of Nationalism (London & New York, Verso, 1983). 4. Frauke Heard-Bey, From the Trucial States to United Arab Emirates (New York & London, Longman, 1982, 2004 edition) and Aqil Kazim, The United Arab Emirates, AD 600 to the Present: A Socio-Discursive Transformation in the Arabian Gulf (Dubai, Gulf Book Centre, 2000). 5. James Onley, Britain and the Gulf Shaikhdoms, 1820– 1971: The Politics of Protection (Occasional Paper n8 4 Georgetown University School of Foreign Service in Qatar, 2009), p. 44. 6. Christopher Davidson, Dubai: The Vulnerability of Success (New York, Columbia University Press, 2008), pp. 880– 1. 7. Glen Balfour-Paul, ‘Britain’s informal empire in the Middle East’, The Oxford History of the British Empire. The Twentieth Century (Oxford, Oxford University Press, 1999), p. 512. 8. Jeffrey R. Macris, The Politics and Security of the Gulf. Anglo-American Hegemony and the Shaping of a Region (London & New York, Routledge, 2010), pp. 155 – 228. 9. Regarding the context, cf. William Gue´raiche, ‘De´colonisation des Emirats. Regards britanniques sur les luttes d’influence et les enjeux de pouvoir (1967 – 1971)’, De´colonisation, les hommes de la transition (Paris, L’Harmattan, 2014), pp. 114 – 28. 10. Frauke Heard-Bey, 1982, p. 341 seq. 11. Andrea B. Rugh, The Political Culture of the Leadership in the UAE (New York, Palgrave Macmillan, 2007, 2nd edition, 2012). 12. Robert Litwak, Security in the Persian Gulf 2: Sources of Interstate Conflicts (London, Gower International Institute for Strategic Studies, 1981), p. 56. 13. Frauke Heard-Bey, 1982, pp. 349, 352. 14. Joyce Miriam, ‘On the road towards unity: The Trucial States from a British perspective, 1960– 66, Middle Eastern Studies, 35:2 (April 1999), p. 45. 15. J.C. Wilkinson, ‘Traditional concepts of territory in South East Arabia’, Geographical Journal, 149:3 (November 1983), pp. 301– 15.

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16. J.E. Peterson, ‘Sovereignty and boundaries in the Gulf States. Settling the peripheries’, in Kamrava Mehran, International Politics of the Persian Gulf (Syracuse, Syracuse University Press, 2011), p. 23 seq. 17. Aqil Kazim, The United Arab Emirates, AD 600 to the Present, pp. 217 – 33; Fatma Al-Sayegh ‘The UAE and Oman: Opportunities and challenges in the twenty-first century’, Middle East Policy, 9:3 (September 2002), p. 124. 18. Frauke Heard-Bey, 1982, p. 341; Christopher Davidson, ‘Arab Nationalism and British opposition in Dubai, 1920– 66’, Middle Eastern Studies, 43:6 (November 2007), pp. 34 – 5. 19. Frauke Heard-Bey, 1982, p. 350. 20. On the occupied islands, cf. Chapter 5. 21. Richard Schofield, ‘The crystallisation of a complex territorial dispute: Britain and the Saudi-Abu Dhabi borderland, 1966– 71’, Journal of Arabian Studies: Arabia, the Gulf, and the Red Sea, 1:1 (2011), pp. 27– 51. 22. Noura Saber Al-Mazrouei, The UAE and Saudi Arabia: Border Disputes and International Relations in the Gulf (London, I.B.Tauris, 2016). 23. ‘N8 30250 Saudi Arabia and United Arab Emirates. Agreement on the Delimitations of Boundaries (with exchange of letters and map). Signed at Jeddah, Saudi Arabia, on 21 August 1974’, United Nations Treaty Series [s.l. New York?], 1993, pp. 9 – 35. 24. Cf. The articles by Simon Henderson, researcher at the Washington Institute for Near East Policy and notably ‘Map wars: The UAE reclaims lost territory from Saudi Arabia’, policy 1069, 19 January 2006, http://www.washingtoninstitute.org/policy-analysis/view/mapwars-the-uae-reclaims-lost-territory-from-saudi-arabia (accessed 20 June 2016). A similar document, Horinuki Koji ‘Borders and state structures in Gulf countries: Border issues between UAE/Iran and between UAE/Saudi Arabia’, International Relations, 162 (2010), pp. 56 – 69. 25. In an interview, Zaki Nusseibeh, Sheikh Zayed’s translator and adviser, explained that at the time of independence the sheikhs were not used to cooperation and that the mere idea was foreign to them. ‘Interpreter’s-eye view of a nation’s birth and growth’, Gulf News, 2 January 2009. 26. Christopher Davidson, The United Arab Emirates: A Study in Survival (Boulder, Lynne Rienner Press, 2005), p. 65. 27. Ibrahim Al Abed, ‘The historical background and constitutional basis to the Federation’, Ibrahim Al Abed and Peter Hellyer (eds), United Arab Emirates. A New Perspective (London, Trident Press, 2001), p. 134. 28. Adam Bouyamourn, ‘UAE federal budget not swayed by oil drop’, The National, 30 December 2014. 29. Andrea B. Rugh, 2007, pp. 31– 95. 30. Ibid., p. 51. 31. Christopher Davidson, Abu Dhabi: Oil and Beyond (New York, Columbia University Press, 2009), p. 232. 32. UAE Office of the Deputy Prime Minister for Information Affairs. Khalifa Building Future Generations (Abu Dhabi, Abu Dhabi Printing & Publishing Co., 2005), p. 37 seq. 33. Malcom Peck, ‘Formation and evolution of the Federation and its institutions’, in Ibrahim Al Abed and Peter Hellyer (eds), United Arab Emirates, p. 145 seq. 34. Organization of Arab Petroleum Exporting Countries. In 1967, Abu Dhabi became a member of OPEC and shared its seat with the other emirates in 1971. Inasmuch as oil was no major industry in the other emirates, there was little chance that an emirate would decide to enter one of these organisations. 35. Malcom Peck. ‘Formation and evolution of the Federation and its institutions’, p. 156.

NOTES TO PAGES 45 –50

233

36. William Gue´raiche, ‘The UAE and Iran: The different layers of a complex security issue’, Shahram Akbarzadeh and Dara Conduit Iran in the World. President Rouhani’s Foreign Policy (New York & London, Palgrave Macmillan 2016), pp. 65 –92. 37. Cf., for instance, the Millenium report of Kofi Annan, ‘We, the People’. The Role of the United Nations in the 21th Century (New York, UN Department of Public Information, 2000), pp. 13 – 16. 38. Louise Fawcett, International Relations of the Middle East (Oxford, Oxford University Press, 2005), pp. 135– 6. 39. Resolution 48/134 passed by the General Assembly of the United States on 20 December, 1993. The idea was to create a structure that reports to governments or parliaments in order to improve the situation of human rights in a particular country. 40. For a general perspective cf. the Emirati official report submitted in Geneva: The UAEMinistry of Foreign Affairs. The UAE National Report Presented in Accordance with Article 15 (a) of the Appendix to the Decision of the Human Rights Council 5/1, Abu Dhabi, 2008. See also the report of the Congressional Research Service (Library of Congress), Kenneth Katzman, The United Arab Emirates (UAE): Issues For U.S. Policy. CRS Report for Congress (Washington, July 2008). 41. 16 December in Abu Dhabi and Fujairah; the 18th in Dubai and Ras al Khaimah; the 20th in Sharjah, Ajman and Umm al Qaiwain. 42. Samir Salama. ‘Democracy to be taught from Grade One’, Gulf News, 5 December 2005. 43. WAM, ‘Symposium on ‘UAE National Day’, 27 November 2008. 44. Sunil K. Vaidya, ‘Democratisation is a gradual process’, Gulf News, 24 December 2008. 45. Najla Al Rostamani, ‘An election where every vote counts’, Gulf News, 20 September 2011. 46. Mentioned in the NEC report in March 2011. Olga Salem, ‘NEC reports helps with turnout poser’, The National, 6 March 2012. 47. Abdulfattah Yaghi and Osman Antwi-Boateng, ‘Determinants of UAE voters’ preferences for Federal National Council candidates’, Digest of Middle East Studies, 2:2 (Fall 2015), pp. 213 – 35. 48. WAM, ‘79,157 voters participated in Federal National Council Elections 2015, says Anwar Gargash’, 4 October 2015. 49. ‘Dubai candidate appeals FNC election vote count’, The National, 7 October 2015. 50. Committee on Human Rights National Academy of Sciences, Washington, NGO specialised in the defene of scientists and scholars victims of human rights violations summarised the case. http://sites.nationalacademies.org/PGA/humanrights/PGA_066190 (accessed 20 June 2016). 51. See William Gue´raiche, ‘Un peuple de migrants’, in William Gue´raiche (ed.), Philippines contemporaines (Bangkok-Paris, Irasec-Indes savantes, 2013), pp. 361 – 84. 52. WAM, ‘Abdullah bin Zayed takes part in IISS Manama Dialogue 2014, meets Bahraini Crown Prince’, 6 December 2014. 53. Anwar Gargash, ‘Amid challenges, UAE policy engages gradual reforms’, The National, 26 September 2011. 54. See the next chapter. 55. Reuters, ‘UAE extends crackdown on Islamists, 8 arrested’, 11 September 2012. 56. Mazhar al-Zo’by, Birol Bas¸kan ‘Discourse and oppositionality in the Arab Spring: The case of the Muslim Brotherhood in the UAE’, International Sociology (2014), p. 9. 57. Ola Salem, ‘Islah “does not represent UAE interests”’, The National, 5 October 2012. 58. The Guardian, likely because of its good reputation and the professionalism of its journalists on the Arab world, was regularly updated on the campaign. For the final and

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crucial episode of 27 October 2010, see Robert Booth, ‘Death of Gulf emirate ruler Sheikh Saqr prompts fight over succession’, Guardian, 27 October 2010.

Chapter 3

The Invention of Arab Muslim Liberalism

1. Martin Hvidt, ‘The Dubai Model: An outline of key development-process elements in Dubai’, International Journal of Middle East Studies, 41:3 (2009), pp. 397 – 418. 2. Jim Krane, City of Gold: Dubai and the Dream of Capitalism (St Martin’s Press, 2009), p. 368. 3. Ahmed Kanna, Dubai. The City as Corporation (Minneapolis, University of Minnesota Press, 2011), p. 296; Thorsten Botz-Bornstein, ‘A tale of two cities: Hong Kong and Dubai. Celebration of disappearance and the pretension of becoming’, Transcience, 3:2 (2012), pp. 6 – 11. 4. Ahmed Kanna 2011, pp. 35– 52. 5. See Beng Huat Chua, ‘Singapore as model’ and the final report of Aihwa Ong and Ananya Roy, Inter-Asian Connections, co-organised by the Social Science Research Council (SSRC) and the Dubai School of Government (DSG) 21– 3 February 2008, pp. 53, 58, available online: http://www.ssrc.org/workspace/uploads/docs/Dubai_ConfProcdgs_FINAL.pdf (accessed 20 June 2016). 6. Sean Foley, The Arab Gulf States. Beyond Oil and Islam (London, Lynne Rienner Publishers, 2010), p. 145. 7. WAM, ‘We want to be number one’, 30 December 30, 2011. 8. Andrea B. Rugh, The Political Culture of the Leadership in the UAE (New York, Palgrave Macmillan, 2007, 2nd edition, 2010), pp. 5 – 14. 9. Christopher Davidson, Abu Dhabi: Oil and Beyond (New York, Columbia University Press, 2009), p. 94. 10. Mina Wasseem, ‘United Arab Emirates trade policy review’, World Economy, 31:11 (November 2008), pp. 1443– 5. 11. UAE Ministry of Foreign Trade, Trade Policy Review, United Arab Emirates 2010. Update on the WTO Report 2006 (Abu Dhabi, 2010), p. 53. 12. Lubna bint Khalid Al Qasimi, Introduction, UAE Ministry 2010, non-paginated. 13. Gilbert Beauge´, ‘La kafala, un syste`me de gestion transitoire de la main-d’œuvre et du capital dans les pays du Golfe’, Revue europe´enne des migrations internationales, 2:1 (September 1986), p. 110. 14. Andrew Gardner, City of Strangers: Gulf Migration and the Indian Community in Bahrain (Ithaca, Cornell University Press), pp. 29, 58. 15. Abraham L. Udovitch, ‘Labor partnerships in early Islamic law’, Journal of the Economic and Social History of the Orient, 10:1 (July 1967), pp. 64–80. 16. Chantal Garnier (ed.), L’essentiel d’un marche´. Les Emirats Arabes Unis ([s.l.], Editions Ubifrance, 2010), pp. 136– 58 and Latham & Watkins LLP, Doing Business in the UAE, September 2011. http://www.lw.com/upload/pubcontent/_pdf/pub2783_1.pdf (accessed 20 June 2016). The following information comes from these two books. 17. Partnership companies, joint-ventures, shareholders companies, limited liability companies, subsidiaries and representation offices, law societies, commercial/sales agents. 18. Christopher Davidson, ‘Expatriates and the Gulf monarchies: Politics, security and the Arab Spring’, Asian Affairs, 45:2 (2014), p. 271. 19. Ali Hepsen, Metin Vatansever, ‘Relationship between residential property price index and macroeconomic indicators in Dubai housing market’, International Journal of Strategic Property Management, 16:1 (2012), p. 72.

NOTES TO PAGES 56 – 63

235

20. Helen Lackner, ‘Wasta: Is it such a bad thing? An anthropological perspective’, in Mohamed A. Ramady (ed.) The Political Economy of Wasta: Use and Abuse of Social Capital Networking (New York, Springer, 2016), pp. 33– 46. 21. Zena Al-Esia and Walter Skok, ‘Arab knowledge sharing in a multicultural workforce: A dual case study in the UAE’, Arabian Journal of Business and Management Review, 4:4 (2014), p. 2. 22. Robert B. Cunningham and Yasin K. Sarayrah, ‘Taming wasta to achieve development’, Arab Studies Quarterly, 16:3 (Summer 1994), p. 29. 23. Andy H. Barnett, Bruce Yandle and Georges Naufal, ‘Regulation, trust, and cronyism. Middle Eastern societies: The simple economics of “wasta’’, Journal of Socio-Economics, 44 (June 2013), p. 3. 24. Christopher Davidson, Abu Dhabi: Oil and Beyond, pp. 94 –121. 25. Ahmed Mustafa and Mansour Elhussein, ‘The impact of privatization on the United Arab Emirates (UAE) federal public sector’, International Public Management Review, 9:2 (2008), pp. 66 – 89. 26. WAM, Mohammed Bin Rashid Al Maktoum ‘Why Ministers for Happiness, Tolerance, Youth and the Future?’, 27 February 2016. 27. Al Nahyan bin Moubarak, ‘Tolerance and enterprise’, Global Emirates. An Anthology of Tolerance and Enterprise (Dubai, Motivate Publishing, 2009), p. 24. 28. Feisal Khan, ‘How “Islamic” is Islamic banking?’, Journal of Economic Behavior & Organization, 76:3 (December 2010), pp. 805– 20. 29. Ahmed El-Ashker and Rodney Wilson, Islamic Economics. A Short History (Boston, Brill Academic Publishers, 2006), p. 336. 30. Ende, Werner Steinbach, Udo, Islam in the World Today: A Handbook of Politics, Religion, Culture, and Society (Ithaca, Cornell University Press, 2011), pp. 183 – 4. 31. Charles Tripp, Islam and the Moral Economy. The Challenge of Capitalism (Cambridge, Cambridge University Press, 2006), pp. 137– 8, 147. 32. Mahmoud A. El-Gamal, Islamic Finance. Law Economics and Practice (Cambridge, Cambridge University press, 2006), pp. 97– 8. 33. Hadeel al Sayegh and Gregor Stuart Hunter, ‘Standstill reached on Dana Gas sukuk’, The National, 31 October 2012. 34. Reuters, Andrew Torchia, ‘Dubai plans new sukuk channels as listings top other centres’, 9 July 2015, and following data. 35. ‘The UAE Islamic banking sector is en route to achieve $263b by 2019’, Islamic Business & Finance, 30 May 2015. 36. ‘Friday-Saturday weekend in UAE from September’, Gulf News, 14 May 2006. 37. Musab Ahmad Alatiyat, Ramadan Effect on UAE Stock Market-Banks Category (Paper of The British University in Dubai, June 2014), p. 16. 38. Shafaat Shahbandari, ‘Reduced work hours in UAE for Ramadan’, Gulf News, 12 July 2012. 39. Mazhar al-Zo’by and Birol Bas¸kan, ‘Discourse and oppositionality in the Arab Spring: The case of the Muslim Brotherhood in the UAE’, International Sociology (December 2014). 40. Cf. Chapter 2, the ‘94’ court case. 41. ‘Israeli tennis player given visa for Dubai tourney’, New York Times, 19 February 2009. 42. WAM, ‘Egyptian Coptic Church: UAE under Khalifa’s leadership is leading the march of religious enlightenment’, 29 June 2015. 43. See the chapter Asian Tropism. 44. Martin Hvidt, ‘The Dubai model’, pp. 399– 401. 45. Martin Hvidt, ‘Public-private ties and their contribution to development: The case of Dubai’, Middle Eastern Studies 43–4 (July 2007), pp. 557, 567 seq.

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46. Vimi Jham, Anupam Mehta and Eric Van Genderen, ‘Al Ghurair group: A crossroads in corporate strategy’, Middle East Journal of Business, 10:2 (April 2015), pp. 38 – 45. 47. Frauke Heard-Bey, From the Trucial States to United Arab Emirates (New York & London, Longman, 1982, 2004 edition), p. 114. 48. Christopher Davidson, The United Arab Emirates: A Study in Survival (Boulder, Lynne Rienner Press, 2005), p. 333 and Christopher Davidson, Abu Dhabi: Oil and Beyond. 49. Christopher Davidson, Abu Dhabi: Oil and Beyond, pp. 102 –104. 50. Ibid., pp. 99 – 134. 51. Available online: https://www.vision2021.ae/en (accessed 20 June 2016). 52. http://www.sclgme.org/Dubai%20Strategic%20Plan%20-%20English.pdf (accessed 20 June 2016). 53. See Introduction, Chapter 10. 54. Ratna Vadra, ‘Knowledge-based development and knowledge-based economy – a case study of Dubai’, International Journal of Arab Culture, Management and Sustainable Development, 2 – 3 (2012), pp. 121– 30. 55. Jamal S. Al-Suwaidi, ‘Introduction’, The Emirates Center for Strategic Studies and Research, Human Resource Development in a Knowledge-Based Economy (Abu Dhabi, ECSSR, 2003), p. 3. 56. Thomas A. Kochan, ‘Government policies for a knowledge-based economy’, ECSSR 2003, pp. 117 – 45. 57. Ahmed El-Ashker and Rodney Wilson, Islamic Economics. A Short History (Boston, Brill Academic Publishers, 2006), p. 240. 58. William Gue´raiche, ‘L’enseignement supe´rieur aux EAU, entre e´miratisation et contraintes du marche´’, Revue de la Me´diterrane´e et des Monde Musulmans, 13 (July 2012), pp. 187 – 203. 59. William Gue´raiche, ‘De´colonisation des Emirats. Regards britanniques sur les luttes d’influence et les enjeux de pouvoir (1967– 1971)’, De´colonisation, les hommes de la transition (Paris, L’Harmattan, 2014), pp. 114– 28. 60. Christopher Davidson, ‘The Emirates of Abu Dhabi and Dubai: Contrasting roles in the international system’, Asian Affairs, XXXVIII/I (March 2007), p. 45. 61. Christopher Davidson, Abu Dhabi: Oil and Beyond, p. 288. 62. Reem Al Hashimi, state minister, was questioned on this issue by the Federal National Council, cf. Ola Salem, ‘Head of statistics bureau quizzed by FNC on missing data’, The National, 12 December 2012. 63. Kamco Research UAE 2011, pp. 12– 13. 64. John Issac, ‘Trade, tourism spur Dubai GDP growth’, Khaleej Times, 30 May 2012. 65. SCAD, Statistical Yearbook of Abu Dhabi 2014 (Abu Dhabi, SCAD, 2014), p. 16. 66. Sherine El Hag, Mona El Shazly, ‘Oil dependency, export, diversification and economic growth in the Arab Gulf States’, European Journal of Social Sciences, 29:3 (2012), pp. 403– 404.

Part II

What Place on the World Map?

1. Abdul-Monem Al-Mashat, ‘Politics of constructive engagement: The foreign policy of the United Arab Emirates’, Korany, Bahgat Dessouki, Ali E. Hillal, Foreign Policies of Arab States: The Challenge of Globalization (Cairo, American University in Cairo Press, 2008), p. 464 seq.

NOTES TO PAGES 76 –86

Chapter 4

237

Agent of Globalisation

1. Cf. my analysis ‘Dubai, temps et espace’ in Manufacturing and inhabiting cities in the global era, Annaba (Algeria), 20– 2 April 2015, forthcoming. 2. Christopher Davidson, Abu Dhabi: Oil and Beyond (New York, Columbia University Press, 2009), p. 92 and Stephen J. Ramos, Dubai Amplified: The Engineering of a Port Geography (Farnham, Ashgate, 2010), pp. 69 seq. 3. Stephen Ramos, Dubai Amplified, pp. 96– 100. 4. Bashar H. Malkawi, ‘Balancing open investment with national security: Review of US and UAE laws with DP World as a case study’, The University of Notre Dame Australia Law Review, 13 (2011), pp. 153– 91. 5. See the excellent article of Thomas Friedman, one of the best specialists of the Arab World in the United States, ‘Port Controversy could widen racial chasm’, Washington Post, 25 February 2006. 6. WAM, ‘DP World celebrates listing of US$500 million bond on Nasdaq Dubai’, 22 June 2015. 7. WAM, ‘UAE on top of the world’, 20 February 2015. 8. http://www.etihad.com/en-us/about-us/etihad-news/archive/2015/etihad-airways-rep orts-strong-performance-in-2014/ (accessed 21 June 2016). 9. For a regional approach, see Kristian Coates Ulrichsen, ‘Global aviation and the Gulf’, in Insecure Gulf: The End of Certainty and the Transition to the Post-Oil Era (New York, Columbia University Press, 2011), pp. 151– 65. 10. Chantal Garnier (ed.), L’essentiel d’un marche´. Les Emirats Arabes Unis ([s.l.] Editions Ubifrance, 2010), p. 147. 11. For information on the Emirati free zones see: http://www.uaefreezones.com/ (accessed 21 June 2016). 12. Kishore Rao, ‘Free zones in the Middle East: Development patterns and future potential’, Bernard M. Hoekma and Hanaa Kheir-El-Din (eds), Trade Policy Developments in the Middle East and North Africa, Volume 763 (Washington, World Bank, 2000), pp. 247 – 51. 13. Robert G. Picard and Leon Barkho, ‘Dubai Media City: Creating benefits from foreign media developments’, in Charlie Karlsson and Robert G. Picard, Media Clusters: Spatial Agglomeration and Content Capabilities (Cheltenham, Edward Elgar Publishing, 2011), pp. 281 – 305. 14. Geodesic data of the capital. 15. Saskia Sassen, The Global City: New York, London, Tokyo (Princeton, Princeton University Press, 2001), p. 449. 16. Ahmed Kanna, ‘The “State Philosophical” in the “Land without Philosophy”: Shopping malls, interior cities, and the image of Utopia in Dubai, Traditional Dwellings and Settlements Review, 16:2 (2005), pp. 64– 7. 17. Jennifer Bell, ‘DSF 2016 revenues may top Dh 600m’, Khaleej Times, 3 January, 2016. 18. Abdul-Monem al-Mashat, ‘Politics of constructive engagement: The foreign policy of the United Arab Emirates’, Korany, Bahgat Dessouki, Ali E. Hillal, Foreign Policies of Arab States: The Challenge of Globalization (Cairo, American University of Cairo Press, 2008), p. 464. 19. Abdolhossein Ansari, Batoul Modarress and Emil Thies, ‘The impact of technology transfer through foreign direct investment in developing nations: A case study in the United Arab Emirates’, International Journal of Economics and Finance, 6:7 (2014), pp. 108 – 26.

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20. Haico Ebbers and Tim Rodman, ‘The determinants of foreign direct investment in the Middle East North Africa region’, International Journal of Emerging Markets, Vol. 8 – 3 (2013), pp. 240– 57. 21. Abdolhossein Ansari 2014, pp. 113, 122. 22. Foreign Trade 2014, National Bureau of Statistics. 23. SCAD, Abu Dhabi Statistical Yearbook 2013 (Abu Dhabi, SCAD, 2013), p. 36. 24. On 5 July 2008, a British couple was arrested after having had sexual intercourse on a public beach; in May 2011, an English surgeon risked being placed behind bars by making an obscene gesture on the motorway; in May 2012, a British couple was incarcerated after having had sexual relations in a taxi. Only British individuals were incriminated in these affairs. 25. William Gue´raiche, ‘L’enseignement supe´rieur aux EAU, entre e´miratisation et contraintes du marche´’, Revue de la Me´diterrane´e et des Monde Musulmans, 131 (July 2012), pp. 187– 203. 26. Ayman Safadi, ‘United Arab Emirates. Easy money’, in John Kampfner, Freedom for Sale: Why the World is Trading Democracy for Security (New York, Basic Books, 2010), pp. 123 –4. 27. Nadim Hasbani, Ge´opolitique des achats d’armements aux Emirats arabes unis. La politique de de´fense d’Abou-Dhabi face a` l’Iran (Saarbru¨cken, Presses Acade´miques Francophones, 2014), pp. 109 – 10. 28. Ibid., p. 118. 29. Nadim Hasbani, ‘France-Emirats: des relations militaires strate´giques?’, Moyen-Orient (December 2009– January 2010). 30. Christopher Davidson, The United Arab Emirates: A Study in Survival (Boulder, Lynne Rienner Press, 2005), p. 333. 31. Khalid S. Almezaini, The UAE and Foreign Policy (New York, Routledge, 2012), pp. 41 – 3. 32. Christopher Davidson, ‘Arab Nationalism and British opposition in Dubai, 1920– 66’, Middle Eastern Studies, 43:6 (2007), pp. 879– 92. 33. Nadim Hasbani 2014, p. 82 seq. 34. Phebe Marr, ‘US strategy towards the Persian Gulf: From rogue states to failed states’, Kaim Markus (ed.), Great Powers and Regional Orders: The United States and the Persian Gulf (Abingdon, Ashgate, 2008), p. 18. 35. Khalid S. Almezaini, The UAE and Foreign Policy, p. 43. 36. Gregory Harms, Straight Power Concepts in the Middle East: US Foreign Policy, Israel and the World History (London: Pluto Press, 2010), p. 61. 37. Kenneth Katzman, The United Arab Emirates (UAE): Issues for US policy (Washington, CRS Report For Congress, 2008), p. 3. 38. The Center for Peace in Stockholm has complained about the lack of transparency regarding the military budget. 39. Karim Sadjadpour, The Battle of Dubai. The United Arab Emirates and the U.S.-Iran Cold War (Washington, Carnegie Endowment for International Peace Publications Department, 2011), p. 16. 40. See the previous chapter. 41. Kenneth Katzman, The UAE and Foreign Policy, p. 6. 42. John Issac, ‘Blow to UAE-US FTA hopes’, Khaleej Times, 1 July 2007. 43. Tom Arnold, ‘Americans want to boost trade’, The National, 25 October 2011. 44. See Chapter 7. 45. Karim Sadjadpour, The Battle of Dubai, p. 20. 46. Private company that publishes Sovereign Wealth Quaterly. It supplied the following information from its site http://www.swfinstitute.org/ (accessed 21 June 2016).

NOTES TO PAGES 92 –97

239

47. Mehmet Asutay, ‘GCC SWFs and their role in the European and American markets’, Equilibri, 12:3 (December 2008), p. 337. 48. Le SWF institute uses an index, from 1 to 10, to assess the transparency of the agencies. Cf. http://www.swfinstitute.org/statistics-research/linaburg-maduell-transparency-index/ (accessed 21 June 2016). Mubadala was awarded 10, IPIC 9. 49. See Chapter 8 on Dependences. 50. Mark Thatcher, Western Policies towards Sovereign Wealth Fund Equity Investments: A Comparison of the UK, the EU and the US (London, LSE Policy Brief n8 01, 2011), p. 4. 51. Daniel Haberly, ‘Strategic sovereign wealth fund investment and the new alliance capitalism: A network mapping investigation’, Environment and Planning (2011), pp. 7–13. 52. Walid Ben Hamida, ‘Sovereign FDI and international investment agreements: Questions relating to the qualification of sovereign entities and the admission of their investments under investment agreements’, The Law and Practice of International Courts and Tribunals, 9 (2010), pp. 18– 19. 53. Achmed Al-Shahrabani and Kito de Boer, ‘Modernising the United Arab Emirates: An interview with Minister Lubna Al Qasimi’, McKinsey Quartely (February 2007), p. 91. 54. http://www.vision2021.ae/en/national-priority-areas/safe-public-and-fair-judiciary (accessed 21 June 2016). 55. Robert Shelala collected the data in a table: ‘UAE military strength in 2013’, Antony H. Cordesman, Robert M. Shelala and Omar Mohamed, The Gulf Military Balance. Volume III: The Gulf and the Arabian Peninsula (Lanham, New York, Toronto, Plymouth, Rowman & Littlefield, 2014), p. 190. 56. Sean Foley, ‘What wealth cannot buy: UAE security at the turn of the twenty-first entury’, in Barry Rubin (ed.), Crisis in the Contemporary Persian Gulf, London-Portland (Frank Cass, 2002), pp. 52 – 9. 57. Mark Mazzetti and Emily B. Hager, ‘Secret desert force set up by Blackwater’s founder’, New York Times, 14 May 2011. 58. Nadim Hasbani, Ge´opolitique des achats d’armements aux Emirats arabes unis, pp. 64 – 7. 59. Ola Salem, ‘UAE Cabinet introduces mandatory military service for all Emirati males’, The National, 19 January 2014. 60. ‘Al Badi promises to further improve security apparatus’, Khaleej Times, 13 April 1997. 61. John Daugman and Imad Malhas, ‘Iris recognition border-crossing system in the UAE’, International Airport Review, 2 (2004). 62. See William Gue´raiche, ‘Security and securitisation in the UAE’, Le Banquet, forthcoming 2017. 63. Abdulla Al Neaimi, Tago Ranginya and Philip Lutaaya, ‘A framework for effectiveness of cyber-security defenses. A case of the United Arab Emirates (UAE)’, International Journal of Cyber-Security and Digital Forensics, 4 – 1 (2015), pp. 290 – 301. 64. Shazia Mehmoods Khan, ‘UAE defence strategy’, Defence Journal, 18 – 5 (December 2014), pp. 39 – 42. 65. Shadi Mokhtari, ‘The Middle East and human rights: Inroads towards charting its own path’, Northwestern Journal of International Human Rights (2012), p. 195. 66. Mohamed A. Al Roken, ‘Human rights under the Constitution of the United Arab Emirates: Guarantees and restrictions’, Arab Law Quarterly, 12 – 1 (1997), pp. 94 – 5, 101. 67. Human Rights Watch, Building Towers, Cheating Workers, Exploitation of Migrant Construction Workers in the United Arab Emirates (New York, HRW, 2006), p. 71. 68. David Keane and Nicholas McGeehan, ‘Enforcing migrant workers’ rights in the United Arab Emirates’, International Journal on Minority and Group Rights, 15 (2008), pp. 114 – 15.

240

NOTES TO PAGES 99 –105

Chapter 5 Persian Janus 1. WAM, ‘Khalifa congratulates Iranian President on nuclear agreement’, 14 July 2015. 2. SPA, ‘Official source on nuclear deal between Iran and the P5þ 1 Group’, 14 July 2015. 3. AFP, ‘Saudi hopes Iran ends “interference” after nuclear deal’, 14 July 2015. 4. WAM, ‘Iran nuclear deal to turn new page for regional ties, says UAE source’, 14 July 2015. 5. Andrea B. Rugh, The Political Culture of the Leadership in the UAE (New York, Palgrave Macmillan, 2007, 2nd edition, 2010), p. 125. 6. Ghouam Ali Haddad Adel, ‘The image of the Arabs in Iranian schoolbooks’, in Khair el-Din Haseeb (ed.), Arab-Iranian Relations (Beirut, Center for Arab Unity Studies, 2008), pp. 145 – 51. 7. Talal Atrissi, ‘Arab and Iranian images of each other’, in Tahar Labid (ed.), Imagining the Arab Other: How Arabs and Non-Arabs View Each Other (London, New York, I.B.Tauris, 2008), p. 317. 8. Ibid. 9. See Chapter 10. 10. Thomas R. Mattair, The Three Occupied UAE Islands. The Tunbs and Abu Musa (Abu Dhabi, ECSSR, 2005), pp. 212–32. 11. Anwar Gargash, ‘Iran, the GCC States, and the UAE: Prospects and challenges in the coming decade’, in Jamal S. al-Suwaidi (ed.), Iran and the Gulf. A Search for Stability (Abu Dhabi, ECSSR, 2002), p. 151. 12. Thomas R. Mattair, The Three Occupied UAE Islands, pp. 132 – 5. 13. Ibid., pp. 135 – 40. 14. Heard-Bey, Frauke From the Trucial States to United Arab Emirates (New York, London, Longman, 1982, 2004 edition), pp. 68– 70, 82– 5. 15. Thomas R. Mattair, The Three Occupied UAE Islands, p. 8. 16. Ibid., pp. 34 – 123. 17. Hooshang Amirahmadi, ‘The olonial-political dimension of the Iran-UAE dispute’, in Hooshang Amirahmadi (ed.), Small Islands, Big Politics. The Tonbs and Abu Musa in the Persian Gulf (London, New York, Palgrave Macmillan, 1996), pp. 4 – 5. 18. Antony H. Cordesman, ‘Threats and non-threats from Iran’, in Jamal S. al-Suwaidi (ed.). Iran and the Gulf. A Search for Stability (Abu Dhabi, The Emirates Center for Strategic Research, 2002), pp. 211– 86. 19. Emirates News, 23 May 1993, WAM, ‘UAE, Iran Open Talks’. 20. ‘New hope for stable ties with Iran’, Khaleej Times, 5 August 1997. 21. Thomas R. Mattair, Iran and the Gulf, pp. 124– 51. 22. Peter W. Wilson and Douglas F. Graham, Saudi Arabia. The Coming Storm (Armonk, M.E. Sharp, 1994), pp. 119– 20. 23. Fatemeh Shayan, ‘Geopolitical subjectivity in Iran-GCC relations: The Three Islands issue since 1979’, Geopolitics, 18– 3 (2013), p. 639. 24. Respectively $144 and $525 million for the first 9 months of the year. ‘Iran seeks Dubai investment’, Khaleej Times, 15 November 1993. 25. ‘Iran Dubai’s top re-export destination’, Emirates News, 15 February 1994. 26. ‘Iran offers to become UAE’s launching pad’, Emirates News, 19 November 1993. 27. Agis Salpukas, ‘Iran signs oil deal with Conoco; First since 1980 with U.S.’, New York Times, 7 March 1995. 28. ‘Iranian gas from Sirri’, APS Review Gas Market Trends, 17 June 2002.

NOTES TO PAGES 105 –113

241

29. ‘UAE, Iranian Delegation meet. Iranians, government officials look forward to improved relations between two countries’, Gulf News, 30 August 2001. 30. ‘UAE, Iran plan to sign deal’, Gulf News, 13 June 2002. 31. ‘UAE, Iran will work together to crack down on smuggling’, Khaleej Times, 29 January 2006. 32. ‘UAE for broader ties’, Iran Daily, 8 May 2005. 33. ‘Iran wants aid against smuggling’, Gulf News, 13 December 2004. 34. ‘UAE, Iran will work together to crack down on smuggling’, Khaleej Times, 29 December 2006. 35. ‘Iranian Investors Pump dh 730b into UAE ventures’, Gulf News, 20 August 2005. 36. Azadeh Kian-Thie´baut, ‘Mahmoud Amahdinejad, la ce´sure’, Outre-Terre, 16 (2006), p. 53. 37. ‘UAE concerned over Iran’s nuclear capabilities, says Mohammed. Iran’s programme poses a threat to countries in the Gulf’, Gulf News, 22 January 2006. 38. ‘Iran yet to provide details on detained UAE men’, Gulf News, 2 March 2006. The crew was finally released on 21 March. 39. ‘UAE Government believes Iran’s nuclear programme is peaceful’, Khaleej Times, 11 September 2006. 40. ‘No US Office in UAE to monitor Iran, says Abdullah’, Khaleej Times, 10 January 2007. ‘Matter is just a misunderstanding, says Foreign Minister on trip to Teheran’, Khaleej Times, 11 January 2007. 41. ‘Iranian Govt to relax rules to ease trade with the UAE’, Khaleej Times, 24 June 2007. 42. ‘UAE-Iran ties at new high’, Gulf News, 30 October 2008. 43. Kambiz Foroohar, ‘Dubai helps Iran evade sanctions as smugglers ignore U.S. laws’, Bloomberg, 25 January 2010. Available online (not on Bloomberg’s site) http://www. iranfocus.com/en/index.php?option¼ com_content&view ¼ article&id ¼ 19568:dubaihelps-iran-evade-sanctions-as-smugglers-ignore-us-laws&catid ¼ 4&Itemid ¼ 109 (accessed 21 June 2016). 44. ‘US says Iran could misuse UAE’s banking system’, Gulf News, 29 February 2008. 45. ‘Iran will not deliver gas to UAE until contract price is corrected’, Gulf News, 26 April 2009. 46. ‘No tension with UAE, says Iranian President’, The National, 25 September 2008. 47. ‘War of words not justified – Gargash attacks Iran’s handling of grievances’, Gulf News, 1 February 2009. 48. Christopher Davidson, Dubai: The Vulnerability of Success (New York, Columbia University Press, 2008), pp. 74– 6. 49. Vali Nasr, The Shia Revival. How Conflicts within Islam Will Shape the Future (New York, London, Norton, 2006), p. 109. 50. Kristian Coates-Ulrichsen, Insecure Gulf: The End of Certainty and the Transition to the PostOil Era (New York, Columbia University Press, 2011), pp. 47 – 8. 51. Stephanie Cronin and Nur Masalha ‘The Islamic Republic of Iran and the GCC states: Revolution to realpolitik?’ (Kuwait Programme on Development, Governance and Globalisation in the Gulf States-London School of Economics, n8 17, August 2011), pp. 30 – 1. 52. Timothy J. Lynch, review article. ‘Obama and the third Bush term: Towards a typology of Obama studies’, International Affairs, 88– 5 (2012), pp. 1101–11. 53. James Mann, The Obamians: The Struggle inside the White House to Redefine American Power (New York, Viking, 2012), pp. 335– 6. 54. Reuters, ‘US urges vigilance against Iranian banks in Dubai’, 20 November 2008. 55. Tim Brooks, ‘Iranian ambassador feted for work in improving ties with UAE’, The National, 29 August 2009.

242

NOTES TO PAGES 113 –117

56. Joseph A. Christoff, Iran Sanctions: Complete and Timely Licensing Data Needed to Strengthen Enforcement of Export Restrictions (Washington, United States Government Accountability Office, GAO), March 2008, p. 16. 57. The resolution: http://usuaebusiness.org/wp-content/uploads/2012/06/bermanresol.pdf (accessed 21 June 2016). 58. Ki-Chan Park and Franc
oise Chevalier, ‘The winning strategy of the late-comer: How Korea was awarded the UAE nuclear power contract’, International Review of Business Research Papers, 6 – 2 (2010), p. 225. 59. Jumana Al Tamaimi, ‘Sanctions to have limited impact on Iranian lenders’, Gulf News, 17 June 2010. 60. Press conference given in Basel (Switzerland) on 28 June 2010. ‘Iranian trade with UAE hurt by sanctions’, Gulf News, 29 June 2010. 61. WAM, ‘Levey: Implementation of Iran sanctions not just Middle East effort’, 16 June 2010. 62. Himendra Mohan Kumar, ‘Iran sanctions implemented’, Gulf News, 5 October 2010. 63. Nader Habibi, ‘The impact of sanctions on Iran-GCC economic relations’ (Middle East Brief, Brandeis University Crown Center for Middle Eastern Studies, November 2010), p. 10. 64. Arno Maierbrugger, ‘Call to ease trade with Iran’, Gulf News, 9 November 2010. 65. Daniel Dombey and David Blair, ‘US and EU step up Iran nuclear sanctions drive’, Financial Times, 24 May 2011. 66. Tom Arnold, ‘EU sanctions may further choke local business with Iran’, The National, 26 September 2012. 67. Zaher Bitar, ‘Dubai-Iran trade grows in goods exempt from UN sanctions’, Gulf News, 21 August 2011. 68. Nader Habibi, ‘The impact of sanctions on Iran-GCC economic relations’, pp. 9 – 10. 69. Simeon Kerr, ‘US sanctions finally bite on Dubai’s trade with Iran’, Financial Times, 26 March 2013. 70. Caline Malek, ‘Kerry: UAE has paid a price for Iran sanctions’, The National, 11 November 2013. 71. William Gue´raiche, ‘The UAE and Iran: The different layers of a complex security issue’, Shahram Akbarzadeh and Dara Conduit, Iran in the World: President Rouhani’s Foreign Policy (New York, Palgrave Macmillan, 2016), pp. 65– 92. 72. Cf. next chapter on the role of the joint committees in the Emirati diplomacy. 73. The full interview: http://www.bbc.com/news/world-middle-east-25751968 (accessed 21 June 2016). 74. The official statement: http://www.treasury.gov/press-center/press-releases/Pages/jl2280. aspx (accessed 21 June 2016). 75. WAM, ‘H.H. Sheikh Abdullah bin Zayed and Iranian Foreign Minister discuss ties of cooperation and friendship’, 15 April 2014. 76. For further development on this issue, see Chapter 10. 77. ‘The outstretched palm. Abu Dhabi bails out its neighbour. What will it ask in return?’, The Economist, 26 February 2009. 78. Fatemeh Shayan, ‘Geopolitical subjectivity in Iran-GCC relations’, p. 645 seq. 79. Abdul-Monem al-Mashat, ‘Politics of constructive engagement: The foreign policy of the United Arab Emirates’, in Korany, Bahgat Dessouki, Ali E. Hillal, Foreign Policies of Arab States: The Challenge of Globalization (Cairo, American University of Cairo Press, 2008), p. 464 seq.

NOTES TO PAGES 119 –126

243

Chapter 6 Arab Fraternities 1. ‘Gulf Summit Today’, Khaleej Times, 25 May 1981. Six-page special issue. 2. ‘Joint projects bring brotherly Gulf countries closer’, Emirates News, 22 May 1981. 3. A bold synthesis was written by Brigadier A.R. Siddiqui, ‘CCG and the Iran-Iraq War’, Deecoor, 30 November 1984. 4. Guzansky, Yoel, ‘Defence cooperation in the Arabian Gulf: The Peninsula Shield Force put to the test’, Middle Eastern Studies, 50:4 (2014), pp. 640 –54. 5. The Emirati press was enthusiastic, cf. for instance Dara Kadva, ‘AGCC manoeuvres a big success’, Khaleej Times, 16 October 1983. 6. ‘AGCC proceeding on the right path’, Khaleej Times, 9 July 1985. 7. WAM, ‘Substantial achievements for GCC in a decade’, Emirates News, 27 May 1990. 8. WAM, ‘Summit declares absolute support for Kuwait’, Gulf News, 26 December 1990. 9. Khalid S. Almezaini, The UAE and Foreign Policy (New York, Routledge, 2012), pp. 123–7. 10. ‘Final communique of the 13th GCC summit’, Emirates News, 24 December 1992. 11. Steve A. Yetiv, Absence of Grand Strategy: The United States in the Persian Gulf, 1972– 2005 (Baltimore, Johns Hopkins University Press, 2008), p. 101. 12. Abdullah Al-Shayeji, ‘Dangerous perceptions: Gulf views of the US role in the region’, Middle East Policy, 5 – 3 (September 1997), pp. 1 – 13. 13. David Mack, ‘From the Cold War to the War on Terror: A US perspective on Arabian Gulf security’, The Emirates Center for Strategic Studies and Research, Arabian Gulf Security. Internal and External Challenges (Abu Dhabi, ECSSR, 2008), p. 143. 14. WAM, ‘Zayed views aim to create stability in the region – Al Attiya’, Gulf News, 27 March 2003. 15. ‘GCC opposes war on Iraq’, Gulf News, 28 March 2003. 16. Mohammad Almezel, ‘Open criticism a sign of change in GCC politics’, Gulf News, 21 December 2004. 17. S. Nuri Erbas, Behrouz Guerami and George T. Abed, The GCC Monetary Union: Some Considerations for the Exchange Rate System (New York, International Monetary Fund, 2003), pp. 3 – 7. 18. Mohamed A. Ramady, The Saudi Arabian Economy: Policies, Achievements, and Challenges (New York London, Springer, 2nd edition, 2010), p. 464. 19. Shinji Takagi, Establishing Monetary Union in the Gulf Cooperation Council: What Lessons for Regional Cooperation? ADBI Working Paper 390 (Tokyo, Asian Development Bank Institute, 2012), p. 13. 20. See Chapter 8. 21. Muawia E. Ibrahim, ‘GCC summit to discuss key issues’, Khaleej Times, 16 December 2005. 22. WAM, ‘National Committee for Railways reviews progress on federal railway network’, 30 April 2015. 23. ‘Riding the rails’, CPI Financial, 28 February 2016. 24. Neil Partrick, The GCC: Gulf State Integration or Leadership Cooperation? (Research Paper, Kuwait Programme on Development, Governance and Globalisation in the Gulf States, 2011), pp. 6 – 12. 25. WAM, ‘EAU-Bahrain joint committee’, 11 October 2000. Same rhetoric during the 3rd meeting with Sheikh Mohammed bin Zayed WAM, ‘UAE, Bahrain joint committee concludes its activities’, 25 February 2004. 26. WAM, ‘Khalifa meets Bahraini PM’, 7 October 2001. 27. See Chapter 2. 28. WAM, ‘Omani minister interview’, 28 February 2000.

244

NOTES TO PAGES 126 –133

29. WAM, ‘UAE-Oman relations’, 25 February 2000. 30. Reuters, ‘Oman and Iran will complete Kish gas field development by 2012’, 12 September 2008. 31. Arif Ali, ‘Oman, Iran look for ways to improve ties’, Gulf News, 11 April 2001. 32. Reuters, ‘Oman says uncovers UAE spy network’, 30 January 2011. 33. WAM, ‘The UAE denies link with spy network in Oman’, 31 January 2011. 34. ‘UAE president Khalifa and Oman leader reaffirm strong UAE-Oman ties’, Gulf News, 12 July 2011. 35. Sean Foley, ‘The UAE: Political issues and security dilemmas’, Middle East Review of International Affairs, 3:1 (March 1999), p. 32. 36. WAM, ‘UAE and Qatar to set up joint company’, 22 December 2004; ‘Sheikh Khalifa’s visit to Qatar-Joint Statement’, 23 December 2004. 37. Mohamed Almezel, ‘Saudi bridge objections could “strain relation”’, Gulf News, 29 June 2005. 38. Justin Dargin, The Ties that Bind: The Dolphin Project and Intra-GCC Relations (Belver Center Harvard Kennedy School-Dubai School of Government, 2009), p. 1. 39. Christopher Davidson, The United Arab Emirates: A Study in Survival (Boulder, Lynne Rienner Press, 2005), pp. 127– 8. 40. WAM, ‘UAE, Qatar to sign Dolphin production-sharing agreement’, 31 March 2001. 41. WAM, ‘Dolphin project towards construction’, 30 July 2000. 42. WAM, ‘Dolphin: A new departure for GCC gas industry’, 5 August 2000; ‘India in touch with UOG for supply of Dolphin gas’, 15 February 2001. 43. WAM, ‘Dolphin Energy names sign long-term gas sales Agreement with Dubai government’, 3 May 2005. 44. WAM, ‘UAE and Qatar sign gas pipeline accord’, 26 September 2004. 45. WAM, ‘Dolphin will buy Omani Gas’, 6 February 2003. 46. WAM, ‘Oman-UAE pipeline nears completion, gas to flow in December’, 19 September 2003. This option was nevertheless abandoned. 47. WAM, ‘Dolphin Energy delivers natural gas to UAE customers’, 10 July 2007. 48. WAM, ‘Dolphin Energy Limited achieves major production milestone’, 3 February 2016. 49. Jim Krane and Steven Wright, Qatar ‘Rises Above’ its Region: Geopolitics and the Rejection of the GCC Gas Market (Kuwait Programme on Development, Governance and Globalisation in the Gulf States, Number 35, March 2014), p. 2. 50. See Chapter 8. 51. Jeffrey R. Macris, The Politics and Security in the Gulf. Anglo-American Hegemony and the Shaping of a Region (London, New York, Routledge, 2010), p. 187. 52. Hassan Hamdan al-Alkim, The Foreign Policy of the United Arab Emirates (London, Saqi Books, 1989), p. 117. 53. WAM, ‘Sharjah ruler receives Saudi diplomats’, 19 March 2008. In this case, the Saudi General Council visited Sheikh Sultan Al Qasimi when his mission ended. 54. Nadim Kawash, ‘UAE becomes second Arab economic power’, Gulf News, 6 August 2003. 55. See Chapter 2. 56. WAM, ‘UAE becomes top investor in Saudi Arabia’, 18 June 2006. 57. WAM, ‘Khalifa highlights the importance of UAE-Saudi Arabia partnership’, 22 September 2006. 58. Mariam Al Hakeem, ‘UAE ban on importing raw Saudi dates “violates GCC agreement2”’, Gulf News, 6 October 2006. 59. WAM, ‘UAE-Saudi trade volume hits dh178.7 billion in 12 years’, Khaleej Times, 19 July 2012.

NOTES TO PAGES 133 –141

245

60. Christopher Davidson, After the Sheikhs? The Coming Collapse of the Gulf Monarchies (London, Hurst, 2012), pp. 1 – 15. 61. F. Gregory III Gause, ‘Why Middle East studies missed the Arab Spring: The myth of authoritarian stability’, Foreign Affairs (July 2011), p. 81. 62. Ingo Forstenlechner, Emilie Rutledge and Rashed Salem Alnuaimi, ‘The UAE, the “Arab Spring” and different types of dissent’, Middle East Policy, 19 – 4 (Winter 2012), pp. 54 – 67. 63. Kristin Smith Diwan, ‘Bahrain’s Shia question. What the United States gets wrong about sectarianism’, in Council on Foreign Relations, New Arab Revolt: What Happened, What It Means, and What Comes Next (New York, Council on Foreign Relations, 2011), p. 44. 64. Kristian Coates Ulrichsen, ‘After the Arab Spring: Power shift in the Middle East? Bahrain’s aborted revolution’ (IDEAS reports – special reports, Nicholas Kitchen (ed.), LSE IDEAS, London School of Economics and Political Science, London, 2012), p. 6. 65. Mabon Simon, ‘The Battle for Bahrain: Iranian-Saudi Rivalry’, Middle East Policy, 19:2 (Summer 2012), pp. 84– 97. 66. WAM, AFP, ‘UAE joins Gulf forces to restore Bahrain’s stability’, Khaleej Times, 15 March 2011. 67. Kristian Coates Ulrichsen, ‘Small states with a big role: Qatar and the United Arab Emirates in the wake of the Arab Spring’ (Discussion Paper, Durham University, HH Sheikh Nasser Al-Sabah Programme, Durham, 2012), pp. 16 – 17. 68. WAM, ‘Largest military drill in the region’s history launches today in Saudi Arabia’, 27 February 2016. 69. Mehran Kamrava, ‘The Arab Spring and the Saudi-led counterrevolution’, Orbis, 56:1 (2012), pp. 96 – 104. 70. David Roberts ‘Qatar and the Muslim Brotherhood: Pragmatism or preference?’ Middle East Policy, XXI/3 (Fall 2014), pp. 84–94. 71. WAM, ‘El-Sisi receives Abdullah bin Zayed on sideline of Egypt Economic Development Conference’, 15 March 2015. 72. WAM, ‘Egypt holds a special place for UAE and its people’, 19 January 2015. 73. WAM, ‘UAE seeks normality in ties with all GCC states’, 10 August 2014. 74. WAM, ‘Abdullah bin Zayed takes part in IISS Manama Dialogue 2014, meets Bahraini Crown Prince’, 6 December 2014. 75. WAM, ‘Gulf leaders united in security outlook’, 22 April 2015. 76. WAM, ‘At the end of joint committee meeting, UAE and Qatar affirm commitment to continuing mutual consultation and coordination towards bilateral issues, regional and global challenges’, 5 May 2016. 77. WAM, ‘Cabinet welcomes UAE-Saudi Joint Higher Committee’, 9 June 2016. 78. Khalid S. Almezaini, The UAE and Foreign Policy (New York, Routledge, 2012), pp. 116 – 38.

Chapter 7 Asian Tropism 1. On the relations between the GCC and China, cf. the very useful bibliography of the Middle East Institute (until 2012): http://www.mei.edu/content/china’s-relations-middleeast-bibliography-1950 – 2012 (accessed 22 June 2016). 2. Muhamad Olimat, China and the Middle East: From Silk Road to Arab Spring (Oxford, Routledge, 2012), pp. 163– 75. 3. ‘Gulf states still rely on Asian labor’, Arabian News, 22 April 1984. 4. Fred Halliday, ‘Labor migrations in the Middle East’, Middle East Research and Information Project, 59 (August 1977), p. 10.

246

NOTES TO PAGES 141 –146

5. Andrew Gardner, City of Strangers: Gulf Migration and the Indian Community in Bahrain (Ithaca, Cornell University Press, 2010), p. 216. 6. See Chapter 8 on demographics. 7. Ismael Serageldin, James Socknat, Stace Birks, Bob Li and Clive Sinclair (ed.), Manpower and International Migration in the Middle East and North Africa (Washington, Oxford University Press for the World Bank, 1983), p. 23, Table 4– 1. 8. J.S. Birks and C.A. Sinclair, International Migration and Development in the Arab Region, Geneva, ILO, quoted by Halliday Fred, ‘Labor migration in the Arab World’, MERIP Reports, n8 123 Migrant Workers in the Middle East (May 1984), p. 5. One must be aware of the relative quality of these data because officially there were exactly 100,000 Pakistanis, 4,500 North-Yemenis, exactly the same number from South Yemen, and 4,500 Syrians. 9. J.S. Birks, I.J. Seccombe and C.A. Sinclair ‘Labour migration in the Arab Gulf States: Patterns, trends and prospects’, International Migration, 26:3 (July 1988), pp. 267 – 86. 10. Davidson Christopher, Dubai. The Vulnerability of Success (New York, Columbia University Press, 2008), pp. 99– 135. 11. Weiner Myron, ‘International migrations and development: Indians in the Persian Gulf ’, Population and Development Review, 8:1 (March 1982), pp. 9 –13. 12. Andrzej Kapiszewski, Arab Versus Asian Migrant Workers In The CCG Countries (Beirut, United Nations Expert Group Meeting on International Migration And Development in the Arab Region, Population Division, Department of Economic and Social Affairs United Nations Secretariat, 2006), p. 7. 13. See Chapter 3. 14. Syed Ali, Dubai. The Gilded Cage (New Haven, Yale University Press, 2010), pp. 64 –5. 15. Dovelyn Rannveig Agunia, Migration’s Middlemen. Regulating Recruitment Agencies in the Philippines-United Arab Emirates Corridor (Washington, Migration Policy Institute, 2010), p. 57. 16. Eelen Franck and J.T. Speckman, ‘Recruitment of labor migrants for the Middle East: The Sri Lankan case’, International Migration Review, 24:2, Special Issue, Recruiting Organizations in the Developing World (Summer 1990), p. 305. 17. Sasidharan Anand, Is Grass Greener on the Other Side? A Glimpse of the Worker Camps in UAE (Munich, MPRA Paper n8 19 378, 2009), pp. 2– 3. 18. Yasser Elsheshtawy, ‘Transitory sites: Mapping Dubai’s “forgotten” urban spaces’, International Journal of Urban and Regional Research (2008), pp. 968 –88. 19. Syed Ali, Dubai. The Gilded Cage. 20. Mizanur Rahman, ‘Bangladeshi migrant workers in the UAE: Gender-differentiated patterns of migration experiences’, Middle Eastern Studies, 47:2 (2011), pp. 395 – 411. 21. MD Mizanur Rahman, Recruitment of Labour Migrants for the Gulf States: The Bangladeshi Case (Singapore, ISAS Working Paper, n8 132– 6, 2011), p. 24. 22. Ibid., pp. 401 – 403. 23. Filippo Osella and Caroline Osella, ‘Migration, money and masculinity in Kerala’, Journal of Royal Anthropological Institute, 6 (March 2000), p. 123. 24. Mahjabin Banu and Mini Amit ‘Dynamics of expatriation process. A Case of Indian expatriation to UAE’, Global Journal of Management and Business Studies, 3 – 6 (2013), pp. 584 – 5. 25. B.A. Prakash and K.C. Zacharia, ‘Indian workers in the UAE: Employment, wages, onditions’, Economic and Political Weekly, 39:22 (29 May– 4 June 2002), pp. 2229. 26. Philippe Venier, ‘Spatial mobility and the migratory strategies of the Kerala’s immigrants to the UAE’, in Prakash C. Jain, Ginu Zacharia Oommen (ed.), South Asian Migration to Gulf Countries: History, Policies, Development (Oxford, New York, Routledge, 2016), pp. 145 – 55.

NOTES TO PAGES 146 –156

247

27. Christopher Davidson, Dubai. The Vulnerability of Success (New York, Columbia University Press, 2008), pp. 89 – 91. 28. Ian J. Seccombe, ‘Labour migration to the Arab Gulf: Evolution and characteristics 1920– 1950’, Bulletin British Society for Middle Eastern Studies, 10:1 (1983), p. 7. 29. Ibid. 30. Neha Vora, ‘Unofficial citizens: Indian entrepreneurs and the State-effect in Dubai, United Arab Emirates’, International Labor and Working-Class History, 79 (Spring 2011), pp. 122– 39. 31. Ibid., pp. 377– 406. 32. Syed Ali, ‘Going and coming and going again: Second-generation migrants in Dubai’, Mobilities, 6:4 (2011), pp. 553– 68. 33. Karen Leonard, ‘South Asians in the Indian Ocean world: Language, policing, and gender practices in Kuwait and the United Arab Emirates’, Comparative Studies of South Asia, Africa and the Middle East, 25:3 (2005), pp. 685– 6. Financial issues determine that kind of marriage agreement – these spouses are less ‘expansive’ (10 to 20 per cent less). 34. WAM, ‘Dubai’s foreign trade scores AED 1.331 trillion in 2014’, 23 March 2015. 35. Chevalier Franc
oise and Park Ki-Chan, ‘The winning strategy of the late-comer; How Korea was awarded the UAE nuclear power contract’, International Review of Business Research Papers, 6:2 (July 2010), pp. 221– 38. 36. Christopher Davidson, Persian Gulf – Pacific Asia Linkages in the 21st century: A Marriage of Convenience? (Kuwait City, Kuwait Programme on Development, Governance and Globalisation in the Gulf States, n8 7, January 2010), pp. 7, 9. 37. Nader Habibi, ‘Growth in economic relations of China and India with the CCG countries’, Asian-Pacific Economic Literature, 25:2 (November 2011), pp. 52 – 67, and Muhamad Olimat, China and the Middle East. 38. Oil and Gas Directory in the Middle East 2011, p. 1020. 39. Gerald Butt, ‘Oil and gas in the UAE’, in Ibrahim Al Abed and Peter Hellyer (ed.), The United Arab Emirates. A New Perspective (London, Trident Press Ltd, 2001), p. 247. 40. International Energy Agency, World Energy Outlook 2005 (Paris, OCDE-IAE, 2005), p. 551. In the spot market, the financial transaction is immediate not with the future market. 41. Statistic Center Abu Dhabi, Statistical Yearbook of Abu Dhabi 2014 (Abu Dhabi, SCAD, 2014), pp. 33 – 6. 42. Conversion in barrels depends on the quality of oil – usually between 7 and 9. Therefore, refined oil amounts to 60 million barrels per year. 43. M.S. Vassiliou, Historical Dictionary of the Petroleum Industry (Lanham-Toronto-Plymouth, Scarecrow Press, 2009), p. 67. 44. ‘Asian premium vanishes’, PIW Quarterly Scorecard, 26 April 2010. 45. ‘India asks OPEC to stop charging premium from Asian buyers’, Economic Times, 3 June 2015. 46. International Energy Agency 2005, p. 536. 47. Mohammed bin Dha’en Al-Halimi, ‘UAE energy policy: Expanding production capacity and maintaining market equilibrium’, in China, India and the United States. Competition for Energy Ressources (Abu Dhabi, the Emirates Center for Strategic Studies and Research, 2008), p. 32. 48. Gerald Butt, ‘Oil and gas in the UAE’, p. 233. 49. WAM, ‘Jodco plans to enhance Abu Dhabi oil recovery’, 8 November 2002. 50. April Yee, ‘Vital energy mission for Japan agency’, The National, 19 March 2012. 51. WAM, ‘ADNOC, INPEX sign New ADCO Concession Agreement’, 27 April 2015. 52. Reuters, ‘UAE to pump more crude to Asia to cut reliance on Iran’, 8 February 2012.

248

NOTES TO PAGES 156 –164

53. Christian Oliver and Camilla Hall, ‘South Korea finalises $2bn UAE oil deal’, Financial Times, 5 March 2012. 54. WAM, ‘ADNOC and Korea GS E&P Pte. Ltd., sign new ADCO Concession Agreement’, 13 May 2015. 55. LeAnne Graves, ‘Asia drills into fresh UAE oil opportunities’, The National, 4 June 2015. 56. WAM, ‘ADNOC and Total sign New ADCO Concession Agreement’, 29 January 2015. 57. Robin Mills, ‘Expect Abu Dhabi to look East for strategic oil partnerships’, The National, 17 May 2015. 58. ‘For more detail on the Philippine community in the UAE, see William Gue´raiche, ‘Transnational Filipinos in the UAE: Actors and strategies’, Arabian Humanities (Fall 2016), and William Gue´raiche ‘Un peuple de migrants’, in William Gue´raiche (ed.), Philippines Contemporaines (Paris, Bangkok, Les Indes Savantes-Irasec, 2013), pp. 361– 84. 59. Nadeem Hanif, ‘Remittances to Pakistan to reach $4bn’, The National, 27 May 2012. 60. Usman Manzoor, ‘Half of Pakistan’s remittances come from KSA, UAE’, News International, 14 April 2015. 61. Georges Naufal, ‘Remitters in Dubai’, Swiss Journal of Economics and Statistics, 146:4 (2010), pp. 769– 80. 62. Geoffrey Kemp, The East Moves West. India, China, and Asia Growing Presence in the Middle East (Washington, Brookings Institution Press, 2010), p. 326 and Olimat, China and the Middle East, p. 224. 63. Document non-classified in the archives of Khaleej Times. 64. WAM, ‘Hamdan’s China visit set to enhance bilateral ties’, 19 April 2004. 65. Kai Bruns, ‘India-UAE relations: The beginning of a new era?’, Diplomatist Magazine, March 2016. 66. WAM, ‘UAE, India have enjoyed close ties for thousands of years: Abdullah bin Zayed’, 3 June 2007. 67. WAM, ‘CCG and India take first step in major economic initiative’, 13 February 2004. 68. For the details of these bilateral relations between the UAE and East Asian states see Kemp The East Moves West: India, pp. 47 – 50; Pakistan, p. 107; China, pp. 86 – 7; Japan, pp. 125– 6; South Korea, p. 129; and see also Muhamad Olimat, China and the Middle East, pp. 163– 75. An analysis of the crossed investments is also still missing.

Chapter 8

Dependencies

1. Muawia E. Ibrahim, ‘UAE 30pc self-sufficient in farm produce’, Khaleej Times, 17 June 2003. 2. Mohamed Shihab, ‘Economic development in the UAE’, Ibrahim Al Abed and Peter Hellyer (eds), The UAE. A New Perspective (London, Trident Press, 2001), p. 251. 3. Ibrahim Al Abed, Peter Hellyer and Paula Vine (eds), UAE Yearbook 2005 (London, Trident Press, 2005), p. 167. 4. ‘Stress on organic farming in country’, Khaleej Times, 13 January 2005. 5. Saif Al Qaydi, ‘The status and prospects for agriculture in the United Arab Emirates (UAE) and their potential to contribute to food security’, Journal of Basic & Applied Sciences, 12 (2016), pp. 155– 63. 6. His name was not mentioned, ‘UAE eyes overseas land to provide steady food supplies’, Gulf News, 12 July 2012. 7. Abdul Ghafoor, Khalid Mustafa, Iqbal Zafar, Khalid Mushtaq and Maqsood Hussain, ‘Determinants and margins of exporting mango from Pakistan to the UAE market’, Journal of Agriculture, 29:3 (2013), p. 483.

NOTES TO PAGES 165 –169

249

8. Melanie Sommerville, Jamey Essex and Philippe Le Billon, ‘The “global food crisis” and the geopolitics of food security’, Geopolitics, 19 – 2 (2014), pp. 239–65. 9. Derek Headey and Shenggen Fan, ‘Anatomy of a crisis: The causes and consequences of surging food prices’, Agricultural Economics, 39 (November 2008), pp. 375–91. 10. Nadim Khour, Julian A. Lampietti, Sean Michaels, Nicholas Magnan, Alex F. McCalla and Maurice Saade, ‘A strategic framework for improving food security in Arab countries’, Food Security, 3:1 (2011), p. 7. 11. ‘Agriculture Department gets tough on abuse of power’, Gulf News, 19 May 2005. 12. ‘Farmers will get supplies directly from importers’, Khaleej Times, 24 June 2005. 13. Ahmed Mushtaque and Shahid Shabbir A. ‘Changing face of agriculture in the Gulf Cooperation Council countries’ Environmental Cost and Face of Agriculture in the Gulf Cooperation Council. Fostering Agriculture in the Context of Climate Change (Cham, Springer, 2014), pp. 1 – 25. 14. Farhan Bokhari and Simeon Kerr, ‘UAE investors buy Pakistan farmland’, Financial Times, 11 May 2008. 15. ‘Abu Dhabi develops food farms in Sudan’, Guardian, 2 July 2008. 16. ‘Great resource rush’, Middle East Business News, 7 May 2012. 17. Andrew England and Barney Jopson ‘Sudan woos investors to put $1bn in farming’, Financial Times, 11 August 2008. 18. Reuters, ‘Egypt to lease farmland to Arab investment firm’, 8 April 2014. 19. ‘Echange pe´trodollars contre terres agricoles en Afrique’, Les Afriques n8 42 (4– 10 September 2008). 20. Zaher Bitar, ‘UAE’s food imports to rise to $400b in 10 years’, Gulf News, 31 March 2015. 21. Lorenzo Cotula, Land Rights and Investment Treaties. Exploring the Interface (London, International Institute for Environment and Development (IIED), 2015), p. 57. 22. Amena Bakr, ‘Pakistan opens more farmland to foreigners’, Reuters, 18 May 2009. 23. Tom Arnold, ‘Al Dahra to develop farmland in Serbia’, The National, 23 October 2012. 24. Rudnap Agrar, ‘Al Dahra Intl Investment gets nod to acquire 51% of Serbia’s’, See News, 9 April 2014. 25. Tanjung, ‘Government, UAE firm set up joint agriculture company’, 7 July 2014. 26. ‘Farmers protest in Serbia: “Most fertile land is given to Arabs’’’, InSerbia, 28 July 2014. 27. Anwar Ahmad, ‘Serbian village raises complaint about UAE purchase of farmland’, The National, 20 July 2014. 28. Robert Tashima ‘Foreign investors buy up African farmland, sparking fears of a new colonialism’, Business Today Egypt, July 2010. 29. Anas Bougataya, ‘Rabbad incite the Marocains des EAU a` investir au Maroc, Les inspirations Eco, 1 April 2015. 30. Benjamin Shepard, ‘Investments in foreign agriculture as a Gulf State food security strategy: Towards better policy’, Environmental Cost and Face of Agriculture in the Gulf Cooperation Council. Fostering Agriculture in the Context of Climate Change (Cham, Springer, 2014), pp. 125–44, and Ian G. Baird, ‘The global land grab meta-narrative, Asian money laundering and elite capture: Reconsidering the Cambodian context’, Geopolitics, 19:2 (2014), pp. 431– 53. 31. Lorenzo Cotula, Land Deals in Africa: What Is in the contracts? (London, International Institute for Environment and Development, 2011), p. 49. 32. Most likely dh 500 million ($136 million). Chris Stanton, ‘Cairo court says Al Dahra land deal was illegal’, The National, 23 February 2011.

250

NOTES TO PAGES 169 –175

33. Zaher Bitar, ‘UAE’s food imports to rise to $400b in 10 years’. 34. WAM, ‘Abu Dhabi and Alberta sign strategic economic co-operation’, 10 January 2010. 35. ‘Emirates seek overseas feed supply’, Al Dahra, 16 August 2010, available on the site Food Crisis and the Global Land Grab http://farmlandgrab.org/ (accessed 24 June 2016). 36. Asa Fitch, ‘Abu Dhabi’s Mubadala studies billions of investment in Brazil’, The National, 1 May 2011. 37. Toivo Ndjebela, ‘Abu Dhabi group enters grape, date hunt’, New Era, 28 May 2010. 38. ‘Qatar, UAE chambers eye stronger ties in food security, tourism and IT’, Gulf Time, 2 May 2016. 39. WAM, ‘Australian business leaders partner with MoFA to host joint forum on UAE Food Security’, 2 November 2015. 40. ‘Abu Dhabi moves to secure food supply’, Financial Times, 16 November 2010. 41. Mohammed al-Husseiny, Executif Director of Aabar, stated, Financial Times, 2 January 2011, that both companies explored the Australian market in 2010. Continuity of coincidence? The Emirati government wanted to buy arable land in Australia in June 2011, cf. Tom Arnold, ‘UAE ponders Australia’s wheat’, The National, 2 June 2011. 42. ‘Public and Private sectors partnerships vital for future of MENA agriculture industry, says expert’, Zawya, 2 March 2014. 43. Saif Al Qaydi, The status and prospects for agriculture in the United Arab Emirates (UAE) and their potential to contribute to food security’. 44. Data corrected by Suzan M. Shahin, Mohammed A. Salem, ‘The challenges of water scarcity and the future of food security in the United Arab Emirates (UAE)’, Natural Resources and Conservation 3:1 (2015), p. 2. 45. Environment Agency Abu Dhabi, Sustainability. Our Challenge . . . Our Opportunity. 2007 Sustainability Report (Abu Dhabi: Environment Agency Abu Dhabi, 2008), p. 49 (EAD, Sustainability, p. . .). On the cover page: ‘The first Global Reporting Initiativechecked Report for a Government Agency in the Arab World’. 46. In the developed world, data are streamlined: per capital, per household, per domestic subscriber, per domestic use. This question is central inasmuch as one needs to know if the numbers are not only the consumption per capita, encompassing water used in agriculture, industry and water to public areas. 47. EAD, Abu Dhabi Water Resources Master Plan (Abu Dhabi, EAD, 2009), p. 220. Data come from this report. 48. Suzan Marwan Shahin and Mohammed A. Salem, ‘Food security in the United Arab Emirates (UAE): The great competition between the agricultural and forestry sector on irrigation resources’, Natural Resources and Conservation 3:1 (2015), pp. 1 – 6. 49. Aquastat Database (Food and Agriculture Organisation, FAO, agency). 50. One might wonder if there are really cogeneration plants as the report implies. Seawater desalination takes place in different plants. 51. Binsal Abdul Kader, ‘Abu Dhabi takes steps to reduce water consumption. UAE has one of the highest per capita consumption rates of water and energy’, Gulf News, 20 March 2014. 52. Yong Hun Jung, Yong Hoon Jeong, Jinyoung Choi, Andhika F. Wibisono, Jeong Lk Lee and Hee Cheon No, ‘Feasibility study of a small-sized nuclear heat-only plant dedicated to desalination in the UAE’, Desalination, 337 (March 2014), pp. 83 – 97. 53. Zher Bitar, ‘Dewa splashes out on new water desalination plants’, Gulf News, 19 August 2010. 54. WAM, ‘Mirfa power and water plant to begin construction in February’, 29 December 2014.

NOTES TO PAGES 175 –179

251

55. Nadia Saleem, ‘Farming “main cause of water shortage”’, Gulf News, 1 November 2008, and Binsal Abdbul Kader, ‘Abu Dhabi aims to save water wasted by farmers’, Gulf News, 26 August 2010. 56. Data come from a market research made by an economic mission of the Italian embassy. The report synthesised statistics given by the International Energy Agency and the Emirati authorities: Italian Trade Commission. Trade Section of the Italian Embassy, UAE. Market Report. Water, Energy, Technology, and Environment Exhibition (WETEX) (Dubai, ICE, March 2011), p. 27. 57. UAE Ministry of Energy, State of Energy Report 2016 (Abu Dhabi, DCCE Publications, 2015), p. 290. 58. Economist Intelligence Unit statistics quoted by Italian Trade Commission 2011, pp. 9–10. 59. For instance: Samia Badih, ‘Energy sector faces demand challenges. Study predicts UAE population will hit 8M by 2050, resulting in increases in power usage’, Gulf News, 19 March 2010. 60. Laura El-Katiri, Interlinking the Arab Gulf: Opportunities and Challenges of GCC Electricity Market Cooperation, Oxford, Oxford Institute for Energy Studies, 2011, p. 6. 61. DEWA Statistics accessible online: https://www.dewa.gov.ae/aboutus/electStats2014.aspx (accessed 24 June 2016). 62. Zaher Bitar, ‘Air conditioning sucks up 40 per cent of Dubai’s power. Dewa chief executive urges building owners to switch to district cooling systems’, Gulf News, 1 September 2009. 63. Federal Government of the UAE, Policy of the United Arab Emirates on the Evaluation and Potential Development of Peaceful Nuclear Energy, Abu Dhabi, April 2008, pp. 2 – 17. 64. Ali Oguz Dirioz and Benjamin A. Reimold, ‘The strategic context of the UAE’s nuclear project: A model for the region?’, Middle East Policy, XXI/3 (Fall 2014), p. 72. 65. Ibid., pp. 78 – 9. 66. Laura El-Katiri, Interlinking the Arab Gulf, p. 11. 67. WAM, ‘Energy swap will power and empower the GCC’, 25 December 2014. 68. Laura El-Katiri, Interlinking the Arab Gulf, p. 32. 69. Hassan K. Al-Asaad, Adnan I. Al-Mohaisen and Satish Sud, GCC Power Grid: Transforming the GCC Power Sector into a Major Energy Trading Market (2006): https://www.researchgate. net/publication/228870399_GCC_Power_Grid_Transforming_the_GCC_Power_Sector_ into_a_major_energy_trading_market (accessed 24 June 2016). 70. See, for instance, Nasouh Nazzal, ‘Desalination process threatens marine life’, Gulf News, 8 September 2001. 71. World Wildlife Fund (WWF) and Zoological Society of London, Global Footprint Network, Living Planet Report 2006, pp. 14– 15. Available on the site: http://www.footprintnetwork. org/images/uploads/LPR_2006_FR.pdf (accessed 24 June 2016). 72. Living Planet Report 1998, p. 20. Available on the site: assets.panda.org/downloads/ livingplanetreport98.pdf (accessed 24 June 2016). 73. Quoted by Susan L. Sakmar, Mathis Wackernagel, Alessandro Galli and David Moore, Sustainable Development and Environmental Challenges in the MENA Region: Accounting for the Environment in the 21st Century (Dokki, Economic Research Forum, Working paper 592, June 2011), p. 10. 74. EWS-WWF, Year 1. Tehnical Report of the Al Basama Al Beeiya Initiative (Confidential Report, unpublished). 75. Laila Abdullatif, Laura Ledwith, Tanzeed Alam, Razan Al Mubarak and Alessandro Galli, ‘Policy role of the ecological footprint as an indicator: UAE case study’, in Simone Bastianoni (ed.), The State of the Art in Ecological Footprint Theory and Applications,

252

76. 77. 78. 79. 80.

81.

82.

83.

84. 85. 86. 87. 88.

NOTES TO PAGES 179 –184 Colle Val d’Elsa, 9– 10 June 2010, pp. 5 – 6. Available on the site: http://www. footprintnetwork.org/images/uploads/Academic_Conference_Book_of_Abastracts.pdf (accessed 24 June 2016). Living Planet Report 2008 and 2010, respectively, p. 14 and p. 36. Living Planet Report 2014, p. 38. Stanley Hartmann, Anders Reed and Alessandro Galli, ‘Reflections on the fishing ground footprint methodology: The UAE as a case study’; Simone Bastianoni 2010, pp. 53 – 4. Abu Dhabi Urban Planning Council, Plan Abu Dhabi 2030. Urban Structure Framework Plan (Abu Dhabi, Abu Dhabi Urban Planning Council, 2008), p. 168. Sgouris Sgouridis, Ayu Abdullah, Steve Griffiths, Deger Saygin, Nicholas Wagner, Dolf Gielen, Hannes Reinish and Dane McQueen, ‘Re-mapping the UAE’s energy transition: An economy-wide assessment of renewable energy options and their policy implications’, Renewable and Sustainable Energy Reviews (June 2015). Danyel Reiche, ‘Energy policies of Gulf Cooperation Council (GCC) countries: possibilities and limitations of ecological modernization in rentier states’, Energy Policy, 38:5 (May 2010), pp. 2395– 403. Danyel Reiche, ‘Renewable energy policies in the Gulf countries: A case study of the carbon-neutral “Masdar City” in Abu Dhabi’, Energy Policy, 2010– 11 (January 2010), p. 381. Noor Ghazal Aswad, Yasser Al-Saleh and Hanan Taleb, ‘Clean energy awareness campaigns in the UAE: An awareness promoters perspective’, International Journal of Innovation and Knowledge Management in Middle East & North Africa, 2:2 (2013), pp. 131–56. Ian G. Baird, ‘The global land grab meta-narrative, Asian money laundering and elite capture’, p. 4. Dennis Kumetat, Managing the Transition: Renewable Energy and Innovation Policies in the UAE and Algeria (Oxford, Routledge, 2015), p. 101 seq. For the details of the creation, see the official website: http://www.irena.org/menu/index. aspx?mnu¼ cat&PriMenuID ¼ 13&CatID ¼ 30 (accessed 24 June 2016). Roth von Wolfgang, ‘Entscheidung fu¨r die Emirate Warum die Internationale Agentur fu¨r erneuerbare Energie nach Abu Dhabi geht’, Su¨ddeutsche Zeitung, 1 July 2009. Danyel Reiche, ‘Renewable energy policies in the Gulf Countries. A case study in the carbon-neutral ‘Masdar City’ in Abu Dhabi’, Energy Policy, 38:1 (2010), p. 379. See Chapter 7. WAM, ‘Abdullah bin Zayed inaugurates International Renewable Energy Agency headquarters’, 3 June 2015.

Chapter 9

What Does Identity Mean?

1. Christopher M. Davidson, ‘Expatriates and the Gulf monarchies: Politics, security and the Arab Spring’, Asian Affairs, XLV/II (2014), p. 272. 2. Franc
oise De Bel-Air, Demography, Migration, and the Labour Market in the UAE (European University Institute and Gulf Research Center, n8 7/2015), p. 6. 3. Tar-Ching Aw, Taoufik Zoubeidi, Fatma Al-Maskari and Iain Blair, ‘Challenges and strategies for quantitative and qualitative field research in the United Arab Emirates’, Asian Pacific Journal of Cancer Prevention, 12 (2011), pp. 1641– 5. 4. Lyndal H. Hunter, Walter F. Robb and Sharon M. Brownie, ‘The “secret” impact of population statistics on the metrics of diabetes’, Journal of Diabetes, Metabolic Disorders & Control, 1:4 (2014), pp. 1 –9. 5. https://www.cia.gov/library/publications/the-world-factbook/geos/ae.html (accessed 26 June 2016).

NOTES TO PAGES 185 –190

253

6. Table available online, UAE National Bureau of Statistics. Methodology of estimating the population of the UAE: http://www.uaestatistics.gov.ae/ReportPDF/Population%20 Estimates%202006%20-%202010.pdf (accessed 26 June 2016). 7. Statistics Center Abu Dhabi (SCAD), Statistical Yearbook of Abu Dhabi 2011 (Abu Dhabi, SCAD, 2011), p. 9. 8. Iain Blair and Amer Ahmad Sharif, ‘Population structure and the burden of disease in the United Arab Emirates’, Journal of Epidemiology and Global Health (May 2012), p. 6. 9. Mouawiya Al Awad and Carole Chartouni, Explaining the Decline in Fertility among Citizens of the GCC Countries: The Case of the UAE (Dubai, Institute for Social and Economic Research Zayed University, Working Paper n8 1, 2010), pp. 10 –16. 10. Ibid. 11. Iain Blair and Amer Ahmad Sharif, ‘Population structure and the burden of disease in the United Arab Emirates’, pp. 6 – 10. 12. A. Bener and D. Crundall, ‘Road traffic accidents in the United Arab Emirates compared to Western countries’, Advances in Transportation Studies an international Journal, Section A 6 (2005), pp. 5 – 12. 13. ‘Car accidents cost the UAE a massive dh17 billion in 3 years’, Emirates 24/7, 22 April 2012. 14. http://www.arabianbusiness.com/four-gcc-countries-rank-amongst-world-s-10-fattestnations-464631.html (accessed 26 June 2016). 15. Hussein Saadi et al., ‘Prevalence of diabetes mellitus and its complications in a populationbased sample in Al Ain, United Arab Emirates’, Diabetes Research and Clinical Practice, 78:3 (2007), pp. 369–77, and Cother Hajat, Oliver Harrison and Zaid Al Siksek, ‘Weqaya: A population-wide cardiovascular screening program in Abu Dhabi, United Arab Emirates’, American Journal of Public Health, 102–105 (May 2012), pp. 909–14. 16. Hala Khalaf, ‘Treating diabetes costs Abu Dhabi dh3.7bn a year, says doctor’, The National, 12 October 2009. 17. Habiba S. Al Safar, Sarra E. Jamieson, Heather J. Cordell, Jenefer M. Blackwell and Guan K. Tay, ‘Heritability of quantitative traits associated with type 2 diabetes in an extended family from the United Arab Emirates’, International Journal of Diabetes & Metabolism, 19 (2011), pp. 59– 62. This journal, whose office lays at the Al Ain medical school, is dedicated to diabetes. 18. Iain Blair and Amer Ahmad Sharif, ‘Population structure and the burden of disease in the United Arab Emirates’, pp. 9 – 10. 19. Statistics Center Abu Dhabi (SCAD), Statistical Yearbook of Abu Dhabi 2011, p. 117. 20. Yasser Elsheshtawy, ‘Transitory sites: Mapping Dubai’s “forgotten” urban spaces’, International Journal of Urban and Regional Research, 32 – 4 (2008), p. 982. 21. Gehan M. Selim and Mohamed Gamal, Neighborhoods & Residential Communities: The Case of Al-Ain-UAE, Housing symposium 3 (Neighborhoods are more than houses) ([s.l., Saudi Arabia] Arriyadh Development Authority, 2007), pp. 343 – 61. 22. Fred H. Lawson and Hasan M. al-Naboodah, ‘Heritage and cultural nationalism in the United Arab Emirates’, Alanoud Alsharekh and Robert Springborg (ed.), Popular Culture and Political Identity in the Arab Gulf States (London, Saqi, 2008), p. 17. 23. Nadia Rahman, ‘Places and spaces in the memory of United Arab Elders’, Alsharekh Alanoud and Springborg Robert (eds), Popular Culture and Political Identity in the Arab Gulf States (London, Saqi, 2008), p. 37. 24. Lelania Sperrazza, ‘A clash of cultural identities in the UAE’, International Journal of Arts & Sciences, 5:7 (2012), pp. 297– 306. 25. WAM, 2 December 2007.

254

NOTES TO PAGES 190 –193

26. Mahmoud Habboush, ‘2008 debate source of culture threat’, The National, 17 September 2008. 27. Jihad Fakhreddine, ‘Defining crucial element of national identity’, Gulf News, 30 October 2008. 28. Manal A. Jamal, ‘The “Tiering” of citizenship and residency and the “Hierarchization” of migrant communities: The United Arab Emirates in historical context’, International Migration Review, 49:3 (Fall 2015), pp. 601– 32. 29. Benedict R. Anderson, Imagined Communities: Reflections on the Origin And Spread of Nationalism (London, New York, Verso, 1983). 30. WAM, ‘Cabinet approves FNC’s recommendations on General Authority of Islamic Affairs And Endowments’, 19 June 2015. 31. Valerie Goby and Catherine Nickerson, ‘Language, religion, and culture in the context of international retail: A study of the multicultural commercial hub of Dubai’, Australian Journal of Communication, 40:3 (December 2013), pp. 1 – 16. 32. Sarah Hopkyns, ‘The effects of global English on culture and identity in the UAE: A double-edged sword’, Learning and Teaching in Higher Education: Gulf Perspectives, 11:2 (2014), p. 9. 33. Ibid., p. 26. 34. Matthew Clarke, ‘Language policy and language teacher education in the United Arab Emirates’, TESOL Quarterly, 41:3 (2007), pp. 583– 91. 35. Sana Tibi and Lorraine McLeod, ‘The development of young children’s Arabic language and literacy in the United Arab Emirates’, Literacy Studies, 9 (2014), pp. 303 – 21. 36. Mick Randall and Mohammad Amir Samimi, ‘The status of English in Dubai. A transition from Arabic to English as a lingua franca’, English Today, 101 (March 2010), pp. 45 – 6; 49. Kay Gallagher, ‘Bilingual education in the UAE: Factors, variables and critical questions’, Education, Business and Society: Contemporary Middle Eastern Issues, 4:1 (2011), pp. 62 – 79. 37. Fred H. Lawson and Hasan M. al-Naboodah, ‘Heritage and cultural nationalism in the United Arab Emirates’, p. 22. 38. Daniel Simonet and Cle´ment Vincent, ‘The management of museums in Sharjah’, Public Administration and Globalization, 9 (2015), pp. 247– 61. 39. Sulayman Khalaf, ‘Globalization and heritage revival in the Gulf: An anthropological look at Dubai Heritage Village’, Journal of Social Affairs, 19:75 (Fall 2002), pp. 277 – 306. 40. Sulayman Khalaf, ‘Camel racing in the Arab Gulf: Notes on the evolution of a traditional cultural sport’, Anthropos (March 1999), pp. 85– 10, and Sulayman Khalaf, ‘Perspectives on falconry as a world intangible heritage and UAE’s efforts to enhance international cooperation for promoting falconry’, Beyond Borders: Plurality and Universality of Common Intangible Cultural Heritage in East Asia (2009), pp. 308 –18. 41. Sulayman Khalaf, ‘National dress and the construction of Emirati cultural identity’, Journal of Human Sciences, 11 (Winter 2005), pp. 230 – 67. 42. Noor Al-Qasimi ‘Immodest modesty: Accommodating dissent and the Abaya-as-fashion in the Arab Gulf States’, Journal of Middle East Women’s Studies, 6:1 (Winter 2010), pp. 46 – 74. 43. World Economic Forum, The Global Gender Gap Report 2015, http://reports.weforum.org/ global-gender-gap-report-2015/economies/#economy¼ ARE (accessed 26 June 2016). 44. Vania Carvalho Pinto, Nation-Building, State and the Genderframing of Women’s Rights in the United Arab Emirates (Reading, Ithaca Press, 2012). 45. Samer Kherfi and George Naufal, Does Diploma Type Matter for Subsequent Academic Achievement? A UAE Case Study (Bonn, IZA Discussion Paper n8 8472, September 2014), pp. 12, 15.

NOTES TO PAGES 193 –197

255

46. Susan R. Madsen, ‘The experiences of UAE women leaders in developing leadership early in life’, Feminist Formations, 22:3 (Fall 2010), pp. 75 – 95. 47. Najla Al-Awhadi, ‘Empowering women through development’, Gulf News, 3 December 2008. 48. Rima Sabban, ‘Women migrant domestic workers in the UAE’; Simel Esim and Monica Smith (eds), Gender and Migration in Arab States: The Case of Domestic Workers (Beirut, International Labour Organisation-Regional Office for Arab States 2004), p. 91. 49. Sara Ashencaen Crabtree, ‘Culture, gender and the influence of social change amongst Emirati families in the United Arab Emirates’, Journal of Comparative Family Studies, 38:4 (Autumn 2007), p. 57. 50. Wanda Krause, Women in Civil Society: The State, Islamism, and Networks in the UAE (New York, Palgrave Macmillan, 2008), p. 264. 51. Joe Wallisa, Alison Williams and Paul Williams, ‘Emirati women and public sector employment: The implicit patriarchal bargain’, International Journal of Public Administration, 36:2 (2013), pp. 137– 49. 52. Mohammed Al Sadafy, ‘Emiratis advised to not wed foreign women’, Emirates 24/7, 20 January 2012. 53. Jennifer L. Kerpelman, Jay D. Schvaneveldt and Paul L. Schvaneveldt, ‘Generational and cultural changes in family life in the United Arab Emirates: A comparison of mothers and daughters’, Journal of Comparative Family Studies, 36:1 (Winter 2005), pp. 77 – 91. 54. Sara Sabry, ‘Marriage fund in UAE promotes family life. Around 400 people benefited from lectures’, Gulf News, 5 August 2014. 55. Wafa Issa and Rym Ghazal, ‘Children of Emirati mothers, expatriate fathers offered citizenship’, The National, 30 November 2011. 56. Ola Salem, ‘1,117 children of Emirati women to get citizenship’, The National, 1 February 2012. 57. WAM, ‘Ministry of Interior grants citizenship to 106 children of Emirati mothers’, 25 August 2014. 58. WAM, ‘MoI awards UAE Citizenship to 152 candidates born to Emirati mothers’, 19 May 2016. 59. Franc
oise De Bel-Air, Demography, Migration, and the Labour Market in the UAE, p. 10. 60. Cassia Marchon and Hugo Toledo, ‘Re-thinking employment quotas in the UAE’, International Journal of Human Resource Management, 25:16 (2014), pp. 2253– 74. 61. Benedict R. Anderson, Imagined Communities, pp. 150 – 1. 62. Kasim Randeree, Workforce Nationalization in the Gulf Cooperation Council States (Doha, Center for International and Regional Studies, Georgetown University School of Foreign Service in Qatar, 2012), pp. 18, 20. 63. Robert Looney, ‘Saudization and sound economic reforms: Are the two compatible?’, Strategic Insights, III (2004), p. 10. Divya Pakkiasamy, 2004, Saudi Arabia’s Plan for Changing its Workforce, Migration Policy Institute, http://www.migrationpolicy.org/article/ saudi-arabias-plan-changing-its-workforce (accessed 26 June 2016). 64. Philipp Nugent, ‘Looking to the future’, The Middle East, 266 (April 1997), p. 22. 65. Sultan Al Azri, Unemployed Youth in the UAE: Personal Perceptions (s.l.; Diane Publishing, 2010), pp. 1, 3. 66. Mervyn J. Morris, ‘Organisation, social change and the United Arab Emirates’, paper presented to the Social Change in the 21st Century conference, 28 October 2005, Centre for Social Change Research, Queensland University of Technology, p. 6. 67. Paul A. Elsner and James Horton, ‘Higher Colleges of Technology: United Arab Emirates’, Paul A. Elsner, George R. Boggs and Judith T. Irwin (eds), Global Development of

256

68. 69. 70.

71. 72. 73. 74. 75.

76.

77.

78.

79.

80. 81.

NOTES TO PAGES 197 –204 Community Colleges, Technical College, and Further Education Programs (Washington, AACC, 2008), p. 150. Davidson 2010, p. 71. Ibid. William Gue´raiche, ‘L’enseignement supe´rieur aux EAU, entre e´miratisation et contraintes du marche´’, in Romani Vincent (ed.), Enseignement supe´rieur, pouvoirs et mondialisation dans le monde arabe. Revue de la Me´diterrane´e et des Mondes Musulmans, 131 (2012), pp. 187– 203. Caren Nelson and Guang Yang, Emiratisation in the Insurance Sector: Experience and Challenges, Dubai, Tanmia-CLMRI, 2005, p. 8. Emiratisation in the Banking Sector: Factors influencing Success and Failure (Dubai, TanmiaCLMRI, 2004), pp. 3 – 4. WAM, ‘FNC calls on Ministry of Labour to set measures to increase emiratisation rate in private sector’, 3 February 2015. WAM, 3 June 2012. Emirati Youth Forum 2015, ‘Emirati youth surveyed on work preferences – graphic’, The National, 3 February 2015, available online: http://www.thenational.ae/uae/emiratiyouth-surveyed-on-work-preferences- - -graphic (accessed 26 June 2016). Andy H. Barnett, Michael Malcom and Hugo Toledo, ‘Shooting the goose that lays the golden egg: The case of UAE employment policy’, Journal of Economic Studies, 42:2 (2015), pp. 285 – 302. Mohammed A. Al-Waqfi and Ingo Forstenlechner, ‘Barriers to Emiratization: The role of policy design and institutional environment in determining the effectiveness of Emiratization’, International Journal of Human Resource Management, Special Issue: HRM in the Middle East: Towards a Greater Understanding, 25:2 (2014), pp. 167 – 89. Mohammed Al-Waqfi and Ingo Forstenlechner, ‘Stereotyping of citizens in an expatriatedominated labour market: Implications for workforce localisation policy’, Employee Relations, 32:4 (2010), pp. 364–81 and notably p. 271. Emilie Rutledge, Fatima Al Shamsi, Yahia Bassioni and Hend Al Sheikh ‘Women, labour market nationalization policies and human resource development in the Arab Gulf states’, Human Resource Development International, 14:2 (2011), p. 186. Rania Moussly, ‘New generation of Emiratis forge a new career path’, Gulf News, 19 April 2012. Khalid Al Ameri, ‘A wake-up call for Emiratis: Competition will change all the rules’, The National, 6 July 2012.

Chapter 10

After the Depression

1. Mauro F. Guille´n, ‘The global economic & financial crisis: A timeline’, Wharton, http:// lauder.wharton.upenn.edu/wp-content/uploads/2015/06/Chronology_Economic_ Financial_Crisis.pdf (accessed 29 June 2016). 2. Paul Jorion, Vers la crise du capitalisme ame´ricain (Paris, La De´couverte, 2007), came out a month before the crisis started. See p. 254. 3. WAM, ‘UAE takes preventive measures to face global financial crisis’, 12 October 2008. 4. WAM, ‘Mohammed bin Rashid orders transfer of Dhs70 billion to the Ministry of Finance’, 14 October 2008. 5. WAM, ‘US official commends UAE’s steps to handle global financial crisis’, 29 October 2008. 6. Cf. the column of Gulf News, ‘The right move at the right time. Government action brings us back from the brink’, Gulf News, 15 October 2008.

NOTES TO PAGES 205 –210

257

7. WAM, ‘Economic Committee examines impact of global credit crunch on sectors’, 26 November 2008. 8. WAM, ‘All well on the UAE front’, 27 November 2008. 9. Duraid Al Baik, ‘Dubai “an oasis of prosperity”. City still attracts new comers – Al Merri’, Gulf News, 11 March 2009. Major General Mohammed Al Merri was the general director of residents and naturalisation in Dubai. 10. Joanna Hartley, ‘20,000 Indian workers to be flown out of UAE’, Arabian Business.com, 8 February 2009. 11. ‘Dubai to boost public spending by 20pc, Merge Entities’, Khaleej Times, 28 December 2008. 12. Tom Arnold, ‘Construction chief predicts many firms will go bust’, Arabian Business, 6 January 2009. 13. WAM, ‘Seminar in Sharjah on the ongoing global financial crisis’, 29 December 2008. 14. Marwan Abu Ebeid, The Impact of the Financial Crisis on the Main Contractors in Dubai, UAE (Msc in Construction Management, Herriot-Watt University School of the Built Environment, April 2010). 15. Andy Sambidge, ‘Value of UAE building contracts falls 58% in 2009’, The National, 5 October 2009. 16. Landon Thomas Jr, ‘Dubai debt woes raise fear of wider problem’, New York Times, 27 November 2009. 17. The Doha Debates are annual oratorical contests. After two intellectuals argue on a text, the audience votes. The motion ‘Dubai was a bad idea’ was rejected (38– 62 per cent). 18. ‘The outstretched palm. Abu Dhabi bails out its neighbour. What will it ask in return?’, The Economist, 26 February 2009. 19. Christopher Davidson, Dubai: The Vulnerability of Success (New York, Columbia University Press, 2008), p. 392. 20. Which is arguable given the peak of commerce between Iran and the UAE at the beginning of the 2010s. See the chapter on Iran. 21. Abdulkhaleq Abdullah, ‘Give Dubai its due diligence’, Gulf News, 16 March 2009. 22. Johann Hari, ‘The dark side of Dubai’, The Independent, 7 April 2009. 23. WAM, ‘UK distances itself from slanderous stories on Dubai’, Gulf News, 7 April 2009. 24. Meher Murshed, ‘What’s prompting the attacks on Dubai?’, Gulf News, 10 April 2009. 25. Steve Rose, ‘How Dubai’s fantasy skyline tumbled to earth’, Guardian, 21 November 2008. 26. For the January 2010 report, see Bertrand Renaud, ‘Financial crises and real estate bubbles’, Ali Tawfik Al Sadik and Ibrahim Ahmed Elbadawi (eds), The Global Economic Crisis and Consequences for the Development Strategy in Dubai (New York: Palgrave Macmillan, 2012), p. 104 seq. 27. International Monetary Fund (IMF), United Arab Emirates. IMF Country Report 2012 (n8 12/116, Washington: IMF, 2012), p. 14. 28. International Monetary Fund (IMF), United Arab Emirates. IMF Country Report 2015 (n8 15/219, Washington: IMF, 2015), p. 12. 29. Ibid., p. 16. 30. See Ali Tawfik Al Sadik and Ibrahim Ahmed Elbadawi (eds), The Global Economic Crisis and Consequences for the Development Strategy in Dubai. 31. Hasan Zubair, ‘Dubai financial crisis: Causes, bailout and after – a case study’, Journal of Islamic Banking and Finance (July September 2010), p. 53. 32. Rahim Bah, Zaki Ehab and Ananth Rao, ‘Analysis of financial crisis in UAE financial markets’, International Research Journal of Finance and Economics, 83 (2012), pp. 123– 4.

258

NOTES TO PAGES 210 –219

33. Hasan Zubair, ‘Dubai financial crisis’, p. 53. 34. Reza H. Chowdhury, ‘Equity capital and bank profitability: Evidence from the United Arab Emirates’, Afro-Asian Journal of Finance and Accounting, 5:1 (2015), pp. 1 – 20. 35. International Monetary Fund, United Arab Emirates. IMF Country Report 2012, pp. 17– 19. 36. Reuters, ‘Dubai’s JAFZA secures $1.2 bn loan from eight banks’, 14 June 2012. 37. See Chapter 3. 38. Reuters, Isla Binnie, ‘Dubai’s debt clouds disperse’, 14 June 2012. 39. Frank Kane, ‘Dubai world’s debt deal marks start of a new era for emirate’, The National, 17 February 2015. 40. Mark Townsend, ‘Are Dubai’s debt storm clouds gathering again?’ Aljazeera, 6 February 2015, available online: http://www.aljazeera.com/news/2015/02/dubai-debt-storm-clou ds-gathering-150201075605951.html (accessed 29 June 2016). 41. Suzanne Fenton, ‘New body set up to tackle crisis’, Gulf News, 26 December 2008. 42. Suzanne Fenton, ‘Dubai’s Strategic Plan under review. Government moves to assess all projects’, Gulf News, 17 March 2009. 43. Suzanne Fenton, ‘Job cuts on the rise in Dubai’, Gulf News, 16 January 2009. The journalist is discreet on her sources. 44. The DSC did not release the GDP 2014 at current price. 45. Binsal Abdul Kader, ‘Cab driver petition over salary cuts. Several of them want to return home’, Gulf News, 7 December 2007. 46. See Chapter 9 on the identity crisis. 47. Wafa Issa, ‘Emiratis allege arbitrary termination of services’, Gulf News, 12 February 2009. 48. Samir Salama, ‘FNC expresses concern over firing of Emiratis’, Gulf News, 10 March 2009. 49. Dilip Ratha and Sanket Mohapatra, Revised Outlook for Remittance Flows 2009– 2011: Remittances Expected to Fall by 5 to 8 per cent in 2009. Migration and Development Brief Development Prospects Group, World Bank, [s.l (New York?)], 23 March 2009. 50. ‘UAE expat remittances top $49 bn in five years’, Emirate Business 24/7 February 16, 2012. http://www.emirates247.com/business/economy-finance/uae-expat-remittances-top-49bn-in-five-years-2012 – 02-16– 1.443377 (accessed 29 June 2016). 51. See the document on remittances in the chapter on Asian Tropism. 52. Shikha Jha, Guntur Sugiyarto and Carlos Vargas-Silva, ‘The global crisis and the impact on remittances to developing Asia’, Global Economic Review, 39:1 (March 2010), p. 67. The article supplies information since 1998 but is incomplete for 2009 –10. 53. See Chapter 7. 54. Bertrand Renaud, ‘Dubai’s real estate boom and bust of 2002– 2008: Dynamics and policy responses’, Housing Finance International, summer 2010, p. 10. 55. Ibid., p. 11. 56. John Issac, ‘Landlords undercut rents on glut fears: Landmark Advisory’, Khaleej Times, 4 November 2010. 57. Jesse Downs, director of research at a real estate consulting agency, Landmark Advisory, said the same in an interview given to Emirati newspapers. For example: ‘Rents drop as supply rises in Dubai’ Emirates 24/7, 15 June 2010, http://www.emirates247.com/eb247/ companies-markets/real-estate/rents-drop-as-supply-rises-in-dubai-2010-06-15-1. 255429 (accessed 29 June 2016). 58. Christopher Davidson, ‘The emirates of Abu Dhabi and Dubai: Contrasting roles in the international system’, Asian Affairs, XXXVIII/I (March 2007), pp. 33 –48. 59. Simeon Kerr, Roula Khalaf, ‘Dubai in UAE talks over state funds’, Financial Times, 18 November 2008. 60. Bradley Hope, ‘Dubai reassures creditors amid crisis’, The National, 24 November 2008. 61. The UAE media celebrated the event, cf. Gulf News, for instance, 22 May 2009.

NOTES TO PAGES 219 –225

259

62. The IMF lauded its progress, International Monetary Fund, United Arab Emirates. IMF Country Report 2015, pp. 2, 6. 63. See Chapter 8. 64. The IMF lauded its progress, International Monetary Fund, United Arab Emirates. IMF Country Report 2015. 65. ‘UAE the land of opportunity for Europe’s struggling jobseekers’, The National, 18 June 2012.

Conclusion

The UAE: A Pole of Stability

1. Christopher Davidson, After the Sheikhs. The Coming Collapse of the Gulf Monarchies (London, Hurst, 2012), pp. 220– 6. 2. Lucy Barnard, ‘Dubai house prices rise at fastest global rate, Knight Frank says’, The National, 7 December 2013. 3. Tom Arnold, ‘Dubai Expo 2020. After euphoria comes the question “How to pay for it?”’, The National, 30 November 2013.

INDEX

Abraaj Capital, 166 Abu Dhabi Fund for Development (ADFD), 127, 167, 181 Abu Dhabi Global Environment Data Initiative (AGEDI), 179 Abu Dhabi Global Environmental Data Initiative (AGEDI), 179 Abu Dhabi Investment Authority (ADIA), 92, 206–7 Abu Dhabi Investment House, 167 Abu Dhabi Marine Areas (ADMA), 155 Abu Dhabi Marriage Fund, 195 Abu Dhabi National Hotels Company (ADNHC), 12 Abu Dhabi National Oil Company (ADNOC), 87, 130, 153– 6 Abu Dhabi Sources (ADS), 170 Abu Dhabi Tawteen Council, 197 Abu Dhabi Tourism Authority (ADTA), 28 Abu Dhabi Water and Electricity Authority (ADWEA), 127 Abu Dhabi Water and Electricity Company (ADWEC), 130 Abu Musa, 37 – 8, 100– 4, 110, 117 Afghanistan, 112, 120, 121 Agassi, Andre, 25 Agricapital, 167 Ahmadinejad, Mahmoud, 107, 109, 110, 112, 116, 127 Ajman, 34, 35, 44, 79, 80 Fig. 4.1, Fig. 4.3, 173 Fig. 8.2 Al Ahmadi, Ahmed, 200 Al Ain, 37, 61, 127, 128, 131, 174, 188, 189, 198 Al Arri, Sheikha Eisa Ganem, 47

Al Assadi, Adel, 111 Al Attiyah, Abdul Rahman bin Hamad, 123 Al Awad, Mouawiya, 187 Al Awadhi, Najla, 193 Al Awadi, Saeed, 115 Al Badi, Mohammed Saheed, 94 Al Dahra Agricultural Company, 167, 169, 170 Al Futtaim, 213 Al Ghazal Transport, 213 Al Ghurair, Abdul Aziz, 46 Al Ghurair family, 63 Al Hilal Islamic Bank, 59 Al Khalifa, Isa bin Salman, 36 Al Khalifa, Khalifa bin Salman, 135 Al Kindi, Ali Saeed, 49 Al Maktoum, Ahmad, 115, 219 Al Maktoum, Hamdan bin Mohamed, 15, 63, 221 Al Maktoum, Maktoum bin Rashid, 17, 21 Al Maktoum, Mohammed bin Rashid, 22, 25, 26, 52, 55, 58, 59, 62, 63, 65, 99, 116, 204, 205, 211, 224 Al Maktoum, Rashid bin Saeed, 37, 63, 70, 77 Al Mansouri, Sultan bin Saeed, 167, 205 Al Mashat, Abdul Monem, 73, 86, 117 Al Muhairo, Arif Obaid, 71 Al Nahyan, Abdallah bin Zayed, 29, 43, 49, 109, 137, 159 Al Nahyan, Hamdan bin Zayed, 40, 42, 125, 131 Al Nahyan, Hazza bin Zayed

262

THE UAE

Al Nahyan, Khalifa bin Zayed, 45, 62, 65, 99, 190, 204, 219 Al Nahyan, Mansour bin Zayed, 43, 199 Al Nahyan, Mohammed bin Zayed, 94, 99, 107, 125, 130, 137, 219, 221 Al Nahyan, Nahyan bin Mubarak, 58 Al Nahyan, Saqr bin Zayed, 42 Al Nahyan, Sultan bin Tahnoon, 28 Al Nahyan, Sultan II bin Zayed, 42 Al Nahyan, Zayed bin Sultan, 36, 37, 101, 109 Al Qasimi, Khalid bin Mohammed Al Qasimi, Khalid bin Saqr, 50, 101 Al Qasimi, Lubna bin Khalid, 53 Al Qasimi, Saqr bin Mohamed, 50 Al Qasimi, Saud bin Saqr, 50 Al Qasimi, Sultan bin Kayed, 49, 50 Al Qudra Holding, 167 Al Saud, Nayef vin Abdelaziz, 128 Al Sayegh, Ahmed, 130 Al Shaibani, Mohammed, 115 Al Shamsi, Abdullatif, 201 Al Suwaidi, Jamal, 69 Al Suwaidi, Sultan, 114 Al Tayer, Obaid, 105 Al Thani, Hamad, 103, 128 Al Thani, Khalifa, 34 Al Wefaq National Islamic Society, 135 Al Zyoudi, Khamis, 49 Alabbar, Mohammed, 25, 217 Algeria, 31, 101, 133 Amir-Entezam, Abbas, 101 Amnesty International, 48 Anderson, Benedict, 11 Anholt, Simon, 11, 22 Anti Money Laundering and Suspicious Cases Unit, 114 Arab Authority for Agricultural Investment and Development (AAAID), 166, 167 Arab League, 101, 103, 119, 136, 140 Arab Shipping Company, 119 Arafat, Yasser, 101, 120 Areva, 181 Argentina, 206 Asefi, Hamid Reza, 113 Association of South-East Asian Nations (ASEAN), 139 Australia, 153, 170

Bahrain, 34, 35, 36, 39, 40, 50, 54, 59, 77, 100, 111, 119, 120, 121, 122, 124 Tab. 6.1, 125, 126, 134– 5, 136, 137, 140, 141, 142, 177, 196, 222 Balabagan, Sarah, 48 Baniyas, 145 Ben Ali, Zine el-Abidine, 134 Binhendi, Mohi-Din, 18 Boutros-Ghali, Boutros, 103 Brazil, 73, 167, 169, 224 British Petroleum (BP), 155 Brunei, 139 Buraimi, 37, 37 Fig. 2.1, 39, 61, 128, 132 Burj al-Arab, 4, 9, 24, 29, 52, 85 Burj Khalifa, 24, 29, 85, 171, 207, 219 Bush, George W. 78, 89, 90, 91, 106, 109, 112, 113 Canada, 113, 169 Cargill, 170 Central Bank of the UAE, 114, 204, 205, 207, 212 Chamber of Commerce, Dubai, 17, 21, 104 China, 27, 73, 99, 139, 140, 148, 150, 151 Tab. 7.2, 152 Tab. 7.3, 153 Fig. 7.2, 154, 155, 156, 159, 165, 168, 169 City Bank, 207 Tab. 10.1, 207, 218 Tab. 10.3 Conoco, 77, 105 Crescent Petroleum Company, 110 Daesh, 18, 116, 191, 221, 223 Damac Property, 55 Dana Gas, 59 Deira, 19, 24, 144 Dolphin Energy Limited (DEL), 39, 129–32, 131 Fig. 6.2 Du, 84 Dubai Academic City, 69, 79, 83 Fig. 4.4 Dubai Aluminium (Dubal), 69, 70 Dubai Commerce and Tourism Promotion Board (DCTPB), 16 – 20, 21 Dubai Electricity and Water Authority (DEWA), 59, 172 Tab. 8.4 Dubai Financial Market, 59, 204 Dubai Financial Support Fund (DFSF), 209 Dubai Flower Center, 83 Fig. 4.4 Dubai Healthcare City, 79, 83 Fig. 4.4 Dubai Heritage Village, 192 Dubai Holding, 27, 64, 211

INDEX Dubai Inc. 25 Dubai International Airport, 12, 13, 17, 19, 77, 78 –9, 205 Dubai International Arbitration Centre (DIAC), 81 Dubai International Financial Centre (DIFC), 58, 83 Fig. 4.4, 211, 217 Dubai Islamic Bank, 58, 64 Dubai Media City (DMC), 81, 83 Fig. 4.4, 83, 84 Dubai Multi Commodities Centre (DMCC), 83 Fig. 4.4, 170 Dubai Museum, 24 Dubai National Air Travel Agency (DNATA), 13, 17 Dubai Petroleum Company (DPC), 77 Dubai Port Authority (DPA), 78 Dubai Ports International (DPI), 78 Dubai Ports (DP) World, 78 Dubai Properties, 55 Dubai Studio City, 83 Fig. 4.4, 84 Dubai Supply Authority (DUSUP), 130 Dubai Tea Trading Centre (DTTC), 170 Dubai Tourism and Commerce Marketing (DTCM), 21 – 3, 24 Economic Commission for Western Asia (ECWA), 12 Egypt, 12, 49, 50, 84, 85, 113, 120, 133, 136, 138, 142, 157, 157 Tab. 7.4, 166 Emaar, 25, 27, 55, 64, 210, 217 Emirates Airline, 3, 9, 12 – 16, 17, 29, 64, 70, 206, 207, 217 Emirates Investment Authority, 92 Emirates Investment Group, 166 Emirates NBD (Emirates National Bank of Dubai), 113 Emirates Palace, 28, 29 EmPower, 13 Enron, 130 Estonia, 216 Etihad, 29, 30, 79 Etisalat, 84 Executive Council, Abu Dhabi, 79 Executive Council, Dubai, 63, 65, 217 Federal National Council (FNC), 44, 45, 46, 48, 190, 191, 193, 214 Flanagan, Maurice, 12, 13, 14

263

France, 16, 17, 28, 87, 88, 90, 99, 113, 152 Tab. 7.3, 154, 173, 176, 181 Fujairah, 35, 38, 47, 79, 81 Fig. 4.2, 81 Fig. 4.3, 84, 89, 131 Fig. 6.2, 131, 170 Gargash, Anwar, 49, 110, 135, 221 gas, 39, 68 Fig. 3.1, 70 Fig. 3.3, 105, 110, 126, 127, 129– 32, 131 Fig. 6.2, 153, 155, 161, 174, 175, 176, 177, 178 Gates, Robert, 112, 114 George Mason University, 69 Germany, 17, 28, 87, 99, 149, 150, 152 Tab. 7.3 Ghaith, Nasser, 48 Giat Industries, 129 Glencore, 170 Goldman Sachs, 202 government related entities (GRE), 64, 209–11, 217 Guggenheim Abu Dhabi, 29, 87 Gulf Air, 12, 119 Gulf Cooperation Council (GCC), 39, 45, 55, 56, 74, 86, 92, 94, 99, 102, 103, 105, 109, 111, 112, 114, 116, 117, 118, 119–21, 123 Fig. 6.1, 123, 124 Tab. 6.1, 124– 5, 126, 128, 129, 132, 133, 135, 136, 137, 139, 140, 148, 153, 159, 169, 177, 178, 190, 200, 214, 219, 222 Gulf Finance, 167 Hadi Najafabadi, 108 Hatta, 24, 38 Higher Colleges of Technology (HCT), 197–8 Hong Kong, 13, 14, 17, 20, 78 Human Rights Watch, 2, 48, 96 Hussein, Saddam, 102, 120, 143 Huwaysat, 39 Ibn Battuta, 3 India, 20, 54, 69, 77, 115, 130, 139– 41, 148, 149, 150, 151 Tab. 7.2, 153 Fig. 7.2, 154, 157, 157 Tab. 7.4, 158, 159, 165, 169, 184, 216 Indian population in UAE or Gulf States, 3, 61, 140– 8, 164, 184, 205, 215 Indian subcontinent labourers, 2, 27, 140– 5, 184, 215 Indonesia, 73, 139

264

THE UAE

International Atomic Energy Agency (IAEA), 176 International City, 216 International Court of Justice (ICJ), 101, 103 International Energy Agency (IEA), 153 International Humanitarian City, 81, 83 Fig. 4.4 International Institute for Environment and Development (IIED) International Monetary Fund (IMF), 57, 66, 133, 209, 210, 211, 225 International Renewable Energy Agency (IRENA), 29, 180– 2 Investment Corporation of Dubai (ICD), 92 Iran, 8, 12, 23, 34, 35, 38, 45, 50, 69, 73, 74, 86, 89, 90, 91, 94, 98, 99 – 117, 108 Tab. 5.1, Tab. 5.2, 118, 119, 120, 121, 126, 127, 129, 132, 135, 137, 140, 141, 156, 167, 177, 207, 221 Iraq, 12, 18, 23, 33, 45, 89, 90, 99, 101, 102, 104, 112, 116, 119, 120, 121, 122, 137, 140, 177 Israel, 20, 50, 61, 140, 142, 147 Italy, 15, 17, 87, 152 Tab. 7.3 Japan, 105, 113, 133, 139, 140, 148, 149, 150, 151 Tab. 7.2, 153, 153 Fig. 7.2, 154, 155, 156, 159, 163 Japan Oil Development Company (JODCO), 155, 156 Jebel Ali, 37, 78, 89, 105, 106, Jebel Ali Free Zone (JAFZ), 17, 25, 80, 83 Fig. 4.4, 170, 211, 225 Joint Committees, 125, 128, 137 Jordan, 73, 84, 85, 136, 142 Jumeirah, 1 Kerry, John, 115 Khalifa Port, 82 Fig. 4.3 Khamenei, Ali, 107 Korea Electric Power Corporation (KEPCO), 114, 177 Kuwait, 16, 23, 33, 35, 36, 42, 77, 89, 111, 113, 119, 120, 121, 122, 124 Tab. 6.1, 126, 132, 140, 141, 143, 166, 177, 179, 193, 196, 200 Lebanon, 12, 23, 99 Lee Kuan Yew, 11, 52 Lehman Brothers, 202

Levey, Stuart, 112, 113, 114 Libya, 88, 101, 112, 134, 137, 142 Liwa, 174 Louvre Abu Dhabi, 29, 87, 88 Madinat Jumeirah, 24, 85 Malaysia, 59, 60, 150, 219 Malls, 14, 19, 24, 76, 84 – 6, 144, 164, 224 Masdar City, 29, 64, 79, 80 Fig. 4.1, 82 Fig. 4.2, 180– 2 MoMA (Museum of Modern Art), 87 Morocco, 73, 136, 138 Mubadala Development Company, 92 – 3, 130, 169, 180 Mubarak, Hosni, 134, 138, 169 Muslim Brotherhood, 49, 61, 136 Nakheel property, 55 National Electoral College (NEC) Reforms, 45– 6 National Iranian Oil Company (NIOC), 110 Netherlands, 17 Noor Islamic Bank, 59, 60 Obama, Barack, 91, 112, 113, 114, 116 Oman, 6, 35, 36, 37, 38, 39, 61, 79, 84, 93, 100, 104, 112, 117, 118, 119, 120, 121, 122, 124, 126, 127, 128, 129, 130, 131, 139, 170, 196, 197, 199 Oman Gas Company (OGC), 131 Oman Oil Company (OOC) Dolphin Project, 130–1 Organisation of Arab Petroleum Exporting Countries (OAPEC), 44 Organisation of the Islamic Conference, 58 Organisation of Petroleum Exporting Countries (OPEC) Asian oil commerce, 153– 4 Pakistan, 13, 73, 112, 130, 139, 140, 141, 142, 143, 144, 145, 148, 149, 150, 153, 157, 158, 164, 166, 167, 168, 184, 215, 216 Pakistan International Airline (PIA), 13 Palm Deira, 25 Palm Jebel Ali, 25, 55 Pe´losse, He´le`ne, 181 Philippines, 73, 144 remittances, 157– 8, 194, 208, 214 Putin, Vladimir, 224

INDEX Qatar, 5, 27 Arab fraternities, 118–19 and the GCC, 121– 2, 124– 5 genesis of a federation, 34 – 7, 39, 40, 54 and Iran, 103– 4 Islamic banking and transnational capitalism, 59 – 60, 88 Saudi-Arabia leadership, 136– 8 strategic use of sovereign funds, 93 – 4 UAE– Qatar relations, 128– 32 Qatar General Petroleum Corporation (QGPC), 130 Rafsandjani Hashemi, 104 Ras al Khaimah, 34, 35, 38, 40, 44 Abu Musa and the Greater and Lesser Tunbs, 100– 2, 132, 169, 173 Sarah Balabagan, 49 – 50, 60, 69, 73, 82, 84 sovereign funds, 91– 2 Real Estate Regulation Authority (RERA), 216 Rouhani Hassan, 99, 116, 221 Russia, 99, 113, 129, 169, 206, 224 Saadiyat Island, 29, 87 Satwa Shaybah Zarrarah oil field, 37, 39, 40 Saudi Arabia, 35, 39, 42, 60, 65, 74, 80, 86, 89, 95, 99, 104, 111, 118, 119, 120, 121, 122, 123, 124, 125, 126, 127, 128, 129, 133, 135, 136, 137, 138, 139, 142, 143, 145, 148, 154, 156, 159, 166, 171, 177, 199, 200, 215 Sharjah, 16, 24, 35, 38, 44, 47, 60, 79, 86 UAE– Iran relations, 100– 2, 110, 132, 144, 146, 169, 184, 190, 192, 205 Shell, 155 Singapore, 5, 11, 13, 14, 17, 18, 52, 62, 78, 150, 153, 191, 222 Somalia, 166, 169 Sorbonne Abu Dhabi, 48, 69, 87 South Korea, 74, 88, 114 trade, 150–1, 153, 154, 156

265

Sri Lanka, 141, 170 Statistics Center Abu Dhabi (SCAD), 153, 189 Sudan, 138, 166, 169 Sulayem Khalid, 19, 21, 22 Supreme Council, 41, 43, 44, 108, 119, 128, 154 Syria, 12, 19, 99, 120, 123, 134, 136 Taiwan, 153 Tanmia and Emiratisation, 197– 200, 213, 214 Thailand, 139, 150, 153 Total, 105, 130, 154, 155, 156, 181 Tunbs (islands), 38, 100– 4, 117 Tunisia, 49, 50 Turkey, 73, 105, 123, 224 UAE Offset Group (UOG) Dolphin Project, 129–30 UAE University, 190, 197, 207 Umm al Quwain, genesis of the federation, 34– 5, 79 United Kingdom (UK), 73, 87, 92, 207 United States, 20, 38, 45, 73, 78, 85, 87, 89, 91, 94, 99, 105, 106, 109 bid for power in the Gulf, 121– 2 market share, 149– 50, 152, 154, 161, 176, 178, 184, 210, 223 UAE– Iran relations, 112– 15, 117 WAM (Wakalat Anba’a al-Emarat/Emirati national press agency) World Bank, 66, 81, 157, 214 after the depression, 215– 16 World Trade Oraganisation (WTO), 53, 57 World Wide Fund (WWF), 179 Yas Island, 30 Yemen war, 124, 137, 221 Zayed University, 43, 191, 193, 197