The Spirit of the Land
Tradition and Transformation in the UAE
The Spirit of the Land was written by Brian Moynahan, the former EuropeanEditor of The Sunday Times and Richard Morgan, a freelance journalist specialising in Middle East affairs. Photographs by Romano Cagnoni and Patricia Franceschetti.
The United Arab Emirates is a land of contrasts. Both fast moving and modern, yet a country still steeped in the culture and customs which have sustained its people for generations. A state which vigorously promotes industrialization, but just as fiercely protects its environment, and where soaring skyscrapers sit next to ancient forts and cooling wind towers, which have softened the harshness of the desert heat for centuries. While the new office blocks are emblems of the UAE's rapid progress, the latter signal that this will not be at the expense of traditional values.
Drive along the broad, six-lane highways and in the distance you can just pick out the once-used sand tracks and pathways of the camel herds and spice traders, part of a much older commercial heritage. In the heart of the desert's shimmering sands lie rolling pastures, which thanks to intensive irrigation. are almost as lush and green as those of America's Midwest. A plentiful supply of first-class hotels, good beaches, shaded city parks and duty-free shopping has given rise to another unlikely contrast - an oil state with a flourishing tourist trade.
Building such a country, where the traditions of the past coexist in such harmony with the aspirations of the future, may seem a complex task, requiring at least a century of gradual development. In fact it has been achieved in less than three decades. The UAE, a Federation comprising the seven emirates of Abu Dhabi, Dubai. Sharjah, Ras al Khaimah, Umm al Qaiwain, Ajman and Fujairah, was founded in 1971.
Few countries have grown so quickly. Oil wealth has undoubtedly been the foundation. The UAE has the world's third-largest proven oil reserves and fifth-largest gas reserves, of which 90% are in Abu Dhabi. State-owned Abu Dhabi National Oil Company (ADNOC) has launched a major $2.5bn investment program aimed at substantially increasing its natural gas capacity. This will help to meet increased local demand from Dubai and the other, smaller emirates.
Diversification has been encouraged too; by a free trade policy, favourable terms for foreign investors and sustained government support. The non-oil sector now accounts for two thirds of GDP, with petrochemicals, construction, distribution and manufacturing at the forefront. Expanding into petrochemicals is a natural step for an oil producer. The latest development: a new $1bn, joint venture polyethylene project. set up by ADNOC in partnership with Danish-based Borealis. Another noteworthy move: the $500m expansion program completed by the Dubai Aluminium Company last year.
Today the UAE is a thriving center. The main supplier of goods to the UAE is the US - which overtook Japan last year - with a close to 10% share of the country's total imports. The Emirates' top export market, however, is still Japan, which has a 37% market share. Much of the trading activities are centered on the Emirates' many free trade zones. The biggest is the Dubai-based Jebel Ali Free Zone. Once a wasteland of scrub and sea, it is now home to 1,200 companies, attracted by generous tax breaks, proximity to major markets and an excellent labour force. Dubai is the tenth largest container port worldwide, busier than New York or Tokyo.
The latest boost is Abu Dhabi's plan to spend $3bn on building its own free trade zone, spread over 3,500 hectares on Sadiyat Island. Plans for the new zone include building a new seaport and airport, commodity exchanges and huge storage facilities. It will be connected to Abu Dhabi city by a four-mile bridge. It is planned for the Sadiyat project to have an international share issue shortly, on both the unofficial UAE stock market and in Luxembourg. …