One of the world's most successful business ventures is a small city state that learned lessons from Singapore and Hong Kong.Dubai has been wisely using its oil and gas income over the years to invest in a different sort of future, replacing hydrocarbons with people as it has expanded to be the tourism and business hub of a region where 1.5 billion people are within two hours' flying time.
Thirty years ago there was nothing in Dubai but a creek, a sheikh's palace and a dodgy reputation as the smuggling capital of the Arabian Gulf. The traditional Arab dhows remain, and there were recent echoes of its smuggling past when it emerged, amid rumours of terrorist money-laundering, that much of Pakistan's illegal trade in nuclear materials passed through Dubai.But in most other respects, the sheikhdom has been magnificently transformed, and is now a beacon for legitimate, non-oil business in the Arab world—where shining examples of capitalism are rare indeed. Dubai is run like a family business by a benign autocrat, Crown Prince Sheikh Muhammad bin Rashid al-Maktoum, whose interventions in the economy have judiciously sought to work with market forces, not against them.Today Dubai boasts 272 hotels with 30,000 rooms, 30 shopping malls and almost 5m foreign visitors a year. Its airport's capacity is being tripled to 60m passengers a year. In the desert, Dubailand is being built—a $19-billion theme park twice the size of Disneyworld in Florida.As the city-state built huge tax-free shopping malls and launched sporting events, notably the Desert Classic golf tournament and the Dubai World Cup horse race, so it became a holiday destination, offering attractions such as desert safaris and dhow cruises.
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