Economist.com Cities Guide: Dubai Briefing - August 2005

News this month

Britons arrested

On July 21st police in Dubai arrested two British businessmen suspected of involvement in the London bombings of July 7th. Rafiq Saddique and Alam Ghafoor, both from West Yorkshire, were detained during a business trip to Dubai, and held without charge for more than a week. After being released and returned to the United Kingdom, both men gave a string of interviews complaining that they had been threatened with torture and deprived of sleep. The pair are believed to have come under suspicion because Mr Saddique is from Dewsbury, home town of one of the London bombers.

Come fly with me

Passenger traffic through Dubai International Airport increased by 13.7% year-on-year in the first half of 2005, driven by an increase in tourists to Dubai and the growth of Emirates airline. The state-owned Dubai Civil Aviation Department said 11.8m passengers used the airport from January to June.

Most of Dubai’s big hotels say their occupancy rates have been above 80% throughout the year, with room rates at record levels. Hoteliers say this has partly been driven by the dirham’s weak position relative to the euro and sterling—Germany and Britain are two of Dubai’s main markets for leisure and business travellers. Meanwhile, Emirates airline, which is also owned by the Dubai government, reported a 49% increase in net profits to $708m in the year to March 31st 2005.

Tax please

The United Arab Emirates (UAE) has asked the International Monetary Fund (IMF) for technical assistance in drafting a value-added tax system. Implementing this tax would represent a fundamental shift for the country, which enjoys a reputation as a low-tax haven. The IMF has long called on the UAE to broaden its tax base to reduce its dependence on oil, but until recently the UAE had resisted. Government sources argued that the UAE’s tax regime—no income tax, little corporate tax and no national sales tax—was a major incentive for foreign and domestic investors. Dubai is the location of the Middle East headquarters of multinationals including Microsoft, HSBC and Adidas-Salomon.

Jobs for the boys

The UAE's ministry of labour has implemented a policy that will require private-sector firms employing administrative staff known as public relations officers (PROs) to replace expatriate workers with UAE nationals. The move is part of the country’s efforts to reduce unemployment among the local population, who account for just 20% of the country’s 4.3m inhabitants. PROs are low-level administrative staff who handle red tape for companies at government ministries (processing visas and work permits is a common task). Traditionally, Asian expatriates have performed such low-paid jobs. But Dr Ali Abdullah Al Kaabi, the labour minister, has said that from the end of 2005, only UAE nationals will be allowed to liaise with his ministry.

Some have questioned whether the job will attract UAE nationals, who generally prefer well-paid management roles, often in the public sector. However, others say the government is no longer prepared to offer jobs for life to all UAE nationals, forcing locals with lower levels of education to seek less comfortable positions.

Catch if you can

August 2005

Amir Fallah and Youssef Nabil

September 1st-October 15th 2005

This autumn, Dubai’s new Third Line gallery presents works by two young Middle Eastern artists; Amir Fallah (Sept 1st-20th) and Youssef Nabil (Sept 23rd-Oct 15th). In the past, the California-based Mr Fallah, an Iranian painter, has fused American-style graffiti art with traditional Islamic calligraphy. His latest approach is equally interesting: amorphous shapes and lunar landscapes.

Mr Nabil, by contrast, is a Paris-based photographer with a talent for portraiture. He shoots in black and white and then hand-paints his prints to produce ethereal, almost cinematic images. The young Egyptian's lens has focussed on Tracey Emin, a British artist, Natacha Atlas (pictured), a striking Egyptian singer, and Paulo Coelho, a Brazilian author.

Third Line Gallery, Al Quoz 4, Dubai. For more information, call +971 (0)4 3943194, or visit the gallery’s website.

More from the Dubai cultural calendar