Political implication. In Dubai, family business returns to the mainstream politics. Different from other states or emirates in the region, business elites contributed a significant part in Dubai’s political institutions. Before the Dubai World crisis was revealed, the Dubai government reshuffled Dubai Investment Corporation (DIC), a subsidiary of Dubai Government, and dismissed three board members that had been the pillars of Dubai’s economic development, including the President of Dubai World. Currently, only members of the ruling family are in the newly established board of DIC. In this sense, family business is back to the mainstream politics in Dubai. It enables the new generation of the ruling family more room to muscle their economic and political ambitions. On the emirate level, Dubai and Abu Dhabi are getting intertwined through intermarriages and cross investments recently. Yet, the competition still exists. The global financial crisis is a turning point to rebalance Dubai and Abu Dhabi in the federal affair, consequently, affects the future development of the UAE.
Economic implication. The construction sector contributes approximately 10 percent to Dubai’s GDP. The Palm projects and other real estate projects under Dubai World constitute a substantial part of Dubai’s construction. The delay of these projects will cause a decline of Dubai’s GDP. Yet, it is necessary to point out that one strategy adopted by the Dubai Government to cope with the global financial crisis was to complete those major infrastructure projects, such as Dubai Metro. In September 2009, Dubai Metro was launched on schedule. It signifies that the cost of business operation and living standard is reduced significantly. Moreover, there are signs of economic recovery in Dubai. Statistics shows that passenger numbers at Dubai International Airport has risen in double digits for three consecutive months. The occupancy rate of five-star and four-star hotel reached to 79 percent and 81 percent in August respectively. Re-export volume has also been picked up. All these reflect that Dubai’s economic fundaments are still sound. Trade, tourism and service sectors are on the way of recovery.
Social implication. High level of national unemployment and the concentration of nationals in the public sector have been headache for the government over the years. Through various training programmes and the support of government policies and regulations, there are significant improvements in nationals working in the private sector. When the global financial crisis took place, the first batch of employee laid off was those expatriates working in infrastructure. After the reshuffle, the staff downsizing could involve those nationals in the office. An appropriate solution of accommodating nationals could have a short-term impact on those nationals willingness to pursue career in the private sector. Besides, the return of the Arabian expatriates would cause significant pressures on both employment and social welfares in their home countries.
Prospect of development. Dubai is a member of the United Arab Emirates. It does not enjoy hard powers in economy or military that a state possesses. Its rapid development is embedded with its soft powers, including favorable business policies and regulations, tolerance of cultures and religions, concise and swift administrative procedure. Before the crisis, Dubai was troubled by high inflation and high rents. It competitiveness reduced. After the crisis, these problems are relieved. Dubai waits for a new opportunity to take off.
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