You are on page 1of 11


In under 40 years, Dubai has changed itself from a nearby exchanging group into a standout
amongst the most uplifting, energizing and fruitful urban communities on the planet. Its
advancement keeps on maing worldwide features and it is presently a colossally appealing goal
for voyagers and organizations indistinguishable.
With an assorted, multicultural populace, Dubai offers its inhabitants and organizations a the
earth, enhanced with several societies and a personal satisfaction and work unrivaled in the
Middle East. It is a clamoring city with a blend of Emirati legacy, Arabic imperativeness,
Western spontaneity and Asian desire.
With an indigenous populace of only 170,000, the amount of Dubai exile occupants now
remains at 2 million, on account of its lifestyle offer and venture motivations. The assessment
free approaches and punishment free repatriation of income have huge profits on both an
individual and business level, with extraordinary open doors for private investment funds and
expert benefits.
As a huge number of new organizations are uncovering every year, Dubai is the ideal entryway
in the middle of East and West and the favored center point for the district's imports and fares
market a standout amongst the most lucrative on the planet.
Dubai's vital area gives simple access to 2.2 billion shoppers, from an interesting brought
together time zone that consolidates East and West business hours.
Aim of the Report
The aim of this report is to analyze Dubai as an international business city. Dubai is compared to other
major international cities, primarily New York. The comparison is conducted to determine the viability of
the city to attract foreign direct investment.
From the comparison the report aims to give recommendations on how to improve Dubais competitive
advantage as an international business city.
Methodology of Report
In order to formulate a competitive advantage strategy for Dubai, the following analytical tools in
strategic management are used:
5 forces
Competitive Profile Matrix (CPM)
Integrative strategies
Intensive strategies
SWOT matrix
Each analytical tool is used to highlight a particular aspect or set of aspects that either give Dubai a
competitive advantage or hinged it from gaining a competitive advantage over a rival city.
Porters Five Forces
Competitive Advantage is an general term for a scope of systems that survey a nearby economy focused
around its capability to make wellsprings of preference (minimal effort, high development, or
separation) for region firms. The most prevalent preference investigation structures are those created
by administration scholar Michael Porter, particularly his precious stone system of national intensity and
the related five powers of firm contention, haggling force of suppliers and clients, risk of new
contestants, and substitute items. The precious stone skeleton inspects four components that focus the
aggressiveness of a city and could be impacted by government:
1. Factor conditions: the availability of inputs such as skilled labour, infrastructure, and capital.
2. Demand conditions: the level and sophistication of local demand.
3. Business/sector structure, strategy, and rivalry: the degree of competition.
4. Related and supporting industries: the availability and degree of linkages between core and
supporting activities.
Dubai's rulers have been reliably probusiness and development arranged. The administration made an
environment in which remote and local organizations contended on harshly equivalent terms. Soes led
its monetary advancement, yet Dubai's authority strives to mediate little with the exception of
characterizing forceful development aspirations. Dubai made up for the absence of labor and abilities by
permitting the migration of laborers, particularly those of lower expertise levels. Nonetheless, it likewise
made living conditions that made it alluring for gifted ostracizes to move to Dubai. Through assessment
free zones, it made an aggressive environment to draw in remote organizations (see the full Dubai
precious stone at Figure 12). The 2008 financial emergency uncovered numerous shortcomings in the
framework, particularly identified with administration, hazard administration and oversight over the
financing of this development. The legislature was not transparent in the choice making methodology.
The private part has not been included in characterizing system going ahead and there are no
establishments that empower open private joint effort. Besides, regardless of the late development in
the training framework and the acceptable center of the legislature on expertise improvement, the
Emirati populace remains inadequately gifted to contend all inclusive. There is likewise the inquiry of a
developing social partition between the two classes of nationals: Emiratis and non-Emiratis.

Dubai SWOT analysis
Dubais Key Advantages
I. Vital Location: Dubai is a period zone connect between the Far East and Europe on the
East-West pivot and the CIS and Africa on the north-south hub. It is a door to a market that
might be portrayed as:
Large - entrenched exchanging connections exist with the more prominent than 1.5 billion
individuals in the neighboring area coating the Gulf, Middle East/Eastern Mediterranean,
CIS, Central Asia, Africa and the Asian sub-landmass;
Growing - Dubai's aggregate universal exchange has developed on normal by in excess of
11% for every year since 1988 and territorial financial development and liberalization ought
to support request further;
Prosperous - a light neighborhood economy deliberately placed amidst one of the world's
wealthiest areas and plentifully supplied with sufficient supplies of shoddy vitality and
essential aluminum; likewise contiguous real territorial suppliers of indispensable agro-send
out wares;
Diversified - changed and critical import necessities produce open doors for item suppliers
and re-exporters;
Accessible - served by in excess of 120 delivery lines and joined through 85 aerial
transports to in excess of 130 worldwide objectives;
Open - no trade controls, shares or exchange
II. Political And Economic Stability: Dubai is a piece of the UAE which is a low-wrongdoing
and politically-stable nation. Additionally, the UAE revels in money related and fiscal
security. Its decently created, complex managing an account framework characteristics far
reaching credit offices and plentiful liquidity. The Emirate's rising capital markets are based
on a premise of heading edge advances and sound administrative frameworks. The
administration has a long, steady duty to master business, liberal monetary approaches
including the insurance of licensed innovation rights. The UAE profits from steady and
symphonious modern relations. At last, there is a decently characterized, sound lawful
system for business and an agreeable set of possession guidelines. Outsiders are allowed
proprietorship privileges of up to 49% for restricted risk organizations made inside the
Emirate of Dubai and up to 100% for expert organizations, limbs and delegate work places
of remote organizations and free zones ventures. These components reflect decidedly in
Dubai's being relegated a venture evaluation rating for altered pay speculation by Moody's
Investors Service.
III. Open And Free Economic System: Dubai's economy has been kept open and allowed to
draw in financial specialists and business. Government control and regulation of private
segment exercises has been kept to a base. There are no immediate duties on corporate
benefits or particular salary (aside from oil organizations that pay a level rate of 55% and
extensions of remote banks that pay a level rate of 20% on net benefit produced inside
Dubai). Traditions obligations are low at 4% with numerous absolutions, 100% repatriation
of capital and benefits is allowed, there are no outside trade controls, exchange standards
or boundaries and a stable swapping scale exists between the US Dollar and the UAE
Dirham (Us$1.00=aed 3.678). Liberal visa approaches allow simple importation of exile
work of different aptitude levels from just about everywhere throughout the world.
IV. World Class Infrastructure and Service Sector: Dubai's purposeful approach of putting
vigorously in transport, information transfers, vitality and mechanical framework has
empowered it to have one of the best foundation offices on the planet; it additionally helped
fundamentally both to its continuous flourishing and allure to global business. The Emirate
offers a system of seven mechanical ranges, one business park and three very effective,
concentrated free zones of worldwide qualification, two world class seaports, a real global
airplane terminal and load town, a current parkway system, state-of-the-craft information
transfers and solid power and utilities all of which convey productivity, adaptability,
unwavering quality, sensible cost and size.complementing its reality class foundation is an
advanced administration area that peculiarities heading territorial and universal cargo
forwarders, shipping organizations, back up plans in addition to significant global lodgings,
banks and fiscal administration firms, attorneys, bookkeeping firms, experts, publicizing
offices, top universal display and meeting offices, brilliant office and private convenience,
top notch healing centers, schools, malls and recreational offices. Free Zones Websites:
Dubai Airport Free Zone Jebel Ali Free Zone Dubai Media City Dubai Internet City
V. Focused Cost Structure: International organizations setting up in Dubai can acquire
noteworthy expense focal points not for the most part accessible universally. The central
point are:

No outside trade controls,

No exchange hindrances or quantities,

Competitive import obligations (4% with numerous exclusions),

Competitive work costs work power is multi-lingual and talented,

Competitive vitality costs,

Competitive land costs,

Competitive financing expenses and elevated amounts of liquidity,

No corporate benefit or particular pay assessments (aside from oil organizations and
extensions of remote banks). You can allude to the tables under the "Expense of Doing
Business" area.

VI. High caliber of Life, Excellent Living Conditions: Dubai's private division has put
intensely in land, for example, lodgings, private and business properties, recreational and
recreation offices. Likewise, various elements have helped the Emirate's high caliber of life
and predominant living conditions making it a model area for some to imitate. Those
components incorporate phenomenal infrastructural offices, low wrongdoing, nature's turf,
tolerance and social assorted qualities, cosmopolitan life style, advanced open organization,
accessibility of an extensive variety of buyer merchandise and administrations, mellow
winters and clean, palm bordered sunny shores.
VII. Solid Local Commercial Tradition and Wide Choice of Potential Business Partners: The
neighborhood business class has a long convention of exchanging movement and wide
presentation to worldwide business practices and state-of-the-craftsmanship advances.
Nearby ambitious people have officially picked up fruitful experience with global
organizations in franchising, permitting, joint wanders, and so on, in different segments of
the economy.
VIII. Broad Foreign Trade Network & Major Achievements in Export and Re-Export
Performance: Dubai gloats a far reaching outside exchange system stretching out to 179
states consequently offering the financial specialist a broad decision of potential worldwide
promoting outlets for a various arrangement of products and administrations. As a part of
the UAE league, Dubai is likewise piece of the world's third-biggest fare and re-fare focus
after Hong Kong and Singapore.
IX. Quickly Developing Manufacturing Sector Producing a Wide Range of High Quality,
Competitive Export Products: Major additions have as of now been made in the productive
make and fare of aluminum ingots, created metal items, materials and instant pieces of
clothing, gold and adornments, arranged foodstuffs, customer gadgets, refined petroleum,
concoction and non-metallic mineral items
Weakness and Threats
Dubai's obligation is an essential sympathy toward speculators and budgetary foundations
(Figure 37). From December 2004 to March 2013, the notional estimation of UAE
government and corporate universal obligation securities expanded from Us$2.5 billion to
Us$68.8 billion (Figure 38). Here global obligation is characterized as obligation securities
issued outside of the business sector where the borrower resides62. While this may at first
be seen as the sound development of the UAE's obligation showcase, this ballooning was
unfathomably awry to the more extensive area. Amid this period, UAE global obligation
expanded from 6% of that issued in Africa and the Middle East joined together to 35%,
demonstrating conceivable overleverage and a creating credit bubble. Besides, the way that
universal obligation expanded at such a pace additionally infers, to the point that the
household obligation advertise in the UAE was inadequately develop to handle the issuance
and utilization of such volumes, showing a generally powerless money related framework.
While the danger of political shakiness in Dubai is low, the danger of agitation in the more
extensive Middle East district can't be disregarded. Any acceleration in exchange sanctions
against Iran, the UAE's third biggest fare business sector, could raise strain in the more
extensive locale. Numerous ostracizes use Dubai as a base from which to live and afterward
set out to the stretched out MENA locale to work. In the event that those zones got to be
politically insecure, there would be no purpose behind these experts to dwell in Dubai.

Strengths Weaknesses
Fast decision making Negative image of the Middle East
Oil money, booming economy Barren desert, the lack of natural resources
Political neutrality and impartiality Only 20% of UAE nationals
Unique beauty, hotels and attractions
The lack of fundamental infrastructure:
transportation, water
Luxury experience includes relaxing beaches and
invigorating sport and exploration opportunities
Luxuries might appeal too small a segment
Safe environment Debt Level

Opportunities Threats
Increasing oil price
Strong competitors: within the region: Abu Dhabi,
Qatar; outside of region: Singapore, Hong Kong
Increase job opportunities for immigrants and
Oil running out in 30 years
Growing luxury market
Terrorism and war could further negative image of
Middle East, UAE
Increase in foreign investment Limited media coverage
Proactive attitude
Well-developed MICE environment

Intensive Strategy: Market Development through Diversification
Broadening is vital to push financial improvement, to make openings for work for arapidly developing
nearby drive, additionally to lessen or spread the danger of a high monetary focus, which makes an
economy powerless against outer occasions, for example, changes in the cost of the predominant item.
An expanded monetary enhancement can enhance the execution of the economy and minimize
instability and support the way of a manageable advancement. All the more particularly, general
instability and its following overflow impacts might be moderated with the successful advancement and
broadening of high-esteem included generation and an expand of fares of administrations and products
of high caliber.
It is well realized that advanced development money making concerns has concentrated on innovative
advancements and hightechnologyn innovative work as the motor variables for financial development;
specifically endogenous development hypothesis highlights the essentialness of mechanical
advancement and gainfulness of elements (Helpman, 2004). Different lines of examination have focused
on likewise the part of organizations as a central reason for long-run development (Acemoglu, Johnson,
Robinson, 2005). Late improvement encounters propose that a suitable business environment is among
the key elements of practical advancement.
The UAE 2021 vision as of late taken by the Government takes a gander at development and learning as
the key drivers of the economy14. Government approaches fused into the UAE 2021 vision of the
economy focused around advancement and information constitute a critical step towards a
differentiated learning economy and another development model, yet these strategies ought to go for
making a proper business environment furthermore an incorporated set of delicate and hard
establishments. UAE, indeed, does not positions well in ensuring financial specialists and on contract
The Emirate that has attained the best and a most obvious bring about the expansion of the economy
has been Dubai. In the most recent decades Dubai has turned into a real universal administration
economy and secured itself as a territorial habitat for fund, land improvement, shopping, tourism, fares
and re-sends out. Dubai accomplished, case in point, the improvement of the Jebel Ali port and harbor,
different "free zones" (i.e., venture zones) all through the city, and far reaching land edifices pander to
the travel and tourism industry15.
Dubai has taken after a financial formative model which is firmly master business, accentuates market
progressivism and monetary openness, and grasps globalization, while in the meantime abstaining from
testing the conventional neo-patrimonial administration structure in the nation. Thusly, the "Dubai
model" has so far been particularly not the same as financial models connected in the other Gulf
Cooperation Council (GCC) economies16. Dubai is currently seen as a model for alternate Emirates and
for the Gulf nations.
The worldwide budgetary emergency has thrown uncertainty over the customary model of
development. The contention that upgrades in information are an essential wellspring of development
has ended up all the more forcing. The thought that making an information society, taking into account
learning and concentrated on engrossing, adjusting and delivering information, gives particularly
alternate points of view on advancement procedures than those gave by the conventional model, which
has been focused consideration on expanding capital and the proficient distribution of assets. The
collection of learning is naturally connected with externalities (information spillovers)17, since learning
is fundamentally an open decent (Foray, 2004).
However the experimental and innovative learning does not spread equally over all divisions of the
economy, then there are discontinuities of an alternate sort from part to segment (Schilir, 2010).
In this differences concerning the dispersal and improvement of information between divisions of the
economy of a nation, the interest positively assumes an essential part in tending to the organizations to
concentrate on those parts and those items that give a higher expected return.
A nation that is hydrocarbon-rich is not predestinated to monetary fixation. Norway, for instance,
creates a measure of oil for every day surpassed just by Saudi Arabia, yet it has had the capacity to
enough disseminate its GDP over a mixed bag of profitable monetary parts, and its incomes from oil and
gas make up just more or less a quarter of its local yield. Canada is an alternate economy, rich of
common assets, that have effectively differentiated its economy.
Obviously, broadening suggests a structural change of the economy. Structural change normally alludes
to significant changes in the arrangement of vocation and in the relative commitment of essential,
auxiliary and tertiary areas to total development (Schilir, 2012). Therefore, structural change intimates
farming conversion, industrialization, urbanization, changes in the creation structure and in local
interest, outside exchange and money. To have a more enhanced economy it is important to put
resources into profitable areas which can support, with their large amounts of gainfulness, genuine
development in the long haul, and additionally the improvement of new learning and engineering. Yet
additionally it would be fitting to encourage the development of the outer part when advertising
expansion; that is, the fare of an extensive variety of high-esteem added products and administrations
to an extensive variety of ends.
Also, information and abilities have turned into the worldwide coin of 21st century economies. With the
globalization and with the related completely portable capital, there is no purpose behind nations to
restrict themselves to examples managed by enrichments, as expectedly characterized; more
paramount is the 15 Dubai Economic Council (2011).
Thusly, it is justification to move towards and to actualize another model of advancement for the entire
UAE, which visualizes a more differentiated learning based economy.
Competitive Profile Matrix (CPM)
The March 2013 Global Financial Centers Index positioned Dubai twenty-third, one spot above Shanghai
yet dropping one positioning from 2012. Dubai was not voted "one of the main ten budgetary focuses
prone to end up more huge". Likewise, Dubai was profiled as a developing worldwide contender,
alongside Beijing and Moscow. This profile might be translated as an overhaul from a year ago's order of
worldwide pro".
Supporting the money related focus' development is Dubai's main ten positioning for its level of
solidness as a fiscal centre24. This is particularly germane given the emirate's area in an unstable locale
and the way that it has as of late persevered through a speculator fuelled credit air pocket emulated by
a land property crash.
MSCI overhauled the UAE's grouping from Frontier Market to Emerging Market25. This was very much
an accomplishment considering that there were a sum of thirty downright downsizes and just nine
straight out redesigns inside Frontier and Emerging Markets. The UAE's order update was to some
extent because of its "Market Infrastructure Custody" classification redesign from "Issues" "No Major
Issues. The class overhaul was upheld by this present year's improvement of the UAE's operational
effectiveness of the "Conveyance versus Payment" (Dvp) show through execution of a strong false
exchange (purchaser money remuneration) component. This highlights the significance of powerful
budgetary business foundation for
Figure 10 subtle elements the consequences of the audit for a choice of provincial contenders. The
UAE's level of availability is fundamentally the same to that of Qatar for every classification and is
marginally superior to that of Bahrain. Whilst the extent of Saudi Arabia's monetary markets
predominate those of the UAE, the UAE breaks even with or beats Saudi Arabia in every openness
measure. Nonetheless, according to the UAE's late overhaul, it should now contend with other
developing markets, for example, South Africa. Contrasted with this local contender, the UAE's openness
to outside possession and business sector framework things are in critical need of improvement before
the UAE might be thought to be at a similar level of complexity as Hong Kong.

11 The hydrocarbon economy continues to account for approximately 80 percent of total government
12 This expansion will boost annual aluminium capacity to 1.3mln tonnes/year.
13 The trade balance achieved a huge surplus and it represents 23.5 percent of the GDP (UAE Ministry of
14 Innovation and knowledge-based economies are characterized by a good healthcare system, a highly
performing education system and proper policies and regulations. In other words the innovation driven
economies are the ones with the highest levels of prosperity. EEC (2011).
21 In 2012 the median age of the EU-27s population is around 40 years.
22 A principal reason for a supply short-fall beyond increased demand is that deficient or inappropriate
education or training reduces the pool of potential employees in many emerging markets.
23 Krane (2012) argues that Abu Dhabis renewable Energy plan is not economically convenient, but it
may have the positive effect of reducing fuel consumption in conventional power plants, which will cut
carbon emissions and burning of expensive backup fuels.