Exploring the United Arab Emirates: Economy, Culture, and Tourism
Economics
The wealth of the UAE is largely based on the exploitation of oil, representing about 20% of its GDP. The Arab nation is the third-largest Gulf producer after Saudi Arabia and Iran (production in Iraq has decreased significantly due to the war).
Since 1973, the UAE has undergone a profound transformation from an impoverished region of small principalities to a modern state with a high standard of living. The country’s per capita GDP is comparable to that of major Western European nations. Investments of oil profits and a strategic foreign policy have allowed the UAE to play an important role in regional affairs.
Its main trading partner is Japan, which receives 30% of its exports. The remaining exports are distributed among Singapore, India, South Korea, and Iran. The primary sources of imported goods are Japan, France, the United Kingdom, the United States, Germany, and Italy, with each country’s share not exceeding 10% of the total imports.
Technical, Financial, and Legal Considerations
Customs procedures are simple and largely automated, reflecting the government’s policy to promote trade, as evidenced by the thriving re-export industry. Technical regulations at the border are generally based on internationally accepted standards.
The exclusive agency law (the UAE lacks specific legislation governing competitiveness) contributes to local market segmentation and higher prices for branded goods.
Given the informal payment practices of some Emirati customers, businesses, especially those new to the market, should prioritize securing payment in advance via bank transfer or cash/check.
The Commercial Letter of Credit is a widely used payment instrument, available on demand, with deferred payment, or as a revolving credit facility. The irrevocable and confirmed Letter of Credit provides exporting companies with a secure method of payment collection in the UAE.
The ECESB (Export Credit and Business Coverage) is open without restriction for short, medium, and long-term commercial credit. The UAE is classified in the second group for medium and long-term operations and in the third group for short-term operations. For transactions with public buyers without federal guarantees, Abu Dhabi and Dubai are classified in the third group, while the other Emirates are in the fourth group.
Tourism
In recent years, the government has focused on diversifying income sources to reduce reliance on limited oil reserves. This effort has led to the sustained development of tourism, with a hotel infrastructure based on coastal, desert, and sports attractions.
The success of these initiatives, combined with factors such as the relatively low price of raw materials, the warm climate that prevails throughout most of the year, iconic landmarks like the Burj al Arab and the Palm Islands, and a favorable attitude toward the West, has led many to compare the UAE to Singapore or Hong Kong in the Middle East.
Dubai is a major tourist destination and a hub for service industries, including information technology, finance, and logistics. As the epicenter of one of the wealthiest regions in the world, Dubai offers significant business opportunities for investors in various sectors, including manufacturing, regional offices, and headquarters.
The Burj al-Arab (Arab Tower), built on an artificial island near Dubai, is one of the most striking hotels in the world. With a height of 320 meters, it is the world’s tallest hotel and a symbol of the country.
Festivals
Based on the lunar calendar, festival dates vary annually. The main festivals include Eid al-Fitr (marking the end of Ramadan), Eid al-Adha (corresponding to the pilgrimage), Lailat al-Miraj (the Ascension of the Prophet), the Prophet’s Birthday, and the Islamic New Year. Other celebrations include New Year’s Day (January 1st) and National Day (December 2nd).
Culture
The UAE’s cultural landscape is a fascinating blend of tradition and modernity. Futuristic buildings stand alongside old adobe palaces, reflecting the country’s rapid transformation from a past era of scarcity to its present prosperity.
Eight out of ten people in the Emirates are foreigners, primarily Indians and Pakistanis working in the oil industry or various utilities. This influx results in a male population almost double that of the female population.
The role of women varies across the different emirates. Despite the high standard of living, many women still adhere to the strict rules of Koranic law, while others, albeit a minority, adopt a less strict lifestyle. Access to secondary education for women is gradually increasing.
Although the UAE is part of the Islamic community in the Gulf countries, its way of life and customs are more relaxed than in some neighboring countries. The more conservative areas are generally located in the western part of the nation.
Transportation
For longer distances, minibuses are available, although the only direct link is between Abu Dhabi and Dubai. To travel to other cities, taxis are necessary.
Renting a car is relatively easy in Abu Dhabi and Dubai but more challenging in the rest of the country. Given the limited public transportation options, renting a car can be a convenient option, especially considering the low cost of gasoline.
Food
Emirati cuisine shares similarities with other Islamic countries in the region. Traditional dishes include felafel, ful medames, hummus, and shawarma. Other specialties include Warak Dawalia (stuffed vine leaves), Mahshi (stuffed vegetables), and Katayef (sweet dumplings). Due to the country’s cosmopolitan nature and significant immigration from Southeast Asia, a wide variety of international cuisines and Southeast Asian specialties are also readily available.
Health
Health conditions in the country are generally good, and no compulsory vaccinations are required. As in other Arab countries, especially during summer, precautions should be taken to avoid sunburn and dehydration.
Places of Interest
The two emirates with the most attractions are Abu Dhabi and Dubai.
Abu Dhabi
The capital, Abu Dhabi, is situated on an island connected to the mainland by a causeway. Key points of interest include the Al-Husn Palace, the Cultural Foundation, and the old souk.
Another notable site is the city of Al Ain, located 150 kilometers from the capital, bordering Oman and situated in the Buraimi oasis. Here, visitors can explore the small enclave of Muraijib, the Omani-style Al-Khandaq fort, and other ancient buildings, including the East Bastion near the Grand Mosque.
Dubai
In Dubai, the Dubai Museum, the Sheikh Saeed Al Maktoum House, and especially the Creek (a stretch of seawater best explored by water taxi) are worth visiting. The city of Dubai itself is a fascinating blend of modern architecture and traditional customs.
The other emirates have fewer attractions, although Sharjah boasts the old souk and the King Faisal Mosque, and Ajman features an interesting castle, the former palace of the emir.
Practical Tips and Other Useful Information
- Initial meetings may involve multiple individuals and frequent interruptions. Emphasize that the purpose of the meeting is to schedule future private meetings.
- Business cards should be printed in both English and Arabic. Brochures and catalogs should be printed on glossy paper and include numerous photographs.
- The UAE is a small market where news and rumors spread quickly. Discretion and confidentiality are valued.
- Oral agreements are binding. Bargaining is common and expected. While Arabs appreciate a good deal, be mindful of potentially inflated prices.
- Due to Arab courtesy, proposals are rarely rejected outright during meetings. Expressions of interest may simply reflect politeness.
- Women should dress modestly for business appointments.