In Dubai, when does brag become a drag?

by Yeoh Siew Hoon

Every conversation about Dubai is always peppered with the question, “When will the bubble burst?”

I think it’s a question that’s been asked since Dubai started its ambitious building spree, the boldness of which took the world’s breath away – and, in the process, inspired copycats.

(A Taiwan business tycoon has announced that he would build Taiwan’s most-luxurious hotel, modelled on the sail-shaped Burj-al-Arab, by Sun Moon Lake in central Taiwan.)

You can understand the obsession with the “bubble” question.

The Gulf News in Dubai weighs a ton, with property advertisements. During the week I was at the Arabian Travel Market, news of new developments came fast and furious with every developer vying for attention.

An example of some headlines – Palm Islands will host 210 hotels, Dubai to have Dh500m German business centre, Marriott plans to increase regional portfolio by 54% in three years, Emirates boosts hotel portfolio, Tatweer brings Universal theme park to DubaiLand, etc etc

During dinner one evening in Singapore with John Davis, CEO & President of Pegasus Solutions, we were talking about Shanghai, a place he was due to visit on this trip through Asia, and the impending room glut in the Chinese city.

He laughs, “This business is cyclical, we all know that. It’s when the small boys get into the game, when they think they can make money from the hotel business and they start building – that’s the beginning of the down cycle. That’s always been the pattern.”

He pauses for thought. “The only places that defy this are Las Vegas and Dubai.”

So let’s consider that for a moment. Both places are in the desert. One has no natural resources. Dubai has oil reserves, which are running out, so we are told. Both have huge hinterlands of rich people with plenty of leisure time and wads of money.

And the biggest difference – one has gaming, the other does not. Like it or not, gaming underpins Las Vegas as a destination. Yes, even though 2006 statistics from the Las Vegas Convention & Visitors Authority says that visitors spent an average 3.3 hours gaming, the destination was built on chips and a roll of the dice.

What underpins Dubai as a destination? People often ask me that and I am hard-pressed to find one answer.

Is it the big city lights? The big malls, fancy hotels, swanky restaurants and bars? Well, you can get all that too in Shanghai, Hong Kong and Singapore.

Ah, it’s the permanent sunshine, great beaches and clean ocean. I can see the attraction in that for folks from colder climes – which explains why Russia, the German-speaking countries and the UK are big markets.

Perhaps it’s the desert or rather the idea of being in the desert where you can do a day trip and say, “I have done the desert?”

Or possibly, it’s just the brag factor. “You’ve got to see Dubai. It’s unbelievable.”

When does brag become a drag though? All the construction and development going on is detracting somewhat from its “beach paradise” image. The traffic woes make getting round stressful for visitors, be they there for business and leisure.

I wonder if Dubai’s crossed the tipping point between “unbelievable” and “UNBELIEVABLE!”

In a recent interview in the Financial Times with the man who rules and runs Dubai, Sheikh Mohammed bin Rashid al-Maktoum, it was clear he too is used to the “bubble” question.

Referring to his neighbours “that once looked at Dubai with skepticism” and are now embarking on similar expansions, he was quoted as saying, “They used to tell us it’s a bubble, that we can’t have tourism. Now they’re running after the bubble.”

When asked why everything has to be the biggest and tallest in Dubai – it is said construction on Burj Dubai has stopped because it wants to see how high Taiwan’s Taipei 101 will reach so that it can overtake, he said: “Why not? Does anyone ever remember the second man who landed on the moon or the second man who climbed Mt Everest?”

He wants to build what he calls an Arab “renaissance”.

And according to the report, despite concerns that Dubai may be over-stretching, he is considering two “big projects”. “We will not over-reach because we learn from our experiences,” he said.

He added. “People think we are just building Dubai. But no, we’re accommodating 1.5bn people in the central world, here, between the east and west.

“When we say the west and we think of Europe and America. When we say the east and we think of Japan and China. And we are part of Asia but we are in the Middle East. And that’s what I meant by the central world.”

And that, I think, is what underpins Dubai as a destination and makes it a bubble unto itself.

Catch Yeoh Siew Hoon every week at The Transit Café – www.thetransitcafe.com

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