A global vote of confidence
Dubai fulfilled the dream of 370 million Arabs and won a bid to host the world’s 2020 Expo fair to become the first city in the Middle East to organise the prestigious six-month event, which officials expect to attract at least 25 million visitors.
Most of the 168 member-states in the Paris-based Bureau International des Exhibitions (BIE) voted in favour of Dubai to testify to its credibility and big potential that will allow the Gulf’s business hub to cope with such an enormous event and ensure that it would be one of the most successful Expos in its 150-year history.
Only three years ago, when Dubai had a debt problem, sceptics expected that the emirate would need a long time before it could stand on its feet. But they all have been proved to be mistaken. In just a couple of years, Dubai’s economy was back on track, its finances rebounded and investors began to pour in again.
Analysts said Dubai’s winning bid to host Expo against Ekaterinburg in Russia, Izmir in Turkey and Sao Paolo in Brazil amounted to a global vote of confidence and testimony for the emirate’s capability, strength and prestige.
Analysts credited Dubai’s ability to recover in such a short period of time to the sound economic policies and the determination of its leadership. “The vote in favour of Dubai to be the host of the 2020 Expo amounted to a global vote for its credibility, openness, achievements and potential. Certainly, Dubai will work very hard to ensure the 2020 Expo would be one of the most successful events in the world fair’s history,” Mohammed Al Asumi, a Dubai-based economist said.
While Dubai, the second largest economy in the UAE, will pay billions of dollars for hosting the Expo, the investment will be more than offset in terms of hundreds of thousands of new jobs, GDP growth, more than $90 billion in value added for the emirate and above all, the promotion of Dubai as a credible and trustworthy international city.
As Minister of State Reem Al Hashmi put it: “The cost of the Expo is expected to be around 6.4 billion euros (Dh35 billion) to be shared by the public and the private sector. But the event will generate a value added for Dubai of nearly 17.7 billion euros (Dh92 billion) and revenue could be far above Dh100 billion.”
“A study by the Oxford Business Group has showed that the expected revenue from hosting Expo could reach 28.8 billion euros (Dh139 billion),” she said. “Although the Expo is a non-commercial event as it is based on learning, education, innovation and cooperation among peoples, this event will bring immense trade, economic and investment benefits to Dubai in particular and the UAE in general.”
Hashmi said the Expo would also create nearly 277,000 jobs in the UAE between 2013 and 2021 and that each job would generate 50 jobs in other parts of Middle East and North Africa (Mena).
Transport officials said nearly Dh5 billion of the expected investment for Expo would be channeled into the transport sector to cope with the human influx. The plan covers all means of transport including buses and trains besides mega projects to expand roads in various areas and set up direct links to Expo site, which will be built between Jebel Ali Free Zone and Dubai World Trade Centre, said Matar Al Tayer, Chairman of the Dubai Roads and Transport Authority.
“TRA has earmarked Dh5 billion for road and transport development if Dubai wins the bid to host Expo,” he said in press comments this month. The project covers many areas in the emirate, including Sheikh Mohammed bin Zayed Road, the University City Street, roads leading to Expo area, and intersections on several streets besides setting up car parks and stops for buses and taxis, he added.
“We believe that Dubai already has the infrastructure to cope with such a major event. All we need is some expansion and development of the existing facilities so they can handle 25 million people in six months,” he said.
In a recent report, the Washington-based Institute for International Finance (IIF) said Dubai’s success to host Expo would boost its GDP growth by one-two per cent annually. “We expect a bright future for Dubai’s economy because of this event which could attract more than 25 million visitors. Expo will certainly generate a new boom period in Dubai similar to that during 2003-2008, with growth of 6-7 per cent,” said the report.
In a report on the event, the Saudi news network Al Arabiya quoted a Western analyst as saying Dubai already has the infrastructure to host such a big event. “I think selecting Dubai is a right and safe decision because it has proved its capability to accomplish all goals it had set. Its infrastructure is already developed and Expo comes only to hasten projects under way,” said Allan Robertson, CEO of Jones Lang LaSalle, a global real estate services firm.
In its quarterly report issued recently, the government said Dubai’s economy continued its post-crisis recovery and expanded by around 4.7 per cent in the second quarter of 2013, driven by strong performance in trade and most non-hydrocarbon sectors.
The emirate’s real GDP grew by 4.1 per cent in the first quarter before picking up in the second quarter, indicating a steady recovery following a slowdown in the wake of the 2008 global financial crisis that hit most world economies, the government said in its latest report “Dubai’s economic horizons.”
“Growth was a result of expansion in many sectors, mainly trade, financial enterprises, transport and communications, real estate, construction and manufacturing,” it said.
The report showed the emirate is making steady progress in programmes to ease reliance on volatile oil exports, with the hydrocarbon sector expected to contribute only around 12 per cent of the 2013 budget. It showed non-oil sectors dominated the emirate’s GDP, estimating the share at 28 per cent for trade, 16 per cent for manufacturing, 14 per cent for financial enterprises, 13 per cent for real estate and 8 per cent for construction.
What is Expo
The World Expo is a large-scale, global, non-commercial event that has been held every five years in most of the past decades. The hosting of the World Expo must be applied for by a country and approved by the International World Expo Committee. Expo aims to promote the exchange of ideas and development of the world economy, culture, science and technology, to allow exhibitors to publicise and display their achievements and improve international relationships. Accordingly, the World Expo with its 150-year history is regarded as the Olympic Games of the economy, science and technology.
Expo in Dubai
Theme slogan “Connecting Minds, Creating the Future”
Dh35 bn spending
25 million visitors (70% from outside UAE)
A third of world’s people can reach Dubai in four hours by air and 66% in 8 hours
1st major Expo fair was held in London in 1851
Expo was last held in Shanghai, China, in 2010
Next Expo to be held in Milan, Italy, in 2015
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