A new generation of wealthy people are basing themselves in Dubai
Before the Covid-19 pandemic, Ziad Dannaoui was spending two-thirds of the year in a hotel. As president of Safanad, a global investment company, he was making four or five flights a week between its offices in New York, London and Dubai from his home in Beirut.
But Covid-19 led to him being stuck in Lebanon, isolated from global markets and colleagues, so he decided to move his family home to an office location, choosing Dubai. “It is safe and open,” he says. “Dubai has the right kind of leadership, very proactive and robust with quick decision making and an unwavering commitment to functioning infrastructure.”
Last August, he moved his family to the region’s business and tourism hub, buying a home in the popular residential district surrounding the Burj Khalifa skyscraper. “The lack of travel meant I needed to be in a place where we had an office and which had relevance for our business — with partners and counterparties there,” says Dannaoui.
His story is echoed by many new residents of Dubai. From tech workers to crypto enthusiasts, a new generation of wealthy individuals are basing themselves there — despite it being an autocratic state with a mixed human-rights record.
The trade and tourism-focused city has also long been a destination for those fleeing war or economic instability. For decades, Dubai has soaked up investment from people seeking a safe and neutral depository. Amid the unrest of the Arab Spring protests of 2011, huge sums flowed into the emirate, reviving it after the global financial crisis.
But as the pandemic struck global travel, many feared for Dubai’s future. The state-owned Emirates airline grounded its fleet and the hospitality sector suffered as Dubai entered lockdown. By late April and the post-Ramadan Eid holiday, however, the city began to reopen, albeit under social-distancing and mask-wearing restrictions.
While neighbouring oil-rich Abu Dhabi tightened its borders, requiring international visitors to wear an electronic wristband in quarantine, Dubai reopened to tourists last July — the only card the debt-laden emirate had to play, officials say. The drive was assisted several months later by the UAE’s vaccination campaign, one of the world’s most successful. (Almost three-quarters of the population had been fully vaccinated by late May 2021, mainly with the Chinese-produced Sinopharm jab.)
Despite an exodus of white-collar expatriates and lower-income migrant workers over the summer as hundreds of thousands lost their jobs, the city was beginning to liven up again in the autumn. Members of the global elite flew into the emirate for Covid-19 vaccinations, using their influence to jump the queue of residents. Others secured jabs under programmes to encourage people to move to Dubai and work remotely while the west was in lockdown.
Over the new year, Dubai became the world’s party centre, its airport rammed with revellers descending on one of the few tourist hotspots where life was carrying on relatively normally.
A surge of infections followed in January — and since February its case rate has surpassed that of the UK, according to UAE government figures. At one point, doctors warned that they were running out of beds. But a relatively young population — expats outnumber nationals nine-to-one — and vaccinations ultimately kept down the number of severe cases of the disease and eased pressure on hospitals.
The city kept its borders open and is sustaining its pitch as a safe place to holiday and work for foreigners. But the UAE’s relatively high caseload and status as a transit hub means some countries have restricted travel. The UK, one of its closest partners, has kept the country on its ‘red list’, meaning the roughly 100,000 Britons resident in the UAE face paying for 10 days’ hotel quarantine if they head home to escape the stifling summer heat.
Dubai, however, shows no signs of shifting its strategy. Helal Al Marri, Dubai’s director-general of tourism and commerce marketing, says new visas to encourage remote workers to live in the emirate have generated tens of thousands of applicants as global companies give staff greater flexibility in where they base themselves. “While most countries are putting more restrictions on travel, we are looking at easing travel and friction points while critically balancing the highest levels of safety protocols.”
The emirate has gone from being an economic hub for the Middle East, he says, to attracting companies operating in markets further afield, including Africa and Australia.
The Arab world’s economic superpower, Saudi Arabia, is an emerging threat, having told multinationals that they must relocate their regional headquarters to Riyadh if they are to continue receiving lucrative state contracts. But Dubai is banking that its higher quality of life will sustain the influx of wealthy people, thereby kick-starting a broader economic revival.
“Dubai always wanted to become the Monaco of the Middle East,” says one private banker. “The pandemic has set it further along that path.”
Simeon Kerr is the Financial Times’ Gulf correspondent
This article is part of FT Wealth, a section providing in-depth coverage of philanthropy, entrepreneurs, family offices, as well as alternative and impact investment