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Deconstructing Dubai

July 13, 2008|Christopher Hawthorne | Christopher Hawthorne is the architecture critic of The Times.

Dubai

The Vulnerability of Success

Christopher Davidson

Columbia University Press: 376 pp., $32.50

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Back in February, Related Cos., the developer working with architect Frank Gehry on a $3-billion mixed-use complex on Grand Avenue in downtown Los Angeles, announced it was bringing in a new investment partner: Istithmar, a sovereign wealth fund controlled by the ruling family of Dubai. The deal, which gave Istithmar a 45% stake in the project, was reminiscent of the 1980s, when Japanese companies took advantage of a sagging American economy to acquire skyscrapers and other high-profile buildings in Manhattan and Los Angeles. And as was the case 20 years ago, people began asking curious, anxious questions about the flush foreigners: Where did they get so much cash, and what's leading them to use it to buy up -- or at least buy into -- our skylines?

For many Angelenos, the answer probably seemed obvious: The Istithmar fund gets its money from oil, and Dubai's sheiks are keen to stash it abroad as a way to diversify their portfolios before the petroleum reserves back home run dry. As Christopher Davidson's "Dubai: The Vulnerability of Success" makes clear, though, that explanation is mostly wrong. Dubai, one of seven semiautonomous Persian Gulf sheikdoms that make up the United Arab Emirates, has turned itself into a rising and nimble economic power that actually depends on everything but oil to fill its coffers and fund its wide-ranging domestic and international ambitions.

Unlike its supremely wealthy neighbor Abu Dhabi, which is practically drowning in petroleum, Dubai never had much of the stuff to begin with. Its production peaked in 1991, at around 420,000 barrels a day -- less than half a percent of what Saudi Arabia now produces -- and today no more than 5% of Dubai's GDP comes from oil-related revenue. The rest is provided by a remarkably forward-looking economic engine that draws steady profits from trade, luxury tourism, high technology and high-profile real estate investments like the one on Bunker Hill.

While we moan about gas prices and try rather fitfully to imagine a post-petroleum urban future, Dubai has largely already arrived there. Even as construction workers hammer away at the 2,300-foot-high Burj Dubai tower, which will rank when finished later this year as the tallest building in the world, Dubai is showing its ambition below ground as well. The emirate is building a sophisticated subway system that will be mostly complete by 2010 and rival any in the developing world -- and many (ahem) in the West.

As Davidson traces Dubai's rise from sleepy Gulf port to player on the world scene, he devotes equal time to highlighting "several key problems that lie beneath the emirate's glittering facade." Now a fellow at the Institute for Middle Eastern and Islamic Studies at England's Durham University, Davidson earlier worked as an assistant professor of political science at the Sheikh Zayed University in Abu Dhabi and Dubai, and his familiarity with the quirks and customs of Dubai helps lift the text, while quite dry, above typical think-tank fare.

The book defines Dubai as a new breed of political and urban animal, equal parts Las Vegas and Singapore. Nominally Islamic but increasingly Western on its public face, Dubai combines laissez-faire economic policies with an unapologetically closed political system. As a place to run an international business, Dubai has few peers, as was demonstrated last year when defense contractor Halliburton, to Washington's chagrin, relocated its corporate headquarters there from Houston. As a political entity, Davidson writes, "Dubai is still an autocracy, where real evidence of an opening for true democracy proves hard to find, and where far less political reform has occurred than in neighboring Gulf states, including even Saudi Arabia."

As singular a place as Dubai has become, with its just-add-water skyline and its indoor ski resorts, with its archipelagoes of man-made islands topped by multimillion-dollar villas, its blueprint for success may also be a sign of things to come. If the titanic, expensive struggle between capitalism and communism dominated the geopolitics of the second half of the 20th century, the early years of the 21st are shaping up as a test for a handful of hugely ambitious regimes trying to mix free-market growth with autocratic rule. Like China, if on a far smaller scale, Dubai is involved in a high-stakes game of chance, betting that as long as it can keep its economy revving at a high enough level, it will be able to keep real political restructuring at bay.

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