Dubai overview:

Oil was discovered in Dubai just over 50 years ago, but only accounts for one percent of its earnings. So, what makes the city of Dubai so rich?

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From the 1770s up until the late 1930s, the pearl industry was the main source of income in the Trucial States, which today make up the United Arab Emirates. For residents of the sleepy fishing villages of the Persian Gulf, pearl diving was their humble beginning in trade, but it set the scene for something much larger later on.
Dubai and Abu Dhabi clashed over their borders in the search for oil in the late 1950s, leading to many people moving out of Dubai to other places in the Gulf as the city struggled and Abu Dhabi thrived. In 1958, the ruler of Dubai, Sheikh Rashid bin Saeed Al Maktoum, started investing in infrastructure and completed its first airport in 1960 thanks to loans amounting to tens of billions of dollars.

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The move away from oil led to a boost in tourism, and the little oil Dubai eventually discovered in 1966 went towards building the city we know today.
Dubai began shipping oil in 1969 before gaining independence from Great Britain in 1971, when it became one of the UAE’s seven emirates.
As part of Emirates, but with relative independence over its economy, Dubai continued to diversify its revenue stream throughout the 1980s in order to compete with Abu Dhabi’s growing profit from the oil industry.
The city established its first free zone in 1985: Jafza, the Jebel Ali Free Zone, which at 52 sqkm (20 sqmi) is the largest in the world.
This became a big attraction for global businesses, which today take advantage of the emirate’s 30 free zones that offer tax breaks, custom duty benefits and lack of restrictions for foreign owners.
Jumeirah Public Beach, Dubai | © JB-2078 / Alamy Stock Photo
Several thousand Jafza companies make up 20 percent of foreign investment in Dubai, and the estimated 144,000 employees are generating $80 billion in non-oil money. That’s 21 percent of the city’s Gross Domestic Product (GDP).
The UAE is the third-richest country in the world, below Luxembourg at number two and Qatar at number one, with a GDP per capita of $57,744. The bulk of its money comes from the production of goods and provision of services related to petroleum, petrochemicals, aluminium and cement.

The economy of Dubai represents a per capita gross domestic product as of 2022 of US$46,665.[1] Thani Bin Ahmed Al Zeyoudi, Minister of State for Foreign Trade, announced that the UAE's non-oil trade over 10 years totalled Dhs16.14 trillion ($US 4.4 trillion).[2] The UAE GDP jumping from $407 billion in 2021 to $440 billion in 2022 and $467 billion in 2023. Similarly, per capita GDP will also expand from $43,868 in 2021 to $46,665 in 2022 and $48,822 in 2023.[3]


Downtown Dubai at night
The International Herald Tribune described it as "centrally-planned free-market capitalism".[4] Oil production, which once accounted for 50% of Dubai's gross domestic product, contributes less than 1% today.[5] In 2018, wholesale and retail trade represented 26% of the total GDP; transport and logistics, 12%; banking, insurance activities and capital markets, 10%; manufacturing, 9%; real estate, 7%; construction, 6%; tourism, 5%.[6][7]

Dubai became important ports of call for Western manufacturers. Most of the new city's banking and financial centres were headquartered in the port area. Dubai maintained its importance as a trade route through the 1970s and 1980s. The city of Dubai has a free trade in gold and until the 1990s was the hub of a "brisk smuggling trade" of gold ingots to India, where gold import was restricted.

Today, Dubai has focused its economy on tourism by building hotels and developing real estate. Port Jebel Ali, constructed in the 1970s, has the largest man-made harbor in the world, but is also increasingly developing as a hub for service industries such as IT and finance, with the new Dubai International Financial Centre (DIFC). Emirates Airline was founded by the government in 1985 and is still state-owned; based at Dubai International Airport, it carried over 49.7 million passengers in 2015.[8]

According to Healy Consultants, Dubai is the top business gateway for the Middle East and Africa.[9][unreliable source?] The government has set up industry-specific free zones throughout the city in hopes of giving a boost to Dubai property. Dubai Internet City, now combined with Dubai Media City as part of TECOM (Dubai Technology, Electronic Commerce and Media Free Zone Authority) is one such enclave whose members include IT firms such as EMC Corporation, Oracle Corporation, Microsoft, Sage Software and IBM, and media organisations such as MBC, CNN, Reuters and AP. Dubai Knowledge Village (KV), an education and training hub, is also set up to complement the Free Zone's other two clusters, Dubai Internet City and Dubai Media City, by providing the facilities to train the clusters' future knowledge workers. Dubai Outsourcing Zone is for companies who are involved in outsourcing activities can set up their offices with concessions provided by Dubai Government. Internet access is restricted in most areas of Dubai with a proxy server filtering out sites deemed to be against cultural and religious values of the UAE.

During the financial crisis of 2008–2009, Dubai was about to default and, therefore, was obliged to downsize and restructure suffering state entities. The International Monetary Fund (IMF) stated in 2019 that Dubai’s debt exceeded 100% of its GDP. Abu Dhabi rolled over a bailout loan of $20 billion to Dubai to save it.