Why Is The City Of Dubai So Rich? (2024)

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.

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.

Why Is The City Of Dubai So Rich? (1)

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.

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Why Is The City Of Dubai So Rich? (2024)


Why Is The City Of Dubai So Rich? ›

Dubai's independence from the sale of oil may make it a particularly wealthy emirate. The foundation of its multifaceted economy is trade, transportation, technology, tourism, and finance.

Why is the city of Dubai so rich? ›

The discovery of oil in 1966 changed everything and transformed Dubai into a wealthy city almost overnight. Oil and gas exports generated huge revenues for the city and enabled it to invest in infrastructure, public services, and social programs.

What is Dubai's main source of income? ›

Key Takeaway: Dubai's largest single source of income is oil and gas exports, followed by tourism, real estate, trade and logistics, and financial services. Strategic economic planning by government entities has been crucial for elevating Dubai into a globally competitive hub for business and leisure.

Why is almost everyone in Dubai rich? ›

Dubai's incredible wealth and opulence can be attributed to several factors, including its strategic location, its abundant oil reserves, and its visionary leadership. Additionally, Dubai has been able to diversify its economy by investing heavily in industries such as tourism, real estate, finance, and technology.

Why Dubai is the most luxurious city in the world? ›

Dubai - The jewel of the Middle East

This futuristic city is characterised by its incredible skyline of skyscrapers and artificial islands in the shape of palm trees. Luxury real estate in Dubai is second to none, with ultra-modern residences offering breathtaking sea views and world-class facilities.

How does Dubai make money if there is no tax? ›

How does the Dubai government make money without tax? The Dubai government generates revenue primarily from sources other than direct taxation. This includes fees from licenses and services, real estate transactions, and customs duties.

How rich is the city of Dubai? ›

The economy of Dubai represents a per capita gross domestic product as of 2022 of US$46,665. Dubai has substantially transformed over the last couple of decades. More than 90% of the population are foreigners.

How many billionaires are in Dubai? ›

Dubai is also home to 212 millionaires with over $100 million or more, and 15 billionaires. Dubai ranked 21st on the list that ranked the top 50 cities based on the raw number of high-net-worth individuals (HNWIs). The only other Middle Eastern city that made the top 50 was Tel Aviv in Israel, with 24,300 millionaires.

What's the average income in Dubai? ›

The average salary in Dubai, according to SalaryExplorer.com, stands at approximately 15,700 AED ( 189,000 AED yearly) which is 4274.43 USD as per exchange rates in November 2023.

What is the main source of wealth in Dubai? ›

So, unlike its neighbors, whose economies rely on oil, Dubai has a diversified economic base resting on finance, trade, transportation, tourism, oil, and technology industries. Free trade, a low tax rate, and zero income tax have made Dubai a popular business hub and a wealthy state.

Is there any poverty in Dubai? ›

Dubai's poor population is relatively small, as the government provides subsidized housing and food. However, they still face challenges such as job insecurity and limited access to education. Middle-class families in Dubai typically own cars and live in spacious apartments.

How is Dubai so clean? ›

The city's streets are regularly cleaned, and littering is heavily penalized. The use of plastic bags has been banned, and the city has introduced recycling programs to encourage residents and businesses to reduce their waste.

Is Dubai cheap to live in? ›

Dubai is the country's most expensive city to live in. A family of 4 would spend 3 times more than in Sharjah — AED 12,918 or $3,518 a month.

How did Dubai get so rich? ›

The bulk of its money comes from the production of goods and provision of services related to petroleum, petrochemicals, aluminium and cement.

Is Dubai safe to live and work? ›

Dubai has a low violent crime rate compared to cities its size in other countries. Many would credit Dubai's strict laws and enforcement for this level of safety, even though some of these restrictions may seem difficult for foreigners to adapt to.

Is Dubai a safe place to live? ›

The UAE government has implemented pretty strict laws around crime, so Dubai is an exceptionally safe place to live and visit. In fact, due to these laws crime has been reduced by 63% so locals and visitors are well protected (and discouraged) from crime and danger.

Is it easy to get rich in Dubai? ›

In conclusion, achieving financial success and building wealth in Dubai requires a combination of practical tips and strategic approaches. By implementing sound financial practices, such as budgeting, saving, and investing wisely, individuals can lay the groundwork for long-term financial growth.

What is the average salary in Dubai? ›

The average salary in Dubai, according to SalaryExplorer.com, stands at approximately 15,700 AED ( 189,000 AED yearly) which is 4274.43 USD as per exchange rates in November 2023.

Why is Dubai so expensive? ›

Filled with luxury hotels, shopping and experiences, it is often called the “playground of the rich.” While Dubai is expensive, more than 2.5 million expats live in this city of 3.55 million people. Many are wealthy, drawn in by the lavish lifestyles, immigrant-friendly laws and lack of income tax.

How many billionaires live in Dubai? ›

Dubai ranked 28th on the list of cities with the highest number of billionaires in the world, according to the 2024 Hurun Global Rich List, while the UAE ranked 22nd among countries. According to the list, Dubai is home to 21 billionaires, while the UAE hosts 24 billionaires.


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