Is Dubai a Country?

No, Dubai city is within the sheikdom of Dubai, which is one of the seven sheikhdoms that, together, make up the country of the United Arab Emirates, frequently shortened to UAE.

A sheikhdom is a traditional form of Arab tribal governance, in which the headman, known as the sheikh, is seen as a wise elder and clan leader who rules in consultation with his people.

You could also call the sheikhdoms emirates – and that would certainly line up more neatly with the name of the country – but it appears that sheikhdom is the more correct term.

All these sheikdoms were under British protection until 1971, when the British Labour government decided they could no longer afford to protect them. The British pulled out and, while the sheikdoms argued about what to do next, the Iranians nicked two of their islands.

So, the sheikdoms pulled together and formed a new country, the United Arab Emirates. Some laws apply to the country as a whole, but each sheikdom retains control over most laws and how they are enforced within their territory. Essentially, they are seven small but rich countries, each crazy in their own way, that share the same national football team.

All seven of the sheikhdoms have a capital city with the same name as the sheikhdom. The seven sheikhdoms, in order of size, are:

• Abu Dhabi
• Dubai
• Sharjah
• Ras al-Khaimah
• Fujairah
• Umm al-Quwain
• Ajman

As you can see in the map, Abu Dhabi is friggin’ huge. You could fit all the other sheikhdoms combined into Abu Dhabi 6.5 times!

Abu Dhabi also has the most oil and gas, meaning it has the most money.

Dubai is the 2nd biggest but has far less oil and gas. It has, however, been more innovative in re-investing that money into other businesses, so that they will still have money when the oil runs out.

Most obviously, they opened up Dubai city to foreign property investment and benefited greatly when most of money in Russia disappeared during the 1990s. That is essentially where all the cash for those stunning skyscrapers came from.

As a result of that opening up, Dubai is now the sheikhdom with the biggest population, 4.2 million, with 3 million of them living in Dubai city. For comparison, the entire sheikhdom of Abu Dhabi has a population of just 2.79 million.

Of course, 85% of Dubai’s population are not Emiratis, they are people who have flooded into Dubai from all over the world, and that is only increasing. Over the past ten years alone, the population of Dubai city has doubled.

Disaster in Dubai in 2009

Diversification was a smart move for Dubai, and other oil-dependent countries are planning far bigger schemes inspired by Dubai – such as Saudi Arabia’s $500 billion Neom city – but it came very close to disaster when the world economy crashed in 2007 and foreign money stopped flowing into Dubai property developments.

The biggest developer, the Dubai government-owned Dubai World, got into serious trouble in 2009 when it had to admit that it could not meet some looming debt deadlines. They asked all their financiers to extend the time they had to repay certain debt.

This embarrassing situation further knocked confidence in the world markets. It looked as if Dubai, which had seemed so unstoppable during the six boom years before the 2007 crash, was heading for some cold, harsh, involuntary financial restructuring.

Dubai World was unexpectedly saved at the last minute with a $10 billion bailout from Abu Dhabi, which bought them valuable time to arrange a more consensual restructuring of their debts.

The world economy began to grow again in 2010 and, over the past 9 years, lots of Chinese money has been looking for somewhere to land, anywhere that isn’t China. Today, the Dubai property market is once again booming.