City of Gold: Dubai and the Dream of Capitalism

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Authors: Jim Krane
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Europe, finally reaching London on June 8, 1959. It had been a grueling trip, but Rashid wasn’t one to relax. The very next day, he met Queen Elizabeth II for the first time. He greeted her in her box at the Royal Tournament, a military pageant steeped in empire nostalgia. In keeping with the occasion, Rashid handed the queen, her prime minister, and several other top officials a collection of Arab swords and curved
khanjar
daggers. In return, he was given a few photographs in silver frames and an umbrella, a novelty for a desert sheikh.
    London made a big impression on Sheikh Rashid. He enjoyed the Royal Tournament’s pomp, but was more taken by the London Underground, which he boarded for a ride at St. James’s Park. He admired the sense of order, the magnitude of the buildings and elevated sense of politeness that seemed to stem from the British pride of accomplishment.
    The only dim spot was his son, Sheikh Hamdan, who, according to Foreign Office intelligence reports, assumed a teenager’s typical surliness for most of the visit.
    But Sheikh Rashid wasn’t just sightseeing. He also wanted to light a fire under oil exploration in Dubai. In one closed session with Minister of State for Foreign Affairs John Profumo, Rashid expressed “extreme frustration” that the British oil company refused to act on its exploration rights or reveal the extent of the sheikhdom’s oil prospects. The Dubai leader complained that he was locked into the 1937 deal signed by his late father. The contract prevented him from bringing in American oil firms working across the Saudi border which were eager to extend their string of big strikes.
    In the meantime, Rashid worried that Abu Dhabi, which had struck oil the previous year, would soon challenge Dubai’s newfound maritime supremacy, taking away his chief source of income. Dubai, he told Profumo, would again be impoverished.
    “Sheikh Rashid pleaded again and again that we should not treat his country as a little state in the back of beyond, but that we should regard him as part of our own country. (I think he really meant that he wanted a larger slice of cake!) He used the word ‘guardian’ to describe our relationship and said he had no other friends to which he could turn. He said anything we wanted from him would be granted,” states a Foreign Office memo. 25
    Sheikh Rashid got no satisfaction from the British. So he took action on his own. Perhaps he was pushed by Abu Dhabi’s challenge, or maybe it was the success of his dredging bid. But as soon as his plane touched down at home, Sheikh Rashid embarked on a remarkable string of gambles. Dubai’s desert was an empty palette. He was going to start painting.

The Gambler
     
    Sheikh Rashid’s motto is famous in Dubai: “What’s good for the merchants is good for Dubai.” But he had another unstated philosophy: Move first and outrun the competition. He did this even after Dubai struck oil in 1966. The current ruler, Sheikh Mohammed, has taken these mantras to new heights. But Rashid knew Dubai’s prosperity meantkeeping ahead of Abu Dhabi, a neighbor with more resources than Dubai could hope for. To do this, Dubai jumped at every opportunity, cornering industries and economic sectors.
    The curving creek remained Dubai’s chief port for only a decade. Even dredged, it was too small for the ships that dominated international trade in the 1960s. Dubai’s growth was hurtling and vessels again sat at anchor a mile off Dubai and transshipped cargo in barges.
    In 1967, Sheikh Rashid vowed to fix this problem. He hired Halcrow, the British planners that handled the dredging, and asked them to design a deepwater port named after himself: Port Rashid. It was the biggest earthmoving project in Dubai’s history, but, with the oil discovery, Dubai had the cash to make it happen. The sheikh wanted to press his advantage in infrastructure. The first port designs, built by digging away the beach of his ancestral neighborhood in

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