Increasingly polyglot: Demographic data points toward greater diversity for the Emirate

The Report: Dubai 2013 | Country Profile

Thanks in part to its role as a commercial centre, Dubai has long been a diverse place, host to dozens of languages and peoples from around the world. In recent years it has become even more so. Between 2006 and 2011, non-Emirati natural population growth – total natural births minus deaths – outpaced that of Emiratis, according to data from the Dubai Health Authority. The gap between the two has been growing, as well. In 2006 non-Emirati net growth outpaced that of Emiratis by 1654, but in 2010 that number swelled to 7087. This data does not take immigration into account, either. Foreign workers make up the vast majority of Dubai’s population, with about four foreign workers for every local, according to data gathered by researchers from several Dubai public institutions and the Washington, DC-based Centre for Global Development.

CULTURALLY RICH: This multinational workforce will likely serve Dubai well as it continues to move beyond the real estate and construction boom that fuelled rapid growth in the 2000s. Indeed, these workers are important in service-based areas of the economy like tourism and retail, where they can cater to the needs of a global clientele.

Diversity also offers a fillip to local educational institutions. Universities in Europe and North America have long sought an increasingly global body of students and professors. In Dubai, 24,504 out of 43,212 students studying in tertiary educational institutions were non-Emirati, according to the Knowledge and Human Development Authority.

The presence of internationals is even more pronounced when spread over the entire education system. Out of the 237,707 total students studying in Dubai during the 2011/12 school year, 183,126, or some 77%, were non-Emirati. An international student body could fuel a more dynamic way forward not only for the education sector but also the economy as a whole, since many of these students will find work opportunities in Dubai after graduation.

CASHING OUT: This level of diversity does, of course, come with challenges. The influx of foreign workers, for example, has been a major force in shaping capital outflows, since many workers send a portion of their wages back to their home countries. Remittances from the UAE grew 15% from $11.19bn to $12.87bn between 2011 and 2012, according to Y Sudhir Kumar Shetty, the chief operating officer of global operations at the UAE Exchange. GCC governments believe these outflows could be harmful for the local economy. In late 2011 Saudi Arabian officials proposed a remittance cap in order to keep more cash in the country.

Each dirham that flows out of Dubai, however, is not necessarily a dirham lost for Dubai. Remittances could also come back, since they provide foreign families with more cash to buy Dubai’s exports. India, for example, is the largest recipient of UAE-based remittances, taking in about $6bn annually from its guest workers there. Many of these workers are based in Dubai. Not surprisingly, India is also one of Dubai’s largest trading partners. In 2011 the country accounted for nearly a fifth of all the emirate’s foreign trade – a relationship valued at over Dh200bn ($54.44bn). Remittances sent out of the emirate can also be useful for monetary policy and can play a stabilising role, since they can reduce money supply and hold down inflation. Since the dirham is pegged to the dollar, the UAE central bank is already somewhat less flexible in controlling money supply.

SOCIAL CHALLENGES: In addition to economic considerations, social challenges can also arise as result of increased diversity. In July 2012, for example, an online campaign was initiated to push for a dress code in the emirate, with the BBC reporting that supporters had urged lawmakers to consider making it legally enforceable. The episode highlights the issues that can arise when such a diverse group of people inhabits the same city, but tackling these challenges is an important part of Dubai’s social development.

Countries: United Arab Emirates
Topics: Getting Started
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