The Transformation of Dubai- a Global Trade Hub

In the 16th and 17th centuries, cities were built around seaports and waterways. Over time, roads, railroads and canals leading to trading opportunities defined the location of major cities. With the evolution of transport and logistics, the 21st century is seeing a new trend emerging where airports are determining the location of economic hubs and creating 'Aerotropolises'.

The term 'Aerotropolis' was coined in the beginning of the 21st century by John D. Kasarda, Professor of Strategy and Entrepreneurship at the University of North Carolina, who researched the evolution of airports from transportation and supply chain-focused areas into mixed-use commercial centres that are the pivotal factor for business location, urban growth and global economic integration.

With its strategic location in the trade network connecting Asia with the Mediterranean and North Africa, Dubai has thrived in its role as a regional hub. The emirate has invested heavily on developing its infrastructure and has followed a strategy to diversify away from energy commodity exports into a broader base and fourishing service sector to become the major trading hub it is today.

In June 2010, the Emirate added another milestone in the evolution of the global logistics industry when it launched operations at Al Maktoum International Airport, which is set to be the world's largest airport in terms of both passenger and cargo volumes.

Dubai is not stopping there. It is commited to further developing its transportation and logistics infrastructure and will have the frst and only integrated sea-land-air corridor that would allow containers ofoaded from a ship to be transported and airborne in two or three hours.

As global trade acquires an even greater importance in the world economy, Dubai is well positioned to facilitate increased and more efcient trade fows, signifcantly enhancing the economic competitiveness of the Emirate, the United Arab Emirates and the region as a whole.

In light of this, the Government of Dubai established the Dubai Multi Commodities Centre Authority (DMCC), the master developer of the Jumeirah Lakes Towers (JLT) free zone, the fastest growing free zone in the UAE, DMCC's main objective is to enhance commodity trade fows through the Emirate by providing the physical, market and fnancial infrastructure required.

JLT enjoys close proximity to the major logistics and transportation hubs in the UAE, and it is recognised as the free zone of choice for many business activities ranging from oil and petrochemicals, gold, diamonds and shipping to recruitment, IT and advertising. JLT is also just 45 minutes away from the capital of the UAE, Abu Dhabi, and adjacent to an extensive logistics network including roads, ports and airports, that link Dubai with the other Emirates and surrounding countries.

Since its inception in 2002, DMCC has developed diferent commodity-related services and fnancial products which have successfully managed to drive the trade of gold, diamonds, pearls and tea through Dubai, at record levels. For example, diamond trade reached record volumes of 268.7 million carats in 2010, up 50% over 2009, while the total value doubled reaching $35.1 billion, making diamonds the second most valuable commodity imported in Dubai. In 2010, $41.3 billion traded through Dubai through DGCX, DMCC's gold exchange. In August this year, DGCX set daily volume records on two consecutive days: 35,796 contracts traded on August 4 beating the record of 24,532 contracts traded on August 3. The Exchange also reached its highest ever monthly volume of 548,566 contracts valued at US$27.83 billion, a massive increase of 393% compared with last year. This surpassed the previous record of 310,990 contracts set only in July 2011.

In addition, DMCC plays a vital role in commodity focused trade fnance. Through its innovative and award-winning Global Multi Commodities Receipt (GMR) platform, DMCC facilitated transactions of approximately US$ 1billion since inception.

In August, DMCC unveiled the prototype of the frst gold bullion coin in the UAE. Designed by DMCC, the "Khalifa" coin features a portrait of His Highness Sheikh Khalifa on one side, and on the other, Burj Khalifa, the world's tallest tower. At present, DMCC is in discussions with the UAE Central Bank to designate the gold bullion coin as the frst legal tender in the UAE and the Middle East as a whole. A national legal tender gold coin will stand as an internationally recognised symbol of pride and recognition of the UAE's achievements much like the Canadian Maple Leaf, Australian Nugget, South African Krugerrand and others.

DMCC is also the licensing authority of the JLT free zone ofering regional and international companies a multitude of benefts including a 100 per cent business ownership, a guaranteed 50-year tax holiday, 100 per cent capital repatriation, no currency restrictions and a secure regulated environment. DMCC has issued over 3,300 registrations to companies from around the world.

From January to August 2011, DMCC registered ove 750 companies, whereas in 2010, DMCC registered 725 companies throughout the year. This growth continues to make JLT one of the fastest growing free zone in the UAE. As a result of its exceptional growth, and to cater efciently to its growing client base, DMCC has streamlined registration and licensing procedures ensuring smooth and fast processes. As a testament to Dubai's position as the regional trade hub connecting East and West, 93% of these registrations are from companies seting up an ofce in the Emirate for the frst time.

The uniqueness of JLT lies in its 'live, work, play' community. JLT ofers commercial, residential and retail property for both sale and lease through 60 towers with six more to fnish this year. The community sees new retail outlets and leisure facilities opening each month and the landscaping is taking shape across the estate.

The future of Dubai is bright, and DMCC is commited to continuing to help it grow and prosper by enhancing the fow of trade through the Emirate. Today, JLT has over 15,000 residents and10,000 people working in the 200-hectare development, and DMCC looks forward to helping new and existing members reap the benefts of all JLT and Dubai has to offer.