History of Dubai and UAE, Industry, Wall Street Crash

History of UAE and Dubai

The history of Dubai UAE is rather different from the histories of most similarly sized cities in the West. The usual pattern is for different periods of history to be layered on top of each other in an imperceptibly slow process. Then the historian's job is to separate the half blended strata in order to tease out the story of the place. But this approach doesn't work when you're finding out about Dubai, as the city's dramatic transformation resembles a TV makeover show more than a gradual evolution.

Dubai began as a very small, sleepy settlement; until 3000 years BC the area in which Dubai UAE is now found was occupied by nomads who herded sheep, goats and cattle. These nomads supplemented their diet with fish. Agriculture began half a millennium later with the cultivation of the date palm. During the Bronze Age, the area was linked with the copper trade. After that, there is a big gap in what we know until the 7th century, when the region became Islamic.

We do know that fishing and pearl diving supported the region for many centuries. Both Dubai Museum and the Diving Village feature displays on pearling see our page on Dubai attractions for details of these places.

Many people think that it was the sudden discovery of oil in 1966 which poured wealth into Dubai, leading to its rapid reinvention from a quiet settlement to the land of the bling. This isn't far from the truth, but the whole truth is more interesting and subtle.

The pearling industry in Dubai collapsed at the end of the 1920s, dealt a double blow by the Wall Street Crash and the invention of the artificial pearl. This forced the emirate to look around for other sources of revenue. But the development of Dubai had already begun at the end of the nineteenth century, when the ruler at the time allowed tax exemption for foreign traders. This coincided with the port of Lingah in Iran losing its own status as a free port, so Dubai nabbed all its customers. Thus began Dubai's proud history as a place where items are re exported. Debate rages over whether "re exporting" is a euphemism for smuggling, just as it does over the issue of whether Dubai could have been important without the oil. The most realistic answer to the second question is that Dubai used oil revenue to gain capital for the creation of a trade and manufacturing infrastructure, alongside a booming tourist industry. If Dubai had relied on its oil reserves to spend freely without putting any money into developing other industries, the place would now be in serious trouble, as oil and gas reserves were small. Now, nearly 90% of Dubai's revenue is not oil based. So the secret to Dubai UAE's success is doing the best with what you have something every self respecting makeover show advises.

The emphasis now is not on mining or manufacturing, but on trade, just as it was at the end of the nineteenth century. And the emphasis is shifting still further, to modern industries like the media. Dubai Internet City was built and attracted over 200 firms in just a few years.

A glance at the city's many building projects makes it clear just how fast the place is still expanding.

The history of Dubai may resemble a rags to riches fairytale, but the story isn't over yet. Concerns over the fragile ecology of the desert and the widening gap between rich and poor, as well as the sustainability of the city's rapid growth, have yet to be satisfactorily answered. The makeover show may end with a surprising denouement, as the audience agrees less is sometimes more.