Monday, March 12, 2007

Dear Halliburton, Why Dubai? :: Houston Chronicle

The Houston Chronicle:
Texas is the can-do state. But there's no denying that Dubai has become the can-do sheikdom and a potent rival to Houston's supremacy as the center of the oil business.
The move of Halliburton's corporate base from Houston to Dubai is a stark example of the industry's shift in power from North America. The company is moving closer to the oil fields of the Middle East and Africa and its big national oil firms that control financing, exploration and production.

"The business is changing," said Amy Myers Jaffe, a fellow for energy studies at the James A. Baker III Institute for Public Policy at Rice University. "Will Houston remain the center of the energy business? I don't know."

Dubai's leaders decided decades ago to invest their limited oil revenues into building roads, airports and research parks to transform the city-state into a regional business hub. The strategy has been a runaway success, leading hundreds of international companies to relocate. [Aside: Don't forget the huge Jebel Ali port that came earlier than these other projects.]
By moving to Dubai, Halliburton's senior management is following the lead of Vinson & Elkins, a Houston-based international firm that opened an office in the city more than three years ago after considering a number of locales in the region.

The firm wanted a Dubai base from which to pursue energy-related projects, said Jeffrey Eldredge, who helped open the office.

"Nobody lives in compounds, people feel safe here," said Eldredge. "What's happening here is pretty stunning. Many of our clients are setting up regional headquarters in Dubai, and their lawyers and financial types are going to the region, so it's convenient to be there and we need to be there."

The Islam practiced in Dubai is generally tolerant and open to outsiders, and there are few restrictions on social behavior, which has made the city a magnet for young professionals from other Arab countries who want to pursue their careers without having to live by a strict Islamic code.

Women, whose choices are extremely limited in other parts of the Arab world, work in a wide variety of fields in Dubai. While many women wear traditional Muslim head scarves and head coverings, a large number also dress Western-style.
But it is not only a luxurious lifestyle that has drawn hundreds of businesses, including large media companies and computer software giants. It also is the low taxes, the inexpensive labor costs, and the fact that the tensions roiling much of the Middle East are absent.

The city also offers state-of-the-art communications and transportation links close to the major Persian Gulf oil fields, but largely without the religious and political strife associated with the region.
And the political risk is small.



Post a Comment

Links to this post:

Create a Link

<< Home