Dubai and the tourism kiss of death

Dubai is becoming more like Sharjah, the bastion for the conservative-minded tourist. The story that's always been told about how Sharjah came to be that way is that it had borrowed heavily from Saudis and had to toe the line. Never mind the irony that many Saudis flocked to Dubai precisely because it was an oasis of western pleasures. Or the irony that Sharjah actually benefited from this split in the market -- the more the pleasure seekers and the conservatives mix the less they enjoy themselves.

So why has Dubai launched a moral crackdown? That's a question the Wall Street Journal is asking:

"Dubai is in danger of gaining a reputation as a place where you can be arrested for minor incidents," said Sean Tipton, a spokesperson for the Association of British Travel Agents, which represents more than 5000 travel operators in the U.K. "If this type of attitude continues, Dubai's tourism industry will be harmed."

Dubai has grown to become the Persian Gulf's most popular destination due to its liberal tolerance of alcohol and partying in a region that's better known for its austere religious values. Billions of tourism dollars may be under threat as Dubai tightens up. Tourism is crucial to Dubai and accounts for a fifth of the emirate's economy. Close to 41 million passengers traveled through Dubai International Airport last year, making it one of world's fastest growing. Emirates Airline, Dubai's flagship carrier, indirectly contributes just over $10 billion to the sheikdom's economy each year.
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Dubai finds itself in a difficult position promoting itself as one of the world's top tourist destinations, whilst upholding strict Islamic laws. Although tourists can enjoy most activities, there are laws regarding alcohol, drugs, sex outside marriage and dress.

"Dubai is looked on as a bastion of immorality within the wider Gulf region," said Jim Krane, author of 'City of Gold: Dubai and the Dream of Capitalism' and an expert of the U.A.E. "Abu Dhabi is another influence on Dubai. With Abu Dhabi as the rising star, there is more pressure on Dubai to live up to the morals of a Gulf Islamic state." Oil-rich Abu Dhabi, traditionally more conservative than Dubai, was forced to bailout its poorer cousin after a $100 billion mountain of debt accumulated by building many of the lavish tourism projects got out of control.

So there you have it. Dubai's bind is the same as the one Sharjah had: it is beholden to conservative money lenders who have Dubai by the shortandcurlies.