The UAE is a conglomerate of seven states formed in 1971 after the British protectorate over their territories was revoked. After the discovery of oil on its territories, the country was transformed into a global power and a center for trade and tourism (Al Abed 2009). Inevitably, this change in the international status meant a much faster rate of globalization. This paper will discuss the effects it had on the culture and economy of the Emirates, as well as, the related problems from the management perspective, based on the article “The Debate on UAE National Identity” by Eman Mohammed.
Economic Consequences of Globalization
For the UAE globalization was a huge stimulus for economic growth. After the discovery of the large oil deposits, only the global market could allow the country to utilize its potential efficiently. The start of the international trade was the start of the prosperity. With money came new technologies and industries. The Emirates quickly turned from a sparsely populated desert state to a growing conglomerate attracting a lot of new people and businesses. While before the advent of the oil industry, the state was a significant trading location connecting Asia and Europe. It became a true world power after that. It is largely thanks to the globalization the UAE is now a huge center of commerce and tourism. The influx of funds from the global market allowed the country to build incredible infrastructure, including artificial isles, skyscrapers, and ski resorts in the middle of the desert. With the seventh largest GDP per capita in the world, the UAE is a lucrative market for the international companies (IMF 2014).
They developed new business areas and introduced new technologies helping the Emirates to truly become a world power. Those firms also helped increase the oil production by bringing advanced solutions and undertaking the projects to develop new extraction and processing facilities. That contributed to the creation of the new economic clusters in the area. In addition to the concentrated oil production industry tightly controlled by the government, places like Dubai and Abu Dhabi turned into the clusters of financial and recreational services tailored to accommodate international companies. All of that considered, it can be concluded that the globalization had an overwhelmingly positive effect on the economic standing of the UAE. However, with the foreign businesses came foreign expatriates who settled in the country forming communities and introducing Emiratis to new cultures (Abdulrahman & Ahmad 2009). In 2010, only 13% of the population was indigenous which presents a huge problem for the local cultural situation (The National 2010). Another negative economic consequence lies in the fact that the UAE is becoming increasingly dependent on the Western nations. The biggest part of the country’s income is generated by the oil trade which heavily relies on international cooperation. Even the local industries, like tourism, are influenced by the foreign companies. All of that means that the Emirates will face a massive economic crisis without its global partners.
Cultural Consequences of Globalization
From the cultural standpoint, the globalization presents a huge issue. Emiratis are massively outnumbered in their own country. However, it seems that for now the globalization is more of a looming threat than an actual issue. Despite the fears of many nationals, the reports indicate that the core culture of the indigenous was not affected negatively by the foreigners. The research by Nathan Al-Khazraji indicates that the population managed to find a balance between the need to preserve the national values and the need to commercialize and become a part of the international market (Al-Khazraji 2009). According to the researcher, the society is held together by the deep core based on the religion, family values, and tribe relations. However, the culture was forced to adapt, and the outer levels have eroded in the process. The look of the modern Emirates city is nothing like a traditional tribal settlement. The artifacts of the culture have been sacrificed for the sake of commerce and convenience.
The traditional style of life still survives outside major settlements where many nationals have moved when faced with the increasing cultural pressure. Another major concern of the nationals is the language. Most of the expatriates do not learn Arabic. As the result, their communities remain isolated and do not integrate into the society. Moreover, the low percentage of the Arabic-speakers means that the language is threatened with extinction (Abdulrahman & Ahmad 2009). The language is a basis of any culture and preserving it is important to keeping the Emirati society intact. But the effects of globalization are not entirely negative. One of the changes brought on by the foreign influence is the change of the women’s status in the society. They can now pursue formalized education and nontraditional careers (Al-Khazraji 2009). Some even manage to become entrepreneurs and further establish their independence (Erogul & McCrohan 2008). Their general status in the workforce has not changed, but the trend is showing a possibility for more freedom of choice in the traditionalist societies.
From the management perspective, the UAE presents two complicated challenges. The first one is the dependency issue. With the oil-based economy, the country is vulnerable to the unpredictable changes in the global market. Currently, the government handles that problem by assuming the position of power and manipulating the market as one of the biggest exporters. However, with the changes in technology that approach can become unviable very quickly if some advancement makes the fossil fuels unviable. Also, other players in the global market can easily outbid the UAE, making the strategy extremely risky.
The second issue is cultural. The globalization has caused significant changes to the traditional Emirati lifestyle. While the communities managed to maintain their integrity, the future changes threaten to completely dissolve the traditional culture in the sea of imported innovations. With the Arabic language getting overshadowed by the expatriates’ native tongues, it is hard to argue that the issue is not negligible even if it is not fully manifested at the moment. There are a lot of arguments about the approach the government should take. Some culture activists argue that the best approach is to force foreigners out of the country and tighten the immigration laws. They claim that only by ensuring the Emirati majority can the culture be preserved. The indigenous population is so small that aiming for such balance means cutting the country’s population by 70%. That is going to significantly hamper the importance of the UAE as an international power.
A more sound solution to the global market dependency problem might be a course for stronger inner industries. For example, using the money gained by oil trade to develop self-sustained tourist businesses that do not rely on the international companies and seeking out other possibilities for in-country industries to become self-supporting is important. It is impossible to completely insulate a country from the global community, but having safeguards is important to prevent the instability and overdependence on the foreign companies. Supporting independent national businesses can also have a positive effect on the Emiratis’ representation in the country’s economy which is currently low since the private sector is viewed as unattractive by the nationals (Al-Ali 2008).
The solution to the cultural problem is simple. The cultural integration is necessary for any multi-national society. Currently, most of the immigrants are being exploited as cheap and easy to control workforce which breeds a lot of insecurity within their communities. That slows down any sort of integration and increases the power distance splitting the society (Khalaf & Alkobaisi 1999). There are people in the Emirates who not only help the expatriates integrate into the local culture but also help the nationals better understand the immigrants. That work is the only real solution for the UAE, which will help preserve the culture without sacrificing the economic prosperity achieved by the country in the last forty-five years. Wael Al Sayegh is one of the people who understands that and works as a consultant to ensure the mutual understanding between cultures. His work is focused on building healthy workplace relationships, but it is clear that the similar approach will benefit the society as a whole avoiding the dangers of globalization while taking the best from it (Kumar 2010). People like him can ensure that the Emirati culture is preserved and enriched in the future.
Despite the seeming simplicity of the proposed solutions, the fight to maintain a cohesive culture in the world of globalization is a true ordeal. Balancing all of the factors and looking for ways to best exploit the possibilities of the global economy without sacrificing your identity is hard. It is extremely important for the leaders to take a balanced contingency-based approach which will allow them to adapt and mitigate all of the dangers of the cultural struggle without making any rash decisions to appease the worried crowds.
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