Some shipping industry workers based in Dubai are looking to relocate from the UAE as a result of the US-Israeli war on Iran, one ship owner and two industry sources familiar with the matter told Middle East Eye.
Western expats working in the maritime industry are eyeing the Greek capital, Athens, and Cyprus as potential alternatives to Dubai, given those countries’ dominant positions in shipping and the favourable tax policies they offer the industry, the sources said.
The search for alternatives to Dubai underscores how some expats, particularly westerners with easy access to Europe, do not expect the Gulf to return to its pre-war position anytime soon.
Around 2,000 vessels are trapped in the Gulf as a result of competing US and Iranian blockades of the waterway. But the shipping industry is experiencing a boom as a result of the war. The lockdown of vessels has compressed supply, and rates are soaring as energy corridors are rewired.
US oil and gas exports have hit record highs as a result of the war. But the transit time from the US Gulf coast to Asia is substantially longer than the journey from the Arabian Gulf.
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Breakwave Tanker Shipping ETF, which tracks the price of crude oil tanker rates, is up 240 percent since the war on Iran started.
The industry’s good fortune stands in stark contrast to the UAE’s maritime sector, which has been pummelled by the blockade.
The Gulf state turned itself into the dominant logistics hub for the Middle East, Asia and Africa. The port of Jebel Ali is one of the largest in the world, and is a major hub for transhipment, where goods are transferred from one vessel to another before their final destination.
The UAE’s top export, oil, has also been cut by more than half as a result of Iran’s control of the Strait of Hormuz.
“It’s not so much the slowdown in business, but the unreliability of Dubai as a hub. Can you count on a flight back to London or Paris for your family during war?” the ship owner said to Middle East Eye.
‘Thousands’ of Dubai real estate offices to close
Dubai benefited potentially more than any other city in the world from the post-Covid-19 boom of soaring asset prices, cryptocurrency, and remote work.
Capitalising on its low corporate tax rate, zero income tax or capital gains tax, and smooth bureaucracy, it became a magnet for London bankers and American “finance bros”. Its financial institutions have served as a haven for Sudanese militia leaders dealing in gold to Russian and Ukrainian expats fleeing war in Eastern Europe.
But very few are willing to write Dubai off the map, particularly given the UAE’s deep pockets, yet there are some signs that the war has pulled a curtain over its tremendous boom years.
Arabian Business reported on Wednesday that thousands of real estate agencies in Dubai may close in the coming months due to the war. A leading property search platform said that up to 30 percent of the agencies active on its site could shutter within the next five to six months.
As with western expats, where the war is filtering out those most committed to Dubai, the real estate agencies most likely to close are smaller operators or those that focused on speculative ends of the market, such as off-plan sales.
Arabian Business cited Lewis Allsopp, the chairman and co-founder of Allsopp & Allsopp, a real estate consultancy, as saying that Dubai’s ratio of brokers to residents is close to 1,000 per 100,000. For comparison, London has around 176 brokers per 100,000 people.