1. The Gulf A hyperconnected hub Cameron Dunn

2. The Gulf: a hyperconnected hub Geographical position The Persian Gulf is ideally positioned to be a hub, or bridge, between the established economic cores of Europe and eastern North America and rapidly developing Asia. It has become a ‘stop over’ focussing on luxury hotels, high-end shopping malls and exclusive ‘island’ residences. Sunshine is virtually guaranteed: Flight durations to the UAE 2 billion people live within 4 hours flying time of the Gulf, and 4 billion within 7 hours.

3. The Gulf: a hyperconnected hub Making connections Internet population penetration, 2009 Bahrain88% Kuwait39% Oman42% Qatar52% UAE76% Middle east average30% World average27% Internet World Stats, 2009 http://www.internetworldstats.com/stats.htm The Gulf states have rapidly connected to the internet. In some countries, internet penetration is similar to levels in the developed world.

4. The Gulf: a hyperconnected hub Connecting people A common feature of the Gulf states is that they have made significant investment in education. The countries may be oil- and gas-rich today, but they know that in the future they will have to rely on the skills of their people to generate wealth when the oil and gas dry up. As the table shows, huge improvements were made in adult literacy rates between 1990 and 2009. Adult literacy 1990 (%) 2009 (%) Increase (%) Bahrain8289+7 Kuwait7795+18 Oman5581+26 Qatar7793+16 UAE7190+19

5. The Gulf: a hyperconnected hub Super-connectors One of the keys to the Gulf’s success is its airlines. Air travel is the only practical way in and out of the Gulf. Government-sponsored national flag-carriers have grown at startling speed. These airlines are referred to as ‘super-connectors’ because they carry a lot of transit passengers on their way to other destinations. AirlineEmiratesEtihadQatar Based inDubai (UAE) Abu Dhabi (UAE) Qatar Number of aircraft, 2010 1385482 Number of aircraft on order, 2010 140105180 Destinations, 2010956591 Hub passenger traffic, 2009 37 million 9 million 16 million

6. The Gulf: a hyperconnected hub The bigger, the better All of the Gulf’s airlines are planning major expansions. This means their airport hubs have to expand to cope with the passenger demand: AirportCurrent annual passenger capacity Terminals/ runways Expansion plans Abu Dhabi12 million3 / 2Fourth terminal planned for 2012 to increase capacity to 20 million Dubai60 million3 / 2New concourse opening in 2011 to increase capacity to 75 million; brand new Al Maktoum Airport opened 2010 with three runways and planned capacity of up to 120 million Doha12 million2 / 1To be replaced by New Doha International Airport in 2011/12, planned to handle up to 50 million passengers per year By comparison, Heathrow’s two runways and five terminals handled 66 million passengers in 2009.

7. The Gulf: a hyperconnected hub In they flows…. The Gulf has developed into a true global hub partly due to its lucky geography and partly due to deliberate transport, development and education policies. Tourists, migrants and foreign direct investment have flowed into the Gulf at breakneck speed TNCs have invested in the Gulf as Qatar, Bahrain and the UAE have built business parks, universities and financial centres to cash in on the global knowledge economy. Under construction in 2008, the Burj Khalifa is the world’s tallest building

8. The Gulf: a hyperconnected hub Risks Can the rapid transformation of the Gulf into a global hub be sustained? The Gulf suffered from the global financial crisis in 2008–10 but there are also longer term risks that might damage its prospects: Political risks The Gulf region is politically unstable, and has been marred by war and terrorism. Iran, Iraq, Yemen and Palestine all experience conflict Physical risks Running out of water: the region is already suffering water stress and relies on desalinisation Economic risks Rapid growth leads to asset bubbles which are prone to burst, as with the UAE property bubble in 2008–09 Environmental risks Coastalisation, reef and sabkha destruction plus inland tourism in the desert all threaten irreversible damage to the Gulf’s ecosystems Cultural risks Western and Arab cultural norms (and laws) are very different, and this has led to some high-profile clashes on culture Social risks The Gulf’s reliance of cheap immigrant labour from south Asia is seen by many as exploitative