GULF: DUBAI PLANS "INTERNET
CITY" FOR PIECE OF GLOBAL
E-BUSINESS
Inter Press Service - Friday, December 03, 1999
DUBAI, (Dec. 3) IPS - Global electronic commerce is likely to get a huge boost with
the building of a free-trade zone for business done over the Internet by Dubai, in the
United Arab Emirates (UAE).
Seeking to capitalise on the fast-expanding industry, the emirate, which has been
shedding its dependence on oil, unveiled plans for a $200 million "Dubai Internet
City" which includes an Internet University, in October.
"In the future all commercial action will be in cyberspace. But the cyber-world will
need a ground base on this physical world," its Crown Prince Sheikh Mohammed bin
Rashid Al Maktoum said.
Marketing has already begun and operations are expected to begin in one year's
time, officials said. They said leading computer companies from around the world
have been invited to set up offices in the zone, situated outside Dubai, one of the six
emirates in the UAE.
They will be offered 100 percent foreign ownership and 50-year renewable land
leases. Officials in Dubai cite recent estimates of the global electronic commerce
industry being worth around $40 billion.
They say the Dubai Internet City is expected to attract all businesses in the
Internet-related industry, from venture capitalists to software and multimedia
developers.
The cybercity is set to include a research and development centre, a science and
technology park, and an Internet university that will offer short courses in
e-commerce, design and management.
Plans for the Internet City were discussed at Gitex '99, the Gulf's largest computer
show, held in Dubai in October. Gitex, which is the world's third largest information
technology exhibition, drew participants from both the West and South Asia.
The participants said a combination of factors was fuelling e- commerce in a
cash-rich region that has had a long tradition of trade.
"Everything is in place. We now have a sufficient population of Internet users, we
have a large number of credit card holders and we have payment services just about
becoming available in several countries," said Ayman Abouseif, manager of
marketing and technology solutions at Oracle Corp.
"People are already experiencing electronic commerce. It is happening," he added.
While business-to-consumer trading in the Middle East currently represents only a
small percentage of that in Western markets, analysts say the prospects, especially
in the Gulf states, are tremendous.
However, others are less sanguine. Although Dubai has earned itself a reputation as
the commercial capital of the Gulf, analysts note that the UAE, has one of the
world's most restrictive Internet access policies. The state telecom agency, Etisalat,
has a monopoly on all telephone, fax and Internet communications into and out of
the country.
Government officials say they need to control access to the Internet to shield the
country from foreign pornography and emphasise that there is no restriction on
business done on-line.
Traders say there are other factors that stand in the way of full utilization of
Internet-based opportunities. Omran Hamdan, IT manager in charge of development
and e-commerce technology at the Dubai-based Al-Yousuf Universal, said many
people are still wary of using credit cards for business transactions on-line. "As far
as we in the Arab world are concerned, we are still sleeping," Hamdan said.
Others point out that Egypt, Jordan, Syria, the UAE and other states are increasing
government support for computer education. They also note that demand for personal
computers is poised to grow.
Senior officials at Compaq and IBM said they would provide all necessary support for
the various phases of the Internet City project. Top officials from both companies met
Sheikh Mohammed to discuss details of the project.
"The Internet City builds on Dubai's strengths," said Dr Georges Cassir, managing
director of Compaq operations in Dubai.
"Dubai has got the mindset for international commerce. It already has the
infrastructure, be it in terms of banking or other services, and the skills required to
manage the various needs to develop these," he said.
"What Compaq can bring to the table for the project is our global knowledge in
providing solutions for the sites, and contribute to the design and integration of the
e-commerce requirements."
IBM says it is particularly interested in the proposal for an Internet University. "Our
offer provides for passing on the enabling technologies that will go towards building
the Internet City into a physical presence," said Mike Lawrie, general manager for
IBM for Europe, Middle East and Africa.
Arab analysts say the Internet City could prove extremely beneficial to the
development of software solutions, particularly in Arabic. "What they are telling the
world is to come and build the technologies here. And if it has to be here, it has to
be in Arabic," said Fahad Al Sharekh of Sakhr Software, part of the Kuwait-based Al
Alamiah Group.
About 67 percent of private UAE companies consider e-commerce important, but
fewer than 20 per cent are investing in e-commerce sites, according to a recent
survey. Dubai's cyber-architects will be carefully measuring such numbers as they
set out to build the superstructure of their Internet City.
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