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Why has Dubai business hub become one of the most important hubs?

Why has Dubai business hub become one of the most important hubs?
Insight & News 03 August 2022

Why has Dubai business hub become one of the most important hubs?

The passage is primarily concerned with the detailed information on why Dubai business hub becomes one of the most important hubs, first, we discuss Dubai Hub as an Integrated Logistics Hub, then we examine the role of this issue in the development of this city. In the next section, we will provide some information about Dubai airports focusing on their huge impact on the rising air transport demand. finally, we will raise some points about how Dubai business hub will face the COVID-19 crisis.


The history of Dubai Hub, an Integrated Logistics Hub

Dubai (a part of UAE) joined the World Trade Organization in 1996, and it has always been one of the most open economies in the world. The open trade and its location between the eastern and western world makes it one of the most important transportation hubs in the middle east. Dubai is known as the busiest airport in the world also Emirates Airlines is counted as one of the fastest airports to recover during the pandemic.
 Dubai business hub is located between the eastern and western world.

As mentioned before Dubai hasn't been promoted just for being a destination but also as a link between different hub airports in the world. The airport is more than just a passenger hub, with efficient cargo services which have all main cargo carriers. It is worth noting that the facility can handle more than three million tons of cargo each year. This is why Dubai has counted as a logistics hub and center of the world for global trade with hyper-modern logistics facilities.

Dubai business hub plays a vital role in economics

Dubai provides the best logistics services that play a crucial role in Dubai’s industry and it is about 14 % of the UAE’s GDP.
By opening logistics hubs Dubai has attracted extreme foreign investment. Notable investments in logistics facilities and transportation infrastructure, and the collaboration between the public and private sectors increase opportunities to optimize supply chain performance through implementing new policies and enhancing global trade.

By utilization of free zones and ports, the best logistics services are provided in Dubai. The number of modern warehouses and developed freight facilities and infrastructures are the key factors of the competitive global logistics network.
Due to cost efficiency, advanced infrastructure, international airports and ports, roads, and a world-class public transportation network, Dubai is one of the most famous, modern, and successful logistics hubs. As one of the leading logistical hubs in the Middle East, the logistics performance of the city is often compared to that of the top-ranked logistics performing countries such as Hong Kong and Singapore.

The significant position of Dubai airport

being the home of the world’s highest level air cargo centers ranks Dubai the top hub in the Airports Council International and this makes the city face some challenges in fulfilling the rapidly increasing demand resulting from reasons such as huge growth, expansion of Emirates Airlines, air cargo transportation development, and its position on the world map.

Dubai Hub Remarkable Development

Despite the lower-class beginning, Dubai is a global logistics hub now. Dubai’s transformation was remarkable. The world’s tallest building and hotel, the world’s largest shopping center, the world’s busiest airport, and modern islands observe international attention that makes it a global market. The UAE’s most famous city with oil wealth discovery and notable investment has created the first integrated multi-modal logistics platform including all kinds of transportation modes, and advanced logistics services in the world.
Dubai as a logistics city will supply facilities to provide advanced logistics services for companies, in free trade zone environment, modern technologies will always help Dubai to make progress in providing cost-efficient services for companies to use this logistics hub as a basic platform for their operations. Free trade and low tax rates are factors that have made Dubai a well-known business hub and a rich state. Dubai is a commercial and investment capital of the Middle East somehow and one of the most popular cities globally. The city features some of the most amazing infrastructures worldwide, in the area between the Dubai International Airport to the Dubai Mall.

Dubai business hub experienced a remarkable development Despite the lower-class beginning.

Efforts to become Dubai global hub

To increase the well-being of the city, key factors have been taken in various areas of urban design, such as infrastructure improving, affordable housing, and green spaces increasing. Previously to improve the quality of life, a program titled "Dubai Comprehensive Urban Plan 2040" was proposed, to focus on the sustainable development of the city for the next 20 years at a much faster rate than in the past. These factors make Dubai a global hub for citizens and visitors.

The inherent potential of Dubai's logistics hub

Dubai, which is a regional center for re-exports, retail, entertainment, aviation, information technology, and banking, transits about 60% of all goods imported into the Middle East through its borders. With a growth rate of more than 20% in the logistics market, as mentioned before Dubai has created the “Dubai Logistics City”, which is considered the most comprehensive logistics center of its kind in the whole world.
This center provides the necessary platform to turn this country into a commercial hub for the Middle East and beyond, and its logistics market includes more than 2 billion potential customers, including Southern Europe, CIS countries, the Indian subcontinent, and the Middle East, and Africa.
In addition, this city is a distribution hub where companies can establish their distribution centers, supply their inventory by land, sea, or air and deliver their goods to customers in the cheapest and fastest ways. Considering the free zone, multimodal transportation, and integrated logistics service, which is the first of its kind in the world, Dubai benefits from the facilities and legal benefits of free zones. Such advantages create a suitable environment for the operation of companies with multimodal transportation needs, companies that seek logistics services, free trade facilities, and a diverse range of innovative and value-added logistics services.

Dubai business hub advanced services

Dubai Business City, the first e-commerce free zone in the Middle East region and South Asia, has officially started its commercial operations in a new phase for e-commerce. Integrated services for the growth of e-commerce licensed companies in the field of logistics, information technology, and other services are the features of city's advanced services.
The provision of special services has made Dubai Business City succeed in leasing 30% of its facilities in the first two months of e-commerce free zone development in an area of 2.1 million square feet. One of the facilities offered in this commercial town is an integrated customs service that can provide 24 hours’ services a day, seven days a week.

This region has the agenda of providing various advanced services to help the economic growth of the region by promoting the logistics and production sector. With more than 200 operational factories, this area serves the industrial sector at the regional and international levels.
Dubai Industrial City is an industrial hub that offers many facilities to support businesses in various industries. This area has a long network of roads and has access to various sources of electricity, which makes it easy for the providers of this city.

Dubai international Airports 

Dubai has two international airports Dubai International Airport and Al Maktoum International Airport. This city is within a four-hour flight of 34% of the world’s population and an eight-hour flight of the rest. The Dubai logistics corridor connects AMIA and the Jebel Ali Port and the Free Zone into a major trade network connected by three important modes of transportation.
Dubai World Central known as Al Maktoum International Airport is expected to be the largest civilian airport in the world. The airport first opened for cargo in 2010, and then expand to passenger flights in 2013 with the 24 hours’ landings capacity simultaneously.

Dubai International Airport and Al Maktoum International Airport are the main airports in Dubai.
This airport structure will be linked to the existing Dubai International Airport through a rail mode. Al Maktoum International Airport is positioned in Dubai South, and consists of Dubai Logistics City, Commercial City, Residential City, Aviation City and Golf City.
Al Maktoum International Airport is located at Dubai World Central in Jebel Ali, 70km from Dubai International Airport. It is nearby all three of Dubai’s main, multi-lane roads, including Sheikh Zayed Road, and Sheikh Mohammed Bin Zayed Road and Emirates Road, with developed access to the airport. Al Maktoum International Airport aims to handle all types of aircraft. 

Dubai main airports, the reason behind the rising air transport

With these two international airports Dubai faces a huge rise in air transport, and it has become the prime air hub in transit from the Asia Pacific, South Asia, the Middle East, Africa, Europe, and Australia.
The Airport includes features listed below:
•    Major passenger terminals with modern facilities
•    Multiple concourses with the services
•    Executive, private, and royal jet centers
•    Hotels and shopping complexes
•    Maintenance facility
•    1000 parking slots
 Dubai hubs are featured by many advantages.

Dubai International Airport is the first international airport in Dubai, one of the busiest cargo airports in the world and also by international passenger traffic. Dubai International Airport is located in the Al Garhoud district 4.6 km east of Dubai and is spread over an area of 7,200 acres of land. To reduce 30 percent of the city's energy consumption, Dubai International Airport installed the largest solar energy system in the airport as part of Dubai's goal by 2030.
Together, these two airports, Dubai International and Al Maktoum International provide a wide range of excellent services for cargo airlines and freight agents.
Strategically facilities are perfectly located near the ports, airports, and infrastructure to provide the best transit of cargo. With modern handling equipment, faster recovery is guaranteed during COVID-19.


How did Dubai business hub Cope with the COVID-19 crisis?

This section provides some information about how Dubai as a logistics city controls the situation caused by COVID-19 in 2020. The UAE is one of the top countries that provides international efforts to handle the pandemic since the beginning.
Like every other economy, Dubai faced new challenges such as the disruption of global supply chains caused by broken links, the constrained capacity of cargo, and delays during the pandemic in the logistics industry but despite all of these challenges, the city has been adapted rapidly to fulfill the worldwide demand and since then it has continuously worked on better services for crisis situations.
Speaking of global supply chain disruption caused by restrictions on economic activities, flight suspensions, mandatory quarantines, and border closures, Dubai City as a logistics sector faced massive challenges. However, global trade has recovered quickly from the earliest recession. With the investments in technological infrastructure along with several procedures adopted by the UAE federal and emirate governments, Dubai has been able to alleviate the risks and effects of the crisis, and the country's modern infrastructure helps to hence the rate of recovery.

By performing the immediate solutions, Dubai business hub was able to overcome the pandemic.

Dubai hub solutions to deal with the crisis

More than being among the top supporter of advanced logistics services to control the pandemic in the region, Dubai has adopted its world-class infrastructures and experiences in logistics to manage the cold chain logistics of COVID-19 vaccines. The Dubai Vaccines Logistics Association integrates the proficiency and global connection of Emirates Airlines with the network of ports and logistics operations, along with the infrastructure of Dubai Airports and International City to distribute vaccines across the world. The distribution concentrates on new markets, where pharmaceutical logistics and transportation are challenging.
The association is working with a comprehensive series of partners consisting of pharmaceutical manufacturers, logistics providers, federal agencies, and other entities for the transportation of vaccines.


Dubai Airports' essential role in overcoming the pandemic

Dubai Airports will play an essential role in making efforts in advanced logistics services by providing additional space at dedicated facilities during the pandemic. In order to make sure that the COVID-19 vaccines are getting across the world, and provide an efficient global distribution system of high volumes of vaccines, this logistics hub is ready to fulfill all the demands by taking actions such as considering additional capacity for vaccine storage and seamless solution for the transportation of COVID-19 vaccines.

In this article, a comprehensive review of one of the most important logistics cities in the world and especially in the Middle East region was discussed, which resulted in gaining a deep insight into why Dubai business hub has become one of the most important hubs, the history of excessive development, advanced infrastructure, Dubai international airports, ports, roads and world-class public transportation network and equipment and modern logistics facilities, and finally Dubai hub's potentials in facing and quickly adapting to the current crisis.

Melika Mousavi (Marketing Specialist)

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