In recent years, Dubai and Abu Dhabi have been at the forefront of the Middle East's growth and development. The UAE’s efforts are paying off – the two cities have ranked among the most desirable destinations for foreign workers and hubs for tourism and business, as well as for those who call them home.
In the ‘Cities of Choice’ study by Boston Consulting Group, cities including Abu Dhabi, Doha, Dubai, Kuwait City, Riyadh, and Mecca are found to share several similarities in terms of their strengths and weaknesses. While the Middle East cities assessed vary in terms of overall ranking, most have managed to grow their scores over the past year, demonstrating the growing quality of city life in the region.
For its study, the researchers surveyed over 50,000 people from 79 cities, asking them to assess more than 150 economic, social, and political metrics across five dimensions: economic opportunities, quality of life, social capital, interactions with authorities, and speed of change.
Of the five Middle East cities indexed, Dubai and Abu Dhabi both made the top 10 in their respective ranking categories.
Dubai
In Boston Consulting Group’s classification of cities, Dubai is classified as a ‘cruiser weight’ city, with a population of more than 3 million people but below 10 million (these cities are billed as ‘megacenters’).
In the ‘Economic Opportunities’ dimension, Dubai scores relatively well (71 out of 100), indicating that the city provides a highly conducive environment for businesses and entrepreneurs to thrive. The city is among the fastest growing cities in the wold, and has over the years significantly diversified its economy by investing in sectors such as tourism, real estate, finance and transportation.
Dubai’s economic score is underpinned by a strong built environment and digital infrastructure, which helps facilitate a highly efficient and dynamic business landscape.
Dubai is also well known for its innovative projects, including the Burj Khalifa, the world's tallest building, and the Palm Jumeirah, one of the largest man-made islands in the world. More recently, Dubai is positioning itself to become a world leading hub for web3 and blockchain – one of the most highly anticipated technologies for the coming decade.
The ‘Quality of Life dimension’ is a crucial factor in measuring the liveability of a city for its residents. With a score of 51, Dubai faces significant room for improvement, according to Boston Consulting Group.
On the upside, Dubai offers its resident a cosmopolitan lifestyle, with people from various nationalities and cultures coming together, making it a melting pot of different traditions and lifestyles. For those that can afford a good living in Dubai, the city ranks among the leaders (in fact, the prime resident market is one of the world’s hottest).
But for those that live on a low-income, Dubai’s quality of life is considered poor. The housing sector lacks a supply of affordable options for low-income residents. The high cost of living in relation to income means the quality of life is low, and further, the city’s educational institutions require improvement in terms of accessibility and affordability.
The ‘Social Capital’ dimension measures the strength of social relationships and community involvement within a city. In the case of Dubai, the city attained a score of 74 out of 100, indicating that residents have a strong sense of belonging and attachment to their city and they maintain meaningful social relationships.
This score builds on the city’s rich offering of culture, entertainment, and arts. Meanwhile, Dubai’s diverse range of cultures and backgrounds of the residents creates ample opportunities for social interaction and engagement. Dubai is also considered as a place with a strong social fabric, which is an important aspect of a city’s overall health and well-being.
In the ‘Interactions with Authorities’ dimension, Dubai scores above places such as Sydney and Barcelona, indicating an overall positive experience between residents and the city’s authorities. According to Boston Consulting Group, this is essential for creating a sense of trust, security, and cooperation between government and people.
The score is testimony to Dubai’s growing digital government capabilities, and suggests that the authorities have put in place policies and measures that promote citizen participation in governance and decision-making processes, ensuring that the residents have a say in shaping their city’s future.
However, in the ‘Speed of Change’ dimension, Dubai scored below average, suggesting that the city needs to improve its ability to adapt quickly to changing circumstances, particularly in a rapidly changing global environment. Riyadh and Kuwait City for instance, score better in this regard.
This speed aspect is particularly important as it can have significant implications on a city’s ability to remain competitive and relevant in the long term. To overcome this, Boston Consulting Group advises Dubai needs to put more efforts into innovative strategies and technologies to remain at the forefront of innovation, as well as in enhancing its overall agility and responsiveness to emerging challenges and opportunities.
Abu Dhabi
In the study, the UAE’s capital city Abu Dhabi is classified in the middleweight city in terms of its economic standing and population. Abu Dhabi is home to around 1.5 million people and has an above-average income due to its thriving oil-based sector and broader economy.
In terms of the ‘Economic Opportunities’ dimension, Abu Dhabi’s high score of 73 reflects the city’s proactive measures to create a business-friendly environment that fosters innovation and entrepreneurship. In recent years, Abu Dhabi has made substantial investments in sectors such as technology, renewable energy, and tourism, which has attracted local and foreign investors alike.
Abu Dhabi’s economy has been experiencing rapid growth and development over the past few decades, with major infrastructure projects and modern architecture becoming a defining characteristic of the city’s landscape. Despite its relatively small population, the Emirati state has emerged as a global player and a hub for innovation and entrepreneurship.
The significantly lower score of 43 in the ‘Quality of Life’ dimension indicates that Abu Dhabi needs to address certain shortcomings in its social and physical infrastructure. While the city has made significant progress in terms of economic development, its efforts to provide its residents with access to high-quality healthcare, affordable housing, and a sustainable environment still requires improvement.
To achieve a higher quality of life for its citizens, the study suggests more investments are needed in areas such as public transport, green spaces, and social services.
A high score in the ‘Social Capital’ dimension confirms that Abu Dhabi is a place where people feel a sense of belonging and connection to their community. This can be attributed to the city's efforts to preserve its cultural heritage and promote social cohesion among residents. Additionally, the high levels of safety and security in Abu Dhabi also contribute to the strong social capital of the city, as residents feel protected and secure.
The solid score in ‘Interactions with Authorities’ recognised Abu Dhabi’s well-developed system of governance, where the government is responsive to the needs of its citizens and actively involves them in decision-making processes. This can be seen in initiatives such as the Abu Dhabi Government's Customer Happiness Index, which measures public satisfaction with government services and aims to improve customer experience.
In particular, Abu Dhabi is a frontrunner in smart city strategies, using smart technologies and data to deliver creative ways in which the city delivers its services, and interacts with inhabitants.
The ‘Speed of Change’ dimension places Abu Dhabi in the higher end of mid-table, suggesting that the city authorities are capable and agile in the way they respond to a changing environment in various areas such as infrastructure, technology, sustainability, and urban planning. Notably, Doha and Mecca are found to be more adaptive.
The outlook
Looking ahead, the study urges government officials worldwide to continue to invest in making their cities a better place for businesses and residents.
“To maintain economic growth, attract and retain talent, improving the quality of cities is crucial for Middle Eastern nations,” said Christopher Daniel, a Managing Director and Senior Partner who leads Boston Consulting Group’s Public Sector practice in the Middle East.
“By building on their strengths, and working on advancing their areas of opportunity, Middle Eastern cities can leapfrog into the future. Quality of Life is a key opportunity. While Middle Eastern cities are making great progress in upgrading their infrastructure through large projects, their next step should be to focus on services and urban planning in neighbourhoods and communities.”