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A tale of two city states

The commonality between Singapore and Dubai runs deeper than finance and bricks and mortar

Dubai Singapore Pixabay
Merlion Park, Singapore: a small island, unlike Dubai it lacks natural resources and land on which to build

It has been just over two years since my family and I took the major step of relocating from Singapore, our home of 12 years, to Dubai. We did not make the decision lightly: suffice to say, it was partly professional, partly personal.

Twenty-four months gives you a good perspective. We have learned that these two small-ish city states have much in common. The longer we have lived here, the more similarities we see. But there are also important differences.

Why did we relocate? Singapore, after all, operates one of the world’s most successful education systems, offers excellent transport links at home and abroad, and is admirably safe and clean. 

The Lion City has transformed itself from a sleepy backwater in the 1960s through Lee Kuan Yew, a genuinely visionary leader, to become a thriving city state with one of the highest GDPs per capita in the world, and an enviable standard of living for a population of just under 6 million.

The proximate answer is that, after more than a decade in Singapore, the Covid pandemic hit, and life became very tough, with strict rules over social distancing and even stricter ones for quarantining. For a protracted period our family of four could not eat together when in a restaurant or cafe.

While staying in Southeast Asia was an option, Dubai repeatedly came up in conversation, not just in family talks but among expatriate friends.

Both Dubai and Singapore act as wealthy offshore service centres which serve as entrepots for bigger neighbours and provide ecosystems for burgeoning fintech scenes. 

While I had never set foot in Dubai before relocating, my banker wife was a regular traveller to the Middle East to meet clients. She reported back positively.

Wandering around DIFC, she felt many similarities to Singapore’s central business district: shiny skyscrapers, global banks and fancy coffee shops. For her, it was a no-brainer and I was soon convinced to travel west.

We are not alone. 

Research by Savills earlier this year found that expanding visa options, full foreign ownership rights and initiatives such as an accelerator programme for financial technology start-ups hosted by DIFC are fuelling investor interest in Dubai.

Singaporean, Chinese and UK companies in legal services, wealth management, technology and media are leading the way, Savills said.

Tahseen Consulting found that since 2013, when Wego, a Singapore-based travel booking site, expanded into Dubai, more than 20 Southeast Asian startups followed.

Dubai is the regional entry point for 95 percent of Southeast Asian startups, and 90 percent of Southeast Asian startups making the move were founded in Singapore.

A familiar air of economic optimism and entrepreneurial spirit wafts through both business districts

Last June, St James’s Place, the FTSE-listed (albeit troubled) wealth manager opened an office in Dubai to add to its overseas branches in Singapore and Hong Kong. Wealthy Asian family offices have also been diversifying assets and setting up offices in Dubai.

A handful of cryptocurrency firms have relocated to Dubai from Singapore, along with a number of hedge funds, such as Three Arrows Capital.

Even Mark Mobius, the high profile fund manager who spent decades in Asia as the godfather of emerging markets investing, was attracted to the region to set up a new venture in Dubai. 

The commonality between Singapore and Dubai runs deeper than finance and bricks and mortar. A familiar air of economic optimism and entrepreneurial spirit wafts through both business districts. Expansion, new ventures and dynamism abound in both hubs. Both jurisdictions offer political stability and familiar legal systems.

Dubai and Singapore are also talent hubs that attract steady inflows of foreigners. And not just any old foreigners, wealthy ones at that.

A report earlier this month found that the UAE was the biggest magnet for high net worth individuals in the world. Singapore still makes the top three, but is expected to welcome around half the HNWIs that UAE is predicted to host this year, according to Henley & Partners.

There are differences between the two city states. Singapore is a modern-day economic miracle, but it is a small island which lacks natural resources and land on which to build. Last year, the historic racecourse at Changi was closed to make way for housing.

Wealthy entrepreneurs from mainland China have also been making a beeline for Singapore as the rule of law has diminished in Hong Kong, and the influence of the Chinese Communist Party there has grown. These rich Chinese expats have added to housing demand.

Urban, City, People DubaiPizabay/Olga Ozik
Downtown Dubai: much more room to expand than Singapore can offer

Dubai, in contrast, is more than five times the size of Singapore. The emirate can build a business or innovation hub at the drop of a hat. Singapore cannot any more, because of the lack of space.

While we left because of the impact of Covid, others have since departed Singapore because of the spiralling living costs, predominantly housing. Expatriates have seen rent rises of up to 80 per cent in the past year. 

Dubai has seen similar upward pressures, but it offers more wiggle room in terms of cheaper locations and types of accommodation. Singapore lacks such choices and now regularly finds itself at the top of lists of the world’s most expensive cities to live for expats.

Singapore has also been tightening access to its lucrative job market. With complaints from locals worried about foreigners flooding the labour market, the government has raised the salary threshold for foreigners applying for employment passes. It has also limited the number of treasured permanent resident visas it hands out.

This tale of two cities is a fascinating one. In some ways they are growing closer in structure and success. But if I had to stick my neck out, I’d say Dubai has a slightly stronger can-do attitude, and a feeling that anything is possible.

Justin Harper is an award-winning business journalist and editor with more than 20 years of experience across London, Singapore and Dubai

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