City of Gold: Dubai and the Dream of Capitalism (31 page)

At the end, the exhausted group sat around and swapped stories with the boss and his lieutenants. When it was time to go,
60 Minutes
correspondent Steve Kroft gave the sheikh a CBS baseball cap as a parting memento. Without missing a beat, Sheikh Mohammed took off his own cap, a boxy military hat, olive drab with a UAE flag on its face. “Then you shall have mine,” he says, handing it to Kroft.

In a region where people speak in elliptical platitudes, Sheikh Mohammed is a rare straight shooter. He’s an incredibly energetic man who disdains the laziness that envelops many of his countrymen. He understands that a cushy life is part of the tradeoff that keeps him in power, but the excesses tick him off.

His favorite targets are “ministers,” a broad term for bureaucrats. He hates hiring quotas, smoking, and the attitude that says service jobs are beneath Emirati stature. He reminds his countrymen that comforts are useless without work.

In Dubai, Sheikh Mohammed launched a deep reorganization of government, replacing the old department structure with a new order, based on authorities and subordinate agencies. For instance, the Dubai Roads and Transport Authority sets policy for the Public Transport Agency, the Traffic Agency, and the Dubai Taxi Agency.

The structure encourages the liberation of businesses stuck inside the bureaucracy, allowing them to turn a profit that can be recycled back into the municipal budget. It’s an institutionalizing of the moves that created DP World, the global ports operator. The scheme, led by the Executive Council, was stalled in early 2009 by opposition from the
diwan
. But Dubai is so steeped in change—and Sheikh Mohammed’s critical eye—that the reforms didn’t cause a big stir.

Abu Dhabi and the rest of the UAE are different. In 2006, when Sheikh Mohammed assumed his new role as federal vice president and prime minister, he was suddenly in charge of a bureaucracy he’d publicly disdained. He’d described ministers as lazy and accused them of allowing their underlings to wallow in monotony. His takeover would cause major trauma.

He toured the sixteen antiquated ministries and twenty-two authorities, often dropping in by surprise. At some point, he and UAE head of state Sheikh Khalifa agreed that the federal government needed a total overhaul. Sheikh Khalifa agreed that the Dubai leader, with his teams of consultants and advisers, would handle it.

In 2007, Sheikh Mohammed traveled to the $3 billion Emirates Palace Hotel
⁸
in Abu Dhabi to address the largest audience of UAE luminaries since independence in 1971. Sheikh Khalifa sat at front, with his Federal Supreme Council—the rulers of each emirate—and their crown princes, the twenty-one federal ministers, and assorted deputies, royals, and various VIPs from every corner of the country.

What followed was a speech of unprecedented bluntness, with deep criticism of the federal government and harsh personal critiques leveled at several ministers. The effect was similar to Senator Joseph McCarthy’s personal attacks on congressmen in the 1950s, except Sheikh Mohammed focused on incompetence, not politics. His speech, carried on TV, stunned the nation.

Viewers saw Sheikh Mohammed sitting at a dais in a cream-colored
kandoura
, with gold-trimmed black gown and eyeglasses. He scanned
the room and opened with a prescient joke: “It looks like the guys at the back are more nervous than me.” The camera panned to a chuckling Sheikh Khalifa and the silent crowd of royals and dignitaries behind him. The laughs didn’t last.

Sheikh Mohammed first turned to the minister of education, Hanif Hassan Ali, and minister of higher education, Sheikh Nahyan bin Mubarak al-Nahyan, and put them on notice that they’d better stop wasting students’ lives—or else. UAE high schools, he said, are so substandard that graduates must study a further two years in a support program before they can be admitted to a university. “I demand that the ministers of education and higher education resolve the issue of the support programs … within the next three years,” he told the men, who sat in front of him. “There is no room for compromises on education.”

He told Health Minister Humaid Mohammed Obeid al-Qattami that modern hospital equipment and buildings were no replacement for skilled doctors and nurses. He demanded better training and standards.

He lobbed a rare broadside at Emirati families, lambasting their reliance on foreign maids, valets, gardeners, drivers, and the sundry domestic helpers who keep order in their homes. “Domestic help accounts for 10 percent of the labor force in the UAE, a very high figure for which society in general and UAE nationals in particular are responsible. Domestic help in some homes exceeds the size of the family.” Get rid of some of them, he told his countrymen.

Then he skewered Labor Minister Ali al-Kaabi for forcing companies to hire a quota of Emirati secretaries. “I appreciate his dedication and enthusiasm, but his decisions were not successful because they ignored reality as well as the nation’s priorities,” Sheikh Mohammed told his audience. Al-Kaabi’s mistake was twofold: He’d set up a quota, forcing companies to hire less productive and more expensive Emiratis, which was bad enough. But he’d also targeted the lowly job of secretary. This, for a leader working his heart out to turn Emiratis into “lions,” as he calls his leaders-in-training, was inexcusable. “We need to have UAE nationals in more important roles and responsibilities,” he said. Al-Kaabi soon lost his job.

Justice Minister Mohammed Nukheira al-Dhahiri was next in line. He must have been bracing himself, because he’d known about the boss’s fury when he found the ministry using paper ledgers and other
anachronisms that went out with the typewriter. Mohammed told the audience of his “utmost dissatisfaction” at the state of the ministry’s caseload and backwardness, and said he would give al-Dhahiri “the chance” to clean things up.

“We will not allow this to continue,” he said. “We will not accept that people’s cases and rights get stuck in courts for long sequences of useless procedures.”

All this was a warmup for a broader announcement. Sheikh Mohammed ordered the ministers to develop strategies to revamp their workplaces and thus the entire federal government. He gave them a year to do it, and promised to follow up personally. When it came time to judge their reorganizations, Sheikh Mohammed said he would measure them against the world’s best governments: Singapore, New Zealand, Australia, and Canada. The ministers could keep their jobs if they managed to climb international rankings in competitiveness, transparency, and efficiency.

“It’s not good enough to be first in the Arab world. We want to be the first globally,” Sheikh Mohammed said. “Each ministry shall work within its area of expertise to improve the ranking of the UAE. The evaluation of each ministry will depend on the ranking of the UAE a year from now.”

Not all of them made it. The Dubai leader reshuffled the federal cabinet in 2008 and brought in several new faces, most of them can-do technocrats from Dubai. The revamping of government is still under way.

Sheikh Mohammed runs Dubai by motivating people to excel. He prefers to use his celebrity status and personal attention to get things moving, rather than ordering people around. Every other month, he hosts a palace dinner for business leaders. If it’s bankers in January, it might be airline executives in March and hotel owners in May. The boss’s management consultant Yasar Jarrar, who’d previously advised Jordan’s government, attends these dinners. Jarrar says the sheikh’s personal attention works wonders.

“How many presidents or prime ministers do you see having lunch with the hotel owners and managers because they think tourism is important?
A hotel manager would be lucky to see the minister of tourism after crying and begging for six months,” Jarrar says. “By doing that he sends a very strong message to his director of tourism, who realizes he has to be on a first name basis with all these guys.”
⁹

Another time, Jarrar was with a team of consultants reporting on the performance of Dubai’s government. The assessors graded departments with traffic lights: green for good, yellow for so-so, and red for bad. One department—Jarrar didn’t say which—had nothing but red lights for all their key indicators.

“What’s the problem with this department?” Sheikh Mohammed asked.

Jarrar explained that they’d slipped behind on deadlines and their managers’ skills were lacking, and a few other issues.

“Next time you bring me these reports, put the mobile phone number for the department head at the bottom of each page,” the boss told him. Sure enough, the next few presentations, more red lights appeared. This time there were mobile numbers for the leaders of the offending departments. Sheikh Mohammed reached into the pocket of his
kandoura
and pulled out his Nokia.

“Twice I saw him calling the head of government departments,” Jarrar says. “If you’re a department head and you get a call from the ruler on your mobile, that’s scary enough. But when he’s asking you why you’re not performing, that’s serious punishment.”

A few years ago, Jarrar was awakened by a phone call at midnight. An aide from The Executive Office was on the line. She said Sheikh Mohammed wanted to see his Delivery Unit—the team that pushes people to “deliver” on their promises—at Dubai International Airport.

Jarrar, a fast talker who favors tweed jackets and jeans, drove to the airport and the boss was there, taking a surprise tour. He looked in a mood to start cracking heads. Surly travelers waited in interminable lines at immigration and again at the baggage carousels. Sheikh Mohammed had met one arriving flight and walked alongside a passenger—who probably had no idea who he was—to time his journey through customs, to the baggage claim, and out the exit. At the end of his tour, he addressed his staff.

“First of all, it’s one in the morning. This is our peak hour. I don’t see any managers here,” he said. Managers, it turned out, worked the 9:00 a.m. to 6:00 p.m. shift, a calmer time at the airport.

Then he pointed to the crowds. He told his advisers that there was no reason for arriving visitors—Dubai’s economic lifeblood—to be left waiting so long. Many of them were vacationers, and the airport’s inefficiencies were giving them a disastrous first impression.

“In six months I will come back,” he said, bidding them good night.

After that, the Delivery Unit spent its nights tracking passengers at the airport. Managers worked night shifts. The airport added a baggage carousel and streamlined immigration checks. They installed biometric immigration booths, allowing frequent travelers to come and go using a chip-embedded ID card. The airport was still overcrowded and operating far beyond capacity, but the improvements boosted efficiency.

Sheikh Mohammed is not a man to be messed with. Even his uncle says so. “He is pushy. He is aggressive,” says Sheikh Ahmed bin Saeed al-Maktoum, who heads Emirates airline. Sheikh Ahmed, by rights, has a claim on the Dubai ruler’s job. But he has no qualms about letting his nephew be the boss.

“He is the main driver behind pushing everybody,” Ahmed says of his nephew. “He wants things to happen yesterday if you decide today. But at the same time he gives you all the support you need. He will push you to do things but he will always be there to support you.”
¹⁰

Reem al-Hashimy, a federal minister and a top aide of the Dubai leader, says meeting Sheikh Mohammed is an opportunity not to be missed. “He is electrifying.”

I ask everyone to tell me their best Sheikh Mohammed stories. Most people dodge the question. Sometimes I get a look of horror, as if I’ve asked someone to drink poison. People are afraid to discuss him. Good anecdotes and criticisms are tough to come by. To some degree, everyone in Dubai depends on his good graces for their livelihood.

“Sheikh Mohammed? Most people find him very direct. He has terrific energy. You see an article in the paper saying he’s just ridden in some endurance race in Spain and then he’s here. It’s amazing what he manages to do,” says Anthony Harris, the former British ambassador. “He has the ability to lead. People are motivated by him and very loyal. I never heard anybody, I don’t think, say a cross word about him. I’m
not saying he’s a man without fault. He spends enormous sums on horses, but I don’t even hear people criticizing him for that. He has very high popularity for a ruler, by any standards.”

Georges Makhoul, who heads Morgan Stanley’s Dubai operations, ascribes him with the ability to understand complex detail at a glance, like a great hitter sees the stitching on a fastball before knocking it out of the park. “He’s a deep, deep guy,” Makhoul says. “You have to stretch your imagination to see what he has in mind. I know he sees it all in his mind. It’s not just some abstract vision.”

Others, not wanting to be named publicly, describe him as a megalomaniac who is turning a pleasant city into a bloated megalopolis. The giant projects, the constant striving to be number one, to surpass New York and London, to drag the Arab world into a renaissance, to recreate the cosmopolitan tolerance of tenth-century Córdoba—these are the dreams of a desert sheikh deluded by acolytes. Others say he understands these goals aren’t realistic, but he uses grand language as a motivational tool.

“The standard response is, ‘We’re dealing with someone who’s got a kind of Napoleon complex.’ I don’t see him in those terms,” says Eddie O’Sullivan, author of a book on the Gulf, and the former editor of the
Middle East Economic Digest
. “I see him as a man in a hurry. Not only does he know what he wants to do, he wants to do it faster than other people. He’s using language to get people going. ‘If I don’t do it now, who will?’ It’s a great burden of responsibility that he feels. And it’s not yet clear whether any of his children are up to the task.”

Sheikh Mohammed is as much a tribal sheikh as he is a twenty-first-century politician. He’s as comfortable rubbing noses with the men at a traditional wedding as he is in haranguing Bill Gates or Warren Buffett for investments. He can be charming and understated, and a ruthless manager. He hires slick public relations companies, consultants, and lobbyists to work behind the scenes, but he gets his message across through personal charisma that stems from unrivaled power. He is a master of gesture and style, always in control.