Dubai Emirate Goes Electronic With The World's First E-Government.

*** Israel Moves Out Of South Lebanon Much Faster Than Expected, Highlighting The Fact That, For The First Time In The Jewish State's Modern History, Its Army Has Been Driven Out Of Occupied Territory By An Arab Force

*** The Outgoing Parliament Of Iran Holds Its Final Session And Makes Way For The One In Which The Average Age Of Deputies Is 15 Years Younger

DUBAI - The emirate of Dubai is all set to become the first in the Middle East to launch an e-government. The objective is to create an economy and society that is in tune with the latest information and service technologies in order to keep the emirate competitive well into the next millennium. Shaikh Mohammed Bin Rashid Al Maktoum, the third and most favoured son of the late ruler Shaikh Rashid Al Maktoum, is the man behind this initiative. He has warned bluntly that anyone who cannot adapt to the requirements of e-government will no longer have a place in the government.

This is in keeping with the image of Dubai as a progressive and dynamic business centre. The emirate is increasingly being run as a corporation by the "CEO", Shaikh Mohammed, who has been the crown prince of Dubai since 1990 and the UAE defence minister since the early 1970s. Shaikh Maktoum, the eldest and the current ruler of Dubai, is the "chairman" who does not get involved in the day-to-day running of state. Shaikh Hamdan is "the chief of the landed gentry" as well as the treasurer. Shaikh Ahmad, the youngest of the four and in charge of security, is "the playboy" who is often abroad (see their profiles in this week's APS Review).

E-government for Dubai, to be in place by October 2001 in line with Shaikh Mohammed's wishes, literally means turning the country's government into an online and inter-connected entity with the ability to respond rapidly to the needs of businesses and the emirate's inhabitants. The objective is to optimise the day-to-day operations of government departments and allow the emirate's residents easy access to public services. Speaking on April 4, Shaikh Mohammed said government officials who fail to comply by the e-government directive "will be kicked out. This project is a must if you want to continue with me in government".

The objective is to make Dubai a much more attractive place for foreign investors, tourists and for e-commerce. Shaikh Mohammed said recently that, in his view, e-commerce would play a major part in business in the 21st century and that he wanted every "virtual" e-company to have its physical presence in Dubai (see overleaf). Another more subtle aspect of e-government is that, over the long-term, it will cut government expenses in terms of spending on the bureaucracy, as people will be able to access state services directly over the Internet.

Bringing down costs is an aspect of efficiency on which Dubai will have to concentrate in the coming years. This is because, despite heavy spending on expansion and business development projects through the 1990s, in recent years the emirate's finances have barely been breaking even.

To address this issue, Shaikh Mohammed applied a tactic that amounted to killing two birds with one stone: i.e. he got Dubai's armed forces to be integrated into the federal system, pleasing Abu Dhabi which is the leader among the UAE emirates. From a strategic perspective, the move did not affect Dubai much as Shaikh Mohammed is the federal defence minister.

This move consolidated integration processes within the UAE and at the same time eased Dubai's expenditure burdens. In addition, Abu Dhabi also agreed to (a) provide Dubai with natural gas as from May 2001, and (b) channel major projects of the UAE Offset Group (UOG) towards Dubai. The UOG, a brainchild of Abu Dhabi ruler and UAE President Shaikh Zayed Al Nahyan's favourite third son Mohammed Bin Zayed, the UAE chief of staff, is the organisation which channels offsets. These are ventures by Western arms suppliers who are obliged to invest a percentage of the value of weapons procurements orders in UAE industrial ventures.

By transferring the Dubai armed forces into the UAE federal system, Shaikh Mohammed has focused his efforts on turning the emirate into a bastion of "soft power" within the UAE as well as the Middle East as a whole, while Abu Dhabi will retain the elements of "hard power" - i.e. control over the military hardware and forces. This reflects the way in which the UAE is evolving gradually into a cohesive federal unit, with the younger generation of leaders among the member emirates less affected by the mutual suspicions of the past generation. As such, Abu Dhabi is consolidating its role as the capital of federal government affairs, while Dubai has established itself as the UAE's business capital.

In emphasising rapid modernisation, efficiency, free market principles - all done under the guidance of a firm hand - Shaikh Mohammed appears to be adopting to some extent the model of Singapore's senior leader Lee Kwan Yew. The Dubai crown prince's growing focus on keeping abreast of the latest technologies is another reflection of the Singapore style. On Oct. 29, 1999, Shaikh Mohammed had said: "My vision is very simple. In the future, all commercial action will be in cyberspace. But the cyber world will need a ground base on this physical world...and I want Dubai to be the best physical location in the world for any and every virtual company" (see this week's APS Review).

For Dubai, e-government is a natural progression from the current situation. It is already one of the most modern cities in the world and it has instant name recognition in the West as the result of a sustained advertising and public relations campaign carried out over the past decade. The infrastructure in the emirate matches the best in the world, while it has gradually established itself over the past three decades as the main business centre in the Middle East, rivalling Singapore and Hong Kong. At present, Dubai is perhaps the only emirate in the Middle East that has limited hydrocarbon resources yet is run efficiently and according to free-market principles.

The example of Dubai has acted as a catalyst for other member emirates of the UAE to follow in its footsteps - be that in establishing free zones or in setting up modern port facilities and building up a tourism industry. Between 1995 and 1998, hotels and restaurants, the main pillars of the tourist sector of Dubai, grew by an average of 16% per year in real terms, far ahead of the 5.4% achieved by the economy as a whole.

Indeed, information technology (IT) and tourism are the fastest growing sectors in Dubai. In October 2000, the cornerstone of Dubai's drive for e-government and e-commerce, the Dubai Internet free zone, will be opened. The free zone will host IT companies as well as Internet Service Providers (ISPs), with the emergence of the latter signalling the end of the monopoly of the federal Emirates Telecommunications Corporation (Etisalat) over local use of the Internet. There are an estimated 607 software companies now operating in Dubai and these are generating annual sales of $624 million for the emirate.