Tired of reality TV geopolitics? Here's why Dubai didn't collapse

0:00 We live in geopolitics as a TV reality show.

0:03 Like that's where somebody's actually thinking of, you know,

0:06 what kind of ratings will this announcement get?

0:08 What kind of ratings will this attack get?

0:13 Yeah.

0:11 Pretty wild world.

0:16 You're growing like 2 300% in the early years.

0:20 Yeah.

0:19 I never wanted to be an entrepreneur.

0:21 So, I'm definitely an emerging market junkie.

0:23 I want I like to go to the frontier.

0:25 Okay.

0:26 Give us the meat.

0:26 You

0:29 need to be able to make the sacrifices that are required for this journey.

0:33 Take pride in [music] your job.

0:35 This too shall pass.

0:38 Yes.

0:40 [music] I think it's not important to note for the listeners that we

0:47 are we are taping on Friday the what are we today?

0:50 22 24th 22nd.

0:53 No, 26th of April.

0:54 It's day 56.

0:55 When this comes out, maybe the landscape might have shifted,

0:58 but I think what we're going to focus on today

1:02 is not maybe not so attached with the headlines.

1:04 We're going to we're going to talk

1:05 about slightly a slightly longer time frame, right?

1:08 Like,

1:10 yeah, how will all of this impact the UAE specifically and the region, right?

1:14 And what what can we do about it?

1:17 Um,

1:17 we can talk about anything you want.

1:18 We can go 30,000 ft in the air.

1:20 We can go down into the weeds, whatever.

1:21 You just direct me.

1:22 Awesome.

1:22 Let's talk about the news I guess.

1:24 Uh so we are now uh there was a ceasefire but now obviously

1:29 there is like a new deadlineish like 3 to 5 days from my understanding.

1:33 There's strike plans being made as we speak.

1:37 Uh I'm not sure how that's going to happen.

1:38 What's your read about what's going on now?

1:41 Visa v Dubai at the UAE visa.

1:44 I I'd say for the UAE where we are at the moment, as I say,

1:47 in kind of day 56 of this would be that we're

1:51 in the middle of a a coercive pause of of the conflict, right?

1:58 We haven't got a conclusive resolution and the United States and Iran are

2:03 in the middle of a kind of cold phase of a hot war.

2:07 That that would be the best way to kind of to sum it up.

2:11 Um obviously as you say by the time this come out that the landscape

2:14 could could shift quite a lot but I think when you look at it

2:18 for the perspective of the UAE the debate is um the debate internationally has

2:25 been very interesting right so there's kind of two camps when I think of what's

2:30 going on I think of the UAE as a system and I think

2:33 we should frame this conversation through systems

2:36 thinking and rather than thinking of it

2:38 as a as a country which of course it is but view it through

2:41 the the theoretical lens of systems thinking and what

2:45 we've seen so far in this debate, right?

2:47 Is you have two camps.

2:49 You have one camp here which is this is kind of the end of the UAE, right?

2:56 We've seen this sensationalism at the start

2:58 of this and in that debate you have a spectrum.

3:02 You have an extreme spectrum which is basically the Daily Mail, right?

3:05 Which is this is the end of the UAE and blah blah blah.

3:08 It's a it's completely vacuous.

3:10 It's a waste of time even discussing

3:12 it because obviously it's a geographical fact.

3:14 The country is going to remain.

3:16 But if you zoom up the spectrum on that side to more kind of introspectful,

3:21 thoughtful people, you still see a narrative

3:25 externally like let's try personify it.

3:29 Say Rory Stewart who is a former Conservative MP in the UK.

3:34 He has a big podcast with uh Tony Blair's former uh comm's

3:39 man uh Alistister Alistister Campbell and he I saw on BBC I

3:46 think it was a couple of weeks ago he's saying this will

3:50 be the this will set a place like Dubai back I think he

3:53 said up to 15 years right now it's easy once someone like

3:58 Rory Stewart opens his mouth it's easy to kind of dismiss him

4:02 as an kind Etonian um snob I suppose right everything is like Dubai

4:12 Jubai is set back 15 years so a lot of people dismiss him

4:17 but actually I I quite like his analysis

4:19 and he's quite he's quite thoughtful about things

4:22 and that's why it's interesting hearing him say

4:25 this somebody he was I believe he was some kind

4:27 of diplomat in the Middle East in Iraq

4:29 or something but you know like us westerners feel

4:32 like we we spent six months in the Middle

4:34 East and we're experts in the Middle East.

4:36 I'm, you know, I'm here 20 years and I'm still very conscious of that fact,

4:41 okay, that you're trying to look at things objectively.

4:44 He spent some time in the Middle East.

4:46 He was an MP, but he he feels very comfortable making these wild statements

4:50 that it set the UAE back or Dubai back uh 15 years based on what though.

4:55 Does he offer any, you know, any any reason?

4:57 Well, this is a great question because he's viewing things through the prism.

5:01 And this is why it's easy for a lot of people once they hear him

5:04 say this to dismiss him because he he's a product of his own environment, right?

5:10 And I'm not so sure and if he looks at your podcast now,

5:13 he's going to be quite annoyed,

5:14 but I'm not so sure that he's he's looking at it in a a kind of holistic way.

5:21 what he's seen is like everybody is this kind of algorithmic keyhole, right?

5:27 Everybody's looking at things through social media and at the beginning

5:31 of the the shock to the system, right?

5:34 February 28th, obviously everyone from a social

5:37 media point of view around the world.

5:39 Um, and and what he's viewing it on is

5:42 the the British that that left at the beginning of the process,

5:45 you know, a lot of the kind of influencers and whatnot.

5:48 And I think one of the points he made was, you know,

5:51 if you live in a tower that's 50 floors high,

5:55 um, you know, that was his analysis.

5:58 If you live in a high tower and Dubai

6:00 is full of high towers and there's these, uh,

6:02 attacks taking place, well then who who's going to be there, right?

6:05 A and I just feel like this lack of any

6:10 kind of structured understanding of what actually is going on here.

6:16 Um it's it's bizarre when you look

6:20 at the other side of of the discussion, right?

6:24 So let's just let's just think about

6:29 the aggregate demand and everybody that remained

6:32 in in the UAE during this situation which was the vast vast majority of people.

6:38 Okay.

6:38 Yeah.

6:39 Sure some people left but the vast majority of people stayed.

6:42 You see that when you go and drive down uh Shakesside

6:46 road or if you go to uh a shopping mall, right?

6:49 So therefore then the the other camp the narrative

6:52 for a lot of people who remained is around this idea

6:57 of um the UAE has come through you know you

7:01 had the debt crisis the financial crisis you had mid 2014

7:05 the oil prices fell and that impacted the UAE you

7:08 had a that was a a tricky time from an economic

7:11 point of view minor um then you fast forward

7:14 and you have COVID right which if you're a conspiratorial person,

7:19 you would think this is a pandemic that's designed

7:22 to damage an economic model like the UAE, right?

7:25 Trade, transport, tourism, financial services, etc., right?

7:30 Um, and yet the UAE came out of all of these situations stronger.

7:34 And that seems to be the narrative from everybody here.

7:38 And I I buy into that narrative, right?

7:41 But what we're not doing and what the folks

7:43 here need to do is articulate why that is.

7:48 Why does the UAE always come out

7:50 of these shock periods in a better, stronger position?

7:55 And the answer to that is if you look at the UAE

7:58 as a system and you think of it in a holistic terms, right,

8:02 through systems thinking and what you what you

8:06 have when you when you apply a systems lens

8:08 to things is you have this kind of dense

8:11 interconnected um multiple organs that are layered together, right?

8:17 So think of your body as a as a system, right?

8:20 You have all these organs that are working together

8:22 and it either creates a healthy system or a failing system.

8:26 In the UAE, you'd have obviously, you know,

8:28 defense from a military point of view.

8:31 You'd have political leadership, economy, supply chains,

8:34 everything that's happening within within the system.

8:37 And within those systems, you have feedback loops.

8:41 And these feedback loops,

8:43 they either strengthen or bolster trust and confidence in the system,

8:49 which results in it coming out stronger, or it weakens them.

8:55 And what the UAE has been incredibly good at doing is the system

8:59 that it has created is a system that when pressure is applied to that system,

9:07 it comes out stronger.

9:10 and it's been able to do that primarily in these shock periods like like co

9:16 is that it's the system has positive

9:19 feedback loops and then the government is very

9:22 agile and it pulls a lever a reform leader and that reform piece for this will

9:29 will be critical but the the system the agility of the system is is critical.

9:35 Okay.

9:35 So, so you have this you have a shock period,

9:38 you have pressure that's applied and in a in a strong system,

9:43 a healthy system, it comes out stronger.

9:45 In a weak system, you have a deterioration.

9:50 Yeah.

9:49 The UAE has this knack for coming out in a stronger position.

9:54 And that's because it is able to do a few things.

9:58 First of all, it's able to absorb the shock.

10:01 Okay.

10:02 Which again in this in this example that we're living through now,

10:07 the interceptions and everything interceptions and keeping all the people here.

10:13 Yeah.

10:11 It's not this algorithmic social media uh feed that everybody is seeing, right?

10:17 The vast majority of people are here in the UAE.

10:21 The second thing that you're able to do is you take lessons from that, right?

10:24 You learn the lessons and then you

10:26 institutionalize the lessons faster than anyone else.

10:29 True reform.

10:30 Yeah.

10:30 And that's and then when you look at these things,

10:34 what you see is if you zoom out because we're all obsessed now with like day 56,

10:42 but when you zoom out of this, inevitably in five,

10:44 10 years time when we're looking back at this, what you'll see

10:48 as a result of systems thinking and as a result of the the healthy body,

10:53 the system that this is, what you'll see is that these shocks,

10:59 although undesirable, unwanted,

11:03 uncomfortable at the time actually become accelerators of necessary adaptation.

11:10 Yeah.

11:10 like it's the the it's the lessons that we have to learn and something

11:15 I hopefully this is proven right but in the future there will be some

11:21 kind of black swan event where the necessary

11:24 adaptations that we learn through this lesson

11:26 will be advantageous to the system exactly the way co was to this shock

11:33 there's I mean you said a lot I want to unpack uh a few things with you

11:37 so um with with regard ards to the comment

11:40 obviously on the vast majority staying here.

11:43 I think um clearly a lot of the the tourism has been impacted right

11:48 the floating population definitely and and I think that's normal and I think you

11:52 know denying that doesn't make sense if you if you are

11:55 considering visiting I think you will definitely ask the question uh

11:59 before you make that decision and I think maybe that's why

12:01 we saw at least initially a drop in footfall in malls

12:05 for example maybe you wouldn't see the the traffic as you

12:08 said on the streets but then things are really picking up

12:11 I can tell you anecdotally like we're back to school today.

12:13 I dropped off my kids this morning.

12:15 Um again, you know, things look normal.

12:18 The the the roads are busy.

12:20 Uh uh I went to a restaurant last night.

12:22 You know, it was on the palm actually.

12:24 It was quite busy.

12:25 So, you're you're you're seeing I think as you said, there was a shock.

12:30 Yeah.

12:29 And then there was a reaction to the shock

12:31 because there was a lot of uncertainty.

12:33 We we still have a lot of uncertainty.

12:34 I don't think we're over that yet.

12:36 But I think what what you're saying and and and what I

12:39 agree on is is I think that the system has proven resilient.

12:43 uh but of course I think it's it's very normal that um

12:46 you know to something like tourism would be would be hit and

12:49 the the floating population you know as in any

12:53 sectors who are exposed to inbound high-end tourism

13:00 they're going to hurt right there's no it's a shock

13:04 period there there's no getting around that by the way

13:07 but but that is a different narrative than people saying you

13:11 know for example this is the end of the UAE Yeah.

13:13 No, that that's tourists are not coming.

13:15 Yes.

13:15 You know.

13:18 Yeah.

13:17 And and tourism slows down in the summer.

13:20 You you could think of this in a way as depending on where the geopolitics land.

13:24 This is going to be a really long slow summer this year.

13:29 I think the the the facts obviously that ultimately, you know,

13:32 we we all went through this in order

13:34 to make our decisions whether to stay or leave.

13:36 You know, ultimately we felt pretty safe here and most of us stayed.

13:40 You and I met in a barbecue or whatever.

13:42 Yeah, two weeks ago everyone was here, right?

13:44 So I think you know there's there so there's

13:48 the nar like the countern narrative to that is

13:50 is those influences that went on social media

13:53 to say like hey you know everything's perfect and

13:56 yeah there was a lot of that and there was then

13:57 there was the there was two extremes there are two extremes

14:00 honestly yeah I mean it's not like normal and it's not

14:05 cataclysmic like we're we're somewhere in the middle and we're okay

14:08 and I think that's the more u nuanced narrative that should

14:12 come out is that we're here we're safe uh and and yeah,

14:16 we we didn't pack our bags and uh and and leave.

14:19 Um one point though I think you know some sectors will

14:24 probably suffer more than others right I mean you have uh

14:28 you have a you know a wide sort of uh um

14:31 the makeup of the UEE you have a big uh South Asian

14:35 population for example that are here and so on so it's a the makeup of the UE

14:40 is very interesting you have I think

14:41 200 nationalities and and maybe the the impact

14:45 of this war was a little bit different on others do do you see any any

14:48 differences Some of these sectors let's say might

14:52 suffer more than others or or not really.

14:55 Definitely definitely it's it's you know there

14:58 there'll be sectors that will be it

15:01 will be counteryclical that will benefit right

15:03 part half of our business is like peak

15:05 demand at the moment because of this right but then you have like discretionary

15:09 advisory work that people will say well let's let's push that to kind of Q4.

15:14 The key thing obviously is where the the geopolitics and all of this lands,

15:18 but in the meantime there's kind of there's two

15:21 ways of two ways I would look at it.

15:23 One is the immediate impact on from a demand point of view.

15:27 And what you'd want to do is kind of build a table of resiliency.

15:32 Okay?

15:32 And let's say let's work our way from the top.

15:36 If I was say an investor, an entrepreneur, CEO and I'm looking at how can I tap

15:43 into who's going to hold up in terms of demand best.

15:46 I would say and all of these are nuanced, right?

15:50 You want to in even within it there'd

15:53 be subcategories of where demand holds up better,

15:56 where it's more stable,

15:57 and there'd be other elements where it's going to be weaker.

16:01 In any kind of shock, you want to stay close to the government, right?

16:04 is closest to where the spending needs to happen.

16:07 So I would say the most resilient sector will

16:10 be coming from government and government spending because there'll have

16:13 to be a continuation of public administration of you know

16:17 safety regulation utilities all of that stuff holds up really well.

16:22 So you're looking at government, healthcare, pharma.

16:24 I'd say professional services holds up pretty

16:27 well because these guys can pivot, right?

16:30 If you're lawyers, there's going to be quite a bit of work in terms of disputes,

16:34 in terms of um in terms of HR and uh human capital,

16:39 employment issues, um risk advisory, market intelligence.

16:45 Um all of that stuff is going to stay pretty strong.

16:48 And then you start getting into the less kind of resilient.

16:51 You're going to have the the sectors that were exposed or I

16:56 would say moderately resilient and you've got the likes of say manufacturing,

17:01 construction which are still carrying on but the the increase

17:05 in cost for their supply chains are obviously increasing.

17:09 You have the likes of energy, agriculture, chemicals, mining,

17:12 this stuff again continuing but some of them

17:15 were impacted as a result of the war.

17:18 Some of them are going to make a lot of money

17:19 as a result of that because there's such peak demand,

17:22 but there's others that will be will be impacted.

17:25 So, they would be, I'd say,

17:27 moderately resilient depending on where you sit

17:30 on that kind of spectrum of impact.

17:32 And then you get into the the sectors that are more exposed.

17:37 I'd say education holds up reasonably well, right?

17:42 From an overall kind of demand point of view,

17:44 it will it will hold up, I would say.

17:47 reasonably well, but you would also have again those students

17:52 who were coming in from different parts of the world.

17:54 All of that slows down and then the ones that are exposed, right?

17:59 I would say depending on how long this goes

18:03 on, I think real estate has held up pretty well.

18:06 Obviously, it's been impacted,

18:08 but it's held up really pretty well compared to what

18:12 people would have imagined in terms of the circumstances.

18:15 Yeah.

18:15 You know, if someone had described what has

18:17 happened over the last 56 days, a year ago,

18:21 yeah.

18:21 You know, they they would have described,

18:23 you know, a place like Dubai almost an exodus.

18:28 And that didn't that didn't happen.

18:30 Like that's that's an incredible thing.

18:32 I'm on the board of a real estate developer.

18:34 I I see.

18:35 And obviously things are slowing down.

18:37 Obviously, they're being impacted, but they're still making sales.

18:42 Yeah.

18:41 Which is incredible.

18:43 And then you then you'd have kind of the yeah those highly exposed.

18:48 So you have anything in kind of PR media advertising right everyone

18:53 stops advertising in times like this right they just take a beat

18:58 um and then the most exposed obviously travel and tourism and anyone

19:03 as you mentioned earlier Lou who has is exposed to the floating population.

19:09 So the tourists that come in and they go to, you know,

19:14 the the high-end restaurants and even luxury, I think, luxury,

19:18 luxury retail.

19:19 Yeah.

19:19 Exactly.

19:20 So again, yeah, retail is probably moderately resilient.

19:25 You've got one side of it where you've got your daily demand,

19:28 you know, your supermarkets, all that kind of stuff.

19:31 But then on the other side of it, you'll have your high-end luxury where

19:36 inbound tourism.

19:37 Yeah.

19:37 That that's going to be impacted.

19:38 Yeah.

19:39 And I think that's a that's a great picture that you've just laid out

19:43 here because I think it's it's important

19:45 to acknowledge like some of the narratives

19:47 out there and but as you said it's important to understand why you think

19:50 this is going to be resilient and and and and provide the data points.

19:54 Some sectors will be impacted, some sectors

19:58 and this is all in the this is all where we are now.

20:00 this and we've hundreds of CEOs in our network and they're all pretty

20:06 much depending up much better than we

20:13 much better than we would have anticipated.

20:15 But there there's guys that are more exposed.

20:18 This is what is happening now, you know, and this is

20:22 this is a relatively there's going to be chapters

20:24 of this and we're we're still in this kind of early

20:27 shock phase where people are now beginning You're moving

20:31 from shock to tension to processing and then into into recovery.

20:38 Yeah.

20:37 Um and once we get into that recovery, if we think about the systems thinking,

20:42 what the UAE is excellent at is really being quick and pulling that lever.

20:50 What what results in the next boom like

20:52 look look co is a perfect example, right?

20:55 What happened as a what were some of the reforms that happened as a result of co

20:59 co was everything it like what the UAE is great at is don't waste a crisis

21:04 you know so it went from kind of social reforms you know cohabitation and all

21:09 this stuff right up to golden visas and then

21:11 it kind of morphed in you had companies law you had massive reforms in terms

21:15 of from the economic sector more broadly and that just

21:21 it it shifted um it it shifted did gears for the for the country completely.

21:27 And this time I think what will happen after this inevitably and this is

21:30 true of the GCC when we move into the next chapter and that will happen

21:36 the the next thing I think that whether you're a CEO a policy maker

21:43 an investor an entrepreneur an NGO whatever anyone

21:46 who's trying to evaluate and analyze the system

21:51 will need to understand that most likely everything will be viewed

21:56 through the lens of sovereign resiliency in the GCC, you know.

22:00 So, can you explain sovereign resiliency

22:03 like from an infrastructure point of view, right?

22:07 It starts it starts off from a defense point of view, right?

22:10 You know, h how do we ensure that we can um we're in a safe

22:17 structured environment where we can determine and control

22:20 the inputs and outputs of the the system,

22:23 right?

22:23 As much as is humanly possible.

22:25 So that means you know obviously from a defense point

22:28 of view um it means from things like your your infrastructure,

22:33 your food security, your food security will likely turn into food sovereignty.

22:38 How do we turn the desert green?

22:39 How do we grow even more stuff here?

22:42 Your logistics and supply chains which again the country's done an amazing job.

22:46 Um it will be strategic reserves you know everything.

22:51 It will be where you build data centers you know all of this.

22:55 So everything that was viewed through a lens of efficiency

23:00 will now be viewed through a lens of resiliency.

23:03 And if you're a startup or if you're a an entrepreneur,

23:08 you know, that's the way I would view things.

23:10 It's like how do I help these countries in the GCC?

23:15 How can I go and help them be more resilient?

23:18 And there'll be that in itself from an infrastructure point of view.

23:23 That will be a big lever of of growth.

23:26 But again, you need to get the geopolitics to to land in a way

23:31 where everybody can find a balance where they can go about their Yeah.

23:39 their It's funny by the way um how founders always find opportunities.

23:43 So So someone I know he's a he's a great entrepreneur.

23:46 He's built this trucking business called Trucker.

23:49 Okay.

23:49 Very good.

23:49 So basically since the closure of the of the straight of of Hormuz

23:53 like his his business has been booming like he's been transporting everything

23:58 and and I think there's a lesson there and I guess probably this is

24:01 what will be tackled next right this kind of single point of failure.

24:04 Yeah.

24:05 Uh will probably not be with everything allowed anymore

24:08 with everything you know your your logistics your ports your airports

24:12 you know does it make sense having a big huge Yeah.

24:15 have a big mega airport, but maybe you need some other airports.

24:19 The interconnectivity between the region, you know,

24:22 you you see u train infrastructure going from the UAE to Jordan.

24:26 Now,

24:27 your pipelines for energy and oil and gas

24:30 and how you move that around the region.

24:32 It will be a new paradigm.

24:37 Yeah.

24:35 And the humans are adaptation machines.

24:38 The system will just adapt.

24:40 And and like I said, why the UAE is a healthy system is because it recognizes

24:47 that these are actually accelerators of adaptations that will have to happen.

24:55 And if CO hadn't have happened, the UAE,

24:57 the system would have been far less prepared than what

25:01 actually has happened for the shock that they're in now.

25:05 Yeah.

25:05 Um, so it's quite interesting and I think what they're very good

25:09 is that adaptation piece and if you look and this is zooming out.

25:15 If you look at the direction of where the world is going, you know,

25:18 we're in this very messy predatory multipolarity

25:23 like this period of countries not operating

25:28 in in any semblance of of international law and it's very much you know

25:33 the law of the jungle and prison rules and if you have mighty

25:36 or right and you just do what you want to do and political geography starts.

25:42 We thought political geography wasn't that important

25:44 anymore and now we recognize that

25:48 it is right if you're in the sphere of the United States you

25:51 have like the the Gulf of Mexico went to the Gulf of America right

25:56 Canada was chided as the next state of the United States you Greenland

26:00 you know political geography we assumed was had been kind of put to bed

26:06 and it's not all of the institutions just kind of crumble around

26:11 us that we built over the last hundred years

26:14 and now we're building something new and there'll be unbridled opportunity

26:18 in that and there'll be unbridled suffering in that for some people

26:22 but in there what is most likely the adaptation that countries will need

26:29 is resiliency and the adaptations that will come out of this I think

26:35 will actually serve the region well now again with the caveat

26:39 that how do how does this all land between

26:43 the United States and and Iran in the end of it.

26:45 I want to ask you one clarifying question on what you said

26:48 and then I want to um shift the conversation a little bit.

26:50 But you talked about uh a systems uh thinking like the UAE basically

26:55 as a body or even I think of it as an organization to be honest.

27:00 Yeah.

27:00 Uh um and you talked about feedback loops.

27:02 Can you can you maybe give an example of like how how does a like

27:06 how does a feedback loop happen and like I'm sure you've seen it in action

27:10 in now a a great sociological example of this is when the crisis happened

27:15 right and obviously at the beginning it was very surreal and there was this kind

27:19 of shock period and people similar

27:22 to co again human behavior watching human behavior

27:26 everybody started to act a little bit

27:29 weird right the interceptors are clearly working right,

27:33 which is an incredible achievement,

27:35 but we were still all um cautious about our movements.

27:40 A feedback loop that everybody could see,

27:42 and this speaks to the the um the political

27:46 lever is the president going to the mall.

27:49 Yeah.

27:50 Right.

27:50 That went all over social media.

27:53 Um after that, everybody just start moving.

27:56 Right.

27:57 There's a feedback loop loop in that.

27:59 And that's a small example of it.

28:01 But the examples are multiffold and constant.

28:05 You know this there's signals in every sector.

28:07 There's signals in every business and these

28:11 get fed back into the into the overall system.

28:14 I think the way I see it at least on the startup

28:16 side because obviously I work with a lot of entrepreneurs

28:19 and I invest in them and I see the feedback loop

28:21 in the sense that uh people from the government are always

28:24 open like they they're always gathering entrepreneurs and people listening

28:28 to what's happening uh getting feedback from the room you know trying

28:32 to understand what are the challenges and the opportunities for them

28:35 to work you know find solutions and not be the bottleneck.

28:38 This is a great example.

28:39 So I February 28th, right, was when the attack started.

28:45 And then you had I think it was the f I might be misremembering,

28:52 but the Friday after that.

28:54 So I got in touch with the UAE Minister of Economy.

28:56 He's a a friend Abdullah bin talk and I said, you know,

29:00 it would be great to connect with some of our members.

29:03 You know, everybody's trying to figure out what is going on.

29:06 So I think I spoke to him on the Tuesday

29:10 and Friday the Friday night this is the Friday after we

29:16 had I had said to him I'll get I'll get together

29:19 a few of the the clients it ended up 150 right CEOs

29:25 yeah on the f on the Friday night and that speaks to the kind of the spirit

29:30 this was an inerson thing yeah exactly that was on the I'm almost

29:35 sure it was the Friday after the the Saturday.

29:38 And um that is the that is the feedback loop.

29:43 And what was really interesting again putting

29:45 that kind of sociological kind of lens on things.

29:50 That was the Friday and it ended up there was 150

29:55 of us there and the first two executives to speak, right?

30:01 So me and the minister had a kind of fireside chats

30:04 and we were all kind of making sense of things together.

30:07 The first two executives to speak were European

30:10 executives and both of them had flown they were

30:14 outside the country when the missile started and they

30:18 had flown back to the country through Oman.

30:20 They flew into Oman and drove back over the border.

30:24 And again there's like in a kind of the ethnography

30:27 of our like what you were saying it's a cosmopolitan place.

30:30 is the ethnography of our group of of uh

30:34 network is also very cosmopolitan and you

30:38 could analyze each of these groups differently because

30:41 they're going to react based on their circumstances.

30:44 But I think the most interesting part of it

30:46 is the first two were European uh executives,

30:49 European CEOs who who made the point once the country came under attack,

30:54 it wasn't to stay outside, it was to fly back

30:58 and come in into the country, right?

31:00 Then I think it was a couple of weeks ago,

31:02 we hosted one of our member meetings again and we had Halal Almari, right?

31:07 uh who's for your viewers that aren't from the UAE who is like

31:11 the emirate level minister for economy at at the Dubai side of things.

31:16 Again, the feedback loop, it kind of speaks to Yeah.

31:20 It speaks to the the leadership style

31:22 and the bolstering that trust and confidence.

31:26 And what was [snorts] really interesting for me

31:29 by this stage there there had been about 200 2,612 missiles,

31:38 drones, aerial threats, right?

31:40 I think in the end it got up to close to over just over 2,800.

31:45 Yeah, exactly.

31:45 Right.

31:46 So this is a couple of weeks ago.

31:47 So by this stage at that members meeting we'd about 160 of our members.

31:52 And what I realized when I went into that room

31:57 was the most interesting insight was the fact that okay,

32:02 we've had 2,600 missiles and drones fired at 150 whatever was in the room.

32:10 So about 17 161 17 missiles or drones for each

32:17 individual person had been fired at them in the room.

32:20 And they're all sitting in the room.

32:21 And what I realized there, Lou,

32:23 was that I had been making a mistake in terms of my analysis

32:28 of of the UAE because I have this weird job, right?

32:33 So for the last kind of 20 years broadly speaking

32:37 clients roll me out and I give a talk for global

32:41 CEOs for regional leadership teams uh for government officials

32:46 and broadly speak and I'm obviously boiling this down the story

32:50 I had been telling for the last 20 years UAE

32:54 GCC more broadly was really a story of economic diversification right

33:00 that's what everything kind of came down to if you

33:02 had to boil boil it down to a couple of words.

33:04 And what I realized during this period was

33:07 it was never just a story of economic diversification.

33:12 It was a story of sociological diversification.

33:16 Mhm.

33:16 So there has been a deliberate very sophisticated state craft

33:21 a very deliberate policy to broaden out the base of people

33:27 the profile of people type of people who are emotionally

33:32 socially financially and structurally invested in the success of the UAE.

33:38 That's what's been going on for the last 20 25 years.

33:42 We're looking at it through, you know,

33:44 you're looking at it from investing in startups.

33:47 I'm looking at it maybe from, you know, a business outlook or the economy.

33:51 But that's what's actually being happening.

33:53 It think of it like a very complex beehive.

33:56 And and that's what is being has been created.

33:59 and and that sociological diversification manifests itself in a very interesting

34:04 way because what it leads to is a a social connection,

34:09 a social commitment and a social allegiance to the UAE.

34:14 And that's why the vast majority of people stayed in the in the country.

34:18 And that's beautifully said, by the way,

34:20 because I think the bet was that this is going to collapse.

34:25 Absolutely.

34:24 And that's the the death of the UAE articles, right?

34:27 That's where all that 85% experts, everyone's going to go.

34:30 And I think and that didn't happen.

34:32 And the interesting thing about that is

34:34 that social allegiance for you and I, right?

34:39 Well, for me growing up in Ireland

34:41 in the 80s and 90s and Lebanon would be similar.

34:45 Mo all other countries would be similar.

34:47 This is a really profound interest and idea what is happening here.

34:51 And this this will be looked back at as from a historian's perspective.

34:55 this chapter.

34:58 Mhm.

34:57 Where something new came out of this because when we're grown up,

35:02 you have a political allegiance typically, right?

35:05 In Ireland, you know, I'm I'm Oh, that's not even go to political allegiances.

35:11 Well, I in our part of the world,

35:14 but but it's it's really around the allegiance piece, right?

35:18 In Ireland, mo I don't I wouldn't know who to even

35:21 really vote for in Ireland because I'm I'm dead inside, right?

35:24 Okay.

35:25 But but most people in Ireland, broadly speaking, again,

35:30 will vote based on where what their grandfather or great-grandfather

35:35 thought of a civil war that happened in 1922, right?

35:40 In Lebanon based on a the French men mandate,

35:44 the constitution 1926 100 years ago.

35:48 Exactly.

35:49 The confessional process of your constitution.

35:52 everybody well not everybody broadly speaking because we'll annoy people

35:57 they still vote along those ways and and the political

36:00 allegiance goes that way what's happened in the UAE

36:03 is they've created a new system a new model

36:06 and the allegiance is far more practical it's a practical

36:10 allegiance and that practical allegiance I could see it

36:13 in that room that day when I was looking around because

36:18 everybody in that room has the economic viability to leave, right?

36:23 They're all financially secure.

36:27 Second homes, second passports, third homes.

36:30 They're all, you know, doing very well in life.

36:33 And yet, they're all in that room when

36:35 there's almost 3,000 missiles and drones fired at them.

36:40 Why is that?

36:41 It's because it's economically possible for them to leave,

36:45 but it's psychologically costly for them to leave.

36:49 That's a profound shift in the history of this country

36:52 I think because what a lot of us had have assumed was that you know if

36:58 you just focus on Dubai and particularly postco you

37:02 a lot of like really successful people come

37:04 into the UAE and it it it ca it became

37:07 like almost like Dubai was like the best business

37:11 class lounge for the global economy in the world.

37:14 you know, you came here, people enjoyed their wealth,

37:17 and they flew around around the world.

37:19 Okay.

37:20 And in that kind of assumption, there's a transactional feel to it.

37:25 It's a place that you use.

37:28 Mhm.

37:28 But actually, what this has proven is it's a place that you belong.

37:34 Yeah.

37:32 It's not a place that you use.

37:35 It's a place that you you belong in.

37:37 Yeah.

37:37 That's that's more powerful than anything else that comes out of this

37:42 because it it overcomes that exactly what you said.

37:46 It overcomes that really old idea that if something happens here,

37:51 everybody's just going to leave.

37:53 Yeah.

37:53 And that has that's proven not to be the case.

37:55 I think uh you you've said it honestly you've said it beautifully and I think

37:59 I I will I will wrap on that note because I think it's so well said.

38:03 I don't think we should we should add more to that.

38:06 But I wanted to ask you a few uh rapidfire questions.

38:09 So UAE GDP growth in 2026, they were thinking 5%, IMF said it's more like 3%.

38:16 What do you think?

38:18 Look, do you know what I think?

38:20 I think all of the forecasts are ridiculous.

38:25 Okay.

38:24 Right.

38:24 Including the IMS, right?

38:26 Because one, GDP as an indicator is seriously flawed, right?

38:30 At the at the best of times.

38:33 um particularly when you look at now

38:34 with AI investment and what's going on because

38:37 that would would skew things um and how

38:40 the modern economy has shifted quite a bit.

38:41 They've they've made some efforts to to counteract that.

38:44 But so that that's just one element as an aside.

38:48 The second thing is until we know where the geopolitics lands,

38:54 it's just a guess at this point.

38:56 Well, it it's it's not even really

39:00 like this is just going to be determined by how long

39:03 this thing takes for everybody to find the balance of how Yeah.

39:08 everybody operates together.

39:10 Clear.

39:12 Yeah.

39:11 The next lever the UAE pulls maybe if you had to make a again make a guess

39:15 if it was me.

39:18 Yeah.

39:18 Um I think there's a I think one is going to be

39:22 the sovereign resiliency and there'll be huge investments made in that space.

39:29 I think the financialization of assets um you know you have

39:34 some sovereign wealth funds here that own a lot of interest

39:36 in domestic assets that that could be a way for them

39:39 to um pull a lever and they bring in public markets into them.

39:44 Um there's mo there's they have a lot of chips on the table.

39:49 And this is the thing right when these events happen these kind of gray

39:55 or well this is more of a gray swan right than a black swan.

39:58 We've been saying for years at some point you know there's

40:02 a risk with with the way Iran is in the region.

40:06 Um and when these shocks come along like co

40:10 the UAE has chips and it's is it time

40:13 to cash this chip you know the golden visas there

40:16 was I remember us hosting briefings like 10 years ago

40:20 with with uh officials here and they were talking

40:23 about the idea of you know experts having more

40:27 um more ex exposure or linkages into the economy

40:30 and it was always a case of it's a conversation and then at a certain point

40:35 something happens And now we cash those chips.

40:38 Okay.

40:39 Um, best decision a regional CEO can make at the moment at the moment

40:45 advise them all the time.

40:46 So I I would say begin the process of thinking

40:49 through the lens of sovereign resiliency you

40:52 know because that will that will bleed down

40:55 through from a macro to to the micro.

40:59 So how your company can play a role in that, how it can play a role,

41:02 but also how that could impact your industry or sector

41:05 or your stakeholders or your supply chains and everything that goes around it.

41:11 Um everything is going to be viewed through how does this ensure

41:17 that we maximize you know control in order to maximize safety and resiliency.

41:25 And to the to the listeners who are listening at the moment,

41:28 I call them I call them ambitious Arab professionals.

41:31 I like it.

41:32 Uh so what you know maybe one thing

41:34 that they should be thinking about or doing this year.

41:38 Um I I think as this this we're working

41:42 our true working our way through this kind of shock period.

41:46 I would think of this kind of the 3Ds, right?

41:49 Think of D cubed with with this as it goes on.

41:53 What you want to do first of all is everybody's saying the same thing.

41:58 How long does this last for?

41:59 And that determines everything else.

42:01 But that's not really a useful way of looking

42:03 at things because it's just like asking everybody,

42:05 you know, talking about the weather.

42:07 Instead, what you're better off doing is assessing

42:11 the direction of where this situation is going, right?

42:14 Both from a kinetic point of view and from a diplomatic point of view.

42:18 And assessing that like over a 24-hour period.

42:21 And and then what you want to do is have

42:24 a methodical way of looking at the duration of this.

42:28 And the way you do that is by stop saying how long is this going

42:33 to last and start asking what needs to change in order for this to stop

42:38 this conflict.

42:40 And then once you have that, you're really able to drive decisions.

42:44 And those decisions can be, you know, for your career,

42:47 they can be for your investments, for your family,

42:49 for your company, whatever it might be.

42:51 But, but I feel like everybody has resigned to the fact

42:55 that we're in this period of we're in this period of uncertainty.

43:00 And yeah, but there's still a methodical way of going about it.

43:03 And if you're able to similar to what I was saying at a kind of macro level,

43:09 if you're able to take lessons in terms of what

43:12 are the opportunities that will come out of this because there

43:15 will be huge opportunities and how do I institutionalize them

43:20 into my life so that I move faster than everybody else.

43:23 Basically action, right?

43:25 people could have made a a a lot of money even just looking at the markets

43:30 because it's been so sentiment driven um action right but in a methodical way.

43:37 So it's assess the direction the duration drive decisions

43:42 and then you can uh you take action based on that.

43:46 Too many people are just sitting back and feeling

43:49 like it's out of their control and it's not.

43:52 Wonderful.

43:53 That was um very useful conversation.

43:55 I want to thank everyone who's listening.

43:58 I hope you uh enjoyed the conversation and do let

44:01 us know what you think and if there are any

44:02 other guests you'd like me to host on the podcast

44:05 or any topics to to tackle, do let me know.

44:09 Thank you, Trevor.

44:11 Lou, lovely to see and thank you for the chat.