The Birth and Rapid Growth of Dubai Ports World
DP World traces its roots to the establishment of Port Rashid, Dubai in 1972, named after Dubai’s ruler at the time, Sheikh Rashid bin Saeed Al Maktoum. In 1979, Sheikh Rashid completed the ambitious Jebel Ali Port, and in 1991, the two ports were brought together under the directorship of the newly formed, state-owned Dubai Ports Authority. As the Emirates increased its financial clout, largely from growing oil-based wealth, the country witnessed rapid urban and demographic changes, and extensive infrastructural development. During this time, Jebel Ali grew dramatically, and the combined ports handled more than a million shipping containers’ worth of cargo (termed twenty-foot equivalent units, or TEUs, in the industry). Increasingly becoming a regional and international hub for trade, Jebel Ali also developed as a favorite port of call for the U.S. Navy.
In fact, following the United States-led wars in Afghanistan and Iraq (beginning in 2001 and 2003, respectively), Jebel Ali profited immensely from the presence of Halliburton employees, private mercenaries, and American soldiers en route to Baghdad and Kabul. It has been described as the busiest commercial terminal in the world for the United States’ wars in the Middle East.3 But while Jebel Ali grew to be a key logistical hub underpinning U.S. militarism in the region, corporate and state leaders looked beyond the shores of the Emirates for important investment opportunities.
In 1999, the government established Dubai Ports International (DPI) to manage and operate container terminals outside the Emirates in Jeddah (Saudi Arabia), Visakhapatnam (India), Dolareh (Djibouti), and Constanta (Romania), on the Black Sea coast.4 And in 2005, DPI and Dubai Ports Authority merged to form DP World, becoming one of the largest port operators in the world.
The historical trajectory of DP World suggests a tight-knit relationship with state power, and its current structure and leadership is also deeply wedded to the Emirates’ ruling families, blurring the lines distinguishing the state from private capital. Overseeing the management of one of Dubai’s primary revenue-generating infrastructures, DP World is the lifeblood of Dubai’s ruling classes. As such, those classes have a vested interest in shaping the future of the company. DP World’s CEO, Sultan Ahmed bin Sulayem, comes from one of Dubai’s most prominent business and political families. In fact, his father was a key advisor to the ruling Al Maktoum family.5
Moreover, Dubai World—a global holding company that is an investment arm of the government of Dubai—owns 80 percent equity in DP World, essentially giving the ruling family ultimate control.6 In further evidence of the interlocking relationship between state and private capital, bin Sulayem was himself the chairman of Dubai World; the chairman of Istithmar World, the investment arm of Dubai World, which specializes in private equity; and the chairman of Nakheel, the global property development company incorporated by the government in 2001 to establish and develop the real estate sector in Dubai.7
This is not to suggest an equal standing between CEOs and Dubai’s ruling families. A year after the 2009 Dubai debt crisis, the ruler of Dubai, Sheikh Mohammed bin Rashid Al Maktoum, removed bin Sulayem as chairman of Nakheel and Dubai World (though bin Sulayem retained his position as chairman of DP World).8 The Dubai ruler replaced bin Sulayem with his uncle, Sheikh Ahmad bin Saeed Al Maktoum, as chairman of Dubai World; Al Maktoum also appointed his close confidants Mohammed Al Shaibani and Ahmad Al Tayer as board members.9
In fact, the debt crisis served as a moment to solidify and concentrate ruling class power in the Emirates. Members of Dubai’s historic mercantile families, such as Al Tayer and Al Lootah, gained prominent positions in companies such as Dubai World, Nakheel, and Istithmar. Meanwhile, at DP World, where Bin Sulayem had previously overseen the extensive growth of the company, he resumed the company’s two-pronged strategy: acquiring rivals and bidding aggressively for port concessions.10
The Emirates insists that DP World is a private enterprise, but its activities move in lockstep with the country’s strategic interests.
But 2009 undoubtedly marked a rupture in intra-Emirati relations. Following Dubai’s crucial $10 billion bailout from oil-rich Abu Dhabi, the latter tightened its grip over political decision-making in the country. While political decision-making in the federal monarchy of the Emirates remains relatively opaque, researchers and commentators generally agree that Abu Dhabi has taken the lead following the financial crisis.11
Although DP World insists that it operates independently from Emirati foreign policy, the changing atmosphere has clearly affected the firm as well. The Emirates “always say[s] DP World is a private company and is acting out of commercial interests,” said a Western diplomat quoted in a 2018 International Crisis Group report. “But clearly those interests align with Emirati foreign policy.”12
The interlocking relationships between state and private capital, the growing authority of Abu Dhabi over political decision-making, and an increasingly expansionist Emirati foreign policy have all served to ensure that the activities of DP World continue to move in lockstep with the “strategic interests” of the Emirates.
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