The Disney-like Development of Dubai

Contrary to popular belief, the Emirate of Dubai doesn’t have much oil and it never has. Its leaders recognized early on that it would need to grow other sectors to develop economically, and turned to trade, aviation, tourism, and finance. The Sheik of Dubai set aggressive targets for tourism, and real estate developer Nakheel, one of the most fascinating companies that we met with this week, responded with a creative solution. To create more tourist attractions, beaches, and waterfront property, Dubai would need a longer coastline. The Emirate of Dubai only had 70 kilometers of coastline, and it was already nearly entirely built up.

Nakheel is the company responsible for literally reshaping the map of Dubai through the development of the reclaimed land Jumeira Palm Island (and the new reclaimed land Jebel Ali Palm Island) as well as the World, the archipelago of man-made islands off Dubai’s coast. During our fascinating visit Wednesday morning, we learned about the company’s unprecedented development projects and toured the original Palm Island by boat. We learned that the palm tree shape was chosen because of its local significance, beating out a falcon and an old boat, as well as for the tremendous surface length that would double Dubai’s coastline, adding 70 kilometers of beachfront real estate. We watched a handful of videos about the civil engineering that went into creating the Palm, from projecting sand in a “rainbow” shape from nearby parts of the ocean floor, to vibrating the new sand masses to speed up the compression of particles closer together. Nakheel even transplanted coral that was located closer to the Dubai Port and was in the path of larger ships to its newly created barrier islands.


Put simply, this was a fascinating visit. But it also raised a tremendous amount of questions. Nakheel doesn’t share information about the costs or profitability of the Palm Islands development. The company’s prepared response about the environmental sustainability is a bit unsatisfying, reporting that the islands could survive a half meter change in sea level and that the region doesn’t suffer from hurricanes or tsunamis. And Nakheel doesn’t share a timeline for the development of its latest reclaimed land mass Palm Jebel Ali, which is twice the size of Palm Jumeira.

Following the boat tour of Palm Jumeira with Nakheel, I visited the island twice to spend time at two different hotels. Some 15 years after the project’s development commenced, there are still portions of the Palm that are yet to be developed. And driving along the outer road that surrounds the palm tree branches one has no choice but to wonder where so many five-star hotel travelers come from. Driving past five-star resort after five-star resort, and as in many other parts of Dubai seeing more construction equipment than people, I really wish there was public information about the occupancy of the hotels or condominium complexes. The supply and demand curves do not seem to meet at a point that will create value any time soon for Nakheel or the Emirate of Dubai.

Zoe Fox ’17

Global Immersion: Economic Development in the UAE

The Other Middle Eastern Oil Export: Discovering Tunisian Olive Oil

Moulins Mahjoub 1.jpgEarly in the fall, my study group for Global Immersion: Doing Business in North Africa made the somewhat serendipitous decision to study the Tunisian olive oil industry for our term project. We made this choice with little information — other than that olive oil is Tunisia’s largest export and that the industry is the country’s largest employer — but I couldn’t be happier that we got to spend the trip taking a deeper look at olive oil.


On Wednesday, we spent the day at Les Moulins Mahjoub, a 70-year-old, family-owned olive oil producer about an hour outside of Tunis. Despite being a relatively small producer of 200,000 liters per year with no intention of increasing its outputs, there’s a good chance you’ve tried Les Moulins Mahjoub’s products, available in the U.S. at Whole Foods and as the house brand at Le Pain Quotidien. Now in its third generation, the business is co-owned by three brothers and seven sisters. One of the brothers, Abdel-Majid Mahjoub, who serves as the general manager, gave us a tour of the production press, explaining to us the cold press process, which still very closely resembles the ancient process.


Les Moulins Mahjoub has no intention of increasing its production because it is happy with its position as an upscale, boutique producer.  It has no intention of competing with Bertolli, or of providing unbranded liters to European producers who will blend it with Spanish or Italian oil. Roughly 90 percent of Les Moulins Mahjoub’s oil is sold under its own brand, although the remaining 10 percent is sold under the brand (or in the case of Le Pain Quotidien, co-brand) of select partners. The company also sells Tunisia condiments, including its top product by volume, Harissa, which has recently exploded in global popularity.


The highlight of the visit, which served as a microcosm for the industry overall, was eating lunch prepared by the family in their tasting room. We enjoyed olives and spreads, as well as numerous Tunisian dishes ranging from the familiar, shakshuka and cous cous, to the unfamiliar, breadcrumbs mixed with preserved lemons, garlic, harissa, and chickpeas prepared in broth. The third-story tasting room provided aerial views of the olive groves and farmland, which stretched into mountains in the horizon, a surprisingly beautiful setting reminiscent of Californian wine country.


Despite its premium product, Tunisian olive oil faces two challenges in its luxury positioning: first, there’s a lot of olive oil labeled as extra virgin that isn’t in fact extra virgin; second, Tunisian olive oil lacks the brand recognition of olive oil from countries like Italy and Spain. Tunisia was featured at New York’s Fancy Food Show this year, suggesting the beginning of its improved global recognition, but there’s still a ways to go. After sampling numerous brands of Tunisian oil and spending a day at Les Moulins Mahjoub, Tunisian olive oil gained another 30 brand ambassadors in our class.

-Zoe Fox ’17

Global Immersion: Doing Business in North Africa

Brazil: Land of the future

Our Global Immersion Program kicked off on Sunday night with a group dinner, where we ate a lot of cheese bread (pao de queijo) and a steak the size of my head (since arriving in Brazil I’ve learned that Brazilians love to eat meat). Our wonderful Paulistano TA, Lucas Sancassani ’14 then showed us a snippet of the local nightlife: he took us to a lively neighborhood where we drank Brahma and caipirinhas whilst the locals watched soccer and danced samba. More of that to come later this week we hope!

Our first meeting was with the consulting firm, Booz & Co, where Partner, Luiz Vieira, gave us a detailed overview of the Brazilian economy. Brazil has the 5th largest population in the world at 200m and has the 7th largest economy with GDP of $2.4tr. It is predominantly a commodity based economy and is the world’s largest producer and exporter of sugar, coffee and orange juice. Social programs implemented in recent years have drastically improved income inequality, reducing the number of people living on less than $1.25 per day from 15% in 2003 to only 5% in 2012, although Luiz also pointed out of the office window to the neighboring favela, so clearly there is still some way to go.  Additionally, the middle class segment has expanded from 18% of the population in 2004 to 32% in 2012 presenting huge opportunity for businesses.

Booz & Co

Overall, the takeaway for me was that there is a great deal of opportunity and potential for growth in Brazil. However, there are many things that could derail the country, in particular the rise of a populist government similar to that which is causing havoc in Argentina at the moment. Other challenges include the lack of infrastructure, low levels of education amongst the poorer segments of society and the bureaucratic barriers in place that make it difficult for international firms to operate in Brazil.

We spent our afternoon touring the campus of cosmetics company, Natura. The site is absolutely stunning, with very unique architecture framed by the beautiful Brazilian landscape. Natura operates on a model similar to Avon, employing 1.5m ‘consultants’ (mainly women) across Brazil and Latin America, who sell products on to consumers. Natura places a lot of emphasis on biodiversity and sustainability since it sources many of its ingredients directly from the Amazon rainforest. It has an extremely flexible factory, which allows production to change according to demand, requiring from 15 minutes to 2.5 hours downtime as the machines change between products.

Natura’s campus is a huge ecopark

We ended the day with drinks at Skye Bar at the Unique Hotel, overlooking the sprawling Sao Paulo skyline and where we also met with another group of CBSers who are in town for the PE/VC trek. A quick Lebanese dinner with Professor Martinez, then early to bed since we have an early start in the morning…

Clare Skirrow ’14, Sao Paulo, Brazil

The GIP and PE/VC students meet at Skye Bar in Sao Paulo