Russians Buy Furs, Homes In Dubai

MTAlexander Bratersky, editor of RUSH magazine, talking on his cell phone near the skyscrapers of Dubai Media City.
DUBAI, United Arab Emirates — It was simmering outside in the fierce Arabian sun, but in the air-conditioned premises of the Marco Varni fur store on Al Nasser Square, about a dozen Russian tourists were trying on fur coats.

Anatolios Chromatidis, the store's manager, didn't think that was strange at all.

"Wherever there are Russians, you can find fur," Chromatidis, a Greek who has lived in Dubai for five years, said in fluent Russian while his customers tried on coats with prices starting at $3,000.

In recent years, Russians have been buying much more than fur in this small, prosperous emirate on the shores of the Persian Gulf.

They have spent more than $400 million on Dubai real estate in the past two years, according to Dubai government statistics, with Russians buying property in some of the emirate's most hyped megaprojects, such as The Palm Jumeirah, an artificial island in the shape of a palm tree.

Tourists have been coming too. Close to 300,000 Russian tourists arrived last year, a figure that rises to nearly 500,000 if visitors from the rest of the former Soviet Union are counted, according to Dubai's tourism authority.

This influx of sun-starved northerners has led to the formation of a year-round, Russian-speaking colony in the United Arab Emirates.

Estimated at 30,000, it is an expatriate population large enough to support two Russian high schools, one Russian university and five Russian-language magazines. In March, Russians nostalgic for the pop music of their homeland could catch concerts by t.A.T.u and Dima Bilan, while those with more austere tastes could celebrate the planned construction of a Russian Orthodox church, the first on the Arabian peninsula, in the emirate of Sharjah.

The one thing you can't seem to find anymore is the once-ubiquitous shuttle traders, or chelnoki, who poured into Dubai in the 1990s to buy cheap goods and resell them at markets back home in Russia.

It is now mostly tourists who take advantage of Dubai's shopping opportunities, visiting places like Al Nasser Square, a district so popular with Russians that many of the cafes feature Cyrillic writing on their front windows.

"The shuttle traders don't come here anymore," a Russian man with a mouthful of gold teeth said on the square. "It got too expensive."

The man, who was touting electronic goods to Russian-speaking visitors, declined to give his name, although he said he was a former mining engineer from Siberia who had lived in Dubai for 10 years.

Veteran expatriates said the phenomenon of the shuttle trader ended with the 1998 default, when the ruble's collapse dried up the market for imports back home.

"There were eight cargo planes that flew to Russia every day in 1998," said Vladimir Burdun, a Dubai-based boxing promoter who exported goods to Russia before the default. "Now it's one plane every 10 days."

Until the default, nearly all Russians in the Emirates were somehow involved in the import-export business, and many came without a higher education or a knowledge of English, said Burdun, who has lived in Dubai since 1996.

The default left such small-scale traders high and dry. Many went home, and it took a few years for the Russian-speaking population to rebound to its pre-1998 levels. When the Russians returned, they were more likely to be trained professionals who spoke English and took jobs at international companies, Burdun said.

In part, this was thanks to the evolving nature of Dubai's economy. The emirate has enjoyed strong growth in recent years as multinationals have flocked to tax-free zones like Dubai Media City and Dubai Internet City, which are now filled with glass skyscrapers and U.S. chain restaurants like Starbucks and Round Table Pizza.


Alexander osipovich / MT
Anatolios Chromatidis, the Russian-speaking manager of Marco Varni, showing the fur coats in his Dubai store.


Although high oil prices have poured wealth into the Persian Gulf, that is less of a factor for Dubai than many of its neighbors: Less than 10 percent of Dubai's income comes from oil, and its known reserves are expected to run out by 2010, according to The Economist. Trade and financial services play a much larger role in the emirate's economy.

One Russian professional drawn to Dubai's service sector was Anna Popova, a Muscovite who arrived in 2003 and worked as a marketing manager for several companies. Popova recalled how she got her first job in Dubai after meeting a recruiter in Moscow who was relieved to see that she had genuine work experience and a businesslike demeanor.

"She had this image of some girl in a short skirt," said Popova, who now hosts the only Russian-language radio program in the Emirates, broadcasting for two hours per week from a Dubai station.

"It is pleasant that the image of Russian women has improved," she said. "Everything is different now, and they are perceived as professionals."

Many of the Russian-speakers who live in the Emirates today are not actually citizens of Russia, coming instead from other CIS countries, especially Kazakhstan and the Central Asian states, which have an affinity with the Arab world due to their shared Muslim faith and cultural heritage.

Out of the 30,000 Russian-speakers in the Emirates, only about one-third are from Russia, while the rest come from other former Soviet republics, said Alexander Bratersky, editor of RUSH, a Russian-language magazine based in Dubai.

Many work in tourism and real estate, the two sectors where a knowledge of Russian is most valuable.

Dachas in Dubai

Russians have spent $432 million on Dubai real estate since the middle of 2006, according to REIDIN.com, an information service on emerging real estate markets that bases its data on Dubai government records.

Dubai's real estate boom began in 2002, when the emirate ended a ban on foreigners owning property. Among the foreigners who bought residential property were affluent citizens of Russia and the CIS, drawn by easy visas, beaches and sunshine.

That drew many Russian-speaking expats into the real estate business, said Svetlana Naimanova, a native of Kazakhstan who moved to Dubai in 2000 and ran a beauty salon before founding the Sun City real estate agency.

"All the Russians who were working in stores back then, salespeople and managers, most of them women, started moving to real estate agencies," Naimanova said.

"It was a sort of boom," she said. "Ninety percent of the buyers were from our home countries, since there are millions of people in the north, and they all want sea and sun. So at that point, knowledge of Russian was very much in demand."

Naimanova said her typical clients were bankers and middle managers with incomes ranging from $100,000 to $200,000 per year.

For them, Dubai is a more affordable option than London, where Russian billionaires are often said to be purchasing multimillion-dollar homes. Dubai has a few jet setters too, such as pop star Valeria and her producer husband, Iosif Prigozhin, who bought an apartment on the Palm Jumeirah island development last year.

Lately, more of Naimanova's clients have been from outside Moscow. "People from Moscow and St. Petersburg have already bought property here, so now the trend is coming from the regions," she said. "Perm is big now. So is Belarus."

Many relatives of Kazakhstan President Nursultan Nazarbayev have also bought property in Dubai, she added.

Along with rising demand for "dachas in Dubai," the emirate has experienced growth in the number of tourists from Russia and the CIS.

Last year, 286,000 Russian tourists came to Dubai, a 6 percent increase from 2006, said Viktoria Kuznetsova, a spokeswoman for the Moscow office of the Dubai Department of Tourism and Commerce Marketing.

If visitors from the rest of the former Soviet Union are included, the total number was 473,000 last year, a 14 percent increase from 2006, Kuznetsova said.

Visitors from the post-Soviet states now comprise the third-biggest group of tourists in Dubai, after Saudi Arabian and British tourists, according to the department, which acts as the tourism promotion arm of Dubai's government.

Turkey, another popular destination, thanks to its proximity to Russia and its cheap vacation packages, draws about 10 times the number of Russian tourists, but Dubai tends to attract a more affluent crowd, according to expatriates close to the industry.


Alexander Osipovich / MT
A view of Al Nasser Square, a Dubai shopping district popular with Russians.


The growth of Russian tourism is one reason why the emirate is home to the first Middle East branch of a Russian university, opened in 2005. Today, the Dubai branch of the St. Petersburg State University of Engineering and Economics, known as Engecon for short, has about 100 students, many of whom are studying tourism and hotel management.

"Our students are absolutely guaranteed to find work after graduating," said Alla Burlyayeva, PR and marketing manager for Engecon's Dubai branch. "Since the Russian-speaking market is big here, our students are very much in demand."

In September, then-President Vladimir Putin drew attention to the growing ties between Russia and the Emirates by traveling to Abu Dhabi and meeting the country's president, Sheikh Khalifa al-Nahyan, in the first visit by a Russian leader in 35 years. Among the deals reached on that trip was an agreement to launch a navigational satellite for the Emirates from the Baikonur Cosmodrome this year.

In a different kind of milestone, Metropolitan Kirill, a leading figure in the Russian Orthodox Church, laid the cornerstone for the first Orthodox church on the Arabian Peninsula, located in the emirate of Sharjah, the same month.

Though many Russians live in Sharjah, which borders Dubai, business activity is centered on Dubai's bustling free trade zones. In February, Renaissance Capital became the first Russian investment bank to set up shop in the Emirates, with an office in the Dubai International Financial Center.

The Expat Lifestyle

Veteran expatriates praise Dubai for its weather, good service and high quality of life.

Dubai drivers are always willing to give directions, said Sergei Rezets, the publisher of RUSH magazine. He recalled how policemen had helped him fix a flat tire several years ago — something hard to imagine on the streets of Moscow.

"In Moscow you often hear complaints about immigrants taking over, and that sort of thing," Rezets said. "Here the locals are fairly friendly to visitors. They have some moments of discomfort, but on the whole they're quite tolerant of other nationalities."

In some respects, it is easier for a Russian to work in Dubai than Europe, largely because the Emirates has more relaxed visa and work permit requirements.

"There are big advantages to working here compared to Europe," said Popova, the radio talk show host. "In Europe, you need to prove that there are no local hires who are qualified for the job, plus other things too. Here there are no problems with that."

There are also no problems with getting a taste of Russia when one feels homesick. Dubai has several restaurants catering to Russians, such as the Bolshoi restaurant in the Moskva hotel, which — besides offering hearty Slavic fare like pelmeni, sausage and herring — has nightly dance shows featuring girls in elaborate costumes.

Expatriates can read five local Russian-language publications, although several are basically real estate catalogs rather than magazines with original content.

They can also buy imported Russian books and newspapers at a store on Al Nasser Square, although the papers have been adapted to Emirates standards. In the racy Moscow tabloid Speed-Info, for example, all the sexually explicit photographs have been blotted out by a censor's pen.

Some expatriates speak of a darker side to Russian life in Dubai.

Many Russians are lured to Dubai with promises of high pay but then discover their salaries don't go far with the emirate's high prices, Popova said. Moreover, companies often take away employees' passports and make it difficult to switch jobs, she said.

"Many companies hire people and treat them like slaves," Popova said.

As he stood on Al Nasser Square, the former mining engineer from Siberia described a tough life in which Russians came to Dubai because there were no good jobs at home. He said many Russians, including himself, had left behind families because they could not afford to support them in Dubai.

"People don't come here to earn money. They come here to survive," he said.

Perhaps the most vulnerable group of Russian-speaking expatriates in Dubai are women duped into working as prostitutes. The U.S. State Department keeps the Emirates on a watch list of countries that it says are not doing enough to combat sex trafficking. Last year, the department issued a report that said women from Russia, Ukraine, Central Asia and the Caucasus were being trafficked into the country and sexually exploited. Some women are told that they will get jobs as secretaries and are forced into prostitution instead, the report said.

Though conditions may be harsh for some Russians, they are even worse for the nearly half-million construction workers shipped in from countries like India and Pakistan, who are often forced to work in semi-slave conditions to build Dubai's gleaming new skyscrapers, according to Human Rights Watch and other groups.

More than 80 percent of the Emirates' population are foreign-born noncitizens. Along with construction workers, maids and other laborers, most of whom come from Asia, the expatriate population in Dubai includes affluent businesspeople from Western Europe, North America and Australia.

In the social hierarchy of foreigners in Dubai, people from the former Soviet Union fall between these two groups, above the Asian laborers but beneath the West Europeans, Popova said. "We are somewhere in the middle," the talk-show host said. "At least we're not the very bottom."