Dubai could very well be the largest construction site on Earth. Everywhere you travel in this so-called “Las Vegas of the Middle East,” towering cranes fill the arid desert skyline from one end of the city to the next, including the manmade, meticulously crafted “islands” that surround the oil-rich emirate. Construction occurs day and night, with workers from India, Pakistan, Afghanistan and parts unknown bussed in from the trailers they occupy in de facto labor camps just outside the city.

The contrasts couldn’t be more striking. The city—which, these days, derives much of its economy from tourism—is designed to appeal to the moneyed and privileged, mostly from Europe and South Africa, since flights from the States can take a seemingly endless 28 hours. The signs of extreme wealth are everywhere, from the indoor ski slope where vacationing rich kids can snowboard in August, to the $400 Fendi sunglasses that young Arab girls have custom-made so the logos can be seen in the front rather than on the side, where they would be obscured by the hood of a pesky black burka.

Despite these contradictions, Dubai’s international profile continues to grow, thanks in part to events like the Dubai International Film Festival, which wrapped up in December after a successful two-week run that included gala screenings of Hollywood fare like Michael Clayton—complete with a visit from George Clooney—and obscure regional pictures like Lebanon’s Under the Bombs, which took home the fest’s Muhr Award for Best Film. In only its fourth edition, the DIFF is something of an anomaly in the festival world: With plenty of money to spend, the well-organized event has been able to achieve a level of global awareness of which most nascent film events can only dream.

There was much talk at the 2007 DIFF about how the round-the-clock construction in Dubai and neighboring Abu Dhabi—whose Middle East International Film Festival recently played host to Harvey Weinstein—provides an apt backdrop to a regional film industry that is literally being built from the ground up.

Indeed, recent high profile deals between deep-pocketed Arab investors and Hollywood majors confirm that the United Arab Emirates is taking the lead in transforming the Middle East into an entertainment epicenter.

In September, Warner Bros. announced an alliance with Abu Dhabi-based property developer ALDAR and Abu Dhabi Media Co. that will result in an estimated $1 billion going toward features, video games and infrastructure.

Exactly two months later, investment firm Dubai International Capital, which is overseen by Dubai ruler and UAE vice president Sheikh Mohammed bin Rashid al-Maktoum, acquired a reported three percent stake in Sony Corporation. The total spend is estimated to be between $1 and $1.5 billion.

Elsewhere, Los Angeles-based production outfit Insomnia Media Group recently received a $550 million capital infusion from Egyptian asset management firm Borak Holding. Insomnia, which is currently shooting an untitled $70 million war epic in Egypt, Morocco and Los Angeles, is hoping to “continue its rapid growth and to find new and exciting projects to develop and bring to market,” according to a statement by chairman Bret Saxon.

So why is all this investment activity occurring now?

The prevailing wisdom says that the UAE, flush with cash from years of oil production, is attempting to rapidly diversify in preparation for when the black gold inevitably dries up.
David Chambers, a management consultant who specializes in Middle East Broadcasting and is a former member of the White House Arts & Entertainment Task Force, spent 10 years living in Dubai and says headline-grabbing deals—as well as glitzy events like the DIFF—are an outgrowth of the UAE’s aggressive effort to quickly increase its global profile. Nothing accomplishes that quite like money and movie stars, he says. “Events like the Dubai International Film Festival are drawing attention to the region, and behind that prominence is the fact that there’s a lot of money out there,” he says. “Much of this has to do with power and prestige.”

He adds that while the DIFF is driven primarily by an earnest desire to create a viable film culture (and, of course, good publicity), the Sony and Warner deals represent something far more prosaic. “The Warner deal to me is about a ‘big sale,’” he says. “Film is a much smaller component to this larger strategy [to diversify]. The UAE wants to lead in all fields: Business, tourism, medicine, education.”

They’re certainly not wasting any time. Both Abu Dhabi and Dubai are racing to establish an infrastructure, including, in typically ambitious fashion, Dubai Studio City, an all-purpose, 22-million square foot production facility currently under construction.

Will Arab Indies Survive?
All this recent investment activity hints at the possibility that the money will eventually find its way to a Pan-Arab film sector desperately in need of financing. But will it?

“I’m interested in the Warner Bros. deal because they say they want to make ‘local film,’ but I want to see who those local players are,” offers Chambers.

When asked why his company decided to invest in Insomnia, Borak founder and chairman, Dr. Ayman Kandeel, says the deal is more about building up the bottom line than it is strengthening local infrastructure. “Ultimately, any investor is looking for a return on their investment,” he says. “While some of the large deals that have recently been announced in this region have had additional motives, such as building new industry in Dubai, for us, it was about working with a partner that has always made us money, in an area in which we could expand our portfolio.”

Expanding portfolios and returns on investments may be music to a businessman’s ears, but to restless moviemakers in the Arab world, making money takes a back seat to finding money. As the Dubai fest winner Under the Bombs demonstrates, the Middle East is rife with edgy, ambitious moviemakers with stories to tell, but investors at the independent level are scarce.

Consequently, Arab producers have little desire to wait and see if alliances with Hollywood will have a trickle down effect on regional moviemaking.
At a financing forum in Dubai in December, John Sloss of Cinetic Media was blunt when asked why Middle East oil money doesn’t make it to local moviemakers. “There’s no return on investment,” he said, as other panelists nodded in agreement. “It’s not about the existence of capital, it’s about consumption. Films have to make sense financially. Yes, there is money here, but the projects have to be financially viable.”
Even in Egypt, which has a rich film heritage, scraping up money for indigenous productions is a daunting task.

“Egypt is the oldest film industry in the world, yet it’s very hard to find financing,” says veteran Egyptian producer Marianne Khoury. “Films just don’t get made, and that’s why there are some frustrated people there.”

“There have been quality films coming out of Egypt, Lebanon and Syria for some time, but they’ve been coming out on a very selective basis,” adds David Pritchard, president of Los Angeles-based GigaPix Studios, which co-produced, along with Jordan’s Paper & Pen Films, Captain Abu Raed, which picked up a Best Actor award in Dubai and an Audience Award at Sundance.

“The big investment that is happening now is simply a matter of return on investment,” he adds. “There are very few industries left in the world that the U.S. still dominates. The content creation industry is one of the last industries to be completely dominated by America. In music, films, games—everything. It’s merely an investment decision.”

Pritchard should know. He began traveling to the Middle East as an oil executive in the 1970s (“I was in Dubai when there were less than 1,500 people there,” he boasts) and displays an almost evangelical zeal when talking about the potential of the Pan-Arab entertainment industry. In contrast to producers hoping to simply make a buck in an emerging market, Pritchard has a long-term vision that satisfies his impulses as both a businessman and a film lover.

Captain Raed is a film that was made with an Arab writer-director, with an Arab story and produced in the Arab language,” he says. “My goal in the Arab film community is to create net export product. I want to demonstrate to the Arab world that they can actually create entertainment there that can be sold worldwide, as opposed to investing in a slate of U.S.-based films that may or may not have producer associations or story associations in the Middle East.”

A New Era of Arab Film
Pritchard believes that in order to sustain itself, the Arab film sector doesn’t just need investment capital—it needs to think beyond its borders.
“They have never really aspired to tell us the bigger, broader, more enriching stories,” he declares. “They’ve been telling stories more associated with their local community. I have a much more lofty objective in Jordan—and I’d love to do it in Dubai, as well—and that is to build an industry in the Arab market where they are actually feeding independent filmmaking.

“The Arab world doesn’t have a history of creating content,” he continues. “They have a history of buying ours. So when that is the only way they’re getting content, their culture is being overrun by our culture. The important parts of their culture or values are going to be subsumed by those that we’re presenting to them. I believe it’s a two-way street.”

Pritchard says the timing behind the recent flurry of investment money in the UAE is fortuitous, since societal changes and generational shifts in the area have led to a cultural climate that is far more open to new ideas than it once was.

“It’s only this current generation of Arab kids that have parents who can see the value of being a writer or a storyteller or a filmmaker,” he says. “Those things have not traditionally been a part of their culture. Parents now see that their kids can do this and actually make money.”
Adds Mahyad Tousi, co-founder of BoomGen Studios, “We are banking on the idea that American and Canadian audiences will be extremely interested in content originating from the greater Middle East’s new generation of filmmakers.”

Tousi and his co-founder Reza Aslan (who moderated a panel on plurality and the Middle East at Sundance) are attempting to tap their connections within the Middle Eastern artistic community in an effort to bring a fresh Arab perspective to the big screen. Like many young Arab producers, Tousi is troubled by the cultural and economic strictures placed on Arab moviemakers, but he believes the tide is beginning to turn.

“Economic limitations prevent certain levels of society from obtaining the access and connections required in order to make films,” says Tousi. “This represents a certain type of economic censorship. The culmination of these and other pressures have resulted in increased self-censorship. All of these limitations mean that most mainstream films that are locally funded are perversions of reality… The exciting news is that this framework is shifting. We believe that these changes will only continue to gain momentum with the arrival of the new generation of artists. The old parameters will also go out the door. The new generation is different and has very different ideals and concerns.”

Pritchard agrees, adding that with the current social and political divide between the Arab and western worlds, far more can be accomplished with film than mere entertainment.

“I know how powerful film is,” he says. “I do not have any kind of political agenda—I’m not trying to change the world. All I want to do is provide the opportunity for Arab filmmakers to share their culture with us. That’s what is very important to me, because if we give them the tools to tell us their human stories, the values that we do have in common will rise to the surface.”