The Washington PostDemocracy Dies in Darkness

The once flourishing Iranian community in Dubai faces pressure amid Persian Gulf tensions

This Iranian spice shop, pictured on July 10, specializes in Persian products, including saffron, exported from Iran to the Persian Gulf emirate of Dubai. (Karim Sahib/Agence France-Presse/Getty Images)

DUBAI — At the Iranian Club, steam tables overflow with kebabs, rice with barberries and pistachios, bread and stew. Hot tea is served with rock candy to sweeten it. Men wear dark business suits, while women cover their heads.

For decades, the club has catered to those in those in Dubai who wanted to get a taste of home across the Persian Gulf. 

But with tensions in the region running high and U.S. sanctions making daily life more difficult for Iranians, Dubai’s Iranian community is under pressure. Organizations that cater to them are struggling.

On a recent visit on a Saturday afternoon, the club’s colossal dining room was barely a quarter full — not unusual right now, staff members acknowledged. “Dubai has grown, but our market is decreasing,” said Sajad Seyed, a logistics manager at the club.

Dubai’s government does not release the number of Iranians living in the city, but according to informal estimates, it’s as many as 600,000. Many Iranians in Dubai say, however, there has been an exodus, with large numbers of their friends and family members already gone. Those who remain often say they, too, think about leaving unless the economic pressure eases. 

Dubai has been a hub for trade with Iran since long before the separate emirates combined to become a sovereign state in 1971. The city grew to become a center of global commerce, attracting money from all over the world, and that further heightened its appeal to Iranians. Dubai was a city where cash, not creed, was king.

“They followed the model of Switzerland in World War II, when everyone who was fighting everyone had their money in Switzerland,” said Amir, a 60-year-old Iranian businessman who first arrived in Dubai 15 years ago.

But now, Iranians in Dubai say that apolitical past is gone, and they see the change in their bank balances. Many now struggle to receive basic financial services from institutions that are responding to U.S. sanctions targeting the Iranian regime.

In the Iranian Club, this means a cash-only policy. “We don’t have a machine,” a receptionist explained, gesturing to an empty space on the counter where a credit card reader once sat. Staff members say it was abruptly taken away by Network, an Emirati payment company. Seyed recalled receiving a simple explanation: “We are not working with Iran anymore.” 

Since President Trump pulled the United States out of a 2015 nuclear agreement that Iran signed with world powers and reimposed sanctions last year, Iranian entities with links to the government have been hit once again with an array of punitive measures.

In Dubai, some Iranians complain that even though they have no link to the regime, they are being hit as banks and insurers overreact in trying to comply with the sanctions.

Meanwhile, a significant drop in the value of Iran’s currency, the rial, over recent years has hurt anyone involved in trade with Iran. Those who were based overseas and paid in rials have had little choice but to return home.

These difficulties come on top of persistent concerns about the strength of Dubai’s economy itself and the tenuous nature of long-term residency for foreigners in the United Arab Emirates.

“No one can stay here for long,” Seyed said. “You have nothing to lean on.”

Iranians in Dubai are stuck between the confrontational position the UAE has taken on Tehran and the historic hospitality of the city to Iranian nationals, said Amir, whose last name is being withheld because of concerns about pressure he could face from both the Iranian and Emirati governments. 

Amir said he is now taking some of his money out of a bank and putting it in a safe.

More than half of his friends have left the country, he estimated. 

“I always think about moving out of here,” said Kimia, 44, who has lived in Dubai for seven years and whose full name is not being used because of safety concerns. “In Dubai there isn’t much financial or job security for Iranians.”

Arjang Arjangian, a 70-year-old U.S.-educated legal consultant who has lived in Dubai for 27 years, said he has belonged to an Iranian film club for decades that once had at least 20 members. Now it has just three or four. “If the economy keeps going like this, at the end of the year I may have to leave,” said Arjangian, who added that many of his clients are unable to keep paying their fees.

The UAE’s ambitions backfire as it finds itself on the front line of U.S.-Iran tensions

The city’s evolution from a sparsely populated village into a global trading outpost was sparked at the turn of the 20th century when Iran cracked down on Arab traders in its ports. In the 1950s, Western visitors estimated that Iranians outnumbered local Arabs. 

As Dubai boomed at the end of the century, so did its Iranian population. 

The current Iranian Club was built during a high point for Iranian-Dubai relations in 1990, using land initially gifted by Sheikh Rashid bin Saeed al-Maktoum, then Dubai’s ruler.

In 2007, Iranian presidential hopeful Mahmoud Ahmadinejad held a campaign rally on the club’s soccer field, a rare moment of political campaigning in the autocratic UAE.

But since the financial crash of 2008, when Dubai was bailed out by its oil-rich neighboring emirate Abu Dhabi — which takes a more confrontational view of Tehran — Iranians have come under more pressure.

Christopher Davidson, an expert on the Persian Gulf monarchies at Durham University, said that he suspects that the club’s links to the late Sheikh Rashid may be why the Iranian Club is still operating, along with Iranian schools and an Iranian hospital also opened by Sheikh Rashid.

“This represents one of those effectively ring-fenced projects connected to a former father-figure ruler that can’t be dismantled by current rulers,” Davidson said.

But U.S. sanctions could lead to even greater restrictions on Iranian entities, including the Iranian Club.

The club is owned by Bonyad Mostazafan, a charitable organization that holds significant economic power in Iran and is closely connected to Ayatollah Ali Khamenei, Iran’s supreme leader. Khamenei was targeted by new U.S. sanctions in June, a move that experts say could open up Bonyad Mostazafan to designation, too.

At the Iranian Club, Seyed said that although the facility was technically owned by the foundation, it did not receive any funding or send any funding back home.

“We belong to Dubai, not to Iran,” he said.

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