Welcome To Paradise

How long can all this last? In other parts of the world, crumbling mansions attest to the fickleness of oil wealth. A hundred years ago the city of Baku on the Caspian produced half of the world's oil supply. It was famous as a center of luxury and opulence. After a long decline under the Soviets, the capital of Azerbaijan is growing rich once again, but there is little or nothing left of the old elegance.

"You know, this is all going to end," an aide to the late ruler of Dubai, Sheik Rashid, once told me. He was an old man from the desert, and while he enjoyed being rich he mistrusted the speculative development he saw all around him. Eventually the oil would run out and the money would run out, he said. "It will be like a garden without water."

But that was 20 years ago, and there is no sign the old man's prophecy will come true any time soon. What the intervening decades have shown is that when oil states learn how to use their wealth to capitalize on their natural exoticism, whether in the placid Persian Gulf, the sunny Caribbean or the windswept North Sea coast, they are grasping the keys to long-term prosperity—if not, indeed, to paradise.

© 2008