The currency is the United Arab Emirates dirham (AED, local abbreviation dhs). It is pegged to the US dollar at AED 3.67 per dollar. The conversion rates are AED 5 to EUR 1 and AED 6 to GBP 1. The notes come in denominations of MAD 5, 10, 20, 50, 100, 200, 500 and 1,000. There is a MAD 1 coin with sub-denominations of 25 and 50 threads (100 threads = MAD 1). There are coins of 5 and 10, but these are rarely seen (and are used by traders as an excuse to give change at short notice).
Cash and travellers’ cheques can be exchanged in bureaux de change at the airports or in all major shopping centres. ATMs are plentiful and generously distributed. They accept all major card chains: Visa, Cirrus, Maestro, etc. Credit cards are widely accepted.
When you pay with a foreign credit card, most merchants will try to do a dynamic currency conversion, charging several percent more than the issuer’s conversion would have cost. The credit card terminal offers the choice of whether or not to accept the conversion. The merchant will not ask you any questions about it and will choose to accept the conversion. If you are careful, you can intervene and ask for a “no” answer. If you ask straight away, some traders will have no idea what you mean, but many will.
Costs in United Arab Emirates
Commodities used to be cheaper than in most Western countries, although the situation is changing fast (Dubai has risen in the rankings to 25th most expensive city to live in; Abu Dhabi is close behind). Hotel prices are not cheap: there is a shortage of available hotel rooms, especially in Dubai and Abu Dhabi, leading hotels to occupancy rates often above 90%. A large number of new hotels are expected to open in the next five to ten years, but as tourism increases, prices are unlikely to fall. Besides, anything touristy tends to be expensive. Rents in Dubai are starting to rival those in cities like Paris or London, and other prices tend to follow. Some places offer shared accommodation and are quite cheap.
Shopping in United Arab Emirates
One of the things the UAE is best known for is shopping. There are no sales taxes in the UAE, but it is very difficult to find real bargains as inflation is at its highest. If you are interested in shopping, you cannot leave the UAE without going to Dubai. Dubai offers some of the best shopping in the entire Middle East, especially during the annual shopping festival, which usually takes place from mid-January to mid-February.