If protectionism is bad (and I agree that to some extent it is) then let the UAE open ITS borders to competition!!! But then they couldn't let Etisalat and the other big local companies compete now could they. Let them remove the requirement for local ownership.
What the UAE want is free trade in one single market that they have an advantage in.
Next we can talk about the OPEC cartel - a concept that is illegal in most of the world.
There is so much more going on then just the airline industry.