Home to more than 200 nationalities, Dubai holds the title of the world’s most cosmopolitan city following the latest World Migration Report – a testimony that the city has long been a meeting point for the world.
Dubai is gradually becoming a place not only for trade and business, but also a hub for sharing ideas, experiences and inspiration in an environment that provides unique opportunities for startups.
This can be of a great inspiration to this country, but it is imperative for Ghana to consider adopting some of the strategies which have worked perfectly for Dubai, and how such examples have helped transform the economy of the Emirates.
Ghana already has a tradition of attracting investments into agriculture and agro-processing. However, investment into other key sectors including financial services, infrastructure, transportation, ICT and tourism are growing at a slower pace than expected.
Unlike Ghana, Dubai has emerged as a global hub for financial services, logistics, hospitality and trade and is steadily growing in other sectors including healthcare, technology and clean energy, nourishing a strong and diverse knowledge base and community of trained professionals that make it the ideal location for association conferences, corporate meetings and business events.
Dubai in its bid to attract investors all around the globe into key sectors, has put in place proactive tax laws which Ghana can take a cue from.
The Emirati country has a zero percent tax rate on profits for investors, zero percent personal income tax, 100 percent foreign ownership, no restrictions on the number of foreign employees, no restriction on capital repatriation, provision of an independent judicial system, among other benefits.
However, corporate tax rate – which is 25 percent in Ghana – is paid by companies on their profits with self-employed persons required to pay income tax at graduated rates in four equal installments. Ghana can take cues from Dubai to critically look at its corporate tax rate and other taxes to enable investors to throng here.
Dubai’s economy has vastly diversified and is no longer dependent on oil, unlike Ghana that may be looking into a future with an inordinately oil driven economy. The Emirati government instead, has been expanding into the trade, services and the financial sector, with tourism contributing about 7 percent of employment to that economy.
The SME sector in Ghana can also take a great cue from Dubai being that the Emirati government has improved commercial transparency and introduced dynamic regulations, encouraging the formation of small and medium enterprises (SMEs).
With the UAE having an open economy and boasting of high per capita income and a sizable annual trade surplus, economic diversification has significantly reduced the portion of GDP in Dubai derived from oil and gas output to less than 5 percent. That is the direction that Ghana must be considering in order to create a conducive environment for SMEs and large corporations alike in its bid to diversify the economy, which is reliant mainly on imports into a more productive one.