The many generous business and pleasure offerings of Dubai (I)

Dubai is a city-state on the move having scaled obstacles in its history. When its pearl exporting business went under, it resorted to manufacturing products adding the dredging of its water sources to serve as ports for ships to dock. Successive leaders would ensure that emphasis was placed on equipping the population to be ready with skills in the modern era to solve challenges with alacrity while providing foreign nationals a conducive environment to contribute their quota to national development and wealth creation.

Although Dubia-Ghana trade hasn’t particularly been great in terms of volumes and revenue inflow, that is about to change with renewed interest in the country. Meanwhile Dubai’s non-oil trade with Africa reached AED 127 billion ($35 billion) in 2017. Non-oil trade between Dubai and the continent amounted to $34 billion (Dh124.8 billion) in 2016, a 48 per cent increase compared to 2011.

Non-oil trade between Dubai and Africa amounted to AED704 billion ($192 billion) over the 2012- 2017 period. The number of African companies registered with Dubai Chamber has grown to exceed 17,000 today, up 41% from 2015.

According to Dubai Chamber, North Africa accounts for the largest share of Dubai-Africa non-oil trade which amounted to AED 41.8 billion ($11.3 billion) in 2017, followed by Western Africa with AED 30 billion ($8.1 billion), Eastern Africa with AED 28.1 billion ($7.6 billion), Southern Africa with AED 17 billion ($4.6 billion), and Middle Africa with AED 9.8 billion ($2.7 billion).

Top 5 African Trading Partners to Dubai include;

Egypt: AED 15.9 billion ($4.3 billion) in bilateral non-oil trade with Dubai in 2017

Sudan: AED 12.9 billion ($3.5 billion)

Guinea: AED 10.6 billion ($2.9 billion)

South Africa: AED 10.2 billion ($2.8 billion)

Tanzania: AED 6.6 billion ($1.8 billion)

Data from the Kenya National Bureau of Statistics indicates that imports to Kenya from the UAE rose considerably to US$473 million (Sh47.9 billion) in the third quarter of 2017, with the country replacing India as Kenya’s second largest source of imports. Trade between the two counties mainly involves tea exports from Kenya and petroleum, clothes and electronics from UAE.

The UAE is also working to strengthen trade ties with Botswana, especially in the diamond industry and in tourism. In March 2018, Dubai hosted the UAE – Botswana Business Forum, where it was reported that Non-oil trade between Dubai and Botswana specifically exceeded US$1 billion (Dh3.67 billion) in the first nine months of 2017, and was dominated by trade of precious and semi-precious metals.

UNITED KINGDOM (UK)

There are over 250,000 British expatriates living in the UAE with the he value of non-oil trade between the UK and UAE reaching US$10.3 billion in 2017.

UK and UAE target £25 billion in bilateral trade by 2020 while the UK ranks among the top 5 FDI capital source countries, accounting for 7.3% of Dubai’s capital inflows in 2017.

The UK comes in second (after the US) for FDI projects source countries, accounting for 19.3% share of the Dubai’s FDI projects in 2017.

According to recent (2018) research conducted by DMCC, two-thirds of British firms are eyeing closer ties with Dubai after Brexit when the country leaves the European Union.

UNITES STATES (USA)

The value of non-oil trade between the US and UAE reached $30.4 billion in 2017. To date, there are more than 1,500 American companies registered in the UAE and around 50,000 US citizens living in the country.

The US is the top source country for FDI capital inflows, accounting 35.6% of Dubai’s capital inflows in 2017 while the US is top source country for FDI projects in Dubai, accounting for 22.9%.

American investors deployed 33.8% of the total US FDI capital flows in construction related project. According to a statement from Dubai Customs, China and the US topped the list of Dubai’s partners in hardware and tools trade in 2017, with Dh760 million in trade with each of them. They were followed by Italy (with Dh467 million in trade), Germany (Dh307 million), and India (Dh205 million).

GERMANY

The value of non-oil trade between the Germany and UAE reached $13.5 billion in 2017.

According to Dubai Customs, the total value of non-oil trade between Dubai and Germany reached Dh40/USD 12 billion in 2017 with the UAE serving as home to more than 900 German companies and the largest trade partner in the Middle East.

German companies significantly contribute to the UAE’s ongoing infrastructure projects and play a leading role in the alternative energy sector with Germany ranking among the top 5 for FDI projects source countries, accounting for 5.5% share of the  Dubai’s FDI projects in 2017.

RUSSIA

Non-oil trade between UAE and Russia reached USD 2.5 billion in 2017.  UAE and Russia signed an agreement to enable mutual exemption of visa requirements for citizens of the UAE and Russia in a bid to encourage bilateral tourism, investment and trade.

DP World has created DP World Russia to develop ports in the far east of the country. Increased investment from the UAE into Russia especially in energy, transportation and logistics sector, exceeding US$20 billion.

FRANCE

Non-oil trade between the UAE and France reached almost USD 7.3 billion in 2017. France is among Dubai’s Top 20 commercial partners, and among the Top 10 trading partners in the European Union countries, reflecting the strength of the economic bilateral relations.

France is among the Top 3 FDI capital source countries (after US and Austria), accounting for 8.4% of Dubai’s capital inflows in 2017.

France ranks among the Top 3 (after the US and UK) for FDI projects source countries, accounting for 7.9% share of the Dubai’s FDI projects in 2017.

INDIA

More than 2.5 million Indians live in the UAE, which is among the largest number of expatriates anywhere in the world, repatriating US$13.6 billion a year to India.

The number of Indian companies registered with Dubai Chamber increased from 27,717 in 2015 to 38,238 in the first half of 2018, marking a growth rate of 38%. The value of Dubai Chamber member exports and re-exports to India amounted to AED 3 billion ($817 million) during the first half of 2018.

India ranks among the Top 5 for FDI projects source countries, accounting for 7.6% share of the Dubai’s FDI projects in 2017.

The UAE is the 10th largest foreign direct investment (FDI) source market for India with cumulative FDI reaching $4.76 billion in the last 17 years from April 2000 till March 2017.

INDONESIA

Non-oil trade between the UAE and Indonesia reached USD 2.13 billion in 2017. Exports to Indonesia from the UAE generated USD 302 million in value, while imports from Indonesia to UAE accounted for USD 1 billion in value in 2017.

MALAYSIA

Non-oil trade between the UAE and Malaysia reached USD 3.03 billion in 2017. Exports to Malaysia from the UAE generated USD 635 million in value, while imports from Malaysia to UAE accounted for USD 1.72 billion in value in 2017.

SINGAPORE

UAE’s non-oil trade with Singapore reached USD 4.4 billion in 2017. DIFC Courts is led by Singaporean Chief Justice Michael Hwang.

CHINA

Dubai is prioritising strategic brand relations with some of the leaders in their fields such as Tencent, Alibaba and Huawei – to develop mutually beneficial programmes that offer substantial growth opportunities for both parties. An estimated 200,000 Chinese live in the UAE.

The UAE is China’s first non-oil trade partner. In 2017, UAE state news agency reported that China became the UAE’s largest trade partner and China-UAE trade stood at around $54 billion in 2017.

Dubai is a city and emirate in the United Arab Emirates known for luxury shopping, ultramodern architecture and a lively nightlife scene with an estimated population of 3.137 million. It is the largest and most populous city in the United Arab Emirates (UAE) on the southeast coast of the Persian Gulf, serving as the capital of the Emirate of Dubai, one of the seven emirates that make up the country.

Over the past four decades, since it was founded in 1971, the UAE has propelled itself on the world stage as one of the most dynamic economies in the world. The critical success factor that enabled the UAE’s economic development has been the strategic use of oil revenues that the country’s visionary leadership has invested to create a world leading physical and social infrastructure-base that will serve as a catalyst for the future development of the country. In so doing, it has defined the future for the ‘Post-Oil’ Era.

Dubai has been actively developing strategies and frameworks, across different industries, to drive social and economic growth. The Dubai Plan 2021 focuses on moving towards a sustainable economic model, driven by productivity and innovation. Dubai and the UAE are focused on attracting new business but making the set-up and growth process as easy (and as automated) as possible.

Oil revenues have helped accelerate the development of the city, which was already a major mercantile hub but with dwindling oil supply and having planned for the future, Dubai’s economy makes good money from trade, tourism, aviation, real estate, and financial services becoming a notable centre for regional and international trade.

Dubai can be prudent yet retains the ability to attract world attention through large construction projects and sports events such as the world’s tallest building, the Burj Khalifa, a 830m-tall tower. There’s also the Dubai fountain and artificial islands such as Atlantis and The Palm, a resort with water and marine-animal parks.

The emirate’s longstanding international outlook, liberal business policies, strong governance and readiness to address the needs of the world of business, has catapulted it onto the global stage. This has led to everyone from FTSE 100s to innovative start-ups, looking to capitalise on Dubai’s strategic positioning as a gateway to the economies across Middle East, Africa and South Asia.

It is little wonder then that the city is ranked in Top 5 global centres for trade, logistics, tourism and finance and is internationally recognised as the leading financial and trading centre at the heart of the world’s Islamic economy.

Why you should do business in Dubai:

Dubai is a key connecting hub between the markets of the East and West, ideally located to bridge the crucial time zone gap between the markets of the East and West to enable 24/7 services and connectivity.

56% of global multinationals currently have a presence in Dubai and it helps that two international airports – Dubai International and Dubai World Central makes it accessible for business or pleasure.

Dubai is also home to the world largest manmade port – Jebel Ali – a premier gateway for over 90 weekly services connecting more than 140 ports worldwide.

Safety & Security

UAE ranked as the 2nd safest country in the world, according to the World Economic Forum (Travel and Tourism Competitiveness Report 2017). Political stability and a government with a long, consistent commitment to pro-business, liberal economic policies including the protection of intellectual property rights. There is a stringent building regulation and provisions to boost resiliency, fire suppression and cooling systems, in addition to multiple connectivity links.

There exist federal law which abhors religious hatred through any form of expression. It is illegal to discriminate against individuals or groups on the basis of religion, caste, doctrine, race, colour or ethnic origin

Pilot Testbed to MEASA Expansion

With its diverse and mature consumer base, Dubai has a proven track record of being the launch-pad to test and expand operations across the wider Middle East, Africa and South Asia.

Non-oil trade between Dubai and Africa grew by over 700 percent over the last decade, valued at US$24 billion. India was the second-largest trade partner, with US$25.6 billion in non-oil bilateral trade, pushing new trade opportunities following signing of 14 strategic agreements in 2016.

Infrastructure & Services

There is a modern fiber-optic integrated services digital network with rapidly growing use of mobile-cellular telephones. The city-state is connected via the FOG submarine cable to Kuwait, Qatar and Saudi Arabia, and furthermore the city of Al Fujairah is connected to a lot of the primary cables in the region – including Indo-UAE, IMEWE, SEA-ME-WE-4, SEA-ME-WE-3 and Flag Telecom’s FEA 4. There are locally available network of engineers, contractors and solution providers, including managed service providers and systems integrators.

Plan for the future:

Although the emirate’s ambitious infrastructure plans have consistently made headlines around the world, there’s no room for slackening. The Dubai Plan 2021 has a stated aim of establishing the emirate as “a pivotal hub in the global economy.”

The pro-business government allows a range of options to set up and establish businesses and has specific programmes and assets to help start-ups to grow and existing companies to flourish. With a keen eye on neo-industries, green energy, design, A1 and robotics, projects are in place to ensure Dubai is at the centre of the future for everything.

Next Gen Approach: Get Investment Support:

The 2017-2021 Dubai Plan includes a Dubai Chamber US$27.2 million fund to be invested in next generation business through the Dubai ‘Smartpreneur’ Competition, Dubai Startup Hub, Mohammed Bin Rashid Al Maktoum Business Innovation Award and the Dubai Innovation Index.

Dubai Plan will enhance its international network, promote Dubai as an attractive market for commercial and business ties; leverage its relationships and stakeholders to become the business community voice; develop the emirate’s entrepreneurial ecosystem and provide the best membership services through strong engagement and innovative solutions.

Education:

The UAE has developed into a growing education hub, establishing universities, higher colleges and institutions to offer world-class education in engineering, science and technology. The UAE was ranked 10th for education quality in the World Economic Forum’s 2016-17 Global Competitive Index. The same study also placed the UAE 16th for its standards of school management, 4th for student internet access and 17th for staff training.

The UAE’s tertiary enrolment rate has steadily increased and 42,000 additional seats will be required by 2020.

A PwC report forecasts UAE higher education enrolments will increase at a compound annual growth rate (CAGR) of 5.3 and 7.3 per cent respectively at public and private institutions from 2008 to 2020. By 2020, 123,600 students will be enrolled in private higher education courses and 61,600 in public courses.

Dubai’s status as a growing knowledge hub is also enhancing its attractiveness as a business destination. Central to this is the wide range of universities, research facilities and educational institutions that businesses and individuals can tap into and leverage the expertise of. Reflecting the city’s diversity, these include branches of international, well-established and respected institutions, as well as new entrants which have emerged and developed within the fertile environment that Dubai provides.

According to current Knowledge and Human Development Authority (KHDA) figures, there are 18,832 teachers working across Dubai’s private schools; including 3,150 teaching assistants and 13 new are set to open across the city for the upcoming 2018/19 academic year. Dubai is home to over 200 nationalities, bringing together one of the world’s richest and most diverse pool of languages and skills to suit any business. Significant investment into the development of home-grown talent also continues to be a key priority, with the government allocating 20.5 per cent of the 2017 budget, AED10.2 billion (US$2.77 billion), to the education sector. An immediate freeze on tuition fees of all private schools in Dubai for the academic year 2018-2019 is also in effect.

Dubai’s Composition:

Almost 80% of Dubai’s population is made up of expats. You don’t need to know Arabic, literally everybody speaks English. UAE is ranked the 14th happiest country in the world and it has one of the lowest crime rates in the world. The GII sub-indices showed that the country ranked 1st globally in the cost of redundancy dismissal, salary weeks, ease of paying taxes and tertiary inbound mobility. The visa regime in Dubai is expat friendly, which means you can easily get a UAE residency visa. It makes leasing property, movement into and out of the country of UAE, and getting a Schengen visa easy as a breeze.

Proven Track Record:

In addition to attracting 56% of the world’s Fortune 500 companies, and with over 200,000 registered companies, Dubai has also seen an influx of SMMEs (Small Medium and Micro Enterprises) leveraging its conducive ecosystem to set-up, scale and service a wide range of markets from this very geographic node. The city also delivers a compelling network of angels, accelerators and venture capitalists offering a range of support mechanisms, accounting for one-third of all MENA investors and over 20 venture capitalists – the highest in the region.

Due to its continually evolving, mature and business-enabling, regulatory and legislative policy ecosystem, the UAE and Dubai continue to maintain a business-friendly environment

According to the World Bank’s Ease of Doing Business 2018, UAE is ranked 21st globally and is ranked first in the Arab region for the fifth year in a row. Additionally, the UAE is ranked in the top ten globally in five of the reports 10 topics. The UAE is first globally in ‘paying taxes’ and ‘getting electricity. The UAE is also ranked 2nd globally in ‘dealing with construction permits’ and 10th globally in ‘registering property’ and ‘registering property’.

The Index of Economic Freedom 2018 (annual Index by the Heritage Foundation and The Wall Street Journal ) ranks the UAE among the top 10 countries in the world and first in the Middle East and North Africa (MENA) with a score of 77.6 with notable scores for government spending and government integrity indicators.

According to the World Bank and World Economic Forum’s World Competitiveness Report 2018, the UAE is the most competitive economy in the MENA region and 17th globally. According to the 2017 Change Readiness Index (CRI) released by KPMG International, The UAE ranked third globally and first in the MENA in Change Readiness.

GDP:

The IMF had forecast 3.3% growth for Dubai for 2017 and 3.5% for 2018. According to Dubai Statistics Center (DSC); Dubai’s real gross domestic product (GDP) reached Dh389 billion in 2017 compared to Dh379 billion in 2016, an increase of 2.8%.

The growth was fuelled by the performance of strategic sectors that accounted for 72.2% of total growth in 2017. Transportation and storage sector was the biggest contributor to total economic growth at 18.5%. It added a value of Dh46.1 billion compared to Dh44.1 billion in 2016, an increase of 4.5%

Wholesale and retail trade activity contributed 26.6 per cent of Dubai’s real GDP and grew at a rate of 0.9%. The sector’s contribution to growth stood at 8.3%. Growth in wholesale and retail trade activity was accompanied by growth in foreign trade. Total imports and re-exports grew by 2.2% in 2017 compared to 2016. Real estate sector accounted for 7.1% of Dubai’s real GDP contributing Dh27.6 billion in 2017 compared to Dh25.7 billion in 2016. The sector grew by 7.3% and contributed 17.6% to Dubai’s total growth.

Manufacturing accounted for 9.4% of Dubai’s real GDP with a total value of AED 36.8 billion in 2017 compared to Dh36.1 billion in 2016. This sector, which grew by 2% contributed 6.8% to economic growth. Construction sector contributed to 6.3% of Dubai’s real GDP and 7.8% of total growth; contributing Dh24.5 billion, which represents a growth of 3.5% compared to 2016. The Dubai government’s spending on infrastructure projects, which rose by almost 27%, had a pronounced positive impact on the performance of the construction sector in the emirate.

Accommodation and food service activities accounted for contribution of 4.9% to Dubai’s real GDP and a growth rate of 8%. It also contributed 0.4% points to total economic growth.

Dubai SME, the agency of the Department of Economic Development (DED) in Dubai, revealed the results of a study in early 2018 as part of Dubai SME Development Plan, which is part of the Dubai Plan 2021. Small and medium-sized businesses (SMBs) make up 47% of the emirate’s GDP and more than half of its workforce.

SME contribution to Dubai’s economy rose from 40% in 2009 to 47% in 2016. SME contribution to job creation rose from 42% to 52.4% during the same period in spite of the slow global economic growth. Younger start-ups make up nearly 50% of the companies registered in Dubai

Foreign Direct Investment:

According to Dubai Investment Development Agency (Dubai FDI), an agency of the Department of Economic Development (DED).

Dubai ranks among the top 10 international cities in attracting foreign investment. The city attracted Dh27.3 billion in FDI 2017, an increase of 7.1% compared to 2016.

There were 367 FDI projects in 2017, up 50% from 2017 while investment in research and development (R&D) accounted for about 3.5% of total FDI projects.

Medium and high-tech projects constituted more than 60% of the total whiles Strategic projects with a capital of more than $50 million (Dh183.5 million) accounted for 54% of total investment projects and 93% of total capital inflows.

According to the Financial Times’ “FDI Benchmark”, a leading platform for benchmarking the world’s key FDI destinations. The city ranked first globally in the share of FDI in technology transfer in artificial intelligence (AI) and robotics. Third among the top 25 destinations in the same category after Singapore and Shanghai.

According to the Financial Times ‘fDi Markets’ index, which records data on capital flows and new FDI projects across the world:

Dubai was ranked fourth globally in the number of new investment projects ranking fifth globally in the number of re-investment projects and 10th globally in capital inflows into new investment projects.

Top Source Markets:

The US (35.6%), Austria (9.3%), France (8.4%), the UK (7.3%) and Saudi Arabia (6.4%) were the top source markets for FDI into Dubai in 2017.

The US (22.9%) topped the list of investment projects followed by the UK (19.3%), France (7.9%), India (7.6%) and Germany (5.5%).

Government of Dubai General Budget 2018

A total of Dh56.6 billion earmarked for expenditure. Infrastructure spending accounts for 21% of the total government expenditure while renewed focus on the needs of Expo 2020, whose investment value is estimated at Dh25 billion. The expansion of the Dubai Metro’s Route 2020 is estimated at around Dh10.6 billion. Expenditure on social development sector fields of health, education, housing, community development, and innovation represents 33% of the total government spending.

16% of total spending was allocated to the security, justice and safety sectors while 8% of the spending budget allocated to Government Excellence, Innovation and Creativity Sector to develop performance and embed a culture of innovation.

Job opportunities & Employment:

The public budget offered more than 3,100 jobs, with salaries and wages amounting to 30% of the total government spending in 2018.  Salaries and wages saw a 10% increase compared to 2017.

Dubai Competitiveness Report 2018 issued by the Switzerland-based IMD World Competitiveness Centre in co-operation with the Department of Economic Development (DED) in Dubai. The city ranks first globally in employment growth, Second globally in youth unemployment.

Dubai also recorded an unemployment rate of 0.5% in 2017, significantly lower than the global average according to Dubai Statistics Center. Total employment in Dubai reached 2,778,000 in 2017. Overall economic participation rate – percentage of employed people in the total working-age population- reached 83.1%

Dubai is among the Top 10 cities with the highest salaries, coming in at number 9 with average salaries averaging more than $3,400 (Dh12,400) a month, according to a Deutsche Bank study.

The UAE scored the highest for percentage of adult population in good jobs (69%), according to the Gallup 2018 Global Great Jobs Briefing. The UAE scored, the third highest for the percentage of adult population in great jobs at 12%. Across most of the world (the percentage of adults with great jobs rarely tops 10%).

Ease of Doing Business/Cost of Doing Business:

Ease of doing business has huge implications for both foreign direct investments and local businesses as this is impacted by the processes, rules, and regulations set up by governments that can help promote a business-friendly environment or hold back local businesses from their entrepreneurial ambitions.

Over the last year, Dubai and the UAE government have focused on enabling and empowering businesses trough for instance exempting businesses from fines and trade violations.

For example, the Dubai Chamber of Commerce and Industry announced it would waive late membership fees in an effort to reduce the cost of doing business.

A new insurance scheme for workers’ guarantees was introduced. The previous mandatory deposit of Dh3,000 per worker is now replaced by a new insurance that cost only Dh60 annually per worker. The newly created scheme secures workers’ rights in the private sector and reduces the burdens on employers. It allows businesses to recover approximately Dh14 billion, representing the value of current guarantees paid by employers, which will enable them to further invest in the development of their business.

Lower market fees imposed by Dubai Municipality on commercial entities moved from 5% to 2.5%. There’s been the cancellation of 19 fees relating to the aviation industry and to aircraft landing permits.

The 4% fee for a delay in property registration imposed by the Dubai Land Department waived while an advisory board has been established by the Chamber to boost the contribution of global companies in shaping the regulatory landscape.

The council, represented by selected multinational corporations and Fortune 500 companies, will represent business interests, strengthen investor confidence and play a key role in developing the local economy.

Laws and Regulations:

The legal framework of the UAE is more of a dual acting system, comprising mainly Islamic Shariah and aspects of conventional law. However, in comparison to Saudi Arabia and other Arab nations, the laws in the UAE are more liberal.

The legal system in Dubai is a mix of Sharia (Islamic Law), Civil and Criminal Laws, implemented by the Federal Judiciary, comprising courts of first instance and Supreme Courts. The Supreme Council of Rulers is the highest ruling body in the UAE. It appoints the five members representing the Federal Supreme Court, who presides over matters like constitutional law and rule. Local government is also involved and plays a vital role in legislation within each emirate.

The regulations of the UAE and Dubai are constantly being developed and adapted to meet the fast pace of developments happening here. Some of the key regulations for

New Foreign Ownership Laws:

In May 2018, the UAE cabinet announced that foreigners will be able to set up businesses outside of free zones and own them 100%. Eligibility for sponsor-free set up depends on factors such as ability to create jobs and transfer technology. Applicants will be assessed by a committee headed by the Ministry of Economy and will include representatives from across the seven Emirates.

The Department of Economic Development, Dubai will provide assistance on requirements for eligibility for set up in Dubai under the new law which is effective Q4 2018

New Visa Laws:

Sheikh Mohammed Bin Rashid Al Maktoum, UAE Vice President and Prime Minister and Ruler of Dubai, also announced specialists in medical, scientific, research and technical fields, as well as top students, will be offered residencies of up to 10 years.

Tax Advantage:

Dubai’s economy is free and open to attract business and investment. Government regulation of private sector activities is at a minimum, and broadly limited to the context of ensuring rigourous compliance with international standard practices.

The Global Innovation Index by INSEAD also reported that the UAE ranked first in Ease of Paying Taxes’. Additionally, UAE ranked first in Extent and Effect of Taxation’ according to the Global Talent Competitiveness Index by INSEAD. The UAE ranked first in three indices in the Global Competitiveness Report 2017-2018, issued by WEF, including Efficiency of Government Spending’ index, Annual Inflation Rate’ Index, and Absence of Effect of Taxation on Incentives to Invest’.

incentives currently in place to foster business growth include no direct taxes on corporate profits or personal income (except for oil companies and branches of foreign banks).

VAT, which in 2018, is set at just 5%, with exemptions across certain food items, health, education and social services. The new levy is a small figure when compared to 150 countries already implementing VAT or a similar method of taxation (in the UK, for example, VAT is 20%) and because of low red-tape and corruption, the earnings from Tax contribute to government spending in infrastructure projects, safety and security.

The city does not implement income tax. Low customs duties at 4% with many exemptions; 100% repatriation of capital and profits is permitted. There are no foreign exchange controls, trade quotas or barriers whule a stable exchange rate exists between the US Dollar and the UAE Dirham (US$1.00 = AED 3.678). Liberal visa policies permit easy recruitment of expatriate labour from all over the world, with 48 countries currently eligible for visa on arrival.

Free Zones:

The Free Trade Zones (FTZs) of Dubai have been a veritable opportunity for the country to showcase its development and special area approach. The UAE in the last decade has witnessed a quantum increase in industrial development and one of the most significant and remarkable achievements is the success of Free Zones.

Dubai was home to the UAE’s first Free Zone at Jebel Ali, which came into existence in 1985. Today, the city is home to 22 business-first, economic free zones with 100% foreign ownership, tax free policies, full repatriation of profits, low-cost set up and renewal structures. The Free zones offer dedicated zones for segmented industries and their specific requirements, from real estate to regulations and more, contributing to their growing role as Innovation Cradles aiding R&D to tap into cutting-edge knowledge and expertise to launch and test next generation business/products/services.

Dubai as a destination for MNC Regional / International HQs:

In early 2018, Infomineo, a global market research company announced results of a study reviewing how the Global 500 conduct business in the Middle East and Africa (MEA). Using the 2017 Fortune 500 ranking as a sample, the review shed light on where major industry players are choosing to set up a decision making center in the MEA region.

Key Findings:

A 10% increase in the amount of companies listed on the Global 500 ranking with a dedicated entity covering the Middle East and Africa. 217 Fortune 500 companies have a dedicated entity in the MEA region. Dubai leads as the destination of choice for 155 companies; a growth of 12% YoY.

Dubai’s growth as a hub for technology companies is strong as an additional 7 Sub Regional Headquarters were created/established in the city by the Fortune 500 in 2017.

Examples of Fortune 500 companies and leading MNCs in Dubai

USA: Boeing, Dow Chemicals, J.P Morgan Chase, Procter & Gamble, Merck, IBM, Oracle, General Electric & Honeywell

UK: HSBC Holdings, BT Group & GlaxoSmithKline

China: Sinopec Group, China Telecommunications, Tencent, Alibaba & Bank of China

France: AXA, BNP Paribas, Engie, Schneider Electric

Germany: BMW, Deutsche Bank, SAP, ThyssenKrupp & Bayer

India: Tata Motors, Indian Oil, Reliance Industries & SBI

Russia: Lukoil, Kaspersky Lab & InfoWatch

Malaysia: Petronas

A consortium of major Dubai businesses and government stakeholders have also come together to under the Dubai Future Accelerators initiative – a unique start-up programme for cutting-edge entrepreneurs. In partnership with the Government of Dubai, its purpose is to use the city as a living testbed for creating solutions to the global challenges of tomorrow. After the programme’s first round, AED123 million (US$33.5 million) of deals were closed, and 14 international companies taking part relocated their headquarters to Dubai.

Venture Capital, Incubators and Accelerators:

Dubai SME’s business incubator licence offers 100 per cent ownership and investors can apply for the license through its website

Dubai Startup Hub by Dubai Chamber and Hamdan Innovator and Incubator by Mohammad bin Rashid establishment have been set up to empower the emirate as the entrepreneurial capital of the region.

There are currently 17 accelerator programmes, 12 incubators and 7 co-working spaces in the UAE, says MAGNiTT, a platform that tracks developments in the Mena entrepreneurship space.

In a bid to increase the contribution of SMMEs (Small Medium and Micro Enterprises) to the emirate’s GDP, Dubai has established a ratings system for the sector. Launched by the Dubai Economic Department (DED) in partnership with The Executive Council of Dubai, Rate SME is open to all businesses with annual turnovers of between AED 1 million ($272, 480) to AED200 million ($54.5 million).

Businesses are rated between B and A+ based on business performance (turnover/profit), innovation, corporate governance, international expansion and corporate social responsibility. SMMEs must pay Dhs5,000 ($1,360) to register and need at least one year of audited financial records. This ratings system helps obtain bank financing, attract investor interest and improve the prospects of winning government contracts. The best rated SMMEs also benefit from support for international expansion and capability development.

Examples of Successful startups:

Dubizzle: American entrepreneurs Sim Whatley and J.C. Butler founded Dubizzle.com, the Middle East’s largest online classified website, in Dubai. After six years of hard work, the founders stepped down, deciding to move back to the U.S. The duo sold 51% of their equity to investor MIH, a subsidiary of South African media multinational Naspers. Today, the site has 240 million users with more than 17 billion monthly visits and is available in 106 countries. It has three million monthly ads, with 90 million monthly searches.

Souq.com: The Jabbar Internet Group, creators of the Middle East’s biggest e-commerce platform, Souq.com. Established in Dubai Internet City, the online marketplace was acquired by Amazon in March 2017 in a multi-million dollar deal. Amazon’s acquisition marked the company’s first move into serving the Middle East, seen as a relatively untapped market with only about 2% of all its retail spend made online, according to a McKinsey report.

Careem is an app-based car booking service, founded in 2012 by two former McKinsey & Co consultants – Magnus Olsson and Mudassir Sheikha.Today, it is the Middle East’s first Unicorn; beating Uber as the Middle East’s preferred ride-hailing service. In five years, Careem has amassed 10 million registered users in 60 cities in 11 countries, over 250,000 contractor drivers, called captains, work for Careem, and ride numbers have been growing at a 25% monthly clip for the past two years. Today, the team is working to  to raise up to US $150 million to launch its own food delivery service

The Entertainer- Donna Benton arrived in Dubai with just US$3,000 in the pocket, and less than two decades signed a landmark deal to sell a majority stake in The Entertainer, an incentives provider and lifestyle app, which employs 300 staff across 15 global offices; just after the company recorded an annual turnover exceeding $35 million in 2017.

Bridg: Pursuing a little off the beaten path, Moussa Beidas and Nadim Jarudi, created an app that allows smartphone-to-smartphone payments using Bluetooth, and only requires one of the devices to be online. Today, the business is on track to expand across the GCC, Egypt, India, Pakistan, Philippines and Indonesia, to name a few.

Souqalmal: Ambareen Musa founded financial product comparison site Souqalmal in 2012, in 2017 Ambreen raised US$10 million to kick off expansion plans

The Luxury Closet: Last month the high end resale marketplace announced it closed an $US8.7 million growth funding round.

GEMS Education: now the world’s largest schools provider with operations across 14 countries, was started in Dubai by entrepreneur Sunny Varkey, who identified the desire of Indian and UK expatriate families to educate their children in English language facilities.

Jumbo Electronics: Founded by Indian entrepreneur, Manohar Chabbria, in Dubai in 1974, the company secured exclusive rights to distribute Sony products in the Gulf. Chabbria went on to build his company into a retail electronics giant and ultimately a US$2.5 billion transnational conglomerate known as the Jumbo Group.

Al Habtoor Group: What began as a small engineering firm back in 1970, the group is today one of the region’s most respected conglomerates with interests in hospitality, automotive, real estate, education and publishing. Started by now chairman Khalaf Ahmad Al Habtoor, today the Group operates in the UAE and international markets including London, Vienna, Budapest, Beirut and Springfield, Illinois.

These are just a snapshot of the many success stories born in Dubai and now reaching the world – a tradition on which the emirate expects to build as it innovates for business leadership.

The Dubai Industrial Strategy 2030: launched by His Highness Sheikh Mohammed bin Rashid Al Maktoum, UAE Vice President and Prime Minister, and Ruler of Dubai seeks to elevate Dubai into a knowledge-based, sustainable and innovation-focused platform for global business. The new industrial strategy includes 75 key initiatives aimed at generating an additional AED 160 billion (US$43.6billion) in revenues, create 27,000 jobs in the industrial sector, and boost exports by AED 16 billion (US$4.36billion), all by 2030. Six priority sectors have been identified:

  1. Aerospace
  2. Maritime
  3. Aluminium & fabricated metals
  4. Pharmaceuticals & medical equipment
  5. Food & beverages (FMCG)
  6. Machinery & equipment

Dubai 10X Agenda- Building Tomorrow, Today: An initiative of the Dubai Future Foundation under the directives of His Highness Sheikh Mohammed bin Rashid Al Maktoum, UAE Vice President, Prime Minister and Ruler of Dubai, and the Crown Prince of Dubai, His Highness Sheikh Hamdan bin Mohammed Al Maktoum, calling on all Dubai Government entities to embrace and incorporate disruptive innovation across practically every facet of operations.

Smart Dubai 2021: Is the city’s roadmap to achieving the future of Dubai. Leveraging our experience in three years of transforming Dubai into a smart city and becoming the intelligent, responsive and personalised city of the future.

Infrastructure & Industry:

Dubai continues to inject capital into its economic and social infrastructure, producing an emirate that can now boast:

  • World-leading aviation infrastructure
  • Highly developed surface transport infrastructure
  • State-of-the-art telecommunications and virtual ‘smart’ infrastructure
  • A sophisticated financial and service sector
  • Industry-leading exhibition and conference venues
  • High-quality office and residential accommodation
  • Reliable power and water utilities
  • First-class hotels, hospitals, schools, shops, parks and recreation facilities