How the UAE fosters entrepreneurialism
Free zones, tax and duty exemption, low levels of red tape – it’s no secret that the United Arab Emirates has long been a magnet for entrepreneurs starting or relocating their businesses. Ranked 31 worldwide in ‘ease of doing business’ and placing very high on the happiness index (yes, there’s a happiness index) the UAE boasts everything you need to develop a product or service.
A quick glance at the streets of Dubai tells us that success is born and thrives here. But I want to look past the high performance cars and luxury hotels and dig a little deeper into what the UAE can do for you as an entrepreneur, and why setting up a base in the UAE might just be the smartest business decision you ever make.
1. UAE free zones: Encouraging business
The financial infrastructure is little short of legendary for incentivising and attracting wandering eyes from abroad.
Each of these designated areas is set up for specific industry categories. Within the free zone package you can enjoy conditions such as no trade barrier quotas, competitive costs on energy, real estate and financing as well as assistance with labour recruitment. You also benefit from 100% ownership as a foreign company and 100% tax and duty exemption.
2. Taxes and keeping more of the money you earn
A crucial difference when doing business in the United Arab Emirates is that if you do make money, you keep more of it. So generating real wealth is a lot easier compared to trading in many other countries.
Taxes are effectively non-existent: In all seven emirates there is no real enforced tax for general business outside oil and foreign banking. When tax can mean the difference between margin or no margin then it can also mean the difference between breaking even and growth. Chances of success accelerate when you keep what you make. This ‘no-brainer’ benefit is one of the biggest draws – encouraging business development and reducing risk.
3. Easy access to the world: From ports to planes
The UAE is in the perfect physical location for international trade.
There are two impressive ports in Dubai: Port Rashid (35 berths) and Jebel Ali Port (63 berths). These are bustling with activity and are massive in scale, making import and export concerns a non-issue.
For air links, Dubai has the carriers Flydubai and Emirates Airlines. Flydubai accounts for 19% of all landings and take-offs at Dubai International Airport and is one of the fastest growing airline startups. Meanwhile the mighty Emirates accounts for 40% of traffic and is the third largest airline in the world in terms of revenue.
The growth of both these carriers will mean that Flydubai will relocate at the end of 2017 to Dubai’s second airport, Al Maktoum International at Dubai World Central. This will free up room for Emirates to expand operations at Dubai International.
From air to water, the UAE takes advantage of its easy access to the rest of the Middle East, Asia, Europe and Africa as a globally acknowledged business hub on the crossroads of international trade.
4. From tourism to manufacturing: Multiple sectors rising
Traditionally the UAE has had a high reliance on oil and gas shipments that in 2009 accounted for 85% of the economy. But much has been done to reshape industry in the country to ensure sustainability. This is true in Dubai specifically, which does not have oil reserves comparable to Abu Dhabi.
Led by Dubai’s ruler, Sheikh Mohammed bin Rashid al-Maktoum, there has been an energetic refocus of resources on building a different kind of economy bolstering tourism, real estate, communications, manufacturing, retail, trade and construction. And along with a booming insurance industry, there are also over 50 banks in the UAE – approximately 28% of them foreign.
And let’s be clear: There are a lot of people visiting the UAE. The tourism sector is growing and the pure rate of human traffic is soaring, creating opportunities for all kinds of consumer-facing businesses. In Dubai alone tourist numbers reached over 14 million in 2015, and by 2020 the emirate is on target to exceed 20 million annual visitors. A constant flow of people coming into the region means an ever-regenerating population where astute entrepreneurs can flourish.
This is a busy place and it is only getting busier.
5. Mega projects mean mega confidence
Impressions and image make a huge difference for a business person, office or brand. And the UAE shines with success and growth. There are constant reminders of why the place is regarded as the biggest and best in luxury, real estate and development. The Tower at Dubai Creek is the latest mega building that will soon pierce the skyline and be a good 100m higher than the iconic Burj Khalifa. This enormous structure will become the central focus for a major new district being built. There will be 679 million square metres of residential space, 22 hotels, 851,000 square metres of commercial property and 11.16 million square metres designed for retail. Construction is slated to start in July 2016.
6. The UAE entrepreneur of tomorrow
It is important for any entrepreneur looking to move abroad to consider the longer term in the context of their chosen country. With Vision 2021, the UAE has a set plan to boost entrepreneurship. It’s about fostering a go-getter mindset in everyone in the region, particularly younger people. The UAE is preparing for forward thinking, economically astute and technology savvy citizens to take the country into an even brighter future.
7. Look around: Cranes and happiness
I mentioned at the start to look beyond the flashy cars and luxury hotels. Well, if you look up you see cranes. Lots of them. This is a place that is always moving and growing. Now look around: Business people are generally upbeat and energised – in the World Happiness ranking in 2016 the UAE scores a pretty cheerful 28th place out of 156 countries. There is even a Happiness Minister.
In a fascinating and eloquent letter by Sheikh Mohammed bin Rashid al-Maktoum that went viral on the LinkedIn social business platform, he cites happiness and the dreams and ambitions of the people as an economic driver.
These are the signs of a place that’s not so much prospering but bursting from the ground before our eyes.
All that it’s missing is your business.