The United Arab Emirates (UAE) is a region that over the last few years has exploded as a hub for foreign investment. In fact, the UAE is known as one of the freest economies, which is reflected in its culture of multi-culturalism and extensive regulations that facilitate foreign investment.
Also, the UAE is quickly expanding its range of asset classes and moving away from just being an oil economy which means that there are plenty of opportunities for all investors no matter their industry of interest.
This growth is primarily due to the digital and technological transformation the region has recently gone through which now makes the UAE a global leader for innovative ideas and technological investments while at the same time being a model of a progressive and efficient society.
In this article, we discuss the benefits of investing in this region.
Advantages of Investing in the UAE
The UAE has a rich investment environment that is actively supported by the government through various programs that aim to create a secure and sustainable infrastructure that encourages and simplifies investment from both local and foreign investors.
Some of the benefits of investing in the UAE are as follows:
The UAE is located between multiple business centres, including Europe, North America, Asia, Africa, and the Pacific Ocean. Foreign investors can use this strategic location to access the most prominent and emerging markets quickly and easily.
One of the UAE’s primary goals is to join the top-rated countries of the Green and Sustainable Development Strategy initiative by its 50th anniversary. To fulfil this vision, the UAE allocated 230 billion Dirhams to develop what now has become one of the most developed infrastructures in the world.
The UAE has the infrastructure required to accommodate the building of several businesses, including the following:
- Business Centres
- Luxurious Shopping Centres
- Industrial Zones
- Fully furnished commercial towers to conduct business
- Political Stability
The UAE is known for its political stability and security. The culture is one of acceptance, moderation and tolerance, which is reflected in the large population of tourists, expatriates, and foreigners that have made the UAE their home.
To support the culture of acceptance further, the government has created the Future Government Plan an initiative launched by H.H Sheikh Mohamed bin Rashid Al Maktoum which focuses on building strong international relations and establishing an economy of equal opportunity for all UAE citizens.
As we mentioned above the UAE government actively supports the fostering of tolerance as a societal norm. Because of this, the UAE citizens can co-exist peacefully and in harmony, as seen in the 200 different ethnic, cultural, and religious groups that make up its population. In addition to the peaceful environment, the crime rate is exceptionally low, and UAE citizens enjoy an adequate standard of living that includes entertainment, health services, housing, and education.
Ease of doing business
In 2019 the UAE was ranked 11th by the World Bank Doing Business Report beating out all the other Arab countries while ranking 1st (regionally) for the sixth consecutive year. The UAE's participation and excellent ranking within this report reflect the government’s commitment to creating procedures and legislation that fosters local and international investment.
Affirmative Labour Laws and Regulations
The UAE has several laws and regulations in place that promote investment and competition between businesses but more importantly, that also prevent monopolisation. UAE legislation covers the following areas:
- Property and trademark protection
- The suppression of piracy
- The prevention of trafficking
- The elimination of the movement of prohibited goods
UAE: A Free and Open Economy
To support the growth of the private sector, the UAE has implemented various "free and flexible policies regarding the controls on currency exchange, the policies for the grant of entry and work permits, and import and export regulations.”
It also works closely with global trade organisations to ensure that it supports and maintains its position as an international competitive trade player.
The UAE's economy is already quite strong and stable. Despite this, the government continues to work towards the country's economic growth by introducing new policies that promote competitiveness while at the same time, attract new investment.
One way that the UAE is planning for future economic growth is by shifting away from oil dependency and focusing instead on building itself as a digital and science based economy. In this way, the government is proactively creating an action plan for the post-oil era to diversify its economy and make it more sustainable. In fact, by 2021 it has plans to increase its investment in non-oil sectors by 80%.
How to Begin Your UAE Investment Journey
Despite all the benefits that the UAE offers, it can be a risky and sometimes complicated country for foreign investors to navigate. That is why before you begin the investment process, you must prepare by doing your research so that you are ready for any issues and complications that may arise.
The World Bank forecasts that the UAE's economy will contract by 4.5 percent this year due to the lockdown measures introduced to counter COVID-19, but will likely pick up next year. A growth rate of 1.4 percent has been predicted for the non-oil sector after the restrictions are lifted. One way of preparing is by consulting Cedar Rose, the ultimate business intelligence provider of the Middle East and North Africa region. We have been active in the MENA region now for over 20 years. So we are incredibly confident that our experience and knowledge in the UAE investment culture, language, and socio-economic environment can generate the opportunities that you are looking for and guide your business to success.
Furthermore, we can provide you with high-quality company specific data and customised due diligence reports that will help you effectively mitigate risk while guiding your business in the right direction.
For more information please contact our Dubai-based regional manager Frederic Paquay on +971 58 589 2374 or email Frederic.firstname.lastname@example.org.