As the Middle East’s geographic and economic centerpiece, global investors regard the UAE as a critical component of their operations. UAE is a prime location for MNCs to serve the elevated markets of the Middle East. It is also an ideal location for new business ventures in a variety of industries.
Dubai has established itself as UAE’s second largest emirate and perhaps the most important port and commercial center. It has worked hard to transform itself into a diverse economy. Manufacturing, logistics, financial services, information technology, retail, travel, tourism, healthcare, and education are critical sectors, with a strong emphasis on green technologies.
More than half of the biggest global conglomerates operate their offices from/in this dynamic city. Over the years, UAE has built a reputation for offering quality hospitality, impressive infrastructure, and a wide range of attractions.
The Department of Economy and Tourism’s (DET) Business Registration and Licensing (BRL) sector issued 24,662 new business licenses in the first quarter of 2022, representing a 58% increase over Q1 of 2021, where 15,580 licenses were issued. All through Q1 2022, 136,034 business registration and licensing transactions were completed, which happened to be a staggering 36% increase over Q1 2021.
The exceptional growth demonstrates reliable essentials, including but not limited to the resilience and sustainability of Dubai’s economy. This is in turn led by a progressive vision and a strong capacity to endure challenges while maintaining a healthy rate of growth. A significant increase in the issuance of new business licenses demonstrates the confidence that investors have in Dubai’s growth potential across various sectors.
Since enterprises constantly seek routes aimed at streamlining their growth, Dubai is in a perfect position to assist companies in establishing and scaling up to succeed in this new status quo. According to the Ease of Doing Business Report 2020, the UAE was ranked first in MENA and 16th globally for ease of doing business, based on how conducive the regulatory environment is to establishing and operating a private business.
In addition to this, the government is pro-business, with the most transparent business regulations in the region, tax-free zones, state-of-the-art physical infrastructure, and access to a skilled and experienced labor force.
Despite a worldwide pandemic, Dubai granted over 55,000 new company licenses in the first 10 months of 2021. This growth demonstrates Dubai’s reputation as a place where businesses thrive, as its economy provides a variety of appealing opportunities for both prospective entrepreneurs and established businesses. Its ecosystem consists of fields as diverse as healthcare, hospitality, technology, trade, and finance.
Further, according to the Global Entrepreneurship Monitor’s (GEM) 2022 report, the UAE also ranks first globally as the best ecosystem for start-ups and entrepreneurs in 2022. On GEM’s National Entrepreneurship Context Index (NECI), the UAE received the highest score of 6.8, making it the best country in the world for start-ups.
Method of Establishing an Enterprise in Dubai
Business setup in Dubai can seem daunting, but it can be much easier than you think if you follow a simple step-by-step process and get the right help.
-
Determine the nature of your business.
The first step in establishing your business and obtaining a license is to determine the nature of your venture. Choose from 2,000 business activities in the categories of industrial, commercial, professional, and tourism. A holistic and comprehensive list of the same is available on the Department of Economic Development website.
-
Establish the jurisdiction
The United Arab Emirates (UAE) has three economic zones or jurisdictions: Mainland, Free Zone, and Offshore. Each jurisdiction has its own set of business-related laws and regulations that cater to the needs of various companies. The jurisdiction you choose for your business will be determined by your needs and the nature of your business.
-
Legal framework
When starting a business in the UAE, choosing the legal structure is critical. It lays the groundwork for dealing with profits and losses, as well as how to organize your resources and assets. The company must have a well-determined legal structure in place to apply for and obtain a business license
-
Submit all documents to the Department of Economic Development [DED]
Company formation and licensing take place concurrently. The documentation and approval process, on the other hand, consists of several steps. During this phase, you must obtain all required government approvals from the Department of Economic Development. The documentation required varies depending on the firm type and activity.
-
Complete your visa application
This is the final step in establishing an enterprise in Dubai. One could also apply for their staff and family members in addition to their own personal visa application.
The rise of Dubai from a desert city to one of the hottest destinations for hospitality and investment has been based on the founders of Modern Dubai’s exceptional planning. Dubai has a plethora of tourism opportunities as well as a large influx of business travelers. Many economies in the Middle East and other fast-growing emerging markets were hit by laws that limit foreign ownership and investment. To its economic advantage, Dubai has established special zones where the laws encourage international investment and favor specific industries. As a result, it is taking advantage of free trade policies to gain a competitive advantage over its neighbors. Dubai is an ideal destination for new-age entrepreneurs who rely on new technology due to its flexible amenities
Saudi Arabia is another Middle Eastern business hub that is facilitating lucrative advantages to its investors.
Vision 2030, a comprehensive strategy aimed at diversifying the economy of KSA has been in the making since 2016. Structural changes and initiatives, driven by Vision 2030, have already increased investment. This is because businesses are eager to expand into the Kingdom to capitalize on the country’s key assets.
According to the flash estimates, Saudi GDP grew at the fastest rate in the last decade, averaging 9.6% in q1 of 2022 compared to its equivalent in the year 2021.
Significant investment and trade opportunities in Saudi Arabia include traditional areas such as oil and gas and transportation, including metro, rail, and air terminals; water, health, and wastewater projects; thermal power, education, and mining. The UK is the Kingdom’s second-largest investor. More UK firms attempt to establish a physical presence in KSA, hoping to gain traction in this rapidly developing market. KSA is the largest economy in the Arab world and among the top 20 in the world. It provides a plethora of opportunities for all entrepreneurial ventures to have the necessary vision and enthusiasm to excel. There are numerous compelling reasons to establish your next business setup in Saudi Arabia. These range from simple set-up procedures to tax advantages.
Advantages of Establishing your Business in the Kingdom include:
-
Efficient Taxation Regimes
When migrating or establishing a company in a competitive jurisdiction, you must ensure that it is suitable for your needs. For many business owners, this essentially means tax efficiency. Saudi Arabia certainly ranks high in this category.
Personal income tax liability for foreign investors in the Kingdom is minimal, while corporation tax is 15%. Furthermore, while Saudi Arabia does levy VAT, many goods and services are exempt.
-
Innovation
Saudi Arabia aspires to be a global technology hub in the future. For this, it recently announced a series of initiatives totaling more than USD 1 billion. In the coming years, the kingdom hopes to increase the contribution of technology to GDP by around AED 50 billion. This doubles the size of the emerging market sector and generates over 25,000 jobs.
This direct investment in the technology sector is fuelling unprecedented innovation in the country. This facilitates incredible opportunities for its entrepreneurs.
-
Availability of Lucrative Options
Saudi Arabia, like the UAE, wants to diversify its economy away from oil and gas. Therefore, the country’s leaders are offering billions of dollars in assistance to businesses. This is taking place in various industries in order to build a broad, strong, and future-proof economy. However, regardless of your industry, if your offering can help the local economy, you can expect a welcoming and encouraging business environment in Saudi Arabia.
-
Assured Safety
Saudi Arabia is widely regarded as one of the world’s safest countries. Receiving an 86 out of 100 in the Gallup Global Law and Order 2021 survey, it is trailing behind Canada and is ahead of the United Kingdom, Japan, and New Zealand. In addition, the kingdom was recently rated as the safest of all G20 countries based on a variety of key security indicators.
Therefore, as enterprises seek new opportunities to improve their development, Dubai and the Kingdom of Saudi Arabia are well-positioned to assist companies in establishing and ramping up for future success in this new reality. Their policies and high returns are ideal for attracting investors to one of the world’s most successful central business districts.
