Why is Dubai attractive for Business, investors and startups?
Dubai’s rapid evolution from a mere fishing village to a metropolitan area is the result of a strong vision, hard work and its remarkable attitude towards anyone who wants to invest to build his own business in this city. Dubai has always welcomed nationals from different countries to start their business in here with all the resources, excellent infrastructure facilities, abundance of talented human resource moreover with all the advantages of its geographically strategic location on the globe. UAE, being home to more than 8 million expatriates with its cosmopolitan culture has earned its title as a top-ranked business hub in the world. Talking about setting up a new business, we have to look into the reasons to choose Dubai as the place for it.
Reasons to choose Dubai to start a business
- Geographically strategic location – Dubai, which is situated on the Persian Gulf Coast of the United Arab Emirates, with its unique strategic location on the globe, becomes a gateway that connects huge continents of Africa and Asia with the western world. Using all the advantages of its location and with the rapid growth of both air and water transportation facilities, Dubai developed major hubs for passengers and cargo.
- Diverse workforce – People from different nations with diversified culture, background, races, religions, abilities etc. working together brings in creativity, more productivity, and different views about a matter help in reaching better conclusions. Employing personnel from similar socio-economic background, culture and with similar perspectives only limits the creativity and chances of innovation and new ideas. Nationalities of over 200 countries constitute the workforce of UAE which is very much diverse in all aspects and benefits the business in many ways like increased creativity and productivity, reduced fear, excellent performance, expanding the brand reputation also publicizing the name among different communities.
- Tax-free – One of the major factors that attract investors across the world is that taxes like Corporate Tax, Personal Tax, Tax on Capital Gains etc. does not exist in Dubai making it a tax-free city to freely plan on any type of investments.
- High sea sales – As said earlier, the inherent strategic location of Dubai has resulted in the growth of international trade and transport logistics. Dubai has the largest port in the middle-east, Jebel Ali port which is linked to Dubai’s expressway system and the Dubai International Airport cargo village. As per UAE VAT law, the place of supply of the transportation service is the place where the transaction originates. Under cross-border trade, the transaction is undertaking outside UAE and hence would be regarded as out of the scope of VAT. Over these years, Dubai customs has implemented major initiatives in the transport and logistics sector to enhance high sea sales making e-commerce highly efficient in the city and giving importance to customer satisfaction. Two major such recent initiatives include the Authorized Economic Operator program and the TIR customs transit system that minimizes the administrative and financial burdens and covering customs duties and taxes by international guarantee system. These initiatives, saving both time and money in the means of faster border crossings for trucks and containers and lower transport costs, along with other similar projects by the customs authority enhances trade facilitation through improved customs work and thereby supports economic growth.
- Government-Owned Companies – Unlike other major developed countries, UAE has its corporations operating in all sectors of the economy which are fully owned and controlled by the government including Dubai Internet City, Dubai Knowledge Village, Dubai Media City, Dubai World Central – Al Maktoum International Airport, Emirates (Airline) etc. These government entities and tax-free zones fully equipped with high-quality infrastructural facilities and all the required amenities plays an important role in the development of local as well as cross-border trade. The fact that the UAE government has established such world-class corporations and special economic zones for the growth and expansion of all sectors of the economy including trade, investment and communications, tourism, information, technology, infrastructure and human and social development without resorting to privatization made the country one among the top-ranked developed countries.
- Jebel Ali Port, the largest port in the Middle East – The Jebel Ali Port in the UAE, the largest and busiest port in the Middle East acts as the gateway that connects eastern and western markets with North Africa, the Middle East and South Asia and enables trade across the region and beyond. This hub providing sea, air and land connectivity with extensive logistics facilities plays a major role in the UAE economy and earned its position among world’s top ten container ports. The facilities, the port offering includes a modern Container Freight Station (CFS) that provides a range of services based on customer requirements, latest cool and cold storage facilities with a floor space of 9,665 square metres, storage and handling of all kinds of cargo with a high degree of specialization etc. With around 150 ports connected to it, 80 weekly shipping services, and 19.3M TEU handling capacity Jebel Ali seaport is a vital link in the global trade network and also another major attraction of the UAE economy for potential investors across the globe.
- Ease of getting Visa – With its expat-friendly regulations and proceedings, it is easy to obtain a residence visa or investor visa in UAE with a minimal cost which makes the movement into and out of the country very easy.
- Security – Dubai has a very strong security system including its highly efficient and equipped police force making it the seventh safest city in the world with comparatively a lower crime rate. This city is always free from communal or aggressive riots and other kinds of social disturbances. With a strong and efficient defence mechanism equipped with the latest technology gadgets, Dubai police observe every activity within the city without disturbing people and they stay always alert and available to all emergency calls. We can say, security will no way be a concern for anyone travelling to the city.
- Availability of resources.
- Abundance of talented human resource– With 8.45 million ex-pats and a majority of them signed for employment in the country, no business in Dubai will find it hard to select the most talented and appropriate personnel for their company.
- Energy resources– Petroleum, natural gas and similar products are available at economic prices in Dubai and also never heard about an electric power cut in the city ensuring continuous and uninterrupted power supply to industries and manufacturing units.
- Financial resources – Dubai International Financial Centre, one among the world’s top ten financial hubs provide a largest financial ecosystem to the potential investors offering a most comprehensive Fintech and venture capital environment including cost-effective licensing solutions, fit-for-purpose regulation, innovative programmes and funding for start-ups. Various banks in the country also provide financial assistance in all ways possible to the investors.
- Transport network – The world-famous Dubai metro and the high-quality road transport network makes transportation within the city smooth and effective.
- Top-quality business centres – Several world-class business centres are operating in Dubai providing different types of quality business space equipped with all infrastructural facilities to arrange meetings, conferences, business functions and even to set up the company office at economic costs.
- Repatriation – A stable exchange rate with the USD and tax-free environment enables people to keep their money in Dubai itself as they can exchange it at their will hassle-free.
- Mainland and Free Zones – Dubai provides an economic zone under the Department of Economic Development (DED) as Mainland as well as the special economic zone with regional benefits as Dubai Free Zone to set up businesses. Each of them has its advantages and investors can choose either mainland or free zone depending on their type of business, purpose, etc.
- Benefits of having a UAE-based holding company – Having the headquarters or holding company in the UAE provides various benefits to businesses. It limits the risks of individual shareholders and allows them to invest in more than one company. Also holding companies will not be liable for their subsidiaries’ debts and obligations making all the assets protected. They are only responsible for the day-to-day cash flow management and ensuring that the subsidiary remains solvent. What makes a UAE-based holding company more attractive is that there is no need to share reports on the financial information of the company to the government.
- Best choice for real estate business – Dubai has always attracted investors with interest in real estate business with higher rental income and with lesser price per square foot compared to other real estate markets. Visa laws of the country which are linked with property investment enabling investors to obtain a residency visa with a validity depending on the value of property attract many potential investors to this country. Another major attraction in this field of business is that tax conditions are highly favourable to the investors with the absence of property taxes, stamp duties and capital gains taxes which normally pull back businessmen from investing in major global real estate markets. These factors, high rental yield, less price, tax-free and favourable visa laws have made Dubai, the most populated city of the UAE, a hub for the property investors. The dominant position of the tourism industry in the overall growth of the country has paved the way for increased investments in hotel property also.
- Entertainment Opportunities – Speaking of opportunities to start new business, one must think about the ways of getting entertained or recreational facilities also. Every person wants at least one day off from all the tensions of business and Dubai city provides the best tourism spots, malls, water parks, desert safari, sky diving etc.
There are many different reasons like these to start a business in Dubai as it is easy to obtain a license for a foreign investor, set up own company, enter into world-class market space, hire top-quality professionals and enjoy a unique, secure and wealthy life.
Please contact our experts to know about investment possibilities or to open a company in Mainland, Free zone or Offshore in UAE.