The UAE regularly scores well among international economies and has become one of the world’s most diversified and dynamic economies in recent years. According to the latest Global Entrepreneurship Index, the UAE ranks #1 globally for offering the most supportive environment for entrepreneurship. The country even outpaces leading international economies such as the United States, the United Kingdom, Canada, Japan, South Korea, and some EU member countries. Small and mid-sized enterprises (SMEs) make up more than 94 percent of all companies operating in the UAE and provide employment for around 86% of the private sector workforce..
Here are some reasons why the UAE’s booming startup culture is the best fit for your business.
- 1) Easier business setup
The UAE offers a variety of free zones that provide incentives to new businesses. Lower operating expenditures, faster setup and processing, and 100% equity retention are some of the key benefits of creating a startup in a free zone.
Furthermore, because they give varied tax benefits to businesses for durations ranging from 15 to 50 years, most startups are exempt from corporate taxation and those that do incur have to pay a much smaller yearly fee when compared with the rest of the developed world. Not to forget, Dubai boasts a thriving ecosystem of accelerators and incubators to offer startups the assistance they require to increase their chances of success.
- 2) Full foreign ownership
Until a few years ago, the country’s ownership restrictions were one of the most significant challenges for international investors looking to establish businesses in the UAE mainland. While several free zones around the nation give 100% ownership, this choice is not always desirable because it coincides with its own set of issues. The most substantial disadvantage for free zone corporations is that they may only conduct business inside their free zone of formation or outside of the United Arab Emirates.
Therefore, in order to make the UAE market more accessible to international investors, the new foreign direct investment legislation of 2018 relaxed the rules on foreign ownership. There are now 122 economic activities spread over 13 sectors that are suitable for 100% foreign ownership. Companies that satisfy these standards may apply to the Dubai Economic Department (DED), which evaluates the percentage of foreign ownership, which could be “up to” 100% foreign-owned.
- 3) Focus on advancing innovation
In an attempt to expand its economy beyond oil, the UAE has implemented a number of significant projects that have aided its seamless transition to becoming a knowledge-based economy. The UAE’s Vision 2021, National Innovation Strategy, Dubai Integrated Energy Strategy 2030, and 10x are plans that set lofty goals for advancing innovation and supporting entrepreneurship in the UAE.
Conclusion
The UAE is a great country for entrepreneurs for several reasons. It provides the necessary support system needed for businesses to thrive and offers easy access to world-class markets that support the initiation as well as the growth of any business. Furthermore, its low taxation rates make the country an attractive and lucrative place for investments and business ventures. Couple that with its population’s capacity to spend along with its status as a premium tourist hub, UAE makes for a great place for businesses to thrive.