The UAE is a federation of seven emirates. Each emirate is governed by a hereditary emir. The constituent emirates are Abu Dhabi, Ajman, Dubai, Fujairah, Ras al-Khaimah,Sharjah, and Umm al-Quwain. The capital of the UAE is Abu Dhabi.
In 1971, the late President Sheikh Zayed bin Sultan Al Nahyan unified the small, underdeveloped states into a federation—the only one in the Arab world. With his visionary leadership, oil wealth was used to develop the UAE into one of the world’s most open and successful economies.
The UAE has become an important player in regional and international affairs and a major international business hub for the last 40 years.
Since then, the seven Emirates have forged a distinct national identity. The UAE’s political system combines traditional and modern and enabled the country to develop a modern administrative structure while ensuring that traditions of the past are maintained, adapted and preserved.
In 2004, His Highness Sheikh Khalifa bin Zayed Al Nahyan became president and has since continued to strive towards an ambitious vision for the UAE.
The federal system of government includes the Supreme Council, the Council of Ministers (Cabinet), a parliamentary body in the form of the Federal National Council (FNC) and the Federal Supreme Court, which is representative of an independent judiciary. The Supreme Council elects a president and vice-president from amongst them to serve for a renewable five-year term in office. Accordingly, the Supreme Council re-elected President H.H. Sheikh Khalifa bin Zayed Al Nahyan for another five-year term in November 2009.
The Constitution of the United Arab Emirates confers equality, liberty, rule of law, presumption of innocence in legal procedures, inviolability of the home, freedom of movement, freedom of opinion and speech, freedom of communication, freedom of religion, freedom of council and association, freedom of occupation, freedom to be elected to office and others onto all citizens, within the limit of the law.In just over three decades, the nation has transformed from a tribal culture reliant on agriculture and fishing to an entrepreneurial success story with world-class infrastructure. The leadership has improved education (effectively eliminating illiteracy), advanced health care and embraced change as the UAE modernizes, consistent with its history and cultural values.
Why doing business in the UAE?
A Global Hub
The Middle East’s top trading economy – it recorded a trade surplus of US$94m in 2011 – the UAE is a dynamic hub for global commerce, with unmatched infrastructure that provides seamless connectivity for businesses worldwide.
Dubai International Airport stands alongside Paris, London and Hong Kong as among the world’s busiest in terms of international passengers. Last year more than 51 million people passed through its terminals, and it is projected to have the highest footfall of any international airport by 2015. Dubai’s flag-carrier, Emirates Airline, is also on track to become the biggest in the world, while Dubai ranks sixth globally measured by air cargo traffic.
The emirate’s shipping ports are also among the world’s top 10 busiest, with Jebel Ali ranked as the largest container port outside of Asia. If you added all the cargo unloaded in Los Angeles and Long Beach – two of America’s biggest ports – it would be roughly equivalent to that of Dubai.
The UAE enjoys a strategic location on the new Southern Silk Road between Asia, Europe and Africa, a situation that provides optimum trading conditions and means the UAE is poised to take advantage of economic activity among the world’s fastest growing and developing economies as part of the ‘South-South’ trade trajectory. Thousands of Chinese businesses use Dubai as a hub for Africa. Indian traders use the emirate to access the world. Latin American ‘multi-latinas’ see Dubai as a launch pad into South Asia. And, of course, Western multi-nationals use Dubai as a hub for the Middle East. Dubai is both a unique trans-continental trade hub and a nexus for innovation in the fields of technology, culture and the wider knowledge economy.
The UAE continues to develop in areas ranging from environmental engineering to software development, and from film production to biotechnology. For example, the Masdar Institute of Science and Technology is a research university focused on alternative energy and sustainability. Situated inside the zero-carbon, zero-waste Masdar City project in Abu Dhabi, programmes are carried out in cooperation with the Massachusetts Institute of Technology – just one example of international partnerships that support development of the UAE’s knowledge economy.
Such initiatives are a legacy of the UAE founding fathers’ recognition of the importance of investing in education and facilitating entrepreneurship. Forty years ago there were few schools and no universities; now there are more than 1,200 schools and over 70 universities. The country has the highest percentage of female high-school graduates who enrol in university anywhere in the world.
Four-fifths of the UAE is desert, yet it is a country of contrasting landscapes, from awe-inspiring dunes to rich oases, precipitous rocky mountains to fertile plains.
UAE oil reserves are ranked as the world's seventh-largest. It also possesses the world's seventeenth largest natural gas reserves. The UAE has one of the most developed economies in Western Asia. Per capita income is the world's seventh highest
The United Arab Emirates, with its rapidly developing infrastructure, investor-friendly policies and political stability, is undoubtedly one of the most attractive business destination in the World.
The Government encourages the private sector in a free trade regime with low tariff barriers and minimum legal hurdles. Many multinational companies (MNCs) have established branches in the country, many are engaged in manufacturing products or assembling them and many others have set up distribution centres for the region.
Today, the UAE has one of the most open and dynamic economies in the world. The UAE’s tax-free status, world-class infrastructure, low tariffs and 100 per cent ownership for foreign investors in selected zones, make it the ideal location for setting up new business. Today, the UAE stands as a strong nation built on the foundations of security, hope and economic strength, its modern outlook and progressive society bringing it into the front ranks of the Arab world.
A number of global business indexes have recognized the advantages that the UAE brings to international business. "Ease of Doinng Business" ranked in 2013 the UAE 26/185 in the World and the UAE is ranked in the top 30 on the World Economic Forum’s “most-networked countries”- ahead of all other Arab nations, as well as countries like Spain, Italy, Turkey, and India. The UAE also gets positive rankings from Transparency International and the World Bank’s Worldwide Governance Indicators for control of corruption, ranking in the top quarter of the least corrupt countries in the world.
Between 2012-2015, GDP growth in the UAE is expected to rise even further to an average of 5.2 percent,with especially strong growth in 2014 and 2015, with the completion of even more infrastructure projects
Robust open economy
The UAE has a vibrant free economy, a significant proportion of its revenues arising from exports of oil and gas. Successful efforts have been made to diversify away from dependence on hydrocarbons and a solid industrial base has been created, together with a very strong services sector. The establishment of free zones has been an important feature of this diversification policy and reform of property laws gave a major boost to real estate and tourism sectors.
Security and stability
Since its establishment in 1971, the UAE has enjoyed an enviable degree of political stability, unequalled in the region. This has enabled the implementation of consistent sound economic policies and the reinforcing of the country’s social structure to produce one of the most tolerant, prosperous, secure and safest societies in the world. Dubai and Abu Dubai have been ranked the top two cities in the Middle East region for quality of life, according to the latest edition of a global survey. Long-time investors include a wide range of multinational companies headquartered across the globe.
Tax-efficient business environment
Special economic zones and free zones offer 100 per cent ownership, repatriation of profit and capital as well as exemptions from taxes. Outside of these areas, significant incentives are being offered to investors and corporate governance provisions ensuring transparency and accountability are being enforced. Corporate taxes are reserved only for branches of foreign banks and oil-producing companies. A negligible 5 per cent tariff is imposed on goods imported from non-Gulf Cooperation Council (GCC) countries, although tobacco and alcohol products are subject to 50 per cent customs duties.
Intellectual property protection
Intellectual property, including patents and trademarks, is legally protected in the UAE and considerable efforts are being made to implement these laws. The country is also a member of international bodies, treaties and conventions that safeguard intellectual property, including the World Intellectual Property Organization (WIPO), World Trade Organization (WTO), Paris Convention, Patent Cooperation Treaty (PCT), WIPO Copyright Treaty, WIPO Performances and Phonograms Treaty (WPPT) and the Rome Convention.
Infrastructure in the UAE is second to none. Telecommunications, including mobile and fixed telephony as well as internet access is on par, if not better, than the world’s largest international business hubs. The road network is constantly upgraded and ports and airports are of world-class standards. In addition, the UAE is creating one of the world’s biggest and most efficient cargo handling centers. To date, the Government has invested heavily in infrastructure development, but it has also opened up its utilities and other infrastructure to greater private sector involvement, so much so that public-private partnerships are now the norm.
Multi-national human resources
Investors benefit from an abundant supply of human resource skills, courtesy of professionals migrating to the emirate from nearly every country in the globe, as well as the increasing number of UAE nationals that are joining the private sector.
Language for business
Arabic is the official business language. Most government forms and official contracts – e.g. tenancy, residence visa – are in Arabic. Official documents (e.g. university diploma, marriage certificate) that have to be submitted to a government agency for processing or authentication also frequently require translation into Arabic. However, English is commonly used in business circles.
Efficient government services
E-government websites, free zone authorities as well as chambers of commerce and industry provide new entrants with helpful information and guidance.
International business hub
The UAE’s strategic location between Asia, Europe and Africa is a major advantage to investors, particularly the country’s proximity to some of the world’s fastest growing economies in Asia. Collectively India and China alone comprise almost 40 per cent of the world’s total population and support a combined GDP in excess of US$5 trillion, providing significant economic and trading opportunities.
Why doing business in the UAE in brief
No restrictions on profit transfer or repatriation of capital;
No corporate or income taxes;
A currency, the Dirham, that is stable, secure and pegged to the US dollar;
Very low, or non-existent, import duties;
Competitive labor costs;
100% repatriation of capital and profits;
No currency restrictions;
Competitive import duties (5% with many exemptions);
Modern efficient communication facilities;
Abundant and inexpensive energy supply;
International business hub.