In terms of economic growth, Dubai was the 17th most powerful city, stronger than the likes of Geneva, Washington, Paris, Frankfurt, Boston, Brussels, Vienna and others.

Dubai has retained its top position in the Mena region among the world's top 44 powerful cities in terms of economic strength, research and development, cultural interaction, liveability, environment and accessibility.

According to the annual Global Power City Index 2018 released by Mori Memorial Foundation's Institute for Urban Strategies, the emirate was the 29th most powerful city in the world and the only city from the Mena region.

Despite a six position drop in its ranking as compared to last year's index, the emirate was rated stronger than Geneva, Milan, Kuala Lumpur, Moscow, Taipei, Bangkok and Mumbai among others.

In terms of economic growth, Dubai was the 17th most powerful city, stronger than the likes of Geneva, Washington, Paris, Frankfurt, Boston, Brussels, Vienna and others. The emirate even fared better in accessibility and cultural interaction sub-indexes where it was ranked 12th and 13th, respectively. In sub-indexes of research and development, liveability and environment, the emirate was ranked 35th, 23rd, and 38th, respectively.

One of the key reasons for Dubai's economic strength, according to the Index, is its leadership position in offering the lowest corporate income tax at 0 per cent, excluding some corporate entities such as those engaged in the production of oil and gas. Dubai was followed by Hong Kong with 16.5 per cent corporate tax rate, Singapore at 17 per cent, London at 19 per cent and Beijing/Shanghai at 25 per cent.

The report cites rich availability of facilities that cater to higher-income tourists as key reasons for strong rating in cultural interaction for Dubai. While strong air connectivity of Dubai with other cities around the world supports its rating for accessibility. The emirate is rated 5th after London, Paris, Frankfurt and Istanbul for connectivity with 226 cities with direct international flights.

Monica Malik, chief economist, Abu Dhabi Commercial Bank, attributes Dubai's broad economic base and dynamic and integrated policy framework as key strengths of its economy.

"The catchment area for Dubai's economy as a service hub continues to expand. The level of infrastructure remains high with investment focusing on key requirements of the economy. Policy focuses on improving the ease of doing business and strengthening the competitiveness of the economy," she said.

Monica pointed out that key challenges currently facing the economy are tightening monetary policy, external challenges including soft regional demand, weak household confidence and the ongoing real estate correction.

Lenie Assaad, associate, Allied Investment Partners, believes Dubai's economy enjoys a competitive combination of cost, market and environment advantages that create an ideal and attractive investment climate for both local and expatriate businesses, which enables Dubai to compete on an international level.

"Furthermore, its strategic location, a buoyant local economy and its shift towards an innovation and knowledge-based economy are forecast to positively affect Dubai and its economic prosperity, strategically solidifying its status for the years to come. Lastly, the UAE is implementing significant reforms with the aim of attracting foreign funds. This includes granting non-Emiratis full ownership of private businesses in Dubai and Abu Dhabi even in the absence of a local partner, as well as allowing selected investor professionals entitlement to prolonged residency permits of up to 10 years. Both of these initiatives increase the probability of expatriates setting up roots in the UAE rather than treating it as a transitory life phase," she said.

Additionally, she said Dubai aims to be the first smart city in the region by 2021 by introducing the Smart City platform. Dubai's smart city project involves eight key pillars: telecommunication, tourism, utilities, education, buildings, pubic safety, transportation and healthcare, all of which based on and facilitated by technology.

Manoj Krishnan, head of private wealth at Continental Financial Services, believes Dubai's biggest strength is a diversified economic base with oil contributing just about 4-5 per cent of the GDP.

"With the strong and futuristic leadership at the helm, Dubai has developed a strong international brand name as a well-regulated and well managed investment destination. Dubai has become a gateway to the Middle East for various industries like banking and finance, real estate, construction, media, IT and international trade apart from flourishing tourism industry. Industry specific free zones add the necessary infrastructure focus for doing business more easily and cost efficiently," Krishnan added.

"We also add credit to the highly skilled labour force in Dubai which has the ease of finding and retaining good international talent in various sectors. The pro-business attitude at government departments with a literally zero tax regime supports local businesses to face a global challenge in terms of business and trade," he added.

He suggested that the cost of initial setup of business in Dubai is high which acts as an entry barrier and should be addressed so that a more competitive market could be created.

The Global Power City Index 2018 also ranks cities from the perspectives of a manager, a researcher, an artist, a visitor and a resident.

Dubai has been ranked highly by managers at number eight followed by visitors at 12, researchers at 32, residents at 36 and artists at 43.

Globally, the top 5 cities of London, New York, Tokyo, Paris and Singapore remained unchanged from last year.

Editor's Note: This article was originally published in Khaleej Times on Tuesday October 23rd, 2018 http://bit.ly/KTDubaiisMenaPowerhouse