Five Ways The UAE Government Encourages Entrepreneurs
Over the last 40 years, the UAE has successfully diversified its economy to reduce its reliance on the energy industry. As a result, the nation now offers international business opportunities across numerous sectors– from tourism to technology.
The government continues with its positive efforts in this area, including an increasing number of incentives designed to attract professionals and independent business people from all over the world and support smaller enterprises.
These include:
Offering extended visas for entrepreneurs
Attracting tech businesses to the UAE
Providing funding and support for smaller businesses
Creating a favorable environment for living and working
So, let’s look in detail at these five ways the UAE government encourages entrepreneurs to open a company here.
Allowing 100% foreign-owned businesses
In May 2019, the UAE government announced it would soon be possible for foreign entrepreneurs to be 100% shareholders in a locally incorporated business. Total foreign ownership was previously only permitted in the UAE’s free zones, meaning businesses incorporated ‘onshore’ had to be 51% locally owned.
This change will now give anyone looking to start a business, or already operating businesses in other countries, the opportunity to get easier access to the UAE. As a result, the playing field for international entrepreneurs looks even more attractive, particularly when paired alongside other developments.
Offering extended visas for entrepreneurs
In November 2018, the UAE government began actively issuing five-year visas to entrepreneurs looking to set up in the country. Eligible candidates for the five-year entrepreneur visa must have a business with a minimum capital of AED 500,000 or the approval of an accredited business incubator in the country
In May 2019 the UAE brought in a new system for five- and ten-year residency visas, enabling outstanding non-UAE investors and specialists to live, work and study here without a national sponsor. The visa can be renewed if the holder’s circumstances remain positive. These five- and ten-year visas require investments of AED 5 million and AED 10 million respectively. There are currently 125 business areas that UAE-based expats can operate in without the requirement of a local sponsor.
With the introduction of the Gold Card visa in May 2019, the next best thing to permanent residency is now available to the top tier of investors, entrepreneurs, chief executives, scientists, and outstanding students. The visa is reviewed every ten years, and, unlike other visa holders, Gold Card residents can live outside the country for a period of more than six consecutive months.
These developments are seen as a way of making it even more attractive for the international business community to work in the UAE. For those looking to get started in the UAE, whether you’re already living and working here or coming from abroad, having a long-term visa offers both stability and opportunity.
Attracting tech businesses to the UAE
In many parts of the world, the terms ‘entrepreneur’ and ‘startup’ are synonymous with technology. While not traditionally a tech hub in the same way as San Francisco, the UAE is making some strategic moves to change this.
The UAE government announced the creation of a new technology space, Hub 71, earlier this year. Based in Abu Dhabi, Hub 71 is a joint partnership with Microsoft. The fact the government has also earmarked AED500 million in investment funds as part of the overall initiative is further evidence of the UAE’s commitment to attracting international tech talent.
Coupled with its ambitious Government Accelerators’ program which includes Ghadan 21, a three-year development plan worth AED50 billon, all of these efforts make it pretty clear that the UAE government wants to create an even more thriving tech scene here.
Providing funding and support for smaller businesses
Given the leaps and bounds being made in providing help and support to entrepreneurs and startups, it’s no surprise that the UAE ranks highly for online access to administrative and government services. To make things easier for businesses, it was recently announced that 5% of government capital projects will be allocated to small and medium enterprises (SMEs). This comes as part of a drive to encourage them to enter into major projects contracts with government agencies and form alliances to compete for government projects.
Currently aimed at Dubai-based SMEs, this move will allow them to receive contracts for projects worth up to AED 400 million. Also, in order to provide SMEs with greater liquidity, those working on UAE government projects will now be paid within 30 days, according to recent news. Previously, public sector project payments were paid within a 90 day period. In addition, in the run-up to next year’s Expo 2020, the Dubai government has earmarked 20% of all related contracts to SMEs.
Creating a favorable environment for living and working
Weather aside, there are so many reasons why the UAE is an attractive place for entrepreneurs to live and work. In many cases, it’s due to the tireless efforts of the government here to make it so.
According to an expat study, the UAE ranks 25th in the world for quality of life. It also takes the number nine spot for safety and security– making it an attractive location for entrepreneurs with families. It helps that visas for spouses and offspring are also easy to obtain once the main sponsor is accepted.
From a commercial perspective, the UAE is ranked 11th in the world for overall ease of doing business. Plus, there’s no personal tax, corporation tax, or any requirement to submit returns for the vast majority of businesses. This certainly reduces the operational burden of running a company here.
The UAE has a strong tradition of encouraging talented individuals to come here to live and work. However, looking at these recent developments, it’s increasingly evident that the government is now keen to attract independent entrepreneurs from a range of disciplines.
As a result, those with the drive and tenacity to grow a business from scratch here in the UAE are poised to benefit considerably. Entrepreneurs who are able to tap into these government-led initiatives, programs, and resources will have many options available to them. The growing support network provided by these new initiatives, and the communities they foster, will no doubt strengthen the overall startup ecosystem in the UAE and continue to attract entrepreneurs here for years to come.
Article fromhttps://www.entrepreneur.com/article/337739