UNITED ARAB MINISTRY OF FOREIGN TRADE

WHY

Unlimited Opportunities 2012 MINISTRY OF FOREIGN TRADE

WHY

Unlimited Opportunities

Investing in the future

Borouge has an annual manufacturing capacity of 2 million tonnes of polyolefins in , three logistics hubs in Asia, compounding facilities in China, and sales offices throughout the 2012 and Asia Pacific. Supported by the unique Borstar® technology and a culture of innovation, Borouge continues to invest in the future and deliver value added solutions to its customers. Borouge, a joint venture between ADNOC and Borealis, is making a difference to everyday life. UNITED ARAB EMIRATES MINISTRY OF FOREIGN TRADE

@ 2012 All Rights Reserved by: Ministry of Foreign Trade P.O. Box 110555 Abu Dhabi, United Arab Emirates Tel.: +971 2 495 6000 Fax: +971 2 449 9164 E mail: [email protected] Website: www.moft.gov.ae “ It is because of the rapid and dynamic changes in the global economic scene that our economy today needs quality investments that bring modern technology and high levels of technical and managerial expertise that will enable our economy and products to “ compete globaly.

Khalifa Bin Zayed Al Nahyan

His Highness Sheikh Khalifa Bin Zayed Al Nahyan President of the United Arab Emirates “ Thanks God, we turned the dream into reality and great achievements that put the UAE on the spotlight and attracted the largest multinational companies that seek profitability, “ security and future growth

Mohammed Bin Rashid

His Highness Sheikh Mohammed Bin Rashid Al Maktoum Vice President and Prime Minister of The United Arab Emirates, Ruler of I welcome you to the UAE, a country with an ever-renewed spirit and an ever-widening base of opportunities that is today celebrating 40 years of a continuous and united race towards excellence. “Being amongst the best nations in ” is a promise that was made by our leaders not only to the citizens of the UAE, but to the investors, businessmen, employees and families who chose to work and live in it. Around fulfilling this promise revolve our visions, aspirations, initiatives and mandates. After 40 years of hard and diligent work, I stand proud of our achievements. I am also proud and confident of the unique and well-structured value proposition that we today present to the international business community. Our unrivaled infrastructure, accommodating internationally-benchmarked laws and regulations, cutting-edge technological environment and, above all, a determination to aim higher continue to make us the location of choice for the most renowned multinational companies, international investors and well- qualified professionals. No longer is the UAE only associated with the high production of oil and natural gas or with the world’s tallest buildings or the world’s only seven star hotels. Those vital sectors are only some of the unlimited opportunities that can be exploited in choosing the UAE. Today, the UAE is the de facto financial centre between Singapore and London and the host of the world’s largest man-made port and some of the world’s busiest airports. It also hosts the world’s first free zone dedicated to biotechnology and research and has the world’s only capital connected with a fiber network, just to name a few of what our drive for innovation has fruited. In this challenging and fiercely competitive global economic environment, having a partner of trust and a base from which operations can be conducted securely becomes more crucial than ever. That’s what the UAE can offer you all. No matter what field your business operates in, the UAE is committed to provide a tailor-made solution and business environment that will enable it to focus on its core business and overcome its difficulties. In these 40 years, we built, from the ground up, cities, seaports, skyscrapers, airports and international companies, attracted most of the top Fortune 500 companies to setup in the UAE, became among the top 25 nations globally in competitiveness and among the leading nations in the quality of lifestyle. It is to share this ambition and to take part in this success story that I invite you all. In this book, titled “Why UAE?”, you can explore some of the reasons why this nation lying on the shores of the Arabian Gulf is the location of choice to start a successful business. Through a comprehensive overview of our resilient economy, diverse and ever growing base of opportunities, friendly and business- oriented legal environment and smooth procedures to register a business, you can construct a full picture of the country’s promise and potential. Not to forget the openness embedded in our culture and the amazing lifestyle that you and your family can enjoy. That’s what I can label as “The Emirati dream”. I thank you all for taking the time and showing the interest to explore the country. Regards

Lubna Bint Khalid Al Qasimi Minister of Foreign Trade Contents Chapter 5 The United Arab Emirates Seven Pearls and Beyond 233 Abu Dhabi - Free Zones 235 Dubai - Free Zones 245 Sharjah - Free Zones 289 Chapter 1 The United Arab Emirates The Fundamentals 16 The UAE: Histories of Openness and Achievements 18 Ajman - Free Zones 295 The UAE: Strategic Location and Diversified Terrains 22 Umm Al Quwain - Free Zones 299 The UAE: A Unique Demographic Structure 26 Ras Al Khaimah - Free Zones 303 The UAE: A Unique Model of Integration 30 - Free Zones 309 Abu Dhabi 34 Dubai 36 Chapter 6 The United Arab Emirates Accommodating Legal Environment 313 Sharjah 38 [The Constitution, Legislative Authorities, Judicial Authorities, Ajman 40 Characteristics of the Legal System, Civil Litigation Process, Arbitration] Ras Al-Khaimah (RAK) 42 Legal environment in Free zones Vs. Inland 317 Umm Al Quwain 44 Legal Topics Relevant to doing Business in the UAE 318 Fujairah 46 Commercial Transaction 318 Commercial Companies 322 Chapter 2 Why UAE? The Layers of Uniqueness 49 Employment 328 A Gateway to Growth 52 Intellectual Property 332 An Inspiring Society and Spirit 58 Exchange of Securities & Commodities 334 A “Plug and Play” Solution 64 Insurance 340 A Climate of Trust 68 Telecom 342 A True Knowledge Economy 72 Electronic Transactions & Commerce 344 A Recognized Global Brand 78 Chapter 7 Setting Up a Business in the UAE Seizing The Opportunities 349 Understanding the UAE Market 352 The United Arab Emirates A Sound and Resilient Economy 85 Chapter 3 Establishing a Business in the UAE 353 The UAE: A Strong Economic Heritage 86 Business Licensing Authorities in the UAE 354 The UAE Economy: A Unique Orchestration 87 Selecting a Trade Name 356 The UAE Economy: The Pillars of Success 88 Selecting a Local Partner Sponsor or Service Agent 358 The UAE: A Story of Growth 90 Selecting the Form of the Business Entity 359 The UAE: A Sound Macroeconomic Environment 94 Types of Business Licenses in the UAE 370 A Bright Economic Outlook 100 Third Party Approvals 374 The UAE: A Progressive Economic Policy 102 Commercial Registration 378 The UAE: an Open and Flexible Trade Policy 106 Establishing a Free Zone Business Entity: 380 The UAE: A Visionary Approach 126 Employment in the UAE: Easy Regulations and Spirited Workforce 384 The United Arab Emirates A World of Opportunities 133 Chapter 4 The United Arab Emirates A Rooted Business Culture 387 Energy 135 Chapter 8 The Emirati Identity 389 [Oil and Natural Gas Exploration and Production, Petrochemicals, Utilities Infrastructure Development, Renewable Energy, Mining and Quarrying] [Modern Identity , Dubai , Dubai The Palm Trilogy and The World, Dubai International Sports, Real Estate and Construction 153 Abu Dhabi, Abu Dhabi] [Real Estate Development and Investment, Construction, Infrastructure Development, Property and Facility Management ] Down to Business 395 Tourism and Hospitality 173 [The Emirati Perspectives, Interaction, Conversations, What to Wear] [Spas and Recreation Facilities, Tourism and Travel Services, Museums and Historical Tourism, Events and Incentives Tourism] Chapter 9 Relocating to the United Arab Emirates 401 Manufacturing 189 Things to do Prior to Arrival 403 [Petrochemical Industries, High Tech and Heavy Industries, Light and Mechanical Housing and Accommodation 408 Industries, Consumer Industries, Food Processing Industries] Banking Processes and Procedures 410 Health Care and Pharmaceuticals 205 Essential Do’s and Don’ts 412 [Pharmaceutical Manufacturing, Hospitals and Clinical Treatment, Medical Tourism, Education 414 Medical Equipment and Technology] Driving and Etiquette 415 Telecommunications, Media and Information Technology 217 Health Services on Offer 417 [Telecommunications, Satellite Communications, Business Process Outsourcing, Lifestyle and Entertainment 418 Information Technology, Media] Getting Around 421 The United Arab Emirates The Fundamentals Chapter 1

The United Arab Emirates The Fundamentals

Rooted in its unique fundamentals of unlimited “ambition, flexibility and openness, the United Arab Emirates succeeded to evolve to be the energetic modern civilization as

perceived today. The same cultural foundations that have built

the blocks of the nation along with the foresighted strategic planning by visionary leadership have been driving the country’s “ economy to a higher level. Chapter 1 The United Arab Emirates The Fundamentals 16 17 international commercial interests. This unlimitedness, deeply rooted in its culture, has also produced an embedded openness that resulted in a very unique 1900 demography throughout the history. Its port- Population nlimitedness is the characteristic that cities, from Jelfar to Dubai, have always been 25,000 defines the fundememntals upon which points of attraction for those who seek growth U Nationalities and for those with ambition. Recognizing the United Arab Emirates are based. It was not Local Arabs a coincidence that a country, born in the second these unique fundamentals, the leaders of the day of December 1971 is now a top global country’s most recent renaissance have chosen Business Activities investment and trading hotspot. Evidences the most flexible model to establish the basis Pearl Diving from different historical periods show that of the nation’s governance that will assure the Herding the United Arab Emirates, through the preservation of its fundamental values and boundless opportunities it always presented, capitalize upon them to build a vibrant society has been an important location in the global that will always reach the top. economic map, thus attracting significant 1950 UAE - Basic Information Population Country 50,000 The United Arab Emirates Nationalities Local Arabs and National Day Western Asians December 2,1971 The date the UAE was founded Business Activities Trading Capital Fishing Abu Dhabi Sea Faring 1980 President Population H.H. Sheikh Khalifa bin Zayed Al Nahyan 1.04 million Vice-President Nationalities H.H. Sheikh Mohammed bin Rashid Arabs, Asians, Al Maktoum and a few Westerners

Emirates Business Activities Abu Dhabi, Dubai, Sharjah, Ajman Trading, Services, Umm Al Quwain, Ras Al Khaimah Manufacturing, and Oil Production and Fujairah

Languages Arabic - Official Language 2011 Because it is located in the centre of English - Widely Spoken Population the Gulf countries, Indian Sub-Continent, 8.6 million Working Days Commonwealth of Independent States Sunday-Thursday (CIS) and Africa, the UAE enjoys a strategic Nationalities position that allows it to present unlimited A True Multicultural Time Zone opportunities across a wide range of sectors. Society with morethan 200 Nationalities GMT+4 The diverse and geographically-proximate Religion terrains that range from plains to mountains Business Activities Islam and from deserts to beaches give the UAE a A Diversified Economy distinguished competitive advantage. This Currency set of ever-present factors will continue to be United Arab Emirates Dirham (AED), primary drivers and logical reasons to answer USD = AED 3.6725 the question: “Why UAE?”

Why UAE ? The Unlimited Opportunities 2012 Chapter 1 The United Arab Emirates The Fundamentals 18 19 civilizations in the north of Persia and get traded with merchants from all over the and the people. Due to the stabilized Mesopotamia, was during the end of the region. political situation, the pearling industry third millennium B.C. During that time, two In 630, Islam reached the region; people flourished during the 19th and early 20th prominent civilizations flourished in the converted without a battle. Moreover, Jelfar – centuries, creating more income and business The UAE: Histories of country and were in contact with neighboring today Ras al-Khaimah – became a staging base opportunities to the people of the Gulf region. Openness and civilizations. The first was Majan civilization for Muslims to travel throughout the Indian Unfortunately, this industry was smashed by located in the area today shaping parts of Ocean, spreading Islam to vast areas over the economic depression of the late 1920s and Achievements the . The port of Umm many centuries. As a result of the growing early 1930s coupled with the Japanese cultural As indicated by excavations and al Nar, now near the city of Abu Dhabi, was political and commercial importance, city pearl invention as well as the new taxes archeological discoveries in different areas a major trading port for this civilization. The turned into a very wealthy port. Throughout imposed by the government of India. Pearl of the country, the United Arab Emirates second was Milokha located in the central part the middle Ages, the regional sailors and diving and trade completely disappeared in the has an ancient history that goes back to the of the Emirate of Sharjah today. Foreign trade, merchants dominated the most important region by the start of the Second World War. pre-historic times. Throughout the different motivated by copper export, increased with trade routes between the east and the west historical eras, the land has been the home many parts of the world including Persia, Iraq, running through the Indian Ocean, Arabian of active and rich civilizations that interacted the Indian sub-continent and even China. Sea, the Gulf and the Red Sea. positively and effectively with other The domestication of camels, around the In the early 16th century, the Portuguese civilizations in the neighboring Mesopotamia year 2000 B.C., further contributed to the succeeded in controlling the Indian Ocean by and small Asian communities. It had been the rise of the area’s trading activity with its invading and ruling the key port cities of India, home of rich and important strategic resources neighboring regions. Oman and East Africa. This was preceded by from diverse civilizations that inhabited the During the 1st century A.D., the port the historical event of exploring the spice ancient western Asia. This part of the world of Omana – known today as Umm al-Quwain – has always been considered the main transit started its fundamental role as an alternative point between the east and the west. Thus, sea-route to the Red Sea that was used for interaction with the outside world in the form centuries. During this stage, pearl diving and of foreign trade has been a recurring motif in trading flourished as a main source of income the history of the UAE. for the region. Seafaring was also a common The first known human existence on business activity for the region. Dibba, a port the UAE can be traced as far back as 5500 in the eastern coast of the UAE, was known as B.C . However, its initial recorded contact a host of one of the major trade fairs where with the outside world, particularly with the goods coming from India, China and Africa

route to India by Vasco de Gama who was helped by Ahmed bin Majid, a local navigator from Jelfar. In 1650, local Arabs managed to liberate the area from the Portuguese influence. However, it became a target for several competing European colonizing powers. As a move to protect its Indian trade, the British government invited the Sheikhs of the region to sign a maritime treaty. In 1820, the treaty was signed and the area was named as the “Trucial States”. In 1892, the relations between the United Kingdom and the Trucial States became stronger in their signing of a Protection Agreement. The British agreed to defend the Trucial Coast against any foreign attack and in return the Sheikdoms agreed not to enter into relations with any foreign government without their consent. However, the sheikhs kept their control over their local jurisdictions Why UAE ? The Unlimited Opportunities 2012 Chapter 1 The United Arab Emirates The Fundamentals 20 21 The times were hard on people of the The decade of the 1960s was marked by Umm Al-Quwain, and Fujairah. The last Emirate emirates. However, they continued, as was one of the country’s historical milestones, to join was Ras Al-Khaimah on February 1972. the case throughout the history, to create new namely the discovery and export of oil With the visionary leadership and hard work ways of utilizing their resources and pursing from Abu Dhabi’s desert. A massive plan of of the father of the new-born country, Sheikh their role in bridging and facilitating trade infrastructure development had been set to Zayed bin Sultan Al Nahyan along with the between India, Africa, the Arabian Gulf and transform the emirate when the late Sheikh other founding fathers, a revolutionary era the surrounding region. In that particular Zayed Bin Sultan Al Nahyan became the ruler had began. time, some visionary individuals sniffed the in 1966. Dubai ruler, the late Sheikh Rashid Bin Since then, the nation and its seven opportunities lying ahead for the emirates Saeed Al Maktoum, also started the journey Emirates started their journeys of success into and the region. The late 1940s and 1950s of a comprehensive building strategy as oil building one of the region’s most modern and witnessed the birth of what’s today some of revenues started its inflow in 1969. developed nations and a global role model the largest conglomerates not only in the UAE As the United Kingdom’s protection for sustainable development and balanced but in the region at large. agreement with the Trucial Coast was relations with the whole world. After Sheikh approaching its end on December 2nd Zayed passed away in 2004, his eldest 1971, early calls of unifications were son His Highness Sheikh Khalifa bin The made by the new fully independent federation Zayed Al Nahyan was appointed as states’ Sheikhs. On December 2nd was formed; the president of the UAE. Under Trading Conversion 1971, the United Arab Emirates Sheikh Zayed his leadership, the United Arab and flourshing. to Islam was announced as a uniquely- president Emirates continues to target and Domestication modeled federation consisting of of the UAE reach new heights of success. of the camel Abu Dhabi, Dubai, Sharjah, Ajman,

HH Sheikh Interaction Khalifa bin Zayed with outside became the president world. Discovery of oil. Copper Trade Peace Treaty of the UAE exporting to Persia, Early calls of with British Unification. Mesopotamia Governement

1st 5500 3000 2000 Century 630 1507 1820 1930 1960 1971 2004 Today BC BC BC AD

Seaborne travel through port The Collapse of Oman, of pearl Umm al-Qaiwain industry today Still breaking First known Portugese all of the world human Colonized the records occupation region.

Why UAE ? The Unlimited Opportunities 2012 Chapter 1 The United Arab Emirates The Fundamentals 22 23 The country has a significant coastline on the Gulf of Oman on its east and the Arabian Gulf on its west and northwest. The UAE is also located next to the southern lines of the Strait The UAE: Strategic of Hormuz, an essential passage for more than Location and Diversified 40% of the world crude oil. This location has, in some way, shaped the country’s history. Terrains Contacts with ancient civilizations like the The UAE: An Attractive civilization of north of Persia and Mesopotamia Location during the third millennium B.C. were mainly because of this ideal location. It’s for the Positioned in the heart of the old world, same reason the UAE ports and airports today the geographic location of the Middle East are ranked among the top choices for major is certainly very strategic. On this part of the carriers when planning their routes from the Earth, the earliest civilizations flourished, not east to the west. just because of its importance as the ideal access point to the three continents but also because of its wealthy natural resources. Being located on the eastern entry point of The UAE’s Diverse Terrains this strategic region,the UAE’s role as a vital transit point between the east and the west The UAE’s diversified terrains are comprised In the north, east and the southeast of through its access to both the Arabian Gulf of flat, barren coastlines, vast deserts, and high the UAE, bordering the Sultanate of Oman, and the Indian Ocean has been a competitive mountains. The beautiful coasts mostly consist lay Al Hajar al Gharbi (Western Al Hajar) advantage of the country since the ancient of clean salt pans. The five emirates, Abu Mountains. They rise in some places to almost times. Dhabi, Dubai, Sharjah, Ajman, Ras Al Khaimah, 2,000 meters and extend southeastward for and Umm Al Quwain are located on the coast about 150 kilometers to the southernmost Area and Boundaries of the Arabian Gulf, whereas Fujairah and a UAE-Oman border on the Gulf of Oman. The Location part of Sharjah are on the coast of the Gulf of sharp mountain slopes run directly to the Southwest of Asia in the south of the Oman. Just a few kilometers from the coast shore in many places. However, in Fujairah the Arabian gulf and towards the lay vast, rolling sand dunes that covers wide mountains do not approach the coast, only south-eastern edge of the Arabian areas of the south and the west of the country; sandy beaches. On the other hand, there are peninsula. Very Close to the southern those dunes and vast desert areas shaped the small harbors at Dibba Al-Hisn, Kalba, and edge of the strait of Hormuz natural eastern edge of Ar-rub’-al-khali ( the Khor Fakkan on the Gulf of Oman. empty quarter), one of the largest desert areas This diverse yet proximate terrains base that Total Area in the Arabian peninsula and the region. The the UAE possesses provides not only for an 1 83,600 km desert, however, is permeated by important In spite of it is small size and limited ecological richness, but shapes a solid ground oases like “Liwa” and “” that provide for the creating of a flourishing tourism Boundaries area, the UAE is characterized by diversified the area with a great source of underground industry that provides visitors and business Saudi Arabia 457 km environment and rich landscape, adding an water used for sustainable settlements and travelers with a unique experience and variety Oman 410 km extra advantage to its strategic location. Thus, permanent cultivation. of choices for different interests. those two factors combined were important Geographic Co-Ordinates fundamentals that contributed to shaping Between 22° - 26.5° north latitude and between 51° - 56.5° east longitude the UAE’s history and its current and future economic and demographic landscape. Elevation Extremes Sea level – 0.0m (lowest) Jabal Jais in Ras Al-Khaimah 1737m (highest)

Islands More than 200

Coastline Over 800 km on both the Arabian Gulf and the Gulf of Oman

Why UAE ? 1-The UAE Government Official Portal The Unlimited Opportunities 2012 Chapter 1 The United Arab Emirates The Fundamentals 24 are extremely high with dryness while it gets a bit cooler in mountains. In contrast, the Climate climate on the coastal areas is known of its The UAE climate is an arid subtropical high humidity. However, the UAE is considered climate because of its location within the as one of the world’s best winter destinations northern desert belt and as the tropic of cancer since its average temperature is 15 C - 26 C. passes through its lands. Its temperatures Humid southeastern winds, known as Al Kaws, slightly differ from a place to another as well may also blow throughout the summer as rain as from time to another due to diversified may fall in the coastal area, sometimes causing geographical altitudes. In the mainly-desert floods in usually dry valley beds (Wadies). The inlands of the western legions, for instance, region overall is exposed to occasional dust the daily temperature range is significantly storms just like the rest of the GCC countries. wider than the coastline cities and areas. During summer, the UAE’s inland temperatures Flora and Fauna The UAE is a home to a wide range of native flora. Estimates show that the deserts, mountains and islands of the UAE contain more than 6,500 indigenous floras. A variety of trees such as date palms, acacia and eucalyptus grow in the oases, grasses, thorn bushes, and many plants like peganum harmal, heliotropium bacciferum and citrullus are spread all over the desert. Many of these plants are used conventionally and traditionally to develop different pharmaceutical products. The UAE also has an indigenous fauna and a rich wildlife. The famous Arabian Oryx and leopards are just two examples of the species that have their habitats in the UAE’s rich ecological system. In addition, the UAE is also rich in marine life and fisheries resources. Climate Some of the coastal fish that can be found off General Weather the UAE coastlines are mackerel, perch and Hot and Humid (summer) tuna, as well as sharks and whales. Moderate cool (winter)

Highest Temperature 48 °C

Lowest Temperature 14 °C

Hottest Months July and August

Coldest Months January and February

Islands More than 200

The Average Annual Rainfall 120-350 mm

Why UAE ? The Unlimited Opportunities 2012 Chapter 1 The United Arab Emirates The Fundamentals 26 27 from 680,000 in 1975 to reach 8.26 million as of 2010 estimates. Despite the consequences of recent economic downturn, the UAE sustained a strong annual population growth trend. With The UAE: A Unique an annual growth rate of 3.69%, the UAE Demographic Structure today is ranked the 1st internationally in this category in 20095. Among the GCC countries, Population the UAE has the second largest population Since the declaration of the United UAE Population Growth Arab Emirates in 1971, the strong economic growth along with the 8,000,000 embedded openness of the society and the business-friendly policies 6,000,000 and regulations implemented by the government have been attracting 4,000,000 opportunities and success seekers Education from around the globe to join the 2,000,000 The rapid rise in population has demanded men and women to actively participate in the development renaissance in the a significant investment in education. As a society and to provide a reliable competitive country. This attractiveness has 0 1970 75 80 85 90 95 2000 05 2010 workforce. Good education has been resulted in an exponential growth in response to the society’s call and derived providing the country great advantages to be the size of the country’s population from the government’s strong belief on the in the region of which the majority is importance of good education as a major pillar at the head of the nations by building more Demographic Indicators urban residents. The largest portion of the of the society’s overall continuing development competitive and comparative strengths. The population lives in the three largest emirates; UAE Population and progress, approximately 25 percent of the fast economic growth is greatly attributed Abu Dhabi, Dubai, and Sharjah. This high 8,264,0702 total federal government spending has been to the greater portion of the population urbanization rate has driven the country to dedicated to education. New policies and (91%) that attends or graduates from schools. Population Growth Rate focus on building and providing efficient modern high advanced educational techniques Business education in particular has been a 3.28% public services, strong transportation system, and programs have been enforced by the field of emphasis as stated by the Minister of and reliable communication networks. Ministry of Education in order to prepare Higher Education and Scientific Research. Population in Urban Additionally, this urbanization has led the 3,489,9883 drive to improve the business environment Population by Emirates Population by Educational Status and to create service sectors that are today 9.32 Male / Female Ratio globally competitive. 33% Abu Dhabi Illiterate 6.16 million males 13.90 Read & Write The UAE’s population is predominantly 33% Dubai 2.10 million females1 15.63 Primary 20% young. According to the National Bureau of Sharjah 17.90 Preparotary Age Structures4 Statistics estimates based on a total population 25.93 Secondary 0-14 years - 16.8% of 8.20 million in the year of 2009, around 81.9 15-64 years - 81.9% percent of the population is 15 to 59 years of 64+ years - 1.3% age, around 16.8 percent is less than 14 years of age, and 1.3 percent is 60 years old and Literacy Rate older4. The population is male dominant, with 91% males numbering 6 millions and females, 2 millions6. Studies have shown that there is a Labor Force correlation relationship between GDP growth 2,559,000 and the percentage of “15-64 years old age group”. The UAE was among the first nations Language Arabic (official), English, to understand the strong relationship between the young population and the economic 5% Ajman Persian, Hindi, Urdu 4.01 Below University growth and in accordance it made policies to 1% Umm Al Quwain 12.50 University 5 5% Ras Al Khaimah Religions maximize the benefits by providing them with 1.50 Above University 3% Fujairah Islam - 96%, Others - 4% high knowledge, skills and comprehensive 0.10 Not Stated education systems. National Bureau of Statistics, Census Data 2005 National Bureau of Statistics, Census Data 2005 Why UAE ? 1-The UAE Government Official Portal 3-Census Data 2005, National Bureau of Statistics 5-CIA The World Factbook The Unlimited Opportunities 2012 2-Estimates 2010, National Bureau of Statistics 4-Analytical Report on Economic and Social Dimensions UAE 6-Population Estimate 2006-2010, National Bureau of Statistics Chapter 1 The United Arab Emirates The Fundamentals 28

Women in Workforce A lack of formal education had prevented the majority of women from participating in the development of the country’s economy before the creation of the union. However, under the leadership of the founding father of the UAE, the late Sheikh Zayed bin Sultan Al Nahyan, rapid actions were taken to promote women’s education. Since then, women in the UAE have been taking their roles in all political and economic life. The Government, through its policies and incentives, supports the engagement of females to actively participate and local governments. In order to encourage in both the government sector and the private the engagement of women in the private sector and strongly believes on the importance sector, the policies implemented in work of empowering them through good education. environments are designed to be suitable According to latest figures from Statistics Center to their nature such as the maternity law. Abu Dhabi (SCAD), Emirati women workforce Successful and hardworking women reached grew by 24.6% between 2005 and 2008. They greater heights in the UAE. Today, women make about 26 percent of the national labor in the UAE are teachers, engineers, lawyers, force. Women’s participation in the workforce businesswomen, and even ministers. The equal will continue to grow. Even though more opportunities given to both genders by the women prefer working in the public sector, religion and implemented by the government major indications show women’s share in the along with the women’s ambitions were the private sector has been gradually increasing main drivers of the obvious females’ successes due to the supportive strategies of the federal as perceived over all sectors and positions.

Why UAE ? The Unlimited Opportunities 2012 Chapter 1 The United Arab Emirates The Fundamentals 30 31 responsibilities of both the federal government yet independently. Those branches are the and the local emirates’ governments. Supreme Council, the Cabinet, the Federal In accordance to the constitution, the National Council and the Federal Supreme federal government issues the policies and The UAE’s Federal Court. legislations and retains executive control in Government: A Formula of The UAE is a presidential, elected system The UAE: A Unique Model areas that impact the internal and external Efficiency and Effectiveness that has a president, vice president, prime of Integration sustainability of the country, including defense, Looking closely at the structure of the minister and a cabinet. The president is elected internal security, foreign relations, healthcare federal government of the United Arab by the members of the Federal Supreme The evident success of the unity model of and environmental planning and control, Emirates, the model appears to allow for both Council, which includes the rulers of the seven the UAE has not only been a result of short- labor market regulation and management, fast and effective decision making and sets the emirates constituting the federation. The term interests or wealth-related factors. On the telecommunications and inter-emirates ground for the development of well-planned election of the president takes place every five contrary, it has been a result of deeply rooted transportation, (the comma used here is called people participation. Thanks to the visionary years. Currently, His Highness Sheikh Khalifa historical ties between the different parts a serial comma and its use is essential to avoid leadership of the founding fathers and the bin Zayed Al Nahyan, the ruler of Abu Dhabi, of the region, the great economic similarities misunderstanding) and utilities infrastructure. wisdom of the current leaders of the country is the President of the Federation. and correlations as well as the close relations By this, it assures the achievement of the vision under the guidance of Sheikh Khalifa Bin The Federal Supreme Council is the forum in and objectives set by the constitution. between the different tribes living in the area. Zayed Al Nahyan, the president of the United which general policy for the UAE is formulated In fact, many of the ruling families and key In order to maintain a unified rhythm to Arab Emirates, that have always managed to and by which all legislations, being Federal tribes in then seven emirates are close relatives, the development process of the country, the strike a balanced between the preservation Laws or other key federal decisions, are finally such as the ruling families of Abu Dhabi and federal government also maintains legislative of the culture and traditions and the adapting ratified before being issued by the president. Dubai, (the comma used here is called a control over major areas of activity, such as of the most internationally-recognized It meets periodically to set the stage for the serial comma and its use is essential to avoid civil and commercial transactions, banking standards for effective governance and future milestones of the federation and agree misunderstanding) and the ruling families of and monetary system control, protection of excellence in all governmental services. The on critical matters related to policies and Ras Al Khaimah and Sharjah. agriculture and animal wealth, criminal law, UAE’s Federal Government is structured into strategies. The council is also responsible for However, the most important factor that procedures of litigation, and intellectual and four different branches that work effectively the appointment of the Supreme Court judges. made the UAE one of the most successful industrial property protection. unification examples of the region is the Apart from the above, the constitution flexible, pragmatic and well-integrated gave the local governments the right of nature of governance and distribution of controlling the natural resources in its lands, authorities between the federal government such as oil and other mines. In addition, of the country and the local governments of they are responsible for municipal affairs the individual member emirates. Since the as well as licensing economic activities in inception of the country in 1971, the founding their territories. By this formula, each local fathers have understood how a carefully- government will have the flexibility to engineered decentralized union can offer a effectively plan its economic strategy that great deal of efficiency in using the country’s goes in conjunction with that of the overall resources and can create a highly effective and federal level vision and plan, and yet to have far-reaching nation. Therefore, the constitution its unique, distinctive brand that enriches the of the UAE clearly laid out the authorities and offerings of the whole nation.

Why UAE ? The Unlimited Opportunities 2012 Chapter 1 The United Arab Emirates The Fundamentals 32 33 of action on that regard. Membership of the All laws and decrees are issued by the council is distributed fairly and evenly between president. The cabinet is the main executive representatives of the seven member emirates. authority of the federation. It is headed by In accordance with the enablement strategy a prime minister appointed by the president. embraced and announced by His Highness Currently, the vice president and prime Sheikh Khalifa Bin Zayed Al Nahyan, the minister of the UAE is His Highness Sheikh president of the UAE, half of the members of Mohammed bin Rashid Al Maktoum. Along the Federal National Council (FNC) are to be with his 22-members cabinet, the prime elected by 129,274 UAE nationals in the seven minister overlooks the implementation of emirates in the next elections to be held in the the leadership vision for the country and 24th of September 2011. This will mark another supervises the performance of the different step towards greater people participation in federal government bodies. The cabinet’s shaping the bright future of the country. The responsibilities include budget proposal, of other half of the FNC is appointed by the rulers legislations, driving and implementing federal of the seven emirates based on experience and level strategies. capability. The legislative part of the UAE’s Federal The Federal Supreme Court is the fourth Government is represented by the Federal pillar of the Federal Government system. The National Council, a 40-members parliamentary UAE’s constitution assures the independence of body that serves as an advisor to the executive the judiciary system. The system consists of the government. The council’s role is critical to the Federal Supreme Court as well as courts of first effective functioning of the government system incidence. The president and the five judges of as it examines and suggests any amendments to the Supreme Court are appointed directly by proposed federal legislations. In addition, it has the federal supreme council of the UAE. (For the right to question ministers on performance more details on the judiciary and legal system of their ministries and gives alternative course refer to chapter 6 of the book) President of the United Arab Emirates

The Federal Supreme Council Consists of the Rulers of the Seven Member of Emirates

Federal National Federal Council Supreme Court Cabinet Consists of the Consists of Forty Members, Twenty President and Members are Elected Four Judges

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Abu Dhabi Archeological evidences have demonstrated borders. Through Majan’s capital and main that Abu Dhabi has a rich history that has port, Umm Al Nar, foreign trade with other been built-up since the third millennium B. C. nations emerged. The economy of the region During that time, Majan Civilization inhabited flourished due to the increased export of the the area between Baynounah, a town main product (copper) that was extracted from located in the west of Abu Dhabi, and Qatar Al Hajar Mountains. By the late 16th century, a very influential Bedouin tribe known as Basic Information had moved to the area and made a Translation settlement off the Arabian Gulf’s coast after Father of Gazelle finding great sources of underground fresh water. More than 20 subsections came out Area 67,340 km (Largest in the UAE) of Bani Yas tribe one of which is Al Bu Falah that decided to migrate to the modern area of Population Abu Dhabi. A section of Al Bu Falah subsection 1,826,673 (Largest in the UAE) known as has been ruling Ruler Abu Dhabi since 1761. H.H. Sheikh Khalifa bin Zayed Al Nahayan Crown Prince H.H. Sheikh Mohammed bin Zayed Al Nahyan its unprecedented growth era, driven by the headquarters of many financial institutions Geographic Location vision of the new ruler, Sheikh Zayed bin Sultan and leading organizations. Due to its ongoing South Central and Southwest of UAE Al Nahayan. Abu Dhabi started exporting oil development and uprising urbanization, the Main Towns on 1962 and the Sheikh used the revenues to emirate has grown to be a multicultural city and Al Ain, , Liwa, Al Marfa, fund the infrastructure projects. transformed to become the country’s centre of Island, Al Salaa, and Ghaithy Even though Abu Dhabi city is technically political and economical activities. Currently, Main Tourist Attractions an island, located less than 250 meters from Abu Dhabi produces 2.7 million barrels of oil Emirates Palace, Al Ain Museum, Sir Bani the mainland, it is connected to the mainland per day, positioning itself internationally as Yas Island, Hafeet Mountain, Western Zone by Maqta and bridges and to other one of the world’s largest producers. Despite Sand Dunes, Dalma Islands, Marina Mall islands by motorways-bridges as shown in the this fact, it has been putting forward steps in the global non-oil sector through strategic Ports illustration. investments in financial services, tourism, Abu Dhabi International Airport, Al Ain Being the capital of the country, Abu telecommunication, and real estate sectors. International Airport, , Dhabi today is the home of the main offices According to Fortune magazine and CNN news Al Bateen Executive Airport, of the federal government as well as the press, Abu Dhabi was the richest and 50th GDP Contribution most expensive city in the world in 2010. USD 162.39 billion (60%) Remarkable Achievements (At current prices, 2009 estimates) During the 19th and early 20th centuries, the Emirate had been successfully developing The first Arab capital to host the headquarters of a United Nations specialized Average Monthly Household Income its economy by depending on pearling industry, agency – IRENA USD 12,839 (Nationals) camels herding, fishing, and dates production. USD 4,133 (Expatriates) However, the situation started to harden One of the world’s richest cities Average Monthly Household Expenditure when cultured pearls invaded the globe in USD 7,013 (Nationals) the late 1890s. Throughout the following The world’s top-most in per capita GDP USD 2,447 (Expatriates) years, the residents of the emirate had faced a lot of difficulties finding alternative sources The first capital in the world to be fully connected with fiber network Official Website of cash earnings. By the British’s withdrawal www.abudhabi.ae and the discovery of oil, the emirate began The location of the world’s first zero-carbon city – Masdar Why UAE ? The Unlimited Opportunities 2012 Chapter 1 The United Arab Emirates The Fundamentals 36 37

Dubai Although little known about the ancient the mysterious Bronze Age Majan civilization. , archeological traces that During that time, the main trading exchange were found on area, a suburb in depended on the export of copper extracted Dubai, show that the history of the city could from Al Hajar Mountains and pearls obtained go back as far as 3000 years ago, linking it to from . Other excavations found on , another suburb of Dubai, revealed a Basic Information 6th-century A.D. caravan station, proving that Translation people kept trade routes well maintained. Baby Locusts In 1833, a dynasty of Bani Yas tribe known Area as “Al-Maktoum” migrated from Abu Dhabi 4,114 km (2nd Largest in the UAE) to Dubai and settled down around Dubai’s Population creek. Since then, Al Maktoum family has 1,770,978 (2nd Largest in the UAE) been ruling Dubai. It has been a great gear toward establishing Dubai as an important Ruler H.H. Sheikh Mohammed bin Rashid business and leisure hub in the world. With Al Maktoum foresighted vision and supporting policies, the founding father of modern Dubai, Sheikh Crown Prince Rashid bin Saeed Al Maktoum, efficiently H.H. Sheikh Hamdan bin Mohammed Al Maktoum Geographic Location North Eastern of the UAE numbers and its economy was booming. The whole year, mysterious desert, and wonderful Southwest of the Arabian Gulf emirate depended mainly like other emirates clean beaches, coupled with its luxurious on pearling industry that had collapsed in 1929 hotels and malls, historical architectures, and Main Towns , Deira, , Al Hebab, Al because of introduction of the artificial pearls. prosperous businesses welcome millions of Madam, Hatta The discovery of oil in 1966, however, had saved tourists and business seekers from all over the the emirate from the depression and Sheikh world each year. Main Tourist Attractions Rashid worked immediately into developing The Dubai Creek, , The Even though Dubai is distinguished by Historical Bastakiya, Hajar Mountains, infrastructures of schools, hospitals, roads, its desert surface in the south, wonderful Sheikh Saeed’s House, Jumeirah Mosque, ports, communications and transportations vast sands dunes provide astonishing views , Burj Khalifa, Bait Al networks, preparing Dubai to have one of the for visitors. The flat sandy desert gives way Wakeel, The Souks, and Burj Nahar most modern business environments in the to the Western Hajar Mountains, which run Ports world. alongside Dubai’s border with Oman at Hatta. Dubai International Airport Dubai is known of its cultural diversity and Characterized by its shallow waters and many Al Maktoum International Airport welcoming people. Its shinning sun during the coral reefs, Dubai’s territorial water has been a Port Rashid, Port rich source of pearls and fish. GDP Contribution Remarkable Achievements USD 80.09 billion (29.6%) (At current prices, 2009 estimates) Where the world’s tallest building is located – Burj Khalifa drove the development wheel and took Dubai Average Monthly Household Income to the next level. In 1971, His Highness along Among the top ten destinations cities in the world for business tourism with USD 15,071 (Nationals) with Sheikh Zayed began the initial steps of USD 5,474 (Expatriates) 7.9 million visitors in 2010 forming the federation. Average Monthly Household Expenditure By the 20th century, due to its strategically The builder of the world’s largest man-made island – USD 9,081 (Nationals) USD 3,694 (Expatriates) located port, Deira, a major town in Dubai, became the most important commercial city The emirate that has the world’s largest man-made harbor – Jebel Ali Port Official Website on the coat of the Arabian Gulf. Merchants www.dubai.ae from around the globe began coming in large The host of the world’s largest – Why UAE ? The Unlimited Opportunities 2012 Chapter 1 The United Arab Emirates The Fundamentals 38 39

Sharjah Sharjah is a distinguished oasis off the are considered as a witness, demonstrating Arabian Coast that combines between the the ancient city’s deep-rooted heritage. As nobility of the past and the pride of the a reward for maintaining its unique genuine present by refined blending between the old traditions, the emirate was awarded as the and the new in a unique contemporary style. Cultural Capital of the by UNESCO It is rich in many historical monuments that in 1998.

Basic Information Translation The Shinning State Area 2,590 km (3rd largest in the UAE) Population 882,000 (3rd largest in the UAE) Ruler H.H. Sheikh Sultan bin Mohammed Al Qasimi Crown Prince H.H. Sheikh Sultan bin Mohammed bin Sulthan Al Qasimi the most essential trading route in the history, The production of oil in 1972 with the previously Geographic Location several dominating powers attempted to North of the UAE , developed infrastructures was behind the between Ajman and Dubai conquer the area. The Portuguese during early business success of the emirate. the 17th century, and British during the 18th Even though the desert environment Main Towns century succeeded somehow to control a Sharjah City, Al Dhaid, Khor Fakkan, dominates most of the countries in the region, part of the region but the Dutch failed. With Kalba, Dibba Al-Hisn, Islands of Abu Sharjah features vegetarian seasonal cover in Mousa & Sir Abu Nuair the coming of the ruling family “Al Qasimi” addition to the many types of trees that are tribe in 1727 that established the emirate as considered safe haven for a large number of Main Tourist Attractions an independent Sheikhdom, succeeded to Al Qasbaa, Arabian Wildlife Centre, As a result of being an important animals. Sharjah has important oasis areas, the liberate the emirate. Since then, the emirate Sharjah Art Museum, Expo Centre, transportation point that connects Asia to most famous of which is Dhaid where a wide The Planetarium, & Sharjah Aquarium Africa and Europe for over 5000 years and as the made moves ahead toward modernization by range of vegetables and fruits is cultivated on only emirate to have both exits on the Arabian establishing the first school in the UAE in 1903 its rich and fertile soil. In addition, Sharjah has Ports Gulf and Oman Gulf, Sharjah developed to and the first journal in 1927. It also built the several unique islands: Abu Mousa and Sir Abu Sharjah International Airport, first airport in the region in 1932. Following Port Khalid, & Hamriya Port be one of the most prosperous towns in the Nu’ayr located on the Arabian Gulf. Coastal region for thousands years. In order to control the steps of its neighboring emirates, Sharjah and marine environment also provide a great GDP Contribution was the third to join the united federation variety of fish and marine animals that are USD 16.59 billion (6.1%) since its establishment on December 2, 1971. (At current prices, 2009 estimates) endemic in this environment. Average Monthly Household Income Remarkable Achievements USD 9,665 (Nationals) USD 3,225 (Expatriates) A significant regional cultural hub, was chosen as the Arab cultural capital for 1998 Average Monthly Household Expenditure USD 4,715 (Nationals) The host of one of the most notable art exhibitions in the region - Sharjah biennial USD 1,947 (Expatriates) The host of one of the top universities of the region - The American University of Sharjah Official Website www.sharjah.gov.ae A manufacturing hub of the UAE, represents 48% of the UAE’s industrial production

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Ajman Ajman has an ancient history that goes back to thousands years ago and a bright future that is looking to pursuit to achieve more progress toward modernization. Due to its strategic location between the emirates of Sharjah and Umm Al Quwain and to its closeness to Dubai, Ajman has been witnessing an unprecedented Basic Information Translation The Name is Related to an Ancient Tribe Inhibited the Area Area 259 km (7th largest in the UAE) Population 224,000 (4th largest in the UAE) Ruler H.H. Sheikh Humaid bin Rashid Al Nuaimi defiantly heading to a growth over all sectors. UAE was formed, of which Ajman was a founder. Crown Prince For these reasons and for the increasing Since then, the emirate’s leadership has been H.H. Sheikh Ammar bin Humaid population of the neighboring emirates, putting forward steps toward developing Al Nuaimi industrial, commercial, and architectural Ajman’s population has been largely growing people’s life standards by implementing Geographic Location growth. Major infrastructure projects have for the last five years, demanding more major infrastructure plans and developing Northwest of the UAE been developed. With increasing ship construction projects. commercial and touristic mega projects. Main Towns movements and trading activity through As the whole region’s history, Ajman’s Ajman is the smallest emirate in the UAE Ajman city, Masfut, Al Manama Ajman port, that contains the largest ships history goes back to the civilization of Majan in terms of area. It is geographically located maintenance site in the world, the emirate is times, 5000 years ago. Throughout the ages, on the coast of the Arabian Gulf; its coast Main Tourist Attractions defiantly heading to a growth over all sectors. people who lived in the region depended extends for 16 km. The emirate is comprised Ajman Museum, Dhow Yard, Mowaihat, For these reasons and for the increasing mainly on fishing, herding, and cultivation. of Ajman city and the towns of Masfut and and the Souks population of the neighboring emirates, The capital city, Ajman, preserves much of its Al Manamah. Most of the population resides Ports Ajman port, that contains the largest ships ancient history, and traces of the old town are in Ajman city, between the land protruding Ajman Port maintenance site in the world, the emirate is still visible. In 1803, the current ruling family between the Gulf and the creek. As for Masfut settled down in the area and established and Al Manama, they are located on the east GDP Contribution USD 3.78 billion(1.4%) Ajman as an autonomous state. side of the country and a small portion of the (at current prices, 2009 estimates) Ajman was among the four emirates that emirate’s population lives there. These towns signed the General Treaty of Peace with the are environmentally-distinguished. Their Average Income British on January 8th, 1820. On 2 December mountains are rich in magnesium, chrome and USD 9,719 (Nationals) lime stones and their fertile valleys produce a USD 2,959 (Expatriates) 1971 after the withdrawal of the British, the variety of crops each year. Average Expenditure Remarkable Achievements USD 4,624 (Nationals) USD 2,138 (Expatriates) The host of globally recognized players in the ship and boat manufacturing industry Official Website www.ajman.ae The host of one of the first and biggest private universities networks in the GCC region

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Ras Al-Khaimah (RAK) Ras Al Khaimah (RAK) has been an incubation of several civilizations and a settlement for human inhabitation for more than 5000 years, as the archeological evidences in the national museum of the emirate demonstrate. Remnants of a major

Basic Information Translation civilization that inhabited the region, which The Top of the Tent was the Umm Al Nar civilization that emerged in the third millennium, were found on Area 2,478 km (4th largest in the UAE) different parts of RAK. The civilization had a great impact on toward the development of Population the emirate since there are strong evidences th 222,000 (5 largest in the UAE) proving the foreign trade with Mesopotamia Ruler and Persia. During this period, RAK became H.H. Sheikh Saud bin Saqr Al Qasimi a very wealthy town that depended on the export of high quality pottery. The emirate Crown Prince then was known as Julfar and had played a H.H. Sheikh Mohammed bin Saud very important and patriotic role as a defense greatly on the spread of Islam. In the early 18th the west, and a chain of mountains that go Al Qasimi stage of the country through its castles and century, the Emirate’s ruling family tribe, Al along the Gulf from the northern part to the forts. Thus, today it is famous of its historical Geographic Location Qawasim, had settled in Ras Al Khaimah and southern. It has also a number of valleys and North of UAE ancient monuments that are linked to many established it as an independent Sheikhdom. Sulphuric water sources like Ain Khat. events in the region. The emirate has also On 11 February 1972, Ras Al Khaimah was the Main Towns taken a strategic part for being a commercial When RAK decided to join the federation, it Old Ras Al Khaimah, Nakheel, and Jazirat last emirate to join the United Arab Emirates and economic role point during the Islamic sat its vision into becoming a major industrial Al Hamra federation. period on 630 A.D.. Through its extensive producer. Toward implementing its economic Main Tourist Attractions trade network, RAK traders participated RAK is located at the end of the northern pillars, RAK built the first cement company in The National Museum of Ras AlKhaimah, territory of the UAE. It has a strategic the UAE in the early 1970s and today after a Sheeba’s Palace, Dhaya Fort, Al Falaya, geographical location, being the entry gate of long consistent hardworking coupled with Jazirat Al Hamra, the Old City, & Souqs the Arabian Gulf, neighboring three emirates Sheikhs’ support and intelligence, it became the largest cement producer regionally. It Ports Sharjah, Fujairah, and Um Al Qaiwain, and Ras Al Khaimah International Airport bordering the Sultanate of Oman. The emirate has as well established the world’s largest has also a variety of terrains from low sand ceramics producer and became a leader in GDP Contribution plains that are connected to the Gulf from pharmaceutical industries. USD 4.30 billion (1.59%) (at current prices, 2009 estimates) Average Income USD 7,763 (Nationals) USD 1,983 (Expatriates) Average Expenditure Remarkable Achievements USD 4,304 (Nationals) USD 1,764 (Expatriates) The First and Largest Cement Producer in the UAE Official Website The World’s Largest Ceramics Producer www.rak.ae The Region’s First Pharmaceuticals Producer

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Umm Al Quwain Umm Al Quwain is the most ancient and began copper trade during, 3000 B.C. emirate in the country. Archeological traces The metal was sent to all prominent ports on show strong evidences of the emirate’s the Gulf, Umm Al Nar was one of them, and relations with Mesopotamia that existed exported mainly to Mesopotamia. Not only had during the 3rd millennium B.C. Semi- the copper trade flourished during the Bronze nomadic tribes settled down in the region Age but also agriculture and pottery. Al- Dour, the largest pre-Islamic site in the region Basic Information that was located in Umm Al Quwain, was an important port used by several civilizations. Translation Mother of Two Powers In order to defend itself against any foreign attacks, the emirate started building its forts Area and castles. The emirate was also known as the th 777 km (6 largest in the UAE) haven for Arab ships that escaped the foreign Population attacks. 52,000 (7th largest in the UAE) Ruler H.H. Sheikh Saud bin Rashid Al Mu’alla Crown Prince H.H. Sheikh Rashid bin Saud Al Mu’alla to provide a decent life for the people of Umm part is salty which is adjacent to the coast, Geographic Location Al Quwain. By focusing on industrializing while the other part is sandy. Despite its small North of UAE, between Ajman and Ras Al Khaimah the emirate by attracting foreign capital to size, its islands: Al Sinniya, Jazirat Al Ghalla, provide all possible facilities, the emirate Al Keabe, Al Sow, Al Qaram, Al Humaidi, Al Main Towns has been witnessing a comprehensive revival Chewria and Al Harmala make a great portion Umm Al Quwain, and Falaj Al Mu’alla resembled by the impressive achievements of its area. Al Sinniya is about 90 km2 and culturally, socially, and economically. blessed by several environmental privileges. Main Tourist Attractions Umm Al Quwain Fort, Islands of Umm Al Quwain enjoys great touristic It contains the third largest colony of Socotra Umm Al Quwain, Al-Dour, Old Harbor elements which include the availability of Cormorant in the world, ubiquitous green Dreamland Aqua Park different facilities, beautiful beaches, various turtles, remarkable black tip reef sharks, and archeological sites, and distinguished islands. archeological sites that date back to the Ports The emirate is technically positioned between beginning of Islam in 630 A.D. Between the Umm Al Quwain Port island and the mainland runs Khor Al-Beida, Umm Al Quwain Airport two creeks: Khor Al-Baida and Khor Umm Al However, the modern history of the Quwain and is divided into two parts the first an extensive area of sand and mud. GDP Contribution emirate began when Al Ali tribe moved due USD 0.63 billion (0.23%) to limited water sources from Al-Sinniya Island (at current prices, 2009 estimates) and established an independent Sheikhdom in Umm Al Quwain. The current ruling family Average Income is a dynasty of Al Ali tribe. Similar to other USD 8,946 (Nationals) USD 2,817 (Expatriates) emirates, Umm Al Quwain signed the General Maritime Treaty with the British in 1820. Average Expenditure Because of its distinguished location on the USD 4,813 (Nationals) route to India, the United Kingdom’s province USD 1,734 (Expatriates) at that time, the emirate’s import and export Remarkable Achievements Official Website trade thrived. On December 2nd, 1971, the www.uaqcci.com emirate joined the United Arab Emirates union. The host of the world’s largest Aqua park – Dreamland Since then, the emirate made effective efforts Why UAE ? The Unlimited Opportunities 2012 Chapter 1 The United Arab Emirates The Fundamentals 46 47

Fujairah Fujairah’s historical importance goes back Peninsula, which was later known as to 3000 B.C. when the area was inhibited by Phoenicians. Throughout the ages, the area herders and fishermen. It was then named as had been a matter of dispute among several the Land of Titans “Ard Al Jababerah”. It was local dominating powers because of its the home for people who were migrating strategic location. The ruling family descended from the southeastern part of the Arabian from tribes which migrated from Yemen after the collapse of the Marib Dam. It settled down Basic Information in the region on 1808, and established Fujairah Translation as an independent state. During that time, the The Name Derived from a Spring of Water settlement and development evolved around that comes Underneath a Mountain Fujairah’s fort which was built on 1500 and used as a defense stage against any attack. Area Since then, the emirate has been enjoying 1,450 km (5th largest in the UAE) a state of peace and began to focus on its Population development. It was the last state to join the 137,000 (6th largest in the UAE) Trucial States after the singing the General Maritime Treaty with the British in 1902. On Ruler H.H. Sheikh Hamad bin Mohammed 2 December 1971, Fujairah joined the United Al Sharqi Arab Emirates. The ruling family has been the driving force behind the commercialization of Crown Prince the emirate’s economy. H.H. Sheikh Mohammed bin Hamad 70 km2 Fujairah does not have a desert to support investors in order to build, develop Al Sharqi like Dubai and Abu Dhabi and it is mostly and diversify business activities. mountainous, covered by Al Hajar Mountains Geographic Location The emirate’s economy depends on cement, East of UAE that separate the emirate from the rest of stone crushing, and mining industries. The the country. The high percentage of rainfall establishment of the newly free zone has Main Towns comparing to other emirate allows the farmers moved the economy and created a vibrant Fujairah City, Dibba Fujairah, , Al to grow more crops each year. Due to its sunny Bedieh, Gidffa, and Al Bathna business environment in Fujairah. Its beaches, and pleasant weather, the emirate outstanding geographic location gave an ease Main Tourist Attractions is one of the most convenient places in the of communication with the major shipping Fujairah Fort, world for water sports like swimming, sailing, ports in the world. More than 40 giant oil- The Heritage Village water skiing, and fishing; thus, it was given vessels pass the port. The port is also one of the name “the Jewel of the Middle East”. Ports the most important livestock shipping ports in Fujairah International Airport The business-friendly procedures and the the world, where the largest cattle station in Fujairah Port excellent infrastructures had played key-roles the Arabian Peninsula was created. GDP Contribution USD 2.54 billion (0.94%) (At current prices, 2009 estimates) Average Income USD 7,826 (Nationals) USD 2,241 (Expatriates) Average Expenditure USD 4,258 (Nationals) Fujairah is distinguished from the other USD 1,662 (Expatriates) emirates in several aspects. It is the only Remarkable Achievements Official Website emirate located entirely on the Gulf of www.fujairah.ae Oman while others are on the Arabian Gulf. One of the world’s top three Bunkering Destinations Its astonishing beach extends for about Why UAE ? The Unlimited Opportunities 2012 Why UAE? The Layers of Uniqueness Chapter 2

Why UAE? The Layers of Uniqueness

“ Its appeal does not only come from its strategic location at the heart of the emerging world nor from its unrivaled business-readiness. It’s an effect of a well- blended, hard-to-resist combination of unique layer

that makes the UAE the ultimate base for businesses and ventures that are ‘built to last’ “

The Unlimited Opportunities 2012 Chapter 2 Why UAE? The Layers of Uniqueness 50 51

he late years of the first decade and the Tfirst two years of the second decade of the 21st century has brought about a new realm that changed the way business is done around the world. Subsequent to a global economic downturn that has not been witnessed for just under a century, a larger number of nations are competing to attract capital that has become more risk averse and selective. Drastic changes At the center of all trade and investment have taken place in the way international promotion efforts of any country is coming th investors think and make investment choices up with a unique “value proposition” that ow and decisions. Investors, whether individual translates the specific features and elements Gr or institutional, are now highly cautious when offered by the nation into tangible benefits y to selecting a country or a market to invest in. In for potential investors and trade partners. This wa irit differentiated value proposition is what helps ate p addition, the level of awareness in the global A G nd S investor circle is highly increasing due to easy to answer the question “Why invest in this iety a access to information and the accumulation of specific country or region?” For the UAE, the g Soc experience during boom time, raising the level answer for the question “Why UAE?” would spirin of cautiousness among those investors. be summed up in two words: “uniqueness” An In n and “partnership”. The nation continues to utio Along with those significant changes ” Sol in investors’ behavior, there has been an promise investors a fruitful partnership that Play will help them realize potential and growth and increasing level of competition among the “Plug world’s developed and emerging nations to through the different economic cycles using A attract a greater share of the global flow of all the innovation, resources and capabilities required to do so. What is good for business f Trust foreign direct investments and to increase their limate o nations’ competitiveness in international trade. is always the best for the UAE and the trust A C To achieve those objectives, countries come and growth for investors and businessmen is up with various polices to encourage Foreign an integral objective in Direct Investment (FDI) inflow including the nation’s Knowledge Economy investment incentives, investment-friendly strategy. A True legislations and different forms of investment promotion activities. This competition has led to a further level of complexity in the process A Recognized Global of making the right investment decision due to Brand the increased choices for investors and traders wishing to enter a specific geographic region or to seize certain economic benefits and to the perceived similarity in the offerings and benefits presented by each nation or region.

Why UAE ? The Unlimited Opportunities 2012 Chapter 2 Why UAE? The Layers of Uniqueness 52 53 ground and back office services due to the volume of cargo. With its welcoming nature and easy access ion Reg from around the globe, the UAE has also ving developed a proven ability to bring together Thri o a buyers and sellers from different parts of ay t y atew om the world. Combined with the country’s A G Econ n the enrollment in a wide range of bilateral trade ence i Confid agreements and economic blocs, the UAE has ility of Stab become a favorite choice for traders looking ay n Oasis atew A to penetrate certain regional markets or to A G Policy launch regional distribution operations. owth Open Door to Gr The UAE’s neutral and balanced regional and international relations have been one of the most enabler for the country to These investments will ensure that sufficient attain this distinguished regional economic capacity exists in order to continue the high status. The UAE is an active member in the growth trajectory. Gulf Cooperation Council (GCC), enabling companies registered within its jurisdiction to A Gateway to Growth Most of these projects were actually benefit from the customs union and the gulf designed to provide a close proximity between common market that allow export of goods A Gateway to a Thriving Region the UAE, including the Middle East, North a company’s warehouse and the transportation and opening of branches of companies in Africa and South Asia, have been witnessing port. The Al Maktoum International Airport, Throughout its ancient and modern history, different GCC states with no restrictions or an unprecedented economic renaissance. for example, is at the skirts of Jebel Ali The UAE has been able to successfully and customs duties. The UAE have also signed a Aided by a growing hydrocarbons price, a Free Zone, Jebel Ali Industrial Area, Dubai effectively exploit its ideal geo-strategic significant number of treaties to avoid double booming demographic growth trend and huge Investment Park and Dubai Industrial City location at the crossroads of Asia, the Middle taxation and to protect investments within investments in infrastructure, the economy of to name a few. In addition, it’s been a East, Africa and Europe to connect buyers with a number of countries around the world. In the region is soaring compared to many other national norm to provide mega projects with merchants and suppliers across the different simple terms, this means enabling companies developed economic blocks. Even at the peak connectivity between sea and air transport sectors and then to quickly and conveniently and investors who choose the UAE to explore of the Global Financial Crisis in 2008-2009, the allowing for goods to be transferred from the deliver goods to the vast and expanding the opportunities around them with an consumer markets. As such, the country’s region maintained a positive growth trend former to the latter in less than one hour. of 1.9% according to the World Bank. Soon, advantageous position. location allowed it to become the de-facto Operation wise, the country has a strong the region rebounded and recovered quickly One of the reasons why companies decide and most important business hub not only for base of regional and international logistics from the effects of the global downturn to on the UAE for regional distribution of both Gulf region, but also for Europe, Middle East, companies that can transport all types of goods have a combined growth rate of 4.4% in 2010. locally produced and imported good is in South West Asia, Africa, and Russia and even in a cost effective manner, complimented Countries across the region are opening up fact the absence of direct taxes on corporate the Caucasus and Central Asian States. with dedicated warehousing areas for all its economies and creating real opportunities profits or personal income along with the types of products as well as consolidated It is important to note that a potential for investors, service providers, financial minimal customs duties on imports of 5%. market of more than two billion people live institutions and goods exporters from around Full repatriation of capital and profits is within four hours traveling time from the UAE, the world to tap into their rapid expansions also permitted, with no controls on foreign which makes it the ultimate base for export and growing demand potential. exchange. and re-export activities as well as service Consultants, service providers, contractors providing for companies that seek to exploit The strategic location was actually and expert houses have been also taking this favorable demographics advantage. The complimented with a matrix of infrastructure the advance of the UAE’s flexible and good news is that the population growth developments, logistics facilities and flexible internationally-benchmarked regulatory trend that this region is witnessing is expected exporting regulations. Billions of dollars have environment, lavish business amenities, to continue for years to come. This will mean been invested, in recent years, to develop the facilities and ultra-modern lifestyle to use it an increase not only to the number of young warehousing and transportation infrastructure as their base for their operations across the consumers of products and services, but to the in major cities with the construction of new region. The ability to fly to the destination pool of talents that companies, based on the projects such as Khalifa Port and Industrial of interest, get business done and come back UAE, can access as employees and knowledge Zone, Dubai Logistics City and Al Maktoum most of the time in the same day is one of the workers. International Airport as well as the expansion to current developments such as Jebel Ali pros that set the country aside from the rest In the last decade, the region surrounding Port, Dubai Cargo Village and Zayed Port. of the region. Why UAE ? The Unlimited Opportunities 2012 Chapter 2 Why UAE? The Layers of Uniqueness 54 55

Confidence in the Economy Because the UAE economy was structured in a healthy manner, it boosts further confidence from various stakeholders both inside and outside the country. In addition, the country’s economy was able to quickly emerge stronger from the aftermaths of the Global Financial Crisis in 2008-2009 due to its solid pillars and strong foundation. The head of Middle East and North Africa Department at the International Monetary Fund (IMF) has declared in August 2011 that the UAE economy has been steadily performing positively and has continued to attract foreign direct investments. According to IMF, The two funds were scheduled to begin this is only a reflection of the international operations in the final quarter of 2011 and confidence in the Emirati economy. are just two examples reflecting the interest Moreover, the embedded nature of of international financial institutions in taking diversity is another factor that increases the part in the success story of the UAE economy. levels of confidence in the country’s economy. It is not strange here to recall the fact that in The government’s policy has been to widen 2008, the UAE, represented by the emirate the diverse base of the economy and push of Dubai, was the top global destination for to increase the contribution of the non-oil foreign direct investments, attracting more It is also important to notice here the have given investors confidence to return as sectors to the national GDP. In fact, there than USD 21 billion of investment capitals to significance of the UAE government’s move the government took speedy measures to are two boosting players here. The high oil- its rich base of projects and opportunities. towards stimulating small and medium sized save the sector from the adverse effects of based income provides a guarantee against enterprises (SME’s). These projects serve the the global credit crunch. Local and foreign market turbulences in many aspects, while the national economy and create jobs for young banks were encouraged to lend and were diversification builds up the trust of foreign citizens. Representing around 60% of the given the right guarantees. In additions, new and local investors in the national economy total number of enterprises in the economy, development and investment opportunities as it provides them with lucrative and stable the growth and healthiness of this sector will are emerging in different parts of the country opportunities to thrive in. revive the market and solve any potential with end user demand and vast potential for liquidity issues. It will also help in diversifying growth, including the western region of Abu The continuous influx of foreign direct the sources of national income and stimulating Dhabi, Umm Al Quwain and other parts of the investment is another sign of the level of trust entrepreneurship that’s the guarantor for the country. This promises a new dawn for this in the UAE’s national economy. In August 2011, continuous pulse of change in the UAE. sector that has for long shaped a main pillar of First Capital Bank of Switzerland announced confidence in the national economy. the launch of a fund with a capital of USD 500 Of particular interest here is the real million for health services covering hospitals estate sector, which is currently witnessing a Consumer confidence is also gearing up. and labs in the United Arab Emirates. Another renewed interest by foreign investors. Despite A recent report by the The Nielsen Company fund with a capital of USD 500 million was to all the negative hype, the UAE’s real estate shows the UAE as one of the countries on the be established in the precious metals trade. sector did not experience the same extent of world’s top-10 consumer confidence list in the downturn seen in other countries. Real estate first half of 2011 moving up 12 ranks from the regulations in Dubai and the other emirates year before.

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The Federal National Council, which represents Open Door Policy the country parliament, is now half elected If one country in the Middle East is to be by an electoral college and is playing an described as the sole free trade nation in increasingly important role in the assisting the the region, that would be the United Arab executive branch to further boost the national Emirates and that’s for valid reasons. This is An Oasis of Stability aspirations. This is happening in parallel lines evidenced by the country’s tax-free status, The UAE has successfully maintained a with what is called ‘popular majlis democracy’ world-class infrastructure, low tariffs and 100 stable political scene even in the middle of a or open-door policy, which enables national per cent ownership for foreign investors in free turbulent region. Thanks to its modest policy citizens to communicate directly and openly zones, making it the ideal location for setting and wise leadership, the country managed to with both the rulers and government up new businesses. UAE is also appealing to stay away from the various cases of political executives and which has been in effect for investors thanks to its world-class free zones, turmoil in the region surrounding it. Instead, decades in this part of the world. the UAE’s positive politics and neutral position 100% repatriation of capital and profits, and all forms of salary and capital gains, are not To a certain extent, the majlis democracy has have always enabled its business sector to play being in close geographic proximity to the top subject to taxation in any emirates. Expats been also functional for expats who can meet a savior role in the peace building process in European and Asian markets. and foreign travelers are free to move money with senior sheikhs and government executives each of the war-torn countries. The UAE is In fact, while the UAE follows global best legally with only a few limitations concerning without prolonged bureaucratic procedures now one of the largest donors to developing practices and creates a conducive environment travelling with large amounts of cash money. when they wish to make suggestions or countries across the world and is for businesses to operate, and presents ample While the law guarantees free exchange also a big contributor to UN peace opportunities for both investors from the of good, it also maintains minimal lists of keeping operations in various areas. region and around the world, the government prohibited and restricted imports. UAE’s At the federal level, the country’s encourages the private sector in a free trade trading with the USA would be a good example clear political system coupled with a regime with low tariff barriers and minimum of how functional this liberal economy is. systematic decision making process legal hurdles. According to US official numbers, the UAE is and the right diversified economic At the political level, the UAE, a member currently America’s 41st largest goods trading model have allowed the federal of the World Trade Organization (WTO) since partner with US12.8 billion in total (two way) government to function efficiently 1996, supports open trade and has stable trade goods trade during 2010. Goods exports to serve the society while building relations with countries throughout the world. totaled USD 11.6 billion; Goods imports totaled a sustainable growth model that is Thanks to its open economy, attractive business USD 1.1 billion. The U.S. goods trade surplus self dependant and less affected by environment and continued economic growth, with United Arab Emirates was $10.5 billion regional turbulences. the UAE has emerged as a key international in 2010. The five largest import categories Local governments in each of the trading hub between East and West. The WTO in 2009 were: Special Aluminum (USD 195 seven emirates have also applied a has named it the leading Arab economy in million), and Iron and Steel Products (USD 148 terms of global trade and one of the top 30 million), Mineral Fuel and Oil (crude) (USD similar model that keeps the local discuss government decisions affecting their scene least affected by foreign factors, while nations in the world. The UAE Government’s 79 million), and Precious Stones (diamonds) businesses. maintaining a stable relationship with the free-market policy and flexible economic and (USD 68 million) and others (returns) (USD 314 public. The tribal system has positively played As a result of political stability, the UAE is commercial laws are the prime factors in the million). U.S. imports of agricultural products an essential role in building and enhancing the one of the safest countries in the world with country’s rise as a regional and global leader. from the United Arab Emirates were USD 22 powerful security systems and a very low crime million in 2010. mutual trust between national citizens and In terms of imports and exports, the rate. Mugging and street crimes are reportedly the ruling families. country applies a liberal trade regime with of the lowest rates in the world. In addition, Modernization of the political life has tariffs based on the GCC tariff structure. the cultural and religious tolerance that is been steadily taking place since the formation Customs procedures are largely computerized widely applied, encouraged and promoted of the UAE as an independent state in 1971. to facilitate trade, which in the case of several across the country has effectively minimized Calculated and well-planned steps are being emirates includes a large re-export industry. any possibility of ethnic or religious tension put in action to avoid sudden and unbalanced No federal income tax legislation is imposed between the various components of the UAE jumps that may lead to unwanted results. for general business. Each emirate has enacted expat community. Many enterprises in the income tax decrees, but in practice, the UAE have successfully utilized this peaceful enforcement is restricted to foreign banks and harmony to build multicultural teams and oil companies. Personal incomes, including harness its benefits in exclusive sales to various demographics.

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hip eurs pren ntre ce E leran ral To Cultu ess & Openn Nature g tiveness irin ompeti Insp C An pirit in Business ty & S Creativity Socie

An Inspiring Society and Spirit The country is now widely looked at as an of Emirati women entering higher education Entrepreneurship Over centuries, Abu Dhabi and the rest example of an entrepreneurship-promoting institutes has outnumbered local men of coastal cities developed a rich tradition of If the modern UAE could be described economy with an active social policy that pursuing higher education degrees. Both pearl business and entrepreneurship as the in one word, no doubt it would be harnesses entrepreneurship and encourages government and private sector organizations major source of income that kept this part “entrepreneurship”. Ever since the country was both nationals and expats to utilize the employ national women at various vertical of the world alive. The history of Sharjah formed in 1971, entrepreneurship has been at business friendly environment to thrive for roles reflect the advanced level played by and Ras Al Khaimah tells us of a strong the core of almost every government initiative further success. women in the UAE’s business scene. kingdom that controlled both banks of the to further empower the economy and the One interesting aspect here is the support While most countries limit their Straight of Hermes and regulated trade society. Started with a federal policy in the shown to women. The UAE has been at the initiatives to local entrepreneurs, the UAE 1970s that encouraged citizens to establish forefront of regional efforts to enable women has developed many initiatives to provide their own business entities even if they work entry to the entrepreneurship market with lucrative opportunities for expat and foreign for the government to provide the basis for various active initiatives that both empower entrepreneurs to start their own success stories a modern economy, the rhythm continued women and create opportunities. Number in the land of hard work and good rewards. with country-wide initiatives that ease up on regulatory affairs and business doing requirements. While this trend sounds a bit modern, it is in fact rooted in the history of what is now known as the UAE. The people of the federation have inherited from their descendants the spirit of entrepreneurship that saw them diving for pearl as far as African shores and changing their small towns to a regional center for movement through this internationally merchants across the region. strategic marine passage. A story in the National Geographic In effect, a country with such a rich history magazine in 1954 described how Dubai with of trading, exploring opportunities and its 15,000 residents was the centre of trade developing stories of success had emerged exchange for the whole Arabia and beyond. 40 years ago to embark on a new journey Merchants and traders from across the region towards regional leadership and business used to travel to Dubai for business. entrepreneurship.

Why UAE ? The Unlimited Opportunities 2012 Chapter 2 Why UAE? The Layers of Uniqueness 60 61 One of the results of these efforts was certified by a global partner. The World Economic Forum’s Global Competitiveness Report 2011/2012 ranked the UAE 27th globally Competitiveness Nature for competitiveness. The UAE was classified Openness and Cultural The UAE business practice is actually built as an innovation-driven economy. This is the around a unique blend of competitive values highest stage of economic development that Tolerance that spreads the culture of excellence and a country can achieve. The classification is Although the people of the UAE are not that distinction not only among citizens but also based on factors that promote innovation big, their combined expertise and the human among businesses and business people of all in economic development. According to interaction they got over ages is realistically nationalities. The culture of excellence was the report, the UAE has ranked among the rich and is reflected in the way their modern embedded in government practices, both top ten countries in more than 20 global society has evolved to a tolerant and culturally at local and federal government levels in a competitiveness indicators. open society. manner that made it an essential part of the A significant part of the UAE’s approach day to day practice. Government and private With around 200 nationalities living and of excellence and competitiveness is injected sector initiatives were also complimented working in the country; an average UAE in the business community and the public with a parallel drive to inject higher standards national would have met people from all administration alike through a series of of excellence in education and supporting cultures; faiths and backgrounds before he excellence awards at both the national and services such as health care; municipal and reaches the employment age. This has enabled public works. national over years to develop their country; whether nationals or expats. By own model of understanding and tolerance. that, we refer to the ability to communicate Due to the adoption of the free market Their unique ability to accept the other has fluently in business matters with everybody economy, competition has become an been deeply reflected in many legislations else; regardless of geographic boundaries. It essential component of business cycle in the and regulatory procedures that allow for the is also characterized by maintaining the same country. Therefore, excellence in production expats to feel at home while doing business level of business traditions and corporate and services has become one of the major and living in the UAE. culture as Western countries and other requirements of survival in such a highly competitive market. Whether operating Combined with the authentic Bedouin industrial nations. locally or exporting outside the country, UAE traditions to welcome and respect strangers However, the only effect local traditions businesses have always relied on excellence and guests; the country’s national populations may have here is that, if time is available, and good business practice as a major has been known of being expat-friendly; which meetings will generally commence with some competitive edge in their market entry and allowed for expats to integrate easily within polite and friendly conversation, before the survival. Encouraged by strict standardization the multi cultural mix of the UAE without host turns to the topic at hand. This is to be policies, the manufacturing community as well having to dissolve or dismiss their original expected mainly when dealing with Emirati has been at the forefront of the excellence and character. Even while doing business; it has businessmen, and in certain settings it could be distinction face of the country making sure been much easier to start certain exclusive considered impolite to dismiss this small talk by that whatever carries the ‘Made in the UAE’ local levels. Government offices, business or ethnic businesses than in other places going straight to the formal agenda. Showing label is always linked to quality. entities and free zone companies across the because people simply don’t have to give up appropriate respect for all participants in a country have the opportunity every year In order to orchestrate all the national who they are in order to integrate here. The meeting is also considered important, and UAE to apply their credentials to one or more efforts for excellence, the Emirates good point is; even though you may start an Nationals may prefer to listen to all possible royal sponsored awards that measure each Competitiveness Council was formed ethnic business; it is not necessarily targeted at options before making a final decision. segment’s excellence criteria and reward the comprising of representatives of the federal that particular ethnic audience. Yuga centers; A good thing to remember here is that best achievers. government: the private sector and each of ethnic restaurants and spice shops are just this cultural mix has developed its own rules the seven emirates’ own excellence bodies. In addition,; quality promotion programs examples. of etiquette that shows respect to various Working together in partnership with the have been launched country-wide, to In addition, the presence of businesses cultural; religious and personal factors. public and private entities the council enacts educate the wider business about embedded from around the globe; including many Most UAE government portals and business policies and undertakes actions to drive the quality and good business practice and their multinational corporations, has helped directories provide hands on tips on what is UAE’s competitiveness agenda and unite the significance to business continuity. Dubai develop an internationally oriented corporate polite and what is more polite in dealing with country towards achieving the nation’s vision Quality Group, which was established by the citizen identity for most of the people in this locals; various expat groups; but the general for sustainable growth and prosperity. Dubai Chamber of Industry and Commerce, is role of thump is mutual respect and friendly a leading provider of such services. In parallel, language. the Dubai Quality Award focus on best quality practices in management and production in Dubai private sector entities. Why UAE ? The Unlimited Opportunities 2012 Chapter 2 Why UAE? The Layers of Uniqueness 62 63

Creativity in Business Business innovation and creativity Middle East to launch a series of creative Government tenders are increasingly in operation are two essential pillars of rights protection as early as 1992, when a playing an additional role in promoting sustainable growth and international success. set of federal laws were enforced to protect creativity and excellence in the private Both government officials and business leaders intellectual property rights, computer sectors. It is becoming increasingly requested agree that the UAE’s march of development software, industrial designs and patents as well that business entities applying or registering and progress has always been based on as copyrights and trademarks. With intellectual with certain government departments for economic creativity, constructive initiatives protection spanning such a wide array of procurement purposes should meet particular and determination. From a strategic point of industries, the country was able to provide administrative and accounting procedures and view, the country has effectively utilized the both local businesses and foreign investors certification. Tender and service procurement opportunities in this rapidly changing regional with suitable means to protect their respective in many local government departments is now and global environment to achieve the rights and encourage creativity to become a widely based on creative thinking and new national aspirations of its people in building widely practiced business behavior. ideas rather than lower price basis. a modern state that promotes the best ideas from all over the world while preserving its heritage, values and principles. While encouraging local businesses to Current federal and local strategic plans embed innovation into their business models, focus on the importance of innovation, planning the UAE has also provided legal and regulatory and economic, human and technological protection for foreign companies, which development as the foundation of prosperity, allows them to harvest the fruits of their progress and sustainability. Such strategic plans creative minds and inventive solutions. form the framework ofgovernment work and regulations over the new couple of decades. The UAE has been the first country in the In addition, several initiatives were launched to recognize creativity-based excellence and quality practices. Both the President and the Vice President sponsor annual events to celebrate winners of all business segments who compete on a bundle business excellence and performance quality awards. In the vast majority of the cases, creativity is the winning factor. The private sector is also moving in the same direction with more and more training schemes being introduced on embedded quality and the benefits of creativity to various business models.

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p Sho top- ne-S O ives Ready to Operate Initiatives nitiat To save more time, you can even start the ate I An essential part of the UAE business Oper leasing or buying process at the same time your ady to readiness drive is to be able to shorten the y Re n license and visa are being processed, although Pla Locatio period between company formation and the & Added formal signing may need to wait until you get Plug Value actual start of business. Thanks to its advanced ss the official going. All of the free zones can sine e Marketing and versatile infrastructure, this is not an offer you furnished offices to start from, but Bu ion-Wid issue anymore for the UAE. In fact, various ment Reg you can always rely on the quick timely delivery ron components of the country’s infrastructure Envi of ready or custom made furniture available work together to facilitate immediate run- all over the country from international brands time for new businesses and minimal time to local labels. In addition, the wide spread to production in case of fabrication or high speed internet and telecom connectivity Plug and Play Business manufacturing included. makes it possible to get fully connected in less Environment Whether you are in a free zone or the than 24 hours maximum all around the country. rest of the country, the amount of available Residential solutions, whether for office space makes it a matter of a couple of individuals or groups, are just a matter of One-Stop-Shop days before you are completely set up and hours away. You can even shop for available The One-Stop-Shop concept, while it applies The rest, especially annual renewals, is running. In free zones, it can even get better. flats online before you are actually in the at the national level, is actually a synonym done electronically. While waiting for the big space or for an country. The country enjoys a wide range of interim period, you can always choose to start of how combined government efforts are Free zone companies can enjoy a step residential solutions that caters for all tastes operation from a desk or a single executive working together to facilitate business needs ahead of such ease of service. Since free zones and capabilities. However, there are certain office. For free zones where manufacturing from registration to exportation. Not only does operate as self-contained ‘offshore’ areas, each areas known to match particular demographics and storage facilities may be needed, one the UAE provide all the practical requirements free zone authority maintains its own system so you may like to check out these if you are would only need to ask. If what you need is handy for a successful entrepreneurship, it of providing services to its member businesses. interested in living in a familiar environment. not available immediately, in most of the cases also guarantees that the investor has the Instead of going to and from separate it can be arranged for as soon as possible. While language was never a barrier in the freedom to harness the results of his success government departments, businesses working UAE, you may need certain linguistic support back to his homeland. This is reflected in the within a free zone deal almost exclusively with if you are working at the regional level. ease of procedures across the country and the the free zone authority. For example, when Cultural communication is one of the fastest absence of complications even when making hiring a new employee, a free zone company growing segments across the UAE and in many inter-emirate applications and exchanges. will obtain that employee’s visa through language pairs. Moreover, because business registration the free zone authority, not through the One of the most useful ways to start your and the majority of the related procedures Department of Naturalization and Residency. business and life right away in the UAE is to are mostly done at the emirate level, things Some free zones may go a step further check the wealth of online resources abut get extremely easier. The One-Stop-Shop or providing services like customs clearance, the country. Looking for leads? Check the the unified application processing window, is municipal services & building certification as many online directories covering thousands of well as third country visa applications. present in all of the economic departments business across the country. Local chambers of in each emirate which sometimes have more Because most of the free zones also act commerce even provide you with studies and than one site in the concerned city. That means as landlords to rent or sell their offices and reports on lucrative opportunities inside and investors, regardless of being local or foreign, business spaces/factories, investors end up outside the country. will deal with only one contact point for all dealing with the very same people for all their issues related to their company formation official paperwork. In fact, even telecom issues and incorporation. With the introduction of are usually handled by the same office. This e-government services in the country, that’s could be time-saving especially for a startup supposed to be the last time they visit the who wants to start as soon as possible and focus concerned economic department. on the business potential one is looking for.

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Region-Wide Marketing the region. Outdoor advertisement is a good example, which became popular first in Dubai If you are coming to the Middle East to before the industry found it would be more work on a regional level, you cannot afford profitable to apply the same model in other not to be in the UAE for a very practical reason. Value Added Location countries. The UAE has proven it is the ideal location This is the only place where you can market In addition, almost every week there is at for businesses that require rapid access to to the whole region from the warmth of your least one major regional trade show taking markets for high value, low volume cargoes. office without any boundaries. place in the UAE. In some weeks the number But businesses are now discovering new ways The United Arab Emirates has been for at may exceed 10 regional happening either to capitalize on the country’s value added least the last two decades the ultimate centre concurrently in Dubai alone, or simultaneously location and make big money out of it. of the Middle East in everything regional, in Dubai, Abu Dhabi and Sharjah. Geographically speaking, the UAE is a whether it is marketing, sales, business Regional integrated marketing campaigns, time zone bridge between the Far East and development, or trade shows. Everywhere including those adopting new and social Europe on the East-West axis and the CIS and else it is a local effort, targeting only that media, are mostly drafted and approved by Africa on the north-south axis which makes particular local market. But in the UAE, and to regional headquarters in Dubai. With the the country a gateway to a large market that be specific in Dubai, it’s regional even when huge number of outlets and agencies in the can be characterized with the UAE’s well you target the local UAE market. city, they are most likely to be executed here established trading links with the greater than In terms of advertisement, you cannot place as well giving the concerned marketing team 1.5 billion people in the neighboring region a single in two or more different countries an accessible way to monitor and measure the covering the Arabian Gulf, Middle East/Eastern without passing through an agency in Dubai. return on their marketing investment. Mediterranean, CIS, Central Asia, Africa and Public relation agencies who work in other the Asian sub-continent. countries usually hire a Dubai based firm when Many multinational companies have recently started to base their international This has in effect made the country in This is complimented by the fact that they want to do a regional job. marketing or business development teams in whole and Dubai in particular the distribution, Dubai is also the regional headquarters of all Dubai has dominated the regional Dubai, both for cost and accessibility reasons, logistics and re-export hub of the whole major air couriers and freight forwarders who marketing and business development scene even if they’re covering the rest of the world region. So whatever region of these you want use the city as their regional assembly and since early 1990s for both practical and logistical outside North America and Western Europe. to reach from a central location, that location classification point for inbound and outbound reasons. Since most of the multinational and for you is the UAE. shipments. In result, if you ship anything with regional companies are headquartered in the With direct flights connecting Dubai on them from Dubai to outside the region, it daily basis to major US, UK, Japan and Australia Thanks to its developed air and marine city, it would be easier to have their marketing gets everywhere at least one day earlier, and cities, multinational teams can travel the world transportation lines complimented with a agencies including advertisement buying your shipment is only 24 hours away from any at ease while conducting their daily business in series of ground transportation solutions, agents and public relations firms in the same country in the region. such a beautiful and relaxed environment. the UAE has been able to utilize this central proximity. location to serve the whole region in a smart Dubai is also a regional hub for air traffic In the same period of time, Dubai was way. Every UAE free zone is actually located and passenger transportation. The emirate’s gradually becoming the centre of the regional near a transportation hub that reduces airport has become a focal point between the media scene. This was further consolidated the times needed for cargo and shipping. East and the West. That’s besides the obvious with the formation of and , for example, is coupled fact that is a regional center for shopping, then Dubai Media Production Zone and Dubai with its famous port, the largest artificially which means that if your product makes a Studio City. Currently, Dubai is home to over made port in the world, and is very close to penetration in the emirate’s shopping malls, 500 publications and some 300 TV channels Dubai’s premium cargo airport, Al Maktoum it will definitely prevail everywhere else in covering the region between and International. the target region. Starting a business in the India in the east and Morocco in the west. UAE enables you to utilize and harness many There is a valuable marketing potential one unique advantages related to the country’s can generate from being just a call away from location that no other country in the whole all of these media outlets. region can offer. The Dubai regional advertisement hub has been instrumental in the development of individual advertisement markets across

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As part of this commitment, the country’s s Principled Approach ces Ministry of Economy is in the process of Suc Business integrity and corporate rs in preparing a set of new laws that include a tne governance are essential not only for a Par unified foreign investment law, an auditor’s law oach corporation’s image but also for a healthy Appr and a new company law with a sophisticated pled business environment and to insure foreign Princi corporate governance framework to protect investors all doors are open the right way. of Law shareholders, achieve transparency and nt Rule The UAE’s business integrity drive deals rust Inhere disclosure of financial results and reports. of T with three components equally, with more ate for Skills Anti corruption efforts are making progress Clim A Magnet education combined with strict legal handling A in the same time. Corporate governance, across the country as well. Starting in 2008, transparency and anti-corruption culture are Dubai launched a major anti-corruption three pillars the UAE is promoting as the new campaign against officials in big realty and frontier of business integrity and the one of financial companies. The campaign was basics of legitimate commercial practice in aimed to prevent officials from abusing the the country. While these pillars are essential economic capabilities of the country, and to to maintain the investor’s confidence in execute international standards to protect A Climate of Trust the country, they are also instrumental in and guarantee the rights of investors. The developing healthier business practices and campaign was considered to be a “correction Partners in Success promoting fair competition in this free trade movement.” At the same level, the emirate Facilitation is one of the basics that govern country. launched a similar campaign that included In addition, the growing involvement of strict and prompt action against any acts of the relationship between the UAE government the private sector in economic activities has Of the UAE’s first efforts to boost and the private sector. The principle was bribery within the emirate, whether in private created cost efficiency in most new enterprises. transparency and disclosure took place in April or public sectors. once summarized by His Highness Sheikh The public-private partnership is working 2007 when the Securities and Commodities Muhammad bin Rashid Al Maktoum, UAE Vice perfectly well in places like Abu Dhabi and Authority issued the Regulation for Corporate Nonetheless, the country is still positively President, Prime Minister and Ruler of Dubai. Dubai and gone are the days of inefficient Governance and Institutional Discipline applauded by the international community. In He said that the government’s role is to create public undertakings gobbling up resources. Standards for public joint stock companies. The late 2010, Transparency International, a Berlin- opportunities for the private sector. authority allowed for a transitional period of based monitoring organization, said the UAE Abu Dhabi has made its partnership with remains one of the most investment-friendly Whether it is for the federal government the private sector a part of its strategic plan three years before making the implementation or the seven local governments, private sector of these standards obligatory for all concerned countries in the region. The annual study of development. The strategy is based on from Transparency International awarded the initiatives have always been a continuous part both the enhancement of the economic companies. of each government’s strategy for the future. Emirates a score of 6.3 out of a possible 10. structure and the diversification of income The decision is aimed at boosting investor The survey aggregates perceptions of public- It is not only about regulations but also about sources through nurturing the non-oil confidence in the UAE’s capital markets. It the spirit. Simply put, the main difference is sector corruption among business people and sectors, strengthening the public-private also provides for increased transparency and experts. hidden in the mentality behind the decision partnership (PPP), encouraging the direct accountability. Hence the listed entities were making process. foreign investment (DFI), as well as entering given a strict notice period to adopt the new The UAE looks on the private sector not just into joint ventures hinged upon comparative protocols. as a tax payer but as partners. It has developed advantages. The essence for Government is Recently, the UAE Ministry of Economy the vision to deal with the private sector as to become the regulator of services delivered announced that they were in the process of a strategic partner therefore counting on to its people, and for the private sector to developing a whole series of new laws which successful continuum of partnerships to boost become the provider of those services. seek to promote efficiency and impose greater the economy, create new jobs and help the On the other hand, the Dubai Economic transparency in order to improve investor country advance further. This is widely reflected Council was established in 2003 comprising of confidence. The new laws are part of a bid to when drafting new laws and regulations that representatives of both the government and enhance the business environment in line with affect the private sector and various businesses. established private sector organizations. Its the UAE’s Vision 2021; which aims to promote The norm is that the government works objective is to serve as a think-tank and policy the UAE, particularly as a global business hand in hand with the concerned business advisory forum for the Dubai Government. centre and investment destination. representatives to come up with policies and regulations that benefit both sides.

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and North Africa (MENA) and the 13th rank globally in the World Justice Project (WJP) Rule of Law Index which covers 66 countries. A Magnet for Skills Inherent Rule of Law According to the index, which is based Due to its close proximity to various Since the UAE is a federation, each emirate on eight key factors, the UAE came ahead of countries that provides skilled yet efficient is authorized by the UAE Constitution, to have the US, which ranked 20th. The WJP’s Rule labor, the UAE has managed to provide its its own laws and judicial authority when not of Law Index is a new tool developed and industrial and business base with suitable conflicting with the federal laws. Hence, the administered by the WJP to measure countries’ workforce without limitations. The added UAE has federal and local laws and courts. adherence to the rule of law in practice and value of being in the UAE besides the fact that Local and federal courts apply UAE federal provides new data regarding a variety of you’re in the heart of the region’s shopping laws and the laws, regulations and decisions dimensions of the rule of law. This is the first rights of workers and the smooth and centre, comfortable living environment and passed by the local rulers of each emirate. In index to cover the rule of law comprehensively. flexible business operations for employers travel destination, is that one gets a unique general, the UAE follows a civil law system The Index is designed to provide governments, is at the center of the UAE’s labor law work experience that only few other countries with is the primary source of law heavily businesses, NGO’s, and civil society, with a tool and the procedures implemented by the in the whole world can offer. The UAE is now influenced by French, Roman, and Egyptian to plan targeted, effective reforms, and will country’s Ministry of Labor. With the rapid a compulsory resume component for many law. However, there is no reason to worry show incremental change over time. growth of the country’s manufacturing and professionals looking to pursue an advanced of any conflicting procedures or legislations. construction sector, introduction of modern career in an increasingly globalized job market. Laws are clear, stable and publicized, the labor accommodation facilities has been government does not expropriate without Surrounded by countries each with a rich pivotal. The concept of residential cities has adequate compensation and government pool of workforce and limited employment been introduced by Abu Dhabi’s ZonesCorp in regulations are effectively enforced. the UAE becomes a natural choice for 2006 to provide a safe and stable environment investors looking for a healthier investment which in turn helps workers in maintaining a All commercial disputes are heard by the environment with easy access to such a large positive work attitude and motivating them civil, criminal and labour courts. The practice human capital. Furthermore, as the country to provide their best efforts. The Ministry in both federal and local courts is the referral emerges as a regional hub for top-tier of Labor is at the service of businesses and of matters to court-appointed experts for universities, more well-equipped Emiratis are workers to address any issues and hurdles findings of facts involving various issues such also entering the job market as a significant they may face to maintain a healthy employer- as financial, accounting and technical matters. option to tap in. About 330,000 nationals employee relation through friendly dispute- While expert’s reports are not binding and are already part of the labor force, and the resolution channels. may be challenged by the parties before number is expected to grow to about 450,000 courts, nevertheless, they are given persuasive Workers from Indian Sub-continent, South In order and security, the UAE scored by 2020. By 2050, that figure is expected to be weight by the courts. 90, absence of corruption 82 and effective East Asia and the Middle East countries are still about 600,000, according to data from Towers pouring in to the UAE mostly for professional Although civil courts are the main forum for criminal justice 84. The UAE also earned top Watson, a human resources consultancy. and middle-class jobs. In addition, the high recourse in commercial disputes, arbitration score in access to justice as people can access Nearly 60 percent of businesses in the unemployment and stagnant wages in Europe is becoming progressively more popular. The to legal counsel, and afford civil courts under UAE are looking to hire at managerial and and North America have made it much easier Dubai International Arbitration Center (DIAC) due process of law. professional levels, up from 46 percent in the to hire Western nationals. Newer trends are and the Abu Dhabi Commercial Conciliation The report described the government as first quarter of the year, according to a survey also emerging with many companies now and Arbitration Center provide world-class accountable and its powers are limited by from Antal, an international recruitment exploring the Chinese talent pool, as shown by arbitration for local business and commercial the judiciary. It also mentioned the absence company with an office in Dubai. This further a recent report from GulfTalent. The growing disputes serving both local and foreign parties. of corruption in the judicial and executives indicates the healthiness and recovery of the presence of major Chinese corporations in The state of law in the country was even branches as well as in police and military. In economy from the adverse effects of the the UAE has increased the representation of certified by some of the world most authentic the security and fundamental rights, the index global financial downturn. Chinese workers in the region. references on the rule of law and the flexibility said people do not resort to violence to redress At the government level, the UAE assures As the UAE aims to facilitate the operations and transparency of the judicial system. The grievances and noted the fundamental labor to meet the international standards in terms of businesses and to remove obstacles on their UAE garnered the first slot in the Middle East rights, freedom of belief and religion, freedom of opinion and expression, equal treatment of labor related legislations. Striking a fair path to growth, the country is committed to and absence of discrimination and right to life balance between the protection of the basic continuously fuel its attractiveness for talents and security of the person. and creativity, sustain its flexible approach to regulating the labor market, and addressing the ever-changing human requirements of businesses. Why UAE ? The Unlimited Opportunities 2012 Chapter 2 Why UAE? The Layers of Uniqueness 72 73

nal tutio Insti ic & onom n Ec catio al Edu echnic High-T e ovation A Tru Inn edge owl unications Kn IT & Comm omy Econ

A True Knowledge sectors and encourage emerging sectors by Dubai, with its pioneering knowledge Economy strengthening the regulatory framework of economy, is leading the way in terms of both key existing sectors, and supporting high regulations and incentives. Under the general Economic Incentives For example, the federal government has value-added economic sectors. umbrella of “What’s good for business is good made it a strategic goal to extend and enhance Moreover, the government of Abu Dhabi for Dubai”, the emirate’s series of cluster- and Institutional Regime the ease of doing business nationwide through is starting a new policy as part of its strategic based free zones have made it much easier As part of its drive to consolidate its various measures such as supporting SME plan to encourage mobility of talents and the to capitalize on knowledge at various levels knowledge economy, the UAE government development by creating the proper legislative open circulation of ideas through meritocratic of profitability. The ease of doing business has, over the past few years, been working environment that stimulates and promotes incentives, both monetary and in kind. The in Dubai has been remarkably linked to to strengthen its already strong business- SMEs, and developing and promoting emirate is putting in place a comprehensive its dynamic regulations and government enabling environment and institutional entrepreneurial mindsets. The government is innovation policy that will bring practical openness as well as the first hand incentives framework towards improving the country’s also implementing new policies to attract and changes to many aspects of the economic provided at several investment locations to competitiveness and promoting innovation. retain talent by facilitating the attraction and regulations. both local and foreign investors alike. In 2010, the UAE was ranked as one of the retention of highly qualified workers. world’s top five business reformers by the Of particular interest here is the federal widely referenced World Bank Group’s Doing government’s new model of international trade Business Report. It was also ranked 33rd out of which prioritizes high value-added industrial 183 countries for overall ease of doing business sectors and encourages their exports through in the 2012 report. modern and effective policies. In terms of By institutionalizing the country’s institutional regime, the federal government’s competition laws, economic frameworks and aim is to enhance the regulation of key existing regulatory policies, the country‘s economic and institutional regime is increasingly injecting further incentives for the efficient use of existing and new knowledge and the flourishing of entrepreneurship. While many existing initiatives have already made the UAE conducive to entrepreneurship, the new policy adopted at both federal and local levels aims at raising the bar when it comes to new investments and what they bring in. Therefore, a new thinking is now governing the economic planning and regulating process towards knowledge-oriented investors.

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Higher and Technical Education In order to truly develop its human capacity and create a workforce with the skills and talent that will drive a knowledge economy, the UAE realizes the need to ensure quality medium of instruction, with faculty education at every level from pre-school to recruited from around the world. post graduate studies. Currently there are To cater for the need to upgrading the nationwide reforms underway to improve the Of particular importance here country’s innovation system, the UAE has quality of teachers, curriculum, and assessment is CERT (the Centre of Excellence launched a series of initiatives to strengthen at primary and secondary education levels to for Applied Research and Training), the nation’s innovation drive. Key to fostering enhance the country’s educational outcomes. which is the commercial arm of innovation will be the establishment of In higher education, curricula are being the Higher Colleges of Technology, stronger ties between education, industry, upgraded to improve competencies that developing and providing trade, services, enterprises and entrepreneurs. ensure creativity and innovation. education, training and applied Strengthening the motivation for innovation technology for public and private Both federal and local governments among individuals and firms is also critical sector clients. The Wharton realize that education is the cornerstone of to fostering a culture of innovation and Center for Family Business and the knowledge economy as it supplies the entrepreneurship. Entrepreneurship Research for the necessary skills and talent. The objective of While the UAE currently boasts of several Middle East is based at CERT. The UAE current educational policy is to create state universities and double the number University of Waterloo, Canada, a society of skilled and creative people, in private sector, it is important to highlight offers dual degrees in collaboration with opportunities for quality education, the example of the Higher Colleges of with HCT through CERT. employment or self-employment, and the Technology (HCT) which is evidently the chance to participate fully in the country’s But most significant is the role largest institution of higher education in development. CERT played in bridging the gap the UAE. In the academic year 2009-2010, between the academy and the In addition, the UAE is partnering with this MIT-like institute had 11,700 female and various industries present in the some of the world’s leading educational 6,500 male students enrolled at 17 campuses country. CERT’s success has also institutions to fortify the country’s education and 92 programs throughout the country. encouraged the University of sector. This substantial investment to bring What is noteworthy is the type of education the UAE, in Al Ain, to establish a world-class education and strong research offered here which includes post-secondary similar center which is now widely capabilities into the country is an important degrees in business, education, engineering applauded for the essential role it step in developing a workforce with the right technology, information technology, applied plays. Similar initiatives are under skills to generate growth and in increasing the communications and health sciences. In way by the Khalifah University country’s research output. In order to keep particular, the HCT places a strong emphasis for Science & technology, the pace with global developments, there is still a on an innovative, project-driven and student- American University in Dubai, need to develop a critical mass of specialized centered curriculum. English is used as the and the American research institutions and highly-skilled University of Sharjah. knowledge professionals, including scientists and engineers. By strengthening its capacity as a centre for education in the region, the UAE can leverage its position as a knowledge hub and serve as a talent pool, while competing globally.

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Both federal and local governments are widely using e-government to offer more and Innovation more services to the public which in return have Information & Communication raised the percentage of Internet penetration Being the only Arab country to have an both vertically and horizontally. In addition, innovation-driven economy, the UAE has Infrastructure the federal government and the governments been developing and upgrading its system of The importance of a dynamic information of Abu Dhabi, Dubai and Ras Al Khaimah are innovation as part of its drive for a knowledge- and telecommunication infrastructure in available through mobile gateways for easy based economy. The country has been recently enabling a knowledge economy is undeniable. access on the move. named by INSEAD, the leading business school With a clear view to use ICT to facilitate in Europe, as the most innovative country in effective communication, dissemination In terms of national infrastructure, the and processing of knowledge, and have a UAE places building a national fiber networks the Middle East, citing its robust technology and make them pretty strong nationwide, particularly important role in the dissemination as part of the national agenda. For UAE, the infrastructure and high-quality education which guarantees that the production of of scientific and technical information, the aim of having a fiber network is to “improve system. According to INSEAD’s annual Global innovative output is going to continue. Innovation Index (GII) report, the UAE rose UAE has already developed an impressive ICT the country’s image, making it appear quicker by two spots in 2011 to rank as the 24th most There are efforts underway to strengthen sector with a demonstrated commitment to to adopt new technologies than competing innovative country in the world. the UAE’s innovation drive. Strengthening the providing its people and businesses with access nations and so more attractive to foreign motivation for innovation among individuals to the latest technologies. The UAE is rated as investors”. This is confirmed by Fiber To The For many observers in the country, that was and firms is also critical to fostering a culture the leader in the MENA region for ICT and a Home (FTTH) Council which ranks the UAE not a surprise. There’s a lot of creativity and of innovation and entrepreneurship. Currently, solid performer internationally. According “fourth among all economies in FTTH market innovation happening in different ways than in the Small & Medium Enterprises (SME) to the World Economic Forum’s Global penetration, positioned ahead of all European what’s commonly thought of. Although the sector, there are business support program Information Technology Report 2009-10, the and Americas economies and behind South country might not be ready yet to produce including efforts by the Sheikh Khalifa Fund, UAE ranked 23rd globally making it among Korea, Japan and Hong Kong”. patentable technology innovations, what is the Mohammed Bin Rashid Establishment the world’s most networked economies. Out First of its kind in the Arab world, an ICT being done at Abu Dhabi’s Saadiyat Island and and Ruaad to encourage entrepreneurship of 138 countries, UAE is ranked 24th in the Fund was initiated in 2005 with a key objective Dubai’s various knowledge clusters is actually by smaller-sized businesses. Going forward, report’s Networked Readiness Index (NRI) in to drive the strategic development of the creating value-adding changes in society at a challenge will be to provide incentives to a continuation of its impressive performance country’s ICT sector in order to strengthen the large. large multinational companies to anchor their throughout the previous editions of the NRI. innovation and knowledge capital level of the The Global Innovation Index uses a Research & Development (R&D) functions in The UAE is also keen to use ICTs as a market by providing research, education and broader definition of innovation, other than the UAE to encourage valuable knowledge vehicle for the promotion of culture and entrepreneurial opportunities. just looking at investments in research and transfer. Other schemes to change the national identity. There are several initiatives development (R&D) or the amount of patents regulatory structure of how to start a business, To cater for ICT security needs, The for the development of Arabic content such published. The UAE scored high marks in the as well as new bankruptcy legislation, are UAE Computer Emergency Response Team as applications for learning, development index’s technology infrastructure, investment being introduced gradually. (aeCERT) was established in 2008 to facilitate of Arabic media and digitization of scientific in education, and knowledge application the detection, prevention and response of The latest initiative in this regard is the content. The Mohammed bin Rashid Al rankings, finishing eighth, 15th and third cyber security incidents on the Internet, hence, “Majid Bin Mohammed Innovation Center Maktoum Foundation has an initiative to worldwide respectively. In effect, that means supporting a safe cyber environment for the in5” which was launched in October 2011 to translate and digitize masterpieces in science the country is moving into more knowledge- residents of the UAE. Police departments also promote entrepreneurship and technology and culture at the rate of one book per day, based sectors. The UAE has made a similar have specialized units to fight cyber crimes. innovation in the UAE. Located at Dubai and make them available online thereafter. progress on the Innovation Efficiency Index, Internet City (DIC), the center will focus on which examines how economies leverage the five key objectives of accelerating the their enabling environments to stimulate development of new start-ups and SMEs, innovation results. fostering entrepreneurship, driving technology Meanwhile, the UAE has put a lot of effort innovation, contributing to shaping an ICT to create enabling conditions for innovation, ecosystem and, most importantly, promoting such as regulations or scientific institutions, Dubai as an ideal location for tech start-ups. The UAE is also known for its zero-tolerance policy in intellectual property violations while in the same time applying effective regulations for proper patenting, copyrighting and trade- marking.

Why UAE ? The Unlimited Opportunities 2012 Chapter 2 Why UAE? The Layers of Uniqueness 78 79 the third fastest growing city in the world, behind Dublin and Las Vegas, due to these simple reasons. tion Na The government considered a stable ness Busi monetary policy, a resilient fiscal policy and ned enow among international entrepreneurs, he strategic trade policies. It has also realized A R s the importance of concluding regional and sines succeeded in spreading the UAE as one of lic Bu global agreements. In order to strengthen ymbo the most-welcoming investment destinations. S dors its position as an open economy and establish E: mbassa By then, businessmen and investors realized UA A a global presence in all assemblies, the UAE The ized the sincerity and commitment of the UAE gn into becoming a truly investment home. The signed the GATT treaty in 1994 and became a eco sitioned Brands A R d Well-Po UAE is currently housing more than thirty member of the World Trade Organization in Bran 1996. The UAE also holds various Free Trade obal five free zones of which some are purposely- Gl built and dedicated to serve a specific sector Agreements (FTAs) with different countries. such as Dubai Media City and Dubai Internet Throughout the history, the UAE has City. These zones along with specialized been taking the lead in supporting the business zones played a very important role needy nations. It has an active presence in The UAE: A Recognized in establishing the UAE brand since they offer the development of housing, education and Global Brand great incentives for international investors. infrastructure worldwide, thus enabling the A Renowned Business Nation A business entity established in a country Since its establishment on December 2nd does not only mean it carries its own trade 1971, the founding fathers of the UAE have name, but it also means it agrees to bear the pictured the young country as one of the well- country’s brand. Today, thousands of business known nations in all fields. They have started ive ive rt vat ed entities are operating from the UAE, indicating setting up the physical and mental bases by po no rmin up In ete the strong willingness of global entities to building the infrastructure of roads networks, S D Wise associate their businesses with the UAE Brand. seaports, airports and business hubs, and However, what does the UAE brand stand for? by propelling all kinds of positive signals aring Making the UAE a globally-recognized attracting not only the local people but also C business brand can’t only be attributed to a the world to join the development cycle in the single factor. The main drivers that positioned UAE. the UAE brand in the active worldwide The late Sheikh Rashid bin Saeed Al business arena may include the government, Maktoum, the founding father of Dubai, was the UAE-based companies with their individual the first one to introduce the concept of free The steps of the founding fathers were recipient countries to steadily grow their brands, products and services, regional and zones when he launched Jebel Ali Free Zone in followed by their visionary sons, Sheikh economy. Abu Dhabi Fund for Development, international agreements and treaties, and 1985, one of the most recognized free zones Khalifa bin Zayed Al Nahyan and Sheikh the UAE Red Crescent Authority, Dubai Cares, innovative business concepts. in the globe today. By creating a positive stir Mohammed bin Rashid Al Maktoum, showing the Al Maktoum Foundation and Sharjah their commitment to continue the path Charity Association are a few examples of the of success. They legislated free, open and actively involved charities in the world. encouraging business environment where With a wise ambitious leadership, the UAE international investors can own 100% of managed to obtain high rankings in most of their businesses, face easy procedures, cost- the global-recognized indices. To name a effective setting up setting up fees and few, it is the first Arab Country in the Global transparent market data in a highly demanded Enabling Trade Index, Human Development emerging market. In the 1990s, Dubai became Index, Networked Readiness Index, Global Financial Development Index, Prosperity Index and Corporate Social Responsibility Index. Moreover, the government believes of hard work and commitment to provide the most competitive and being recognized globally in order to maintain its prestigious position.

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Symbolic Business Ambassadors The trust with the world that has been In line with the international standards, built by the local and UAE-based international the UAE-based companies and organizations businessmen since the early days of pearl always seek to obtain international industry is significantly contributing to the recognitions such as ISO. Dubai Cable Company structure of the UAE brand today. Foreign “Ducab”, was among the first organizations banks agreed to trade gold with local to achieve the ISO 9001 certification and the businessmen with no need for guarantees first in the region to achieve the ISO 14001 and business transactions with Indians traders environmental certification. Furthermore, were also carried with no guarantees needed. These companies did not halt operating in they compete to obtain international awards and prizes. For example, in 2009 the Reaping the advantages of the UAE the international arena but they are also keen regulatory business environment and basing to place the UAE name visibly on different on the characteristics and reputation of the assemblies. In 2009, Etihad Airways, the Abu UAE brand that has been built up for decades, Dhabi-based national airline of the United y the existing UAE-based companies did not only Arab Emirates, signed a three-year deal to rth l be the official shirt sponsor and partner of o uria flourish in the region but also in the wider t-W ene Premier League side, Manchester City FC to us epr world. Tr ntr sional have the Etihad Airways brand logo appear E rofes Today, the UAE has a foot in all countries P on Manchester City shirts from the summer to mpetitive across all sectors. Abu Dhabi Polymers Company promote the company. Etihad means “Union”, Co (Borouge) established a manufacturing plant representing the name of the country. in , China to serve the Asian growing Social DP World, one of the largest marine market. Rakeen, a real estate developer, Responsible developed a mixed-use luxurious development terminal operators in the world today with in the Georgian capital Tbilisi, offering state- 49 terminals and 12 new developments across of-the-art residential and commercial facilities. 31 countries and serving customers in some of Arabtec, a UAE-based global construction the most dynamic economies in the world, has company, successfully completed the iconic chosen the UAE flag as its official logo. group received seventeen industry awards, Russian project “Okhta Centre”. Al Hilal Bank including three for innovation and three for started operating in the UAE in 2008 and customer service. It has been named ‘Best swung its wings over the Kazakhstani market Overall Operator’ in the Middle East six times in 2010. UAE Exchange, a global leader in since 2006 and was named ‘Best International remittance and exchange services, today, is Carrier’ at the World Communications Awards benefiting the whole globe from its services in 2008. . The examples of the UAE-based companies’ As the UAE-based companies seek for success are unlimited. greater heights in terms of enlarging their business operations and jurisdictions, they also seek to socially contribute to the societies where they operate.

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Well-Positioned Brands Operating from the UAE means that the business entity, through its operations, products and services, carries the UAE brand on its shoulders. Characterized as high quality, competent, reliable and cost effective, the UAE products and services have been vital marketing tools, raising the UAE name globally and actively contributing to the development of the UAE brand. The UAE government issued the regulations that assure the quality of its products and numerous awards over the years for the services in order to match international quality of its in-flight cuisine, the breadth of it standards and measurements. The UAE Federal in-flight entertainment, and the excellence of Law No. 28 of 2001 specifies the standards of a its overall service. material, product or service in order to ensure In Addition, the UAE products are its safety, quality, reliability and compatibility environment-friendly, supported by with international recognized codes. Al Islami government policies to be environmentally- Luncheon Meat from Al Islami Foods, a pioneer responsible. Dubal, a major aluminum food producer in the region, successfully manufacturer in the region, has won a number passed the European Union regulated tests of international awards for its environmental while all other brands tested positive for traces performance. Products of Arabian Packaging of pork. Thus, it was recognized with an award Company follow environmental standards for the best luncheon meat. for its sourced raw material to guarantee Emirates Airline, the largest airline in the complete compliance with the safety of the Middle East and the sixth-largest airline in environment. the world in terms of international passengers Due to the UAE’s prestigious brand that carried and largest in the world in terms of has been built by various factors as mentioned, scheduled international passenger-kilometers many international companies have chosen flown, operating over 2,400 passenger flights the UAE as their main headquarter. Renowned per week, from its hub at Dubai International media providers like CNN international, Airport Terminal 3 to 111 cities in 62 countries Bloomberg and BBC World have chosen the across six continents, has successfully UAE as a main headquarter to cover the Middle represented the UAE brand through its East and North Africa region. The International superior services and defiantly deserved to Renewable Energy Agency (IRENA) chose Abu be the UAE’s top brand. Emirates has received Dhabi as its main headquarters. According to Business Intelligence – Middle East Unit, 90% of French Companies choose the UAE for setting up regional headquarters. Today, the UAE has defiantly become the location of choice by international investors and businessmen due to its globally-recognized brand.

Why UAE ? The Unlimited Opportunities 2012 The United Arab Emirates A Sound and Resilient Economy Chapter 3

The United Arab Emirates A Sound and Resilient Economy

“ No matter what was the size or structure of a nation’s economy, its ability to withstand the years of drought and ride the economic downturn cycles successfully is the real test of its resilience. In the UAE,

the storms and turbulences were seen as challenges, like

finding water in the vast desert. As usual, the country was up to it. “

The Unlimited Opportunities 2012 Chapter 3 The United Arab Emirates A Sound and Resilient Economy 86 87 from paying taxes. Ever since then, the city manufacturers in Europe and auto parts became a destination for merchants, investors, manufacturers in the United States of America and businessmen from all around the world to spice suppliers in India, trust was accepted looking to make a breakthrough in this part as the main guarantee to deal with the UAE The UAE: A Strong of the world. The UAE Economy: merchants. That trust was also reflected on the Economic Heritage Since its establishment in 1932, Sharjah A Unique Orchestration domestic market when banks gave loans and Airport Station rapidly grew up to become construction companies built houses based on The Trucial States, as the seven emirates Arabia’s first specialized cargo airport and a As a key international player and a trust. used to be called until 1971, were famous centre for regional logistics; a role that was responsible energy provider, the United Arab For the present generation, the pearl-diving for their business culture and embedded later complimented and enhanced by the Emirates has designed its economy in a way grandfathers with their friendly personalities, multicultural values throughout the history. establishment of Dubai International Airport that integrates productively in the regional left both rich business traditions and fruitful Commencing from the third millennium B.C., in late 1950s. economic scene while providing residents with partnerships across the region that were Umm Al Nar, the capital of Majan Civilization Abu Dhabi’s early discovery of the nation’s the essential requirements for a prosperous, successfully utilized to build a unique blend that flourished in the lands of the UAE, was largest oil reserve in the early 1960s marked generous life. for the UAE’s emerging economy back in the a major hub that exported copper to the 1970s and beyond. a turning point in the history of the Trucial Even though the federation was formed neighboring nations. In the modern history States and transformed the whole nation merely 40 years ago, tahe pillars of its current The image, today, sounds even more of the country (19th century), Dubai began to a new era in almost every aspect of life. socio-economic stability were deeply rooted promising. With the success each and every its essential role as a regional hub for goods Although the oil fortune was mainly used to in the country’s historic trade traditions Emirate had over the past four decades, going to the upper Gulf, Iraq, Persia, eastern upgrade the public infrastructure nationwide, over centuries. Entrepreneurs from the UAE, the United Arab Emirates has emerged as Africa and even beyond. Other cities like boost education and health services and with their embedded high cultural values, an important, responsible contributor to Sharjah, Ajman and Dalma island also played empower the new federation, it also played were behind the good reputation that the world’s economy, backed by a strong a major role as markets, each in its own an essential role to energize the economy and the economy is known of today. In 1960s, national economy with solid macroeconomic specialized field. fuel its multi-faceted growth in the years after international business transactions between components. Historians demonstrate that by the end of the federation was formed. Dubai, Sharjah foreign companies and local merchants In 2010, the UAE ranks 3rd regionally and the 19th century, the ruler of Dubai made a and Ras Al Khaimah followed the same policy were mainly based on trust, no papers 27th globally in terms of the quality and radical decision by exempting foreign traders with their oil revenues. signed and no bank guarantees. From gold attractiveness of its business environment.

Why UAE ? The Unlimited Opportunities 2012 Chapter 3 The United Arab Emirates A Sound and Resilient Economy 88 region relies on one country; the United Arab Emirates. Diversification has been and will continue to be the main pillar of the UAE economy. Today, The UAE Economy: 40 years ahead, the non-oil economy of the The Pillars of Success UAE contributes over 68% of the nation’s GDP. Both the federal and the local governments are The farsighted vision of the founding still making effective plans to increase the non- fathers of the UAE was essential to the success oil contribution even more. of the local economy and its expansion abroad. The late Sheikh Zayed bin Sultan Al Nahyan In line with its vision 2021 and its federal and Sheikh Rashid bin Said Al Maktoum had strategy 2011-2013, the UAE is taking strategic a clear view of the role the UAE federal and initiatives in order to establish a knowledge- local governments should play to motivate the led economy. Strengthening small and medium newly formed national economy. enterprises (SMEs) to efficiently provide advanced, creative and innovative technologies The view from the top was pretty sharp is the prime contributor to the evolution of the and clear; instead of building a controlled transition. state-run economy, they provided the healthy grounds for it to grow. The new government’s In addition, to the initiatives offered at the task was to act as a facilitator for business federal level, the UAE has several economic and free trade. Both government bodies and initiatives working in integral, parallel harmony. business entities started a de facto partnership The federal government runs the overall that successfully built what we know today as operations, especially in terms of external trade the UAE leading economy. and nationwide monetary and fiscal policies. With such a healthy economic environment, Meanwhile, the local government in each it was natural for the private sector to flourish. emirate thrives to inject as much incentives and The strategic decision not to rely completely competitiveness into their offerings to further on hydrocarbons opened the door to many motivate the local economy and businesses. economic sectors to grow and compete. Local The healthy levels of inter-emirate competition businessmen and women were encouraged have been instrumental in attracting a lot of to start new types of businesses, bring in new foreign direct investment while helping local international brands; they were even offered businesses grow from small shops to multi- government finance as startups. With this billion-dollar conglomerates. winning formula, the UAE has successfully Local initiatives vary from one emirate to maintained its position as the region’s hub another, but they all adopt open market and of international trade in almost all products healthy competition policies. Free trade is and services. From financial institutions to protected by law and each emirate has several information technology and from shipping free zones to facilitate specialized business and logistics to primary re-exports, the whole parks that serve the UAE and beyond.

The United Arab Emirates A Sound and Resilient Economy Largest nd Resilient Enabling and Open and in the GCC Diversified Trust-Based Free, Robust Adapting and Balanced Focus Entrepreneurial GDP II At the Cutting Edge

Why UAE ? The Unlimited Opportunities 2012 Chapter 3 The United Arab Emirates A Sound and Resilient Economy 90 91 billion in 2010 at current prices. However, such The UAE GDP Growth by Sectors at Current Price (Millions Per USD) a huge growth couldn’t have been possible without the fundamental components of the Sector 1975 2010 UAE’s economic policy that kept providing Agriculture , Live Stock and Fishing 315 2,610 The UAE: the market with motivational strengths and Mining and Quarrying 33,387 94,009 A Story of Growth enough liquidity. The stable macroeconomic components, increasing domestic and foreign Crude Oil and Natural Gas 33,294 116,450.80 Throughout the last four decades, the investments, liberal financial and trade policies, UAE managed to leap the hypothetical the availability of the skilled labor and the Quarrying 93 391 development ‘stages’ that most developed access to the MENA and Africa region have Manufacturing Industries 531 28,925 countries seem to have experienced. It has been and will always be the strong drivers of successfully reached the stage of modernity the UAE economy. Electricity , Gas and Water 270 7,617 and became one of the most successful Since the early days of independence, the Construction 8,961 34,660 emerging economies in the world. Not only UAE adopted a dual track approach to grow up Wholesale Retail Trade & Repairing Services 8,864 38,097 the high mass of oil revenues enabled the UAE its economy; both federal and local (emirate to short-cut the usually difficult and lengthy level) factors have been instrumental to this Restaurants and Hotels 6,292 process of saving and capital accumulation growth. Figure 1 below shows clearly that Transports , Storage and Communication 1,847 26,942 necessary for economic development but while the overall performance of the economy also the creativity in devising innovative was growing steadily, its non-oil components Real Estate and Business Services 2,543 29,510 policies and visions to cope with the resources were also being enriched in order to reach a 7,060 scarcity’s challenges, either human or nature, situation where the whole country can live Social and Personal Services 453 and mitigate the sever hardships, has played prosperously without any oil contribution to The Financial Corporations Sector 1,300 20,230 an important role in shrinking the long process. the GDP and the state funding. Government Services Sector 884 13,573 These policies have contributed in building a However, the oil fortune was rightfully creative – spirit economy with a vast pool of used to boost the infrastructure across the Domestic Services of Households 39 1,125 historical experiences and practices. country. Oil revenues made %58 of the Imputed Bank Services (Less) -1,081 -13,105 In conjunction with the rapid growth of national GDP in 1975; which was the year the UAE’s population and domestic needs, the that witnessed the first federal budget. The Gross Domestic Product total 58,313 297,546

economy size has exponentially grown from a government of Abu Dhabi, which produces Included in the above item. GDP of USD 21.10 billion in 1972 to USD 297.5 over 90% of the country’s oil, contributed some Non Oil sector 24,926 203,927 % Non Oil GDP 42.7% 68.5%

80% of that budget. Keeping in mind that share went down by 30% in 2009, while Abu Abu Dhabi is actually the largest emirate and Dhabi’s share became 60% (from 48% in occupies over 85% of the country’s map, the 2002). The other emirates maintained a stable significance and magnitude of its contribution contribution in the remaining 10%. to the federal budget and economy can be easily GDP/Non Oil GDP (Millions per USD) understood, while building and maintaining its pre- 300,000 federation economy. 250,000 Dubai, the second largest emirate in the country, built 200,000 its own unique business model in terms of re-exports and 150,000 services, therefore its share 100,000 in the GDP went from 25% in 1975 to over 40% in 2002. Later 50,000 on, because of the surge in oil 0 prices and the consequent 1975 1980 1985 1990 1995 2000 2005 2010 credit crunch, Dubai’s GDP Why UAE ? The Unlimited Opportunities 2012 Chapter 3 The United Arab Emirates A Sound and Resilient Economy 92 93 1970-1980 saw high growth performance when the the government. The interest rate was lowered government used the surplus of its oil to develop its and banks were given about USD 19 billion facility infrastructure. to enhance economic growth and consumer A closer look at the GDP contributing expenditure (see … to read about how the UAE activities in the UAE shows that the country’s Important Stages of the 1980’s: Diversification Strategy dealt with the crisis in details) economy is highly dependent on the external UAE Economy The government committed itself from the sector as reflected by the trade ratio (exports beginning to allow and accept diversification of its 2009 end’s: Regaining Growth Mode and imports). Consequently the external 1900-1930: Pearl Industry Era economy by allowing foreign investment and issuing National GDP increased by 1.3% in 2009, driven sector plays a major role in the performance open and encouraging policies for companies The UAE became a commercial centre linking by consumer demand. The astonishing increase and evolution of the UAE economy. The UAE’s to flourish. The UAE positioned itself as a main Indian with Arabian waters by supplying pearls of this indicator by 72% since 2005 proves the trade balance in 2009 decreased by 33.1 per international trading hub and a major regional cent from USD 62.9 billion in 2008 to USD 42.1 resources to the world. This economic activity successful transformation of the UAE economy financial centre. from an oil-driven economy to a consumer- driven billion. provided employment and income to the majority of the population, transformed the traditional economy. This decrease was largely due to a 19.8 per economy of the tribal population and made the 1985’s: Inventing Free Zone Concept cent decline in the value of exports and re- UAE’s ports as major trading ports in the region. A totally new business concept was introduced in 1998’s: Aggressive Diversification Strategy exports. The country’s free zones also decline The worldwide economic depression that erupted in Dubai by establishing Jebel Ali Free Zone Authority The oil sector is still a major contributor to the in 1.3 per cent in exports, which reached USD 1930s and the Japanese discovery of the cultured (JAFZA). Little attention and great criticism were total GDP. The UAE is also still supporting the non- 26.2 billion in 2009. Meanwhile, re-exports pearl spelt disaster for the Gulf’s pearling industry. received at the beginning. Day after day, the free oil initiatives and developing encouraging policies in reached USD 79.9 billion in 2009. The UAE, because of its creativity economic spirit, zone concept has proved its success when hundreds that regard. Although the private sector expenditure was able to recover fast by using its ports on trading of domestic and international companies joined that plays an essential role in the UAE’s economy other goods across the region. attracting zone that grants them with exceptional 1999-2007: The Second Boom privileges like 100 percent foreign company with over three quarters of the GDP, the Furthering the diversification and growth ownership and exceptions from taxes and customs. government sector is still an important player. 1958-1980: Discovery and Production of Oil strategy, the UAE and its seven Emirates started Today, free zones have become integral parts of the The UAE maintains a successful partnership to seek for competitive positions in the new fronts An economic significant era began in the early UAE economy and contributes more than 15% of between the government and the private of the world economy, in the period between 1970s with the establishment of the UAE and the the national GD. sector. production of oil. The rapid transformation from 1999-2008, the country maintained a remarkable But with a clear path to the future, optimism a desert region to one with a booming economy economic growth rate of 9%, being among the 1990’s: Advancing the Diversification Scheme is a daily practice in the UAE. The Ministry of was possible by gaining massive revenues from oil top league of the fastest gorwing world economies. Foreign Trade forecasts that the country’s exports. The UAE was the only GCC oil producer The uninterrupted growth over the previous ten with the launch of initiatives in the scale of Dubai external trade will reach USD 200.14 billion in country to keep foreign partners on a production- years allowed the country to focus on developing its internet city, Dubai Media City, DIFC, Dubai Health the year of 2011, increasing by 11% compared sharing basis at that time. This policy proved its non-oil sectors like tourism sector, real estate and care city and twofour54 Abu Dhabi, the country have to 2010. Foreign direct investment FDI in 2010 viability in giving the country a technological edge re-exports sectors. The contribution of the non-oil established itself as a major global destination for grew up 13% to USD 15.03 billion. over fellow producers in the Gulf. The period sector increased. The economy transformed from ICT, Media, Financial services, healthcare and other an oil dependent economy to a more diversified major knowledge-based economic sectors. this economy. period also witnessed great development of iconic projects in the areas of real estate and tourism that 1998’s: Surviving the Oil Price Crunch put the country in the world’s record book, starting The GCC countries were faced with the with the launch of Burj Al Arab, the world’s only challenges imposed by the oil downturn cycle seven-star’s hotel to the creation of Yas Island, one in the late nineties. As a response the UAE of the world’s most luxorious tourist destinations. government increased its spending, deepened its Real Estate developments peaked during he early non-oil initiatives and maximize the private sector’s years of the 2000’s, resulting in 30% of the world’s participation in the strategic sectors like energy and crains to reside in the UAE and in more than 750 heavy industries. The UAE through its diversified skyscrapers decorating the UAE’s landscapes initiatives and with each emirate focusing in a With all the developments taking place in the specialized economic portion were able to absorb country and with the hard and deligent efforts of the downturn and as a result the diversification the government and the private sector, the UaE scheme was fortified. turned into a brand synonymous with development, ambition, luxury and prospertity. This resulted in 2007-2009: Global Financial Crisis a great interest and influx of people to the land of The challenges that the UAE has gone through the UAE to ripe the fruit of what people called “The because of the recent economic cycle were faced Second Boom” by expansionary monetary and fiscal policies by Why UAE ? The Unlimited Opportunities 2012 Chapter 3 The United Arab Emirates A Sound and Resilient Economy 94 95 darkness of the turmoil. The prudent policies GDP at Current Price Per Sectore (Millions Per USD) by the government were mainly behind the remarkable restored macroeconomic figures Sector 2009 2010 The UAE: A Sound as shown in the tables. The Non Financial Corporations Sector 249,229.2 275,722.0 Macroeconomic Agriculture , Live Stock and Fishing 2,608.1 2,610.4 Environment Gross Domestic Products (GDP) Mining and Quarrying 78,552.4 94,009.2 78,177.6 93,618.3 The global economy was affected by the of the UAE Crude Oil and Natural Gas recent economic distress. The UAE, an important The ongoing efforts by the federal Quarrying 374.8 390.9 economic player in the region, had faced these government to diversify its economy and Manufacturing Industries 27,314.0 28,924.8 not-avoided challenges, a fact that can’t be reduce the dependency on the hydrocarbons ignored. However, the sound macroeconomic sector are achieving good results each year. In Electricity , Gas and Water 6,483.3 7,617.0 fundamentals of the UAE driven by high oil 2010, thirty percent of the national GDP came 31,921.0 34,660.0 revenues and government spending were able from mining and quarrying sectors, a relatively Construction to gain back the confidence of the local and low share compared to other GCC countries. As Wholesale Retail Trade & Repairing Services 36,353.7 38,096.8 international businessmen and investors and for the non-oil sectors, the services sector was therefore achieve a steady and sustainable the major contributor with more than 35% as Restaurants and Hotels 5,635.2 6,292.2 growth when most economies stumbled in the the below table demonstrates. Data issued by Transports , Storage and Communication 25,173.6 26,941.8 the National Bureau of Statistics show that the total GDP at current prices grew by 10.1% Real Estate and Business Services 29,039.7 29,510.0 in 2010, whereas the non-oil sectors grew by Social and Personal Services 6,148.3 7,059.8 6.2%. The Financial Corporations Sector 19,555.5 20,229.9 Abu Dhabi, the producer of 90 percent of crude oil and natural gas in the UAE, remains Government Services Sector 13,013.5 13,573.3 as the strategic contributor to the national Domestic Services of Households 1,161.2 1,125.0 GDP. Currently, the emirate is the major contributor in the mining, agriculture, utilities, Imputed Bank Services (Less) -12,717.8 13,104.5 government and social services sectors. In 2010, Abu Dhabi contributed 60% of the federal Total 270,241.6 297,545.6 GDP. Its share is expected to increase because Total of Non Oil Sectors 192,064.0 203,927.3 of the diversification plans that were set by Abu Dhabi vision 2030. the free zone and industrial city around it), it In 2009, Dubai alone contributed 64% of the Dubai, the second largest emirate, was consolidating its centuries-old tradition country’s wholesale & retail trade and repairing of serving as a regional hub of re-exports. services sector. contributes 30% of the federal GDP and 41% of the non-oil GDP. In fact, the role Dubai plays in the national economy has gradually increased since the federation. When theemirate started its flagship Jebel Ali Port (and consequently Key Economic Indicators Gross Domestic Product (GDP) at Current Prices (2010) USD 297.54 billion GDP per Capita (2010) USD 36,000

GDP (at Current Prices): Average Annual Growth 13.08% Rate (from 2002 – 2010)

Balance of Payment (2009) USD 7.85 Billion Government Spending (2010) USD 24.54 Billion Inflation Rate 1.6% (2009) Consumer Price Index (CPI) 11.4% (2009)

Why UAE ? The Unlimited Opportunities 2012 Chapter 3 The United Arab Emirates A Sound and Resilient Economy 96 97 GDP by Economic Activities and Emirates (2009) The Figure below is important to understand how each emirate contributes 1 to the national GDP per economic activity. 2 Because of the liberal policies and the free 3 market competition model, each emirate was able to build its own competitive edge and 4 use it to promote its own micro-economy. 5 The cited income differences between the 6 emirates are generated mainly by the variations 7 in their natural resource endowments. The most important resource the UAE possesses is 8 hydrocarbons (oil and gas). The UAE’s proven 9 oil reserves stood at 97.8 billion barrels at the 10 end of 2008, and its proven gas reserves at Abu Dhabi 11 227.1 trillion cubic feet. Dubai 12 Distribution of Gross Domestic Product by Sharjah Economic Activities 2010 At Current Prices Ajman 13 14 2.37 Social and Personal Services Umm Al-Quwain

6.80 The Financial Corporations Sector Ras Al Khaimah Fujairah 4.56 Government Service Sector 0.38 Domestic Service of Households In spite of the challenges posed by the 4.40 Less: Input Bank Services 1 - Agriculture, Live Stock and Fishing recent economic turmoil, the UAE also 0.88 Agriculture, Live Stock & Fishing maintained a positive balance of payment 2 - Crude Oil, Gas and Mining 3 - Manufacturing Industries 31.59 Mining and Quarying Sector with a surplus of USD 7.85 billion according to data issued by the National Bureau of 4 - Electricity, Gas and Water Statistics. A main driver behind sustaining 5 - Construction the positive growth trend in the UAE is the government’s continuous investment to 6 - Wholesale, Retail & Repairing Services improve the countrya’s infrastructure. In 7 - Restaurants and Hotels 2010, its spending reached USD 24.54 billion. 8 - Transports, Storage and Communications Ranking 7th on government spending 9 - Real Estate and Business Services efficiency by World Economic Forum (WEF) in 10 - Social and Personal Services the 2010-2011 Global Competitiveness Report 11 - The Financial Sector for the second consecutive time proves the strong commitment of the government to 12 - Government Sevice Sector continue the outstanding performance of 13 - Domestic Services of Households diversifying the economy by pumping cash into 14 - Less imputed Bank Services the different sectors. 9.72 Manufacturing Industries

2.56 Electricity, Gas & Water

11.65 Construction

12.80 Wholesale, Retail & Repairing

2.11 Restaurants & Hotels

9.05 Transport, Storage & Communication

9.92 Real Estate & Business Services

Why UAE ? The Unlimited Opportunities 2012 Chapter 3 The United Arab Emirates A Sound and Resilient Economy 98 99 table “Main Expenditure Groups of the CPI”. Consumer Price Indices (2010) The data also show that the “communications group” slowed down the rise of the index Main Expenditure Groups of the CPI 2009 (CPIs) 2010 (CPIs) Relative Change % when the prices of its items dropped down by Food and Soft Drinks 117.20 122.42 4.46 5.79% in 2010 compared to the end of 2009. Alcohol Beverages and Tobacco 114.78 116.23 1.26 GDP per Capita Textile, Clothing and footwear 114.06 108.40 -4.96 The growth of the UAE Emirates GDPs Growth (Millions per USD) economy over the last forty Housing 113.90 113.56 -0.30 years has allowed it to 200,000 Furniture and other items 113.56 118.86 4.67 achieve one of the world’s 2007 highest GDPs per capita 2008 Medical Care 106.18 105.26 -0.86 150,000 2009 that stood at USD 53,400 by Transportation 110.79 114.54 3.38 2008, ranking 35th out of 179 countries in terms of the 100,000 Communication 104.15 98.12 -5.79 UNDP Human Development Recreation and culture 104.40 109.33 4.72 Indicators. This performance 50,000 was not only a result of the Education 119.25 128.89 0.09 sectors expansions but also Restaurants and hotels 129.70 130.84 0.88 of the open and encouraging 0 Abu Dhabi Dubai Sharjah Ajman UAQ RAK Fujairah policies that allowed investors Miscellaneous goods and services 115.68 117.31 1.40 and businessmen from all around the globe to flourish in the UAE’s Total 114.00 115.00 0.88 growing markets. Abu Dhabi also made a progress from its rates, exchange rates of the country’s currency, Inflation previous ranking as the fiftieth in 2010 to and housing costs. Mercer also issued a report Rental costs and goods and services become the sixty-seventh in 2011. The survey of in 2010 stating that Dubai became the city with Consumer Price Index (CPI) prices are still the main driving causes of the all the world’s major cities by Mercer Consulting the best quality of living in the Middle East and Africa, followed by Abu Dhabi in the third The consumer price index (CPI), which inflationary pressures in the UAE. The official takes into consideration monetary value, place in the region, after Mauritius as second. measures the changes in the price level of inflation rate is calculated by measuring the consumer confidence, investment, interest consumer goods and services purchased by percentage change in prices of a representative households shows that the average rise in basket of goods and services consumed by the consumer prices in the UAE at the end of 2010 average household throughout the UAE. As of increased by 0.88% compared to its value the end of August 2011, the rate was calculated at the end of July 2009. The relative change at -0.14% per cent: a figure that is considered shows how much change occurred in 2010 as low in global economies. compared to 2009. For example, the prices of Dubai is the eighty-first most expensive city the items in the Food and Soft Drinks group in the world in 2011, an important improvement have increased by 4.46 %, as shown in the on its previous ranking of fifty-fifth in 2010.

Why UAE ? The Unlimited Opportunities 2012 Chapter 3 The United Arab Emirates A Sound and Resilient Economy 100 101 adoption of sound policies and legislations HSBC Bank that stimulated the developments across all sectors. Economic Forecasts The UAE’s recovery is building momentum and it’s clear the new growth cycle is underway. The Packages of incentives, favorable The UAE Ministry of Economy UAE’s Purchasing Managers Index rose by 2.8% procedures and sound economic legislations m/m reaching an unprecedented 57.5 in April 2011, A Bright Economic were introduced to stimulate the investment The National GDP is expected to grow 3% to its highest level ever. The m/m increase was driven environment. New and modified laws 3.5% in 2011. Inflation will be balanced between 1 Outlook by a sharp rise in current output and new orders, on foreign investment and competition to 1.5 per cent. while employment grew at the sharpest rate for 16 Since the beginning of 2010, the UAE protection in addition to amendments to The UAE Central Bank months. economy has been gaining its growth laws on intellectual property, patents and momentum and showing strong recovery signs. industrial designs protection were passed. Driven by the rigorous diversification strategy of Roubini Global Economics (RGE) The above mentioned indications demonstrate These adapting measures did not only mitigate economy, rapid industrialization, small and medium enterprises increasing contributory role, and Growth is gradually picking up in the UAE as the country’s resistant potentialities in the crisis’s challenges but also have become credit growth unlocks and global growth supports overcoming the worst situations that had essential factors for the future growth. expansionary shares of infrastructure, trade, service sector and tourism, economy is forecast to grow by Abu Dhabi’s oil and Dubai’s re-export trade. Thus, a severely impacted the development’s progress The strong economic performance has 4-5 per cent in 2011. Inflation will be lower than 3 modest further expansion from the 3.2% preliminary at all levels. This success was not a coincidence been embodied in various estimations and per cent. growth in 2010. Regardless, recent macro indicators, or a result of a temporary effort, it was the projections which have wildly shared the including the PMI, export data and retail proxies fruit of the sound visionary and thoughtful conviction that the positive economic growth International Monetary Fund (IMF) point to a gradual improvement in output. The pace planning, supported by the attentive follow- has become a fact on the ground, rather The UAE’s overall economic growth will remain remains well below that needed to spark a robust up of the UAE leadership to release the hidden than an expression of wishful thinking. The steady in 2011 at 3.25%. A closer breakdown recovery. The UAE growth is expected to remain potential in the economy and stress the table below shows a variety of projections by suggests a pickup in the UAE’s non-oil GDP growth below potential (about 4.5%) through 2012. openness to foreign investment through the different sources. of 3.25 % in 2011, compared to 2% in 2010, driven Economist Intelligence Unit (EIU) by strong tourism, logistics, and trade in Dubai and large public investment spending in Abu Dhabi. The UAE real GDP is expected to record a growth at 3 % in 2010, getting up to 4 % in 2012, and 6% in Standard Chartered Bank 2013 and 2014, respectively. Various sectors include The UAE economy is gaining the growth travel and tourism, financial services, professional momentum and will grow at 4 percent in 2011. The services, transport and logistics, trade and storage main contributors to GDP will be hydrocarbons and construction are identified as vertical building (29.2%), ‘other services’ (13%), manufacturing block sectors. Efforts to boost trade using for (16%), construction (11%), trade (9%) and financial example Jebel Ali Port and Jebel Ali Free Zone are services (6%). Dubai’s services and trade sectors to keys mechanism to achieve this objective. drive growth in 2011, while infrastructure plans in Abu Dhabi will boost the construction and services Major macroeconomic indicators and sector. meriting certificates by global financial and economic organizations show that the UAE Reuters enjoys a stable and sustainable economy. Its The UAE economy is expected to expand by 3.4 society is articulated and well-educated; it per cent in 2011 and annual inflation to be 2.5 per enjoys world-in-class facilities of education, cent in 2011. health, housing and law and order. Its culture is dynamic with full of life that combines Institute of International Finance (IIF) traditions with modernity. It has become The turmoil in the Arab world could indirectly a global hub of foreign direct investments, boost the UAE’s economy through channels such trade, services and tourism. The successful as higher production of crude oil; larger revenues implementation of Government Strategy 2011- due to a spike in oil prices; and a diversion the 2013 and the UAE Vision 2021 will bring all the regional trade, transportation, tourism and finance. desired results in the coming days. Dubai’s economy is expected to recover significantly, growing by 3.5 per cent in 2011 compared to 1.7 The resilient macro-economy of the United per cent in 2010. The UAE’s current account was in Arab Emirates endorses the wise policy a surplus of USD 22 billion or 8.6 per cent of GDP initiatives of its leadership. Throughout the in 2010 due to an increase in oil exports resulting years, the UAE economy proves to be dynamic, from higher oil prices and a modest increase in vibrant, diversified and based on strong and production. solid foundations. Why UAE ? The Unlimited Opportunities 2012 Chapter 3 The United Arab Emirates A Sound and Resilient Economy 102 103 have already being sending the positive signals and operating in the UAE for 3 years. decisions of the Co-ordinating Council of the of the UAE’s economic growth, proving that At the emirate level, the government of financial policies. the country is placing itself on the right path Dubai established Financial Support Fund to achieve all the MDGs prior 2015. in 2009 to provide financial support and How the UAE Controlled liquidity to Government and Government- The UAE: A Progressive Related Entities (‘GREs’) that are undertaking Inflation Economic Policy The Policy of No Tax projects of strategic importance within Dubai The fiscal policy has played a very critical In general the UAE has been following that contribute towards the overall economic role in achieving the delicate and complicated The formation of the fundamental a non-tax policy. All free zones therefore development of the Emirate. A USD 20 billion objective of a balanced growth to be neither economic policies has always been a unique benefit from zero income tax. Individuals bond program was initiated to provide GREs hyper nor cooled one, yet to be more sustained feature of the UAE economic model. They are and organizations are also exempted from with loans on a commercial basis. and de-inflated. formulated in a way that can be described as a paying taxes to the government except the Even though, the constitution grants the At the time of the crisis, the UAE has road map that takes into account the changing foreign banks that operate in the country. The right for each emirate to exercise power in all accomplished a unique profile of moderate economic, political and social circumstances. income tax exemptions policy, as one of the matters that are not assigned to the jurisdiction growth in parallel with low inflation rate. This This efficient methodology has and will always major economic policies in the UAE, remains of the federal government which among profile enhances the attractiveness of the be a main pillar of the UAE economy. and will always be a preferential policy by the them are the fiscal policies of the emirates, investment climate in terms of maximizing the The global financial crisis has not only laid government. Its role as a part of the UAE’s they have to go in conjunction with the profits and minimizing the costs. The results some challenges in the domestic economy supportive fiscal policy is very significant in consolidated federal fiscal policy. To serve this can be easily perceived by comparing the but also stimulated the UAE policy makers terms of increasing foreign direct investments purpose, the Ministry of Finance launched the estimates of growth and inflation rates before to reshape and modify the long–adapting (FDI) and consumer spending and developing Department of Co-ordination of Fiscal Policies. and during/after the crisis. The last two years, diversification strategy to be more focused on a more vibrant private sector. Some of its responsibilities are collection they ranged between 2.5% and 4% for growth well-defined and selected economic sectors and preparation of consolidated financial rates, and 1.5% and 3% for inflation rates. which would serve as engines for a sustained statements on revenue and annual federal Prior the crisis figures went beyond 8% for growth on the long run. Fiscal Policy and the Global and local expenditures for the State of the economic growth and 11% for inflation rate. Diversified but integrated policy measures United Arab Emirates, study the consolidation The fulfilment of such a profile has been a were initiated to achieve the UAE’s Millennium Financial Crisis of fiscal policy in the macroeconomic natural outcome of the various measures that Development Goals (2015). As a result, local The stabilization of the macroeconomic framework medium-term at the State level were employed to curb the global financial and global indicators, rankings and forecasts environment mainly depends on the fiscal and Follow up the implementation of the crisis pressures. policy of the country. The global economic distress did not only affect the growth of the developments but also influenced the government’s strategy. As an immediate response, the UAE aimed its current fiscal policy at restoring confidence in the economy, in addition to the continuing diversification strategy and increasing private sector employment. As a response to the challenges imposed by the crisis, the government issued a set of measures to anchor its fiscal policy management and to improve coordination between the various levels of government. As a regulatory response to the crisis, the UAE Central Bank offered a set of financial packages to help the banking sector to stand in the face of the crisis. An overdraft facility of USD 13.6 billion, a CD swap facility, and discounting of government bonds were offered. In addition, USD 19 billion was injected by the Ministry of Finance into the Local Banks. The government has also guaranteed all deposits at banks that are licensed

Why UAE ? The Unlimited Opportunities 2012 Chapter 3 The United Arab Emirates A Sound and Resilient Economy 104 105 infrastructures in the city. Dubai’s planned Public Revenues Streams Growth (Millions per USD) investment of USD 2.04 billion in 2011, which constitutes a 23% of its total budget share, will definitely stimulate the economic growth and 70,000 Steady Spending in Infrastructure create a financial stability. Projects 60,000 The government’s investments in the Government Expenditure 50,000 infrastructure projects have protected the and Revenue sector from the adverse effects of the global The above mentioned trend has been 40,000 Customs credit crunch. Thus, it has continued its growth embodied in the consolidated expenditure of Other Tax Revenue with normal rate, heading and driving the the UAE government which increased from 30,000 growth of the entire economy. USD 69.2 billion in 2008 to USD 78.8 billion in Oil and Gas The private investment in the project 2009 or by 14%. This increase in government 20,000 Enterprises Profits activity went down in 2009. The reason drove expenditure occurred at a time when the public sector to increase its share in order government revenue dropped by 35% from Other Non-Tax Revenue 10,000 to preserve the growth pace. According to a USD 122.7 billion in 2008 to USD 78 billion in report issued by MEED, an economic media 2009, mainly due to the fall in the oil prices. 0 house, in the first half of 2011 that the project These large expenditures and the concurrent 2001 2002 2003 2004 2005 2006 2007 portfolio in the UAE remained large, estimated drop in government revenue completely at USD 1.9 trillion. wiped out the budget surplus in 2009. Abu Dhabi and Dubai are continuing The figure on Public Revenues Stream the developments of their infrastructure at Growth show the growth of the public Public Revenues (2007) Public Expenditure (2007) all fronts with generous budgets; USD 15 revenues streams from 2001-2009 and the billion has been planned by Abu Dhabi to latest available breakdown of the revenues 13.31% Domestic be invested to enhance and established new streams (2007). 2.54% Other Tax Revenues 1.51% Foreign 77.06% Oil and Gas 10.81% Development

13.31% Wages & Salaries

2.54% Enterprise Profit

Other Non Tax 22.18% Goods & Services 2.54% Revenues 13.31% Subsides & Transfers

2.54% Customs 13.31% Other

Why UAE ? The Unlimited Opportunities 2012 Chapter 3 The United Arab Emirates A Sound and Resilient Economy 106 107

The Exchange Rate The UAE Central Bank (CBUAE) has Currency and Monetary maintained a stable, conservative monetary Policy: A Strong Dirham policy that, at all stages, helped both the government and the private sector plan for the for a Healthy Economy future in a healthy manner. By adopting the dollar peg in as early as 1981; a fixed exchange The monetary policy is a powerful economic tool, especially when used in rate for the dirham against the US dollar (at coordination with a solid fiscal policy. The AED3.6725 equal to one US dollar), which UAE provides a good example. consequently provided a stable environment for all dollar-based external transactions. Ever since the federation was formed in 1971, the UAE considered a stable monetary Three decades later, the decision is still policy essential for a strong, sustainable proving to be right, especially that it has economy. A well designed approach was stabilized the value of the UAE dirham. put in place to replace the previous multi- Between 1972 and 1980, the exchange rate currency system and come up with a new has declined from AED4.386 to the US dollar national currency. A national currency was to AED3.707 to the US dollar. introduced in 1973, when the UAE dirham The business community comprising of (AED) began circulating. The dirham replaced traders, industrialists and entrepreneurs has the Qatari Riyal, Dubai Riyal and Bahraini widely harvested the benefit of strategic resulting from large monetary expansion - call Currently, UAE has adjusted itself to shifts in Dinar, which were variously used as legal financial planning in the context of a stable for a fixed exchange rate regime for dirham. international financial turmoil, and it keeps its tender in the several emirates until that date. currency exchange rate. With the fact that the While this is only a primary element of the currency steady against the dollar. This state In 1980, the UAE Central Bank was founded majority of UAE’s foreign trade is being paid in monetary policy, it reflects the way this policy of affairs should continue for a few more years, and tasked with the “organization of the US dollar, it becomes clear why the dollar peg is being implemented nationwide and how even though increasing diversification of its monetary, credit and banking policy and the is crucial for a country such as the UAE. helpful it becomes across all industrial and economy, especially towards financial business, country.” the bank was in fact established to In fact, given the features of the UAE commercial sectors. It simply complies with the will increasingly warrant a switch to flexible replace the UAE Currency Board; which served economy, three factors - small economy, UAE’s fundamental principle of the facilitating exchange rates. It is also important that as a need as a currency issuer for the new state. openness and nominal domestic shocks government. the bulk of UAE`s export income is so typically concentrated in a single area, managing a floating-currency regime would be pretty awkward.

What Does CBUAE Do? Federal Law No. (10) of 1980 has given the Central Bank wide authorities, among which are: organization of the monetary, credit and banking policy and the supervision of its implementation. This has lent support to national economy and led to stability of currency. See Table 1 for further details. In addition, the Central Bank is responsible for implementing other monetary tools that help stabilize the economy and provide businesses with subtle measurements of the global trends and how they affect the local business community.

Why UAE ? The Unlimited Opportunities 2012 Chapter 3 The United Arab Emirates A Sound and Resilient Economy 108 109 now well capitalized with respect to Basel I based on the value of the eligible securities requirement. The capital adequacy ratio in the after adjusting for haircut applied to each such UAE should not be less than 10% according to accepted security. The bank can then access CBUAE’s requirement, compared to 8% Basel Central Bank funds on a weekly rollover basis requirement, which was increased to 11% for as long as they need the facility. Other Monetary Tools starting September 2009 and 12% starting The Central bank also observes a selection June 2010. of monetary indicators and tools to guarantee The CBUAE also manages a plethora The Healthy Results the health of the monetary and banking of tools necessary to maintain a healthy The UAE’s sound monetary strategies has system in the UAE. For example, the CBUAE monetary market. These include an active led to the establishment of a strong and sound requires all banks operating in the country to Dollar/Dirham swap unit to provide banks with banking system which is among the best reserve at the Central Bank without interest; Dirham liquidity when needed, an advances banking systems in the world. The fast growth 14% of their current, savings and call accounts, & overdraft facility for banks, a prudential of the country’s economy was reflected in the and 1% only on time deposits. Controlling the regulation and CBUAE issuance of Certificates great expansion in the activities of the banks level of such reserves is traditionally one f the of Deposits and Repo facilities on Certificates operating in the country, which provided an tools used to manage the country’s monetary, of Deposit (CDs) held. added challenge to the monetary bodies. which in turn will impact the amount banks provide in loans to the economy. However, and because central banks are As a result, cash in circulation increased usually looked at as the friend when needed, from US$ 572 million in December 1980 to In addition, banks are required to keep at the CBUAE started a new division back in 2008. US$13 billion in December 2010. Similarly, the Central Bank 30% of their Dirham deposits The Liquidity Support Facility was set up in Money Supply (M1) increased from US$1.99 abroad with non-resident banks (including September 2008, when banks were facing a billion to US$63.4billion and private domestic 1980, to US$265 billion at the end of December their Head Office and branches in the case of shortfall in liquidity due to the global financial foreign banks). The ratios on local customer liquidity (M2) from US$6.4 billion to US$214 2010. Similarly, foreign assets increased from crisis. Under this facility, a bank can submit its billion during the same dates. US$5.3 billion to US$63.6, monetary deposits deposits apply uniformly to Dirham and other portfolio of securities to the Central Bank of Credit facilities granted to the private sector from US$1.42 billion to US$53 billion, capital foreign currencies. the UAE for evaluation. The Central Bank will by banks operating in the country increased and reserves from US$1.5 billion to US$74.3 Also, the capital adequacy ratio has accept those securities as eligible which satisfy from US$6.8 billion at the end of December, billion during the said dates. By the end of been closely managed and UAE banks are its guidelines and assign a line to the bank 2010, total assets/liabilities of the balance The UAE Central Bank is Authorized to: sheet exceeded US$438 billion.

Issue currency per the provisions of the federal law no 10 of 1980;

Ensure support for currency and its stability inside and outside the country as well as its free convertibility into foreign currencies;

Ensure a credit policy that helps in achieving balanced growth of national economy;

Organize and develop banking as well as monitor the efficiency of the banking system;

Function as the Bank of the Government;

Offer monetary and financial advice to the Government;

Maintain government reserves in gold and other currencies;

Act as bank for banks operating in the country;

Act as financial agent of the government to the International Monetary Fund and World Bank as well as other Arab or international monetary institutions and funds;

Handle all state transactions with such parties.

Why UAE ? The Unlimited Opportunities 2012 Chapter 3 The United Arab Emirates A Sound and Resilient Economy 110 111 Although an effective trade policy has been in place since the federation back in 1971, the Ministry of Foreign Trade was formed in 2008 to play the role of a national hub for all trade activities and be the contact point for The UAE: an Open and international parties looking to do business with the UAE. The Ministry’s mandate also Flexible Trade Policy includes negotiating, approval and signing of trade agreements with international partners. The UAE has adopted several trade policies (See next chapter). that tone with the international standards and guarantee the rights for both consumers In 1994, the UAE became a contracting and traders. They are in line with the strategy party to the General Agreement on Tariffs of the UAE government to create an enabling, and Trade (GATT), and subsequently became fair and balanced trade environment that is a member of the World Trade Organization conducive to economic growth. The policies (WTO) in April of 1996. This engagement with international organizations stems from are not intended to control traders but to the UAE’s commitment to international trade generate an atmosphere of transparency and its obligations under the multilateral in the market, end monopoly policies and trade policy regime. Today, the UAE has prevent practices aimed at jeopardizing the various regulations in place at both the local country’s economy. and the federal levels that aim to strengthen With a clear objective to promote a the country’s position as an open economy, designed in a way that removes the hassles of to the previous law. The new changes are progressive economic model, the UAE one that welcomes international trade and bureaucracy while enforcing business friendly- intended to restrain market offences and always aim at harmonizing its standards competition. regulatory practice. boost confidence between consumers and and simplifying its trade procedures. To In order to establish a free market traders. Up to USD 272 thousand as a plenty complement its investor-friendly fiscal and environment, the UAE has adopted a series can be charged in case of monopoly of certain monetary offerings, the UAE has early of trade regulatory initiatives to facilitate Competition and products occur or trading in counterfeit items adopted a trade policy that facilitates business exchange and growth, both locally Consumer Protection Law in the country. business activities at various levels and helps and beyond borders. As briefed below, various In principle, the UAE market should be Anti-competitive practices are dealt with by corporations expand and profit. frameworks of the trade policy are actually highly competitive given the low import the Ministry of Economy, in accordance with duties and the absence of non-tariff barriers. the Consumer Protection Law of 2006 and its However, rather than encouraging vigorous Implementing Regulations of 2007. The law competition, the UAE has historically No: 6 of 2006 covers and tackles issues relating adopted, and to a large extent still does to the rights of consumer, responsibilities adopt, a cautious and conservative attitude and liabilities and specifying penalties to be as evidenced the protections afforded to local imposed on people for selling substandard registered agents under the UAE Commercial goods. The Regulations deal in greater detail Agencies Law. Although intra-competition with anti-competitive and monopolistic is not completely covered here, a bundle conduct, with the focus so far being on of various laws serve this need. The Labour abnormal movements in prices resulting from Law for example prohibits companies from certain prohibited practices. The Consumer acquiring staff from competitive entities. Protection Department is empowered to take The Ministry of Economy monitors the prices the necessary actions and measures against of 15 goods, mainly food products, in order prohibited monopoly practices and dealings to contain the negative effects of cartels and that cause damage to the national economy or other anti-competitive practices. The federal the consumer interest. and emirate governments have a role in the In order to protect consumers from price determination or approval of a number of unjustified price increases, the government services, including telecommunications, postal, has just introduced new tough measures and medical services. Electricity, water, and against market manipulation. The new federal gas prices are set by state-owned companies at law for consumer protection, enforced on the emirate level. July 1, 2011, contains fundamental changes Why UAE ? The Unlimited Opportunities 2012 Chapter 3 The United Arab Emirates A Sound and Resilient Economy 112 113 such as the Dubai Financial Center, Dubai Multi Commodities Centre and the Media Production Zone. Smooth Licensing and Foreign Ownership Standardization Law The UAE Federal Law No. 28 of 2001 To be able to do business in the UAE, a valid specifies the standards of a material, product trade license is mandatory, and is usually carried or service in order to ensure its safety, quality, out at emirate-level economic departments. reliability and compatibility with international It’s a norm now to perform all registration and renewal procedures electronically across the recognized codes. In this regard, all imported country. The UAE Commercial Companies’ Law and domestically produced goods that are provides flexible regulations regarding the to be sold in or imported to the UAE have to type of business entities and the formulation, comply with the official standards as approved with added flexibility varying from one by the Emirates Authority for Standardization emirate to another. and Metrology (ESMA). Manufacturing units also have to obtain quality accreditation. Under the law, the trading license can ESMA was established 2001 as the sole be obtained by either majority-owned UAE companies or by 100% foreign-owned standardization body in the UAE. It focuses (technical regulations). In the absence of other countries. Under the non-preferential branches of foreign companies. However, a on developing and promoting the application scheme, products are generally considered as large percentage of imports take place under of standards and compliance in industry and national standards on any type of products, originating from the country where they are the Trade Agencies Law, whereby the trading products in the UAE. In addition, ESMA has suppliers may declare compliance to license is held by exclusive commercial “agents”. a clear mandate to conformity assessment internationally accepted standards; self- wholly obtained or where they underwent Usually, a local agent is required to distribute as well as catering for health, safety and declaration is accepted. substantial transformation, with at least 40% imported products in each emirate. environmental protection through the strict While ESMA oversees the whole country, of local value added. The UAE’s preferential implementation of these regulations. the organization has recently authorized rules of origin are also generally based on a However, a large percentage of business value-added content criterion. and trading activities, including exports The priority is to align national standards Dubai Central Laboratory to be the designated and re-exports, is done in free trade zones; on international norms. ESMA has over national “laboratory” for calibration and In 2009, the Ministry of Economy (in which offer 100% foreign ownership among 2000 standards in place, of which 95% are to serve as a reference point for national cooperation with the concerned chambers of other benefits. Practically, each emirate based on GCC standards that are generally measurement of quantities of mass, length, commerce) issued over 139,000 certificates has at least one free trade zone for general based on international standards, and 5% pressure and temperature. Established in of origin, and a growth rate of over 12% in trading purposes. Dubai, in addition, has are UAE standards. About 30% of the 2000+ 1997, DCL acts as the ’s 2010; the momentum is actually consolidating a plethora of special-purpose free zones, standards in force in the UAE are compulsory watchdog over all goods and products the strong position of the country’s trade and imported to the emirate. industry sector. To gain information on standards and According to Ministryof Economy, there are specifications in details please go to the 10 types of these certificates associated with regulator website: (www.esma.ae). various industries and standards. The Ministry’s figures also reflect active distribution of exporting activities over the seven emirates Rules of Origin spanning the various types of certificates. The UAE applies a mixed approach in terms The Abu Dhabi office issued 19,916 of Rules of Origin that works to the best of certificates including 2,598 certificates for its diversified trading and manufacturing Arab nations, 15,390 for Gulf countries, activities. By combining both non-preferential and 1,958 certificates for foreign countries. and preferential rules of origin, the country is Dubai issued 8123 certificates of Arab origin able to sufficiently serve the diverse needs of and 51,464 for Gulf, with a total of 59,587 its growing exports and re-exports sector to certificates. Ras Al Khaimah issued 3232 both regional and international markets. certificates issued for Arab countries, 24,714 As part of its obligations under the GCC for Gulf, and 5,197 globally, marking a total customs union, the UAE applies the same non- of 33,143. Sharjah, Ajman, Um Al Quwain and preferential rules of origin as the other five Fujairah contributed a total of 13,259, 10,285, GCC members with respect to imports from 2,541 and 362 certificates respectively. Why UAE ? The Unlimited Opportunities 2012 Chapter 3 The United Arab Emirates A Sound and Resilient Economy 114 115 intellectual property rights violations. Aset of federal laws were enforced in the year of Import Control 1992 to protect intellectual property rights, It is essential to realize that although the computer software, industrial designs and UAE is a liberal country with a free trade patents as well as copyrights and trademarks. Tariffs Customs Procedures economy, it still shows respects to certain With intellectual protection spanning such a legal and moral boundaries when it comes wide array of industries, the country was able As part of the UAE’s commitment to As a member of the GCC, the UAE has been to imports. Absolute import prohibitions are to provide both local businesses and foreign promote fruitful economic cooperation with applying the “single port of entry” principle, maintained for various reasons, including investors with suitable means to protect their its trading partners, the country grants at therefore items imported in the UAE (or any international conventions, environmental respective rights. least most-favored-nation (MFN) treatment other GCC State), and destined for another protection, health and safety, as well as to all its trading partners. In addition, it has GCC market, are subject to customs duty only In fact, the intellectual properties laws religious and moral considerations. implemented all of its commitments as a full at the first point of entry into the GCC. Customs provide for measures aimed at preventing member of the WTO in terms of customs procedures and the required documentation They cover all kind of drugs; asbestos; used violation of intellectual property rights, valuation. are the same for all GCC members. pneumatic tires; industrial waste; forged and including preventive seizure, confiscation, duplicate currency; “Habara” falcons; ivory removal or destruction of products and Practically speaking, The UAE has a low Nationwide, although each emirate has its and rhinoceros horn; live camels; any printed equipment, as well as elimination of the and simple MFN tariff; all rates are ad valorem own customs authority, customs procedures material that does not adhere to religion or effects of the illegal acts, and compensation. (except on tobacco), and there are no tariff are the same throughout the UAE, and customs morals that is aimed at causing corruption In addition, Punitive Law No. 3 of 1987 quotas, no nuisance rates, and no other duties requirements are kept to a minimum so as and disorder; or materials prohibited under specifies imprisonment of up to three years and taxes on imports. Its tariff is based on not to impair the UAE’s active transshipment any law in force in the country. In addition, all for IPR violation. Customs is entitled to the GCC’s Common External Tariff (CET), and re-export business. Recent figures show imports from Israel are prohibited. take measures at the border to prevent any which consists of an across-the-board rate that over 80% of UAE imports are cleared by violation of intellectual property rights, in of 5% together with a list of 421 tariff lines Dubai Customs and approximately 10% by Abu accordance with the above-mentioned laws that are duty free amongst GCC countries, Dhabi Customs. At both Dubai and Abu Dhabi Intellectual Property as well as under Customs regulations. These mainly agricultural raw materials and basic Customs, the entire customs declaration can measures can be taken upon demand of the food products, pharmaceutical products, and be made electronically. Since 1992, the UAE applies a strict zero other products including certain papers, books tolerance policy against copy rights piracy and right holder based on a judicial order. and magazines, unwrought precious metals, vessels and airplanes; in the case of the UAE, alcoholic beverages are subject to a 50% tariff; and the alternate tariff on tobacco products is 100% or AEd100 (~$30) per 100 sticks of cigarettes or AED800 (~$218) per kilogram of raw tobacco, whichever is higher. To maintain the UAE’s supportive attitude towards various businesses, the UAE’s tariff displays positive escalation, from first-stage processed products, with an average tariff of 4%, to semi-finished goods, with an average rate of 4.9%, and fully processed products, on which tariffs average 5.4%. Even with such a small-margin tariff, the purpose is to further empower UAE-based industries and processing operations. Furthermore, industrial inputs such as equipment, spare parts, raw and semi- manufactured materials, and packing materials necessary for industrial production are exempted from duty under a federal law relating to industry assistance. Duty and tax concessions are also granted under the “import for re-export”, “temporary admission”, or “transit” regimes. Why UAE ? The Unlimited Opportunities 2012 Chapter 3 The United Arab Emirates A Sound and Resilient Economy 116 117 projects to preserve its global stand in the Top Ten Trade Partners (2010) global trade market. Foreign trade’s value includes the values of non-oil export, re-export and import of Other’s 40% the goods between the UAE and the world’s UK 3% Foreign Trade countries. 21% India The growth rate of the KSA 3% Foreign Trade (Billions per USD) 7% China UAE’s Foreign Trade has been Iraq 3% steady for the last ten years 6% US except in the year of 2009 4% Japan 5% when the global foreign trade Iran dropped by 13% due to the Germany 4% economic turmoil. The year of Switzerland 4% 2010, however, saw a strong coming-back up-trend when the UAE’s total foreign trade increased by 14 percent, a trade deficit countries were China, the U.S.A. value of USD 25.6 billion, to and Germany while the main trade surplus reach to USD 205.42 billion. countries were Iran, Iraq and Afghanistan. The continuing growth in 2001 02 03 04 05 06 07 0908 2010 Understanding the most important foreign trade reflects the trade partners and markets for the UAE is strong commitment of the country through its The UAE reported a balance of trade surplus very essential to the decision makers of the free trade policies and encouraging innovative equivalent to USD 50.9 billion in 2010. The main foreign trade policies. The foreign trade structure shows that there are controlling Foreign Trade (Billions per USD) commodities that affect the overall goods 250,00 movement of the UAE. These goods are gold, diamond and precious stones. The largest trade partner of the UAE is India, with a 200,00 Export share of 21.7 percent of the total foreign trade with the UAE. However, India ranks Re-export 150,00 sixth if gold is excluded and China becomes Import the first, the rest remains the same. 100,00 Total Foreign Trade Value 50,00 Major Trade Partners Export to Import From Re-export to 0 2000 01 02 03 04 05 06 07 08 09 2010 India India India Switzerland China Iran KSA USA Iraq Brazil Germany Afghanistan Export Iran Japan Bahrain Re-export Norway United Kingdom KSA Import Pakistan Italy Qatar Oman France Hong Kong Qatar South Korea Belgium 2000 01 02 03 04 05 06 07 08 09 2010 Kuwait Saudi Arabia Kuwait

Why UAE ? The Unlimited Opportunities 2012 Chapter 3 The United Arab Emirates A Sound and Resilient Economy 118 119 a 27% increase from 2009. It is important to mention that the average annual growth rate since 2001 is 30.67%. 50 percent of the goods exported from the Export country are gold and precious stones which As a major component of the UAE foreign are mainly exported to India and Switzerland. trade, export’s share has been increasing Other main export commodities are crude oil, from 5% in 2000 to 11% in 2010. This increase natural gas, dried fish and dates. is not only attributed to the growth of the The UAE export penetrated 198 markets export’s value but also to the changes that around the globe in 2010. However, more occur to the other components, import than 77% (USD 17.32 billion) of it was and re-export. In 2010, the value of the concentrated in 12 major markets, as shown in UAE’s export reached USD 22.63 billion, the figure. These twelve markets have been

Main Export Commodities (2010)

Jewellery Precious Metals 51.70% Total of Remaining 17.66% Articles of Iron / Steel 1.80% Salt, Sulphur & Cement 1.80% playing a significant role in the development Copper & Articles 2.20% Main Re-export Commodities (2010) of the UAE export. 92% of the growth in Mineral Fuels / Oils 2.20% the UAE export in 2010 is attributed to the Iron & Steel 2.69% growth of export in these markets. India 1.37 Optical Instruments Aluminium Articles 2.69% and Switzerland remain as the largest two 1.17 Articles of Iron / Steel markets of the UAE export. Sugar & Confectionary 3.09% 1.08 Cereals Ship, Boats & Floating 7.09% 17.77 Total of Remaining Plastic & Articles 7.09% 39.64 Jewellery Precious Re-Export Metals The re-export sector, the second most important component in the UAE’s foreign trade with a constant share of 25%, reached a value of USD 50.54 billion in 2010. This steady growth is a result of the government’s ongoing support to this vital sector through a variety of different initiatives. Major indicators such as Customs Procedures, Import and Export Cost and the infrastructure of the seaport and airports, have shown the high competitiveness that the UAE enjoys. Today, it is a major global player in this industry, ranking first among Arab countries and sixth globally. The growth rate of this sector has been fluctuating especially in the last five years. It 11.61 Vehicles / Parts grew 26% in 2010 while in 2006 it was -6% and 11.01 Neuclear / Machinary in 2009 -9%. This irregular movement is driven 9.03 Electrical Appliances by the irregular demand of the international 3.57 Aircraft / Parts market. 1.97 Rubber & Articles The main re-export commodities are diamond, vehicles, gold, platinum, jewelry and 1.79 Man-made Articles telephones. Why UAE ? The Unlimited Opportunities 2012 Chapter 3 The United Arab Emirates A Sound and Resilient Economy 120 121 increased to USD 251.22 billion in 2008. As a were trade in 2010 reached USD 53 billion, 2010), the UAE has become ideal and result, the import in 2008 year grew by 46%. (USD 42 billion for imports and USD 10 billon attracted more than USD 73 billion as foreign The 2008 economic crisis had negative for exports) according to the World Trade direct investment (FDI) since it was created effects on the variables that correlate with Organization report. nearly four decades ago to emerge as the Import the import activity. However, the federal second top capital recipient in the region. Cumulative FDI flow into the UAE was totaled It is clearly noticeable that the UAE’s import government immediately acted smartly to Foreign Direct Investment (FDI) around USD 73.4 billion. Investment, business makes up to 64 percent of the UAE’s total preserve the growth trend of the national and people’s friendly policies are contributing foreign trade in 2010. The high percentage economy by increasing the money supply The National Bureau of Statistics, the federal positively to seek greater inflows of the FDIs is mainly due to the high demand by the through its different entities. The 8% increase centre responsible to issue socioeconomic and in the country each year. Due to its popularity increasing population and to the important of the import’s value, therefore, was a result of economic data, issued a report in April 2011 as a foreign direct investment destination, role of the UAE as a major re-exporter in the these strategic decisions. stating that the total FDI reached USD 120,717.5 million in 2008, an increase 6% from 2007. The Dubai has been named as “Middle East City region. In 2010, import value had an increase of In terms of goods imported, gold and total FDI, according to that report, is divided to of the Future 2010-11” by fDi Magazine. Abu 8% reaching to USD 131.87 billion comparing precious stones make 29% percent. Other three groups: FDI, other Foreign Investments Dhabi and Dubai were also ranked as the to USD 121.53 billion in 2009. main import goods are machinery, transport and Foreign Investments in Portfolios. The most favorable destinations of choice for The UAE has experienced some sudden equipment, chemicals and food. table below shows the contribution of each FDI by the AT Kearney FDI Confidence Index growth periods in its import as shown in the group to the total FDI in the years of 2007 and Report. These rankings prove the strong diagram (). These sudden jumps are mainly Trade in Services 2008 (USD, million). economic fundamentals that the country attributed to the growth of the national GDP, enjoys from the right infrastructure for all Banks and financial institutions sector credit facilities’ volume and money supply. In The UAE’s foreign trade strategy is focused sectors to flourish to the flexible business- was the leading attracting sector in 2008, a 2007, the national GDP grew by 23%, credit on the development of the trade in services friendly policies that adapt with the current share of 57%, followed by electricity, gas facilities’ grew by 47% whereas money supply sector. The value of commercial services that state of the economy. and water production Main Import Goods and distribution sector Type of Investment 2007 2008 (10%) and construction FDI 36,492.04 45,283.32 2.70 Articles of Iron / Steel sector (8%). The table below shows the FDI Other Foreign Investments 74,989.52 72,998.23 2.20 Plastic & Articles per sector. 1.60 Mineral Fuels / Oils Foreign Investments in Portfolios 2,122.53 2,435.94 According to UN 30.40 Total of Remaining statistics (December, Total 113,604.08 120,717.49 28.70 Jewellery Precious Metals Financial and Insurance Foreign Direct Investment (FDI) per Sector (2008) 57.7% Institution

10.0% Electricity, Gas and Waters

0.7% Hotels and Restaurants Real Estate and Professional 9.6% Services

4.2% Manufacturing Indusries

3.5% Exctraction Industries

0.1% Social and Personal Services 8.1% Construction

4.3% Real Trading Transport, Storage and 1.7% 11.10 Machinery Communications 8.30 Vehicles / Parts 0.04% Agriculture and Hunting 8.30 Electrical Appliances 0.01% Health 3.90 Aircraft / Parts 0.0% Education 2.80 Articles Iron / Steel

Why UAE ? The Unlimited Opportunities 2012 Chapter 3 The United Arab Emirates A Sound and Resilient Economy 122 123 UAE: A Distinguished Global and Regional Position Indicator Organization Rank Why Indicator Organization Rank Why A significant improvement in the assessment of its cultural resources Friendly doing-business policies

rd A strong affinity for Travel & Tourism 33 (Globally) Government Supported Initiatives Doing Business Quality tourism business and The World Bank nd Simple property registration Travel and th 2012 2 (Arab 30 (Globally) Infrastructure (airports) Countries) procedures Tourism World Economic Competitiveness Forum 1st (Arab The government’s prioritizing the Different options of acquiring credit Index (2011) Countries) sector and carrying out very effective destination-marketing campaigns Quality infrastructure Rules and regulations adjusted 27th/139 to better support the sector’s Global (Globally) Innovation and efficiency driven development World Economic Competitiveness economy Forum rd Index (2010 3 (Arab Stable macroeconomic environment Countries) Ability to finance Financial stability driven by banking stability Manifestation in credit default swap Efficiency of customs, export and st spreads Global Financial 21 (Globally) import procedures World Economic Development 1st (Arab Supporting institutional, legal and Availability and quality of transport Forum Index (2010 Countries) business environment infrastructure and services Global Enabling 16th (Globally) Favorable tax regime Trade Index World Economic Availability and use of ICTs Forum 1st (Arab Corporate, retail and end-users (2010) Countries) Attractive and encouraging business financial access environment Domestic and foreign market access Steadily-growing economic Good Physical Security th World 28 (Globally) performance Competitiveness IMD 2nd (Arab Government and business efficiency Yearbook (2011) 32nd (Globally) Countries) Human Better GDP per capita Competitive overall infrastructure Development UNPD st 1 (Arab Good health and education systems Index 2010 Countries) Continuing economic growth Good citizens’ quality of life and Quality Information Technology satisfaction of economy’s state and infrastructure 30th/110 political landscape ICT friendly-market environment (Globally) Innovative activity is substantial in Prosperity Index Legatum Institute the UAE, and the environment for Political and regulatory framework 1st (MENA entrepreneurship is excellent Region) th High government and business Networked 24 (Globally) Satisfaction of education and health World Economic readiness Readiness Index st systems Forum 1 (Arab High individual readiness and usage (2010-2011) Countries) High levels of safety and security High ICT penetration rate One of government prioritized sectors Steadily growing economy due to Per Capita GDP International Monetary Fund 5th the diversification scheme Quick market to adapt new Ranking (2010) (IMF) technologies A major oil producer

Why UAE ? The Unlimited Opportunities 2012 Chapter 3 The United Arab Emirates A Sound and Resilient Economy 124 125 Indicator Organization Rank Why Indicator Organization Rank Why

Encouraging government’s trade Excellent business climate and regulations and business environment investment policies th High private sector’s optimistic Economic The Heritage 47 (Globally) Liberal trade regime 6th (Globally) Foundation and Global Trade outlook Freedom Index The Wall Street 5th (Arab High government spending Confidence HSBC nd 2 (Arab Secured trade products’ (2011) Journal Countries) Index (2010) Countries) Low level of corruption High level of intra-regional trade Attracting property rights Great connectivity with the emerging markets The strategic initiatives introduced by the government across all sectors Residents are the most satisfied with 15th/160 16th (Globally) Impressive civic development and Resident their lives due to economic and Quality of Life (Globally) Gallup’s Global Index (2010) Economist administration Satisfaction 1st (Arab social stability Survey Data Intelligence Unit 1st (MENA (2010) Countries) Outstanding GDP growth High average income level Region) Quality healthcare, safety and security services Attracting investment promotion policies that reduce investing Foreign Direct obstacles and grant incentives to nd Highly integrated anti-corruption 2 (Arab th Investments UNCTAD investors 28 /178 measures Countries) TI Corruption Recipient (2010) Transparency (Globally) Setting-up Business-friendly policies Perceptions Laws that eradicate poverty International nd Sustainable economic growth Index (2010) 2 (MENA Region) Transparency and accountability’s strict measures to restore trust

MasterCard Consumers are optimistic about the economy and regular income Worldwide Index th MasterCard 4th (Middle East) 44 /149 Political and social stability of Consumer Consumers are satisfied of the Global Peace Vision of (Globally) Confidence quality of life in the UAE Less crimes Index (2011) Humanity 3rd (MENA Region) Safe and secure society

th Government 7 (Globally) The strong commitment by the World Economic government to continue supporting Spending 19th Tax exemptions Forum 1st (Arab the different initiatives across all (Globally) Efficiency (2010) Countries) sectors Quality of Living World Trade International trade agreements Index (2010) Organization 2ND (MENA signed Region) The strategic location of the country Attracting investment market Investor conditions and strategies Attitudes Index Friends Provident 1st (MENA A variety of investment instruments International Best-in-class infrastructure (Investment Region) Confidence) (FPI) Increasing willingness to invest in st Business-friendly policies (2011) gold and bonds Dubai 1 FDI Confidence Access to qualified human resources AT Kearney Abu Dhabi 2nd Index (2010) High standard of quality of life (Middle East) Advanced logistics facilities Corporate Social 1st (Arab Responsibility Countries) Safe environment

Why UAE ? The Unlimited Opportunities 2012 Chapter 3 The United Arab Emirates A Sound and Resilient Economy 126 127

The UAE: A Visionary Approach Since the establishment of the UAE, its founding leadership realized the defining points upon which the nation shall grow and provide a prosperous life for its people. Thus, they introduced effective policies and initiated numerous mega projects. At present, the leadership has continued the march of growth by following the steps of their fathers and preserving the identity’s principles of the UAE. A visionary approach was applied to strategy and planning in order to provide its residents with every possible basic needs of life. The UAE Government Strategy 2011-2013 and the UAE Vision 2021 are the main two policies that draw the steps and moves toward the development of the macroeconomic environment. They are very comprehensive and

take into account the social, cultural, health, As we look to the future and embark on schooling, infrastructure, communications, “a journey of empowerment at all levels, we must and rural development; they also deal with the enhancement of the integration between steer a course among challenges on many fronts federal and local governments and entities. with confidence, optimism and determination. With the aim of building a modern and There will be challenges to the family ties that bind progressive nation, the UAE Vision 2021 sets together the strong fabric of our cohesive society; the guidelines for preserving and developing challenges to our economic competitiveness, the pillars of success to be among the best challenges to our national identity, challenges countries in the world by 2021. Empowering to our health, education, environment and well- people, actively integrating the federal and local governments, creating a diversified being. An ambitious nation like ours can’t achieve

economy, and developing world-class health its goals by relying on its past achievements. We

and education systems are the key goals of must work harder, be more innovative, more the Vision. organized, and more vigilant in examining the “ The UAE Government Strategy 2011-2013 trend and challenges will face us. lays the foundations to achieve the UAE Vision 2021. It forms the basis upon which the Federal Entities develop their strategic H.H. Sheikh Mohammed Bin Rashid Al Maktoum and operational plans, and consists of seven general principles, seven strategic priorities, and seven strategic enablers. The strategic priorities and enablers are not fully comprehensive but comprise the major focus areas for the government. Why UAE ? The Unlimited Opportunities 2012 Chapter 3 The United Arab Emirates A Sound and Resilient Economy 128 129 providing financial and human resources and infrastructures are the essential requirements of arriving to the desired position and vision of the emirate and the country overall, as set by the Plan. Abu Dhabi The five-year plan has also addressed several In line with the UAE strategic road map, Abu issues; the foremost of them is maximizing the Dhabi’s Economic Strategic Plan (2008-2012) capital inflows to the targeted sectors either has focused on the motivating sectors that in form of local or foreign capitals, or through will achieve the ambitious economic growth local and foreign loans to meet its financial and maintainable diversification, as stipulated needs. In addition, it has indicated that the in its long-run strategic thinking “Economic emirate’s economy will witness a rapid and Vision 2030”. It sets the implementation substantial growth throughout the upcoming stages of the diversification process by years. Abu Dhabi’s Economic Vision 2030 aims supporting initiatives in sectors like renewable to significantly expand the non-oil sector by energy, basic industries, tourism, media, IT, 2030 to reach a balance between oil and non- communications and others. Identifying oil trade by 2028. The government intends to the needs of these sectors to grow, creating foster the non-oil GDP growth at a higher rate attractive legislative environment, than that of the oil sector.

The UAE Vision 2021

esive society and Coh pres United erv ed i de S n tro ti n ty g g lo ba in in l s Responsibility ta Prosperity C n o d m in p g in in e e t r i e t Destiny Knowledge u r i t v c a c e u h r k t t The UAE l n s

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t e Sustainable and diversified economy m Confident and socially responsible Emiratis Knowledge-based and highly-productive Cohesive and prosperous families economy Strong and active communities Vibrant culture

Why UAE ? The Unlimited Opportunities 2012 Chapter 3 The United Arab Emirates A Sound and Resilient Economy 130 131

of the global economic downturn. For the future DSP 2015 has identified certain sectors as important for a strategic thrust as building Dubai block which include travel and tourism, The sector-driven economic development financial services, professional services, approach is also a cornerstone of Dubai transport and logistics, trade, storage and Strategic Plan 2015. The diagram below shows construction. These sectors have witnessed the principles of the plan. It is expected to rapid growth from 2000 onwards. In terms of occupy this prominent status in its coming magnitude, this growth has been led by trade, version which will take into account the impact construction and real estate sectors.

Other Emirates All emirates have paved their path toward Umm Al Quwain Strategy 2011-2013 focuses developing selected sectors based on the on reaping the fruitful benefits of its natural existing resources and the emirates’ ambitious resources to boost important sectors like visions. The overall strategy shows a picture tourism. The emirate will also use its strategic of an economic diversification. Ajman, in its location to facilitate establishing businesses Strategy 2030, aims to boost its developmental and attracting local and foreign investments. projects. It strongly encourages local and Umm Al Quwain enjoys a unique historical and international investments in order to achieve natural heritage, islands and natural habitats. social and economic prosperity. The emirate Thus, it will work on developing the concept of is looking forward into developing tourism, nature tourism in the country. These plans are health and education sectors, meeting the accompanied with the developmental plans of demands of its growing population. the government’s efficiency and the emirate’s infrastructure.

Why UAE ? The Unlimited Opportunities 2012 The United Arab Emirates A World of Opportunities Chapter 4

The United Arab Emirates A World of Opportunities

“ Because its ambition is continuous and increasing, and with the word impossible being ruled out, the UAE is determined to be a top global and regional choice across a wide range of industries,

believing that one success is always the gateway to another. “

The Unlimited Opportunities 2012 Chapter 4 The United Arab Emirates A World of Opportunities

The United Arab Emirates A World of Opportunities

Energy

“ It was easy for the UAE to rely on its dominant global position as a producer of oil and natural gas.

But its firm belief in sustainable technology and future

energy is leading it to explore new horizons of energy investments. “

Why UAE ? The Unlimited Opportunities 2012 Chapter 4 The United Arab Emirates A World of Opportunities 136 137 to position itself as a global leader in the Energy Sector - Major Indicators adaptation of renewable and environmentally- friendly resources and technologies. Indicator Actual Figure Global Ranking Contribution to GDP USD 94.0 billion (2010) Proven Oil Reserves 97.8 billion barrels (2009) 6th hroughout its history, the UAE has been Crude Oil Production 2.2 million barrels daily (2009) 6th recognized for its rich natural resources. T th Since the times of Majan Civilization that was Oil Consumption 682 thousand barrels daily (2011) 35 flourished in the area between Abu Dhabi and Proven Natural Gas Reserves 6.0 trillion cubic meters 6th Qatar, people of the UAE mined copper and th exported it to the flourishing surrounding Natural Gas Production 51 billion cubic meters daily 14 nations, Mesopotamia and North of Persia. Natural Gas Consumption 60.5 billion cubic meters daily 15th Since then, various minerals have been also th explored and utilized such as phosphate, sulfur, Electricity Capacity 20,696 megawatts 18 and salt. In the 1930s, the initial signs of the Electricity Production 88,184 gigwatts per hour 44th existence of crude oil under the soil and water st of the emirates began to attract international The entire oil and gas sector remains state Electricity Consumption 84,404 gigawatts per hour 41 attentions. Rights for exploration of oil were controlled. However, the constitution of the Installed Desalinated & Ground 1,235.51 million gallon daily granted by the rulers of the emirates to UAE guarantees the right of ownership of Water Capacity reputable international companies. natural resources for each emirate. Thus, there Water Production 372,369 million gallon annually In 1958, oil was discovered in commercial is no federal energy policy on exploration and quantities in Umm Al Shaif field off the coast development of energy and other mineral Water Consumption 344,082 million gallon annually of Abu Dhabi. Four years later, the first oil products. The Ministry of Energy represents Federal Regulator Ministry of Energy shipment left , marking a historical the country in the international petroleum milestone and a new era for the entire country. community and specialized inter-national The UAE has achieved remarkable milestones The UAE is also leading the regional The discoveries and export of oil from Dubai, and regional organizations to which the in that regards, building a current electricity countries in adapting newer and cleaner Sharjah, and Ras Al Khaimah also followed in UAE belongs. The UAE has been a member production capacity of 20,696 megawatt and energy sources to meet the growing demand. 1960s and 1970s. of the Organization of Petroleum Exporting a water production capacity of 1.2 billion It was the first country in the GCC and the Arab Today, the UAE’s stunning energy and Countries (OPEC) since 1974 and of the gallons. While the federal government sets region to establish a nuclear program in 2009 mining sector comprises of strong oil and Organization of Arab Petroleum Exporting the strategy for this sector and supplies the that aims to generate a significant part of the natural gas industry, a growing petrochemicals Countries (OAPEC) since 1970. northern emirates with the needed utilities, country’s energy needs. The country is also sector, a demand-driven utilities production Since the formation of the country in Abu Dhabi, Dubai and Sharjah have their own engaging in other mega renewable energy sector, and attractive mining opportunities. 1971, building a reliable electricity and water state-controlled electricity and water suppliers. projects to utilize its rich natural resources and Approximately, USD 94.0 billion (31.6% infrastructure that satisfies the growing demand Projects of expansion and improvement of the solar exposure. Masdar initiative provides a of total GDP in 2010) is attributed to the dictated by rapid development has always utilities supply are well underway to meet the clear example of how the UAE is determined revenue of this sector. The UAE also aims been a priority for the federal government. future demand. to pursue its renewable energy goals.

Why UAE ? The Unlimited Opportunities 2012 Chapter 4 The United Arab Emirates A World of Opportunities 138 139 average of USD 80.1 per barrel. As of January 1, 2010, oil and natural gas revenues accounted for 31.3% of the country’s total GDP based on real terms. Oil and Natural Gas Exploration and Production Since the discovery of oil in 1958, this sector has been witnessing an extraordinary growth, spurring the national economy to reach greater heights. Will its contribution continue to shape a significant part in the national economy and in what way? The UAE is a very important global producer of oil and natural gas. As of mid-2011, it ranks the 6th in terms of oil production and 14th in terms of natural gas production. Data issued by the Organization of Petroleum Exporting Countries (OPEC) shows that the UAE has 97.8 billion barrels of proven oil reserves (the seventh largest reserve in the world) and 6.2 trillion cubic standard meters of proven natural gas reserves (the fourth largest reserve). The majority of oil and natural gas reserves The country’s policy is mainly carried out by are in the emirate of Abu Dhabi (92.2 billion the Supreme Petroleum Council (SPC) which players in the market are Dana Gas, a natural Thailand, and South Korea. Abu Dhabi National barrels, 198.5 trillion cubic feet), followed by was established to lay down Abu Dhabi’s gas producing company based in Sharjah, RAK Tanker Co. (ADNATCO) is the sole company Dubai (4 billion barrels and 4 trillion cubic feet), petroleum policy and objectives in all sectors petroleum, a growing oil and gas exploration responsible for the transporting the UAE’s oil Sharjah (1.5 billion barrels and 10.7 trillion of the petroleum industry through Abu Dhabi and production company. cubic feet), and Ras Al Khaimah (100 million National Oil Company (ADNOC), and to issue to the world. National Gas Shipping Company barrels and 1.2 trillion cubic feet). The country resolutions and follow up their implementation The UAE gives the opportunity for Ltd. (NGSC) was also established to transport is currently producing 2.8 million barrels per until all aspired goals and results are achieved. international oil and gas companies to operate liquefied natural gas (LNG) on behalf of Abu day (bbl/d), 4.6% of world crude oil produced Dubai also launched its energy regulator “the on both downstream and upstream operations. Dhabi Gas Liquefaction Company (ADGAS). daily, and 5.1 billion cubic feet per day of Dubai Supreme Council of Energy” to oversee The main international companies working in natural gas, 4.4% of the world natural gas the development of oil and gas sector. Sharjah the country are British Petroleum, Shell, Total, production. has set up its state-owned oil entity, Sharjah ExxonMobil, REX oil, schlumberger and Partex. According to data issued by the National National Oil Corporation (SNOC), in November In 2008, Occidental Petroleum was given the Bureau of Statistics, oil and natural gas 2010 to carry out operations in the upstream right to explore and develop two oil and gas contribution to the country’s GDP has dropped and downstream markets, as well as investing fields Jarn Yaphur and Rahman in the emirate from USD 116.4 billion in 2008 to USD 78.3 in other firms engaging in similar activities The of Abu Dhabi. The company operates and holds billion in 2009, and USD 93.6 billion in 2010 remaining emirates also established their own a 100% interest in hydrocarbons output from mainly due to the unprecedented increase of oil petroleum departments to issue policies and the fields. Furthermore, ADNOC partnered prices during 2008 and the country’s attempts regulate activities in this vital sector as well as with Shell, Total and Partex to form Abu Dhabi to enlarge its non-oil sector contribution to invest in all parts of the oil and gas industry. Industries Limited (GASCO) to be responsible to the national economy. The average price ADNOC is the main local player in the oil for the processing of associated and non- during 2008 was USD 96.55 a barrel, while it and gas sector since it is granted more than associated onshore natural gas production. In dropped down to USD 62.5 a barrel during the 60% of the petroleum and gas projects in the June, 2011, REX Oil was given the right by the economic crisis in 2009. However, international emirate of Abu Dhabi. Its portfolio includes Government of Sharjah to explore and produce demand for oil, supported by the partial 14 wholly owned companies that operate oil for the offshore territories of Sharjah on recovery of the global economy, increased by in a well-defined field of specialty. The the Gulf of Oman. 1.3 million barrels per day in 2010. The demand most noteworthy is Abu Dhabi Company for The country’s crude oil is mainly shipped by a has triggered oil prices to bounce back to an Onshore Oil Operations (ADCO). Other local fleet of oil tankers and exported mainly to Japan, Why UAE ? The Unlimited Opportunities 2012 Chapter 4 The United Arab Emirates A World of Opportunities 140 141 and few coal-fired power plants, can only Key - UAE Oil Field meet around half of the estimated 40,000MW Emirate Oil Field Producing Company Capacity (bpd) domestic demand for power by 2020. Natural Even though the economic, environmental, gas production is expected to increase to 6.5 Zakum Developement and safety considerations have necessitated billion cubic feet daily. the increasing need for diversifying the energy Company (ZADCO) (60%) Upper Zakum 550,000 sources, oil remains as the most cost-effective Entry Points Japanese Oil Development Co. (JODCO) demanded source for energy for most countries. The UAE is a member of the Organization of The UAE Ministry of Economy ExxonMobil (40%) Petroleum Exporting Countries (OPEC), and as The planned USD 3 billion refinery at Fujairah Bu Hasa a result it is bound to the regulations, policies, is a priority in the UAE investment strategy. The and limits of the organization. Presently, it is new refinery will be integrated with Abu Dhabi Abu Dhabi Murban Bab allowed to export 2.2 million (bpd) as crude Abu Dhabi Company for Onshore Crude Oil Pipeline to secure the feedstock Sahil 1,400,000 oil. However, the government has asked the delivery. The refinery will have a capacity to Oil Operations (ADCO) organization to further increase its quota. Oil process 150,000 to 200,000 barrels per day of Asab production is expected to reach four million crude oil. Great opportunities for suppliers and Shah barrels per day by 2015. It has also set its vision technical expertise providers are present in all to increase its oil tankers and carriers as well phases of the project. In April 2011, Shaw Stone Umm Shaif Abu Dhabi Marine Operating 520,000 as building more pipelines, and refineries’ & Webster, an American engineering services Company (ADMA-OPCO) capacity. company, was awarded the project management Lower Zakum Natural gas, on the other hand, is the consultancy. Foreign engagements are in the Fateh form of partnerships with local companies. main source for electricity in the UAE. The Southwest Fateh domestic consumption has outstripped Dubai Dubai Petroleum Establishment 100,000 production for the first time in 2007. Demand Oil Tankers Falah has been rising gradually due to the increased The UAE’s main oil transporter, ADNATCO, Rashid population, and economic expansion, driving is in the process of expanding its shipping the government to produce more volumes or fleet. Strategic contracts for the construction Sharjah Mubarak Crescent Petroleum 60,000 find alternative routes. The country’s current of 6 oil tankers and 7 bulk carriers are in capacity, which is supported by natural gas place. Its current fleet includes 7 bulk carriers, 3 chemical tankers, 2 crude tankers, and 2 Ro/ of the EOR advanced technologies since Ro vessels. ADNATCO is certified by Lloyd’s to additional millions of barrels can be generated Oil Reserves by Emirates Gas Reserves by Emirates the ISM Code (International Safety Management), using this technique. the ISO 9001 (Quality Standards) and the ISO 14001 (Environmental Management Standards).

Enhanced Oil Recovery (EOR) The UAE’s current oil and gas strategy focuses on preserving its reserves by depending on modern technologies such as enhanced oil recovery (EOR) technologies that could also be used to explore more fields and by rationalizing the current consumption. The federal and local regulators are recommending the utilization

94.27% Abu Dhabi 92.58% Abu Dhabi

4.09% Dubai 1.87% Dubai 1.53% Sharjah 4.99% Sharjah

0.10% Ras Al Khaimah 0.56% Ras Al Khaimah

Why UAE ? The Unlimited Opportunities 2012 Chapter 4 The United Arab Emirates A World of Opportunities 142 143

Petrochemicals The petrochemicals products spectrum has been witnessing an unprecedented growth in the MENA region. How does the UAE form its petrochemicals strategy in order to meet domestic needs and mark its fingerprint in the global arena? The giant oil and natural gas producer aims to boost its downstream activities by enlarging its current capacities in the petrochemicals industries and stepping into new fields of specialties. Therefore, huge investments have being pumped in strategic initiatives to production. The government has made massive increase the sector’s portion in the total GDP, plans to boost the performance of this sector. then decreasing the dependency on the export Within the five coming years, the total UAE Abu Dhabi’s petrochemicals’ strategy has (SMEs) sector.” Thus, international of the raw materials. The country’s current two investment expected to reach USD 10.3 billion been shifting from the basic products to end- petrochemicals companies have been classes of petrochemicals, olefins and aromatics, in order to develop and diversify the outputs of user products. It has been establishing itself headquartering in the UAE. The strategic products’ range includes but not limited to petrochemicals. as one of the major petrochemicals producers location as in the heart of the Middle East and ammonia, polyethylene, polypropylene, and In 1998, ADNOC established, in a joint- in the world. Strategic International and the business-friendly policies and regulations urea. Figure () shows the current production venture with Borealis, one of Europe’s local investors have been invited to join the have made the country the ideal place to capacity of each component. largest polyolefin (plastics) producers, to development convoy in petrochemicals. start a petrochemical business. In 2010, Global The growth rate of 4.4% achieved in the be a leading provider of polyethylene and According to BMI’s latest petrochemicals “Cabot Corporation”, a US-based petro- petrochemicals sector in the year of 2010, polypropylene. The current manufacturing report, the profusion of feedstock in the chemicals production company, inaugurated according to data revealed by the Ministry capacity of Borouge is 2 million tons per year. UAE gives it a great potential for growth in the first-of-its kind factory at Jebel Ali Free of Foreign Trade, reveals the success of the In mid-2011, the second phase of its massive this subsector. “Development of a domestic Zone by investing USD 20 million. The plant has sector and proves the continuous demand. petrochemicals complex at industrial petrochemicals industry is now gathering an initial production capacity of 25,000 metric The average growth rate of international zone has enabled it to reach full operational pace, which could significantly enhance the tons of masterbatch per year with provision to demand is 6% annually. During 2005, the UAE capacity. The company is also planning to growth of small and medium enterprises expand to 75,000 metric tons in the future. contributed 6% to the total GCC petrochemical increase its capacity to reach 2.5 m tons per annum by 2013 to meet the increasing local and international demand. ADNOC has also established Ruwais Fertilizer Industries (FERTIL) with a capacity of 1,000 tons of ammonia and 1,500 tons of urea per day. It signed a USD 1.2 billion contract with Samsung Engineering to construct a new fertilizer complex, increasing its urea capacity to 3,500 tons per day. Both companies are located in Al Ruwais Industrial Zone and are looking forward to expand their production capacity by installing more plants, increasing utilization, and depending on new advanced technologies. Borouge and FERTIL’s expansion plans have been attracting local and international investors who are been actively participating in the construction of chemical plants, storages, processing and treating units, and other related projects like cooling systems.

Why UAE ? The Unlimited Opportunities 2012 Chapter 4 The United Arab Emirates A World of Opportunities 144 145 Entry Points Petrochemical Production Capacity Key - UAE Petrochemical Refineries Ammonia 695 Emirate Refinery Capacity (bpd) Refined Products Operating Company The Giant to Come: Chemaweyaat Ethylene 500 Kerosene, Light gas In November 2008, Abu Dhabi National 145,000-Crude oil Abu Dhabi Oil Abu Dhabi Ruwais oil, Heavy gas oil, Refining Company Chemicals Company “Chemaweyaat” was Ethylene Glycol 2000 280,00-Condensate established to enhance the involvement of Abu Straight run residue (Takreer) Dhabi’s chemicals industry production’s holdings. Propylene 800 Its plants are planned to be operating by 2015 Urea 1250 LPG, Naphtha, Gas oil with a total capacity of 1.5 million tons per year. Gasoline, Kerosene Abu Dhabi Oil The company has called international contractors Abu Dhabi Abu Dhabi 88,000 Refining Company up to 1 million tons/yr conversion capacity of a Straight run residue (Takreer) to submit their bids to build the central ethane wide range of resins. & Liquid Sulphur cracking unit for the petrochemicals complex ‘Takamul’ that will turn naphtha to other chemical Emirates National Sajaa Gas Private Limited Company ENOC LPG, Naphtha, Jet products. Dubai 120,000 Oil Company Jebel Ali To efficiently utilize its production of natural fuel, Diesel & Fuel oil (ENOC) A Global Petrochemicals Hub gas resources, the Government of Sharjah, Crescent Petroleum, a Sharjah-UAE based oil and As Abu Dhabi enters its second phase of gas company, and six prominent investors from the modernization guided by vision 2030, developing Sharjah Oil LPG, Naphtha, Jet Sharjah Oil G.C.C. region have invested in Sajaa Gas Private Sharjah 71,000 Refining Company a globally-competitive petrochemicals industry Limited Company (SajGas), a company established Refinery fuel, Diesel & Fuel oil based is one of the main economic pillars to to build, own and operate a gas sweetening plant achieve the desired position. Not only dose Abu at Sajaa in Sharjah. The project is will be one of Dhabi invests heavily in creating petrochemicals the most significant petrochemical plants in the Fujairah Metro Oil 90,000 conglomerate but also it opens its door and country. Opportunities are obtainable in all levels provides the necessary business infrastructure of development and supply of equipments and and environment for international investors to know-how. 1976, it has been building its set of refineries to products. By building its sixth refinery in Fujairah, establish ventures at all levels of the industry serve the domestic and the global market. Today, the added capacity of 150,000-400,000 barrels value chain. Abu Dhabi Basic Industries its five refineries, with a combined capacity per day as well as the expansion plans of the Company’s (ADBIC) polymer’s park project Refineries of 0.64 million barrels per day (Table ), made current refineries will increase the production by is a clear example of the emirate’s strong The UAE’s significant capacity of crude oil and the country a sizable net exporter of refined at least 30%. commitment to attract international players. Abu natural gas production validates the feasibility Dhabi Polymer Park will span 4.1 million m2 with of refining the raw materials in-house. Since

Why UAE ? The Unlimited Opportunities 2012 Chapter 4 The United Arab Emirates A World of Opportunities 146 147 and water production sector, ADEWA accounts natural gas, a strategic energy initiative, the for half of the total capacity. While ADEWA, Dolphin Project, is being developed to ship gas Entry Points DEWA, and SEWA function on their designated from Qatar’s North Field, Al Tawailah. GCC Power Grid emirate, FEWA is headquartered in Ras Al The UAE is not only focusing on increasing The increasing demand of power due to Khamiah and supplies the Northern Emirates the import of natural gas and preserving population growth and economy expansion has Utilities Infrastructure (Ajman, Umm Al Quwain, Ras Al Khaimah and the consumption of electricity energy driven the GCC countries to look for alternative Development Fujairah) with power and water. by connecting to regional grids, it is also solutions. The GCC Power Grid is one of those constructing its strategy of diversifying the strategic projects. GCC Interconnection Authority Due to its ever-increasing population, energy resources. In 2009, Korea Electric Power (GCCIA) was found to build, run, and maintain and in order to meet its economic ambitions, (KEPCO) was given the green light to begin the connecting grids. Investments opportunities the UAE is demanding more electricity and the construction of four nuclear reactors in in the mega project are unlimited and can be in water but will its current infrastructure be Abu Dhabi. The plant will have a production the form of tendering contracts, public, private, able to meet this demand? capacity of 5,600 megawatts; the first reactor partnerships, and technical, and consultancies. is expected to start generating in 2017. As a The GCC grid is also planned to be connected to The Annual Electricity and Water Report result, the country will be able to export its the European, Pan-Arabian, and Mediterranean (2009), issued by the Ministry of Energy, shows natural gas or use it as a feedstock to maximize grids. that the UAE has an electricity generation its water gas-fired desalination plants’ capacity of 20,696 megawatts and an installed production. The country will also be able to Investing in Power Capacity desalinated and ground water capacity of supply the region with enough electricity 1,235.51 million gallon per day as of 2009. Building new power plants is a critical need power through its already developed network. However, the current total generated energy for the future growth of the UAE. Federal is 88,184 gigwatts per hour (GWH) and the Major opportunities were being given to government and local emirates governments current total water production is 372,369 international energy companies so the country are determined to put in place all the necessary million gallon per year (MIG/Y) (1,034 million participates in all energy frontiers. Total and resources to increase their power capacity. gallon per day). The UAE’s annual energy Spain’s Abengoa Solar will run the Shams-1 Massive projects are planned or undergoing in all parts of the country. Shuweihat project in consumption has reached 84,404 GWH and geothermal plant in Abu Dhabi. Abu Dhabi Abu Dhabi, with a capacity of 1,500 mega watts its total water consumption has arrived at plans to generate 7% of electric power from for its second phase, and Hassyan project, with 344,082 MIG/ Y. renewable sources by 2020. Abu Dhabi became a regional benchmark a combined capacity of 9,000 mega watts are More than 85% of the generated electricity in 1997 when it launched its privatization In 2007, Fisia Italimpianti, a subsidiary of some of the key projects in this sector. Expanding is obtained from gas turbines that use natural program that allowed private companies to the Italian construction and civil engineering power capacity in the Northern emirates is also gas as a main feedstock. The remaining is take over the construction, operation, and Impregilo Group, won an order worth USD 256 in the drawing board. The Federal Electricity and produced by diesel engines and steam turbines. maintenance of power and water plants. For million to build a desalination plant in Dubai Water Authority already commenced building While desalinated water makes up 93% of instance, all Independent Water & Power for the Dubai Electricity and Water Authority new power plants in that region such as the the total produced water, limited ground Plants (IWPP) are engaged in this program on (DEWA). Fujairah F2 power with 2,000 mega watts. water resources produces the remaining the basis of the BOO “build, operate and own” 7%. Comparing to 2005, the total energy formula, designed according to partnership Electricity Production Consumption Water Production Consumption consumption has increased by 56% and the agreements made between ADWEA and a total water consumption has increased by 35%. number of international companies. 500,000 100,000 According to all estimates, this will continue The high dependency on gas coupled with to rise for the near future. In the GCC region, increased population and economic expansion 400,000 the UAE records the highest projected increase forms the government strategy that is aiming 80,000 in demand, which is expected to continue now to source greater volumes of natural growing at a minimum rate of 10 per cent per gas and use alternative sources to power 60,000 300,000 annum. Currently, Utilities contribution to the on its country. In 2000, a major project to country’s GDP has reached USD 6.11 billion in connect and share power among all emirates 40,000 200,000 2009 (2.32% of the real GDP), according to was launched. ADWEA and DEWA’s power data issued by the National Bureau of Statistics. grids were connected in 2006. Infrastructure Abu Dhabi Water and Electricity developments are also taking place in order 20,000 100,000 2005 2006 2007 2008 2009 Authority (ADWEA), Dubai Electricity and to connect other emirates. The national 2005 2006 2007 2008 2009 Water Authority (DEWA), Sharjah Electricity electrical network is also being connected and Water Authority (SEWA), and Federal to its neighboring country, Oman, in a step Total Electricity Generated (GWH) Total Water Production (MIG/Y) Electricity and Water Authority (FEWA) toward connecting the GCC’s grids. In order Total Electricity Consumed (GWH) Total Water Consumption (MIG/Y) are the major players in the electricity to provide the UAE with sufficient volumes of Why UAE ? The Unlimited Opportunities 2012 Chapter 4 The United Arab Emirates A World of Opportunities 148 149 ENEC partnered with international reputable energy companies to construct its nuclear plants with the highest international standards. In December 2009, the UAE government awarded a USD 20 billion contract Renewable Energy to Korea Electric Power (KEPCO) to build four nuclear reactors. A partnership with Areva, A country that falls within the northern Total and Suez to build a 1600 MW EPR unit in desert belt, enjoys one of the highest sun the UAE was also signed. The output is to be exposure in the world, and experiences partly used for the desalination of water. frequent storms and winds, is able to mainly depend on renewable energy. However, have the oil and gas great reserves blocked the ways of renewable energies from flourishing in the region? The current energy capacity can only meet half of the demanded energy by 2030. For this reason, tapping into new sources of energy has become an absolute economic necessity in order to cope with the increasing population and economic expansion. The UAE today is focusing on renewable energy due to several reasons: the long duration of sun exposure of renewable energy, with a focus on and the frequent winds and storms, the high Turning Excessive Heat into Power Concentrating Solar Power (CSP), photovoltaic percentage of greenhouse gases produced International renewable energy experts solar energy and on- and offshore wind from oil and gas extractions, the high quantity classified the UAE as one of the most favorable energy. In a joint venture with Abengoa Solar of oil and natural gas used to produce locations to generate solar power because of the and Total, Masdar Power is developing the electricity. The UAE’s energy strategy aims to high level of sun exposure. Encouraged by the wise 100MW Shams 1 CSP plant in the Western diversify the sources of energy generation and environmental policy of the government, demand Region of Abu Dhabi, set to be the largest secures the UAE’s prestigious position in the for solar panels and other means of obtaining CSP plant in the world. It is also developing a future energy realm. solar power has significantly increased over the 30MW wind farm and a PV array on Sir Bani past few years. Properties developers and building To initially declare its committed intention Masdar Yas Island. Through these and future projects, owners are increasingly using the solar panels to of diversifying its energy sources, the UAE In April 2006, the Abu Dhabi Future Energy the unit will contribute to Abu Dhabi’s goal decrease energy consumption. In addition, streets government published the policy of the country Company (Masdar) was established to reach of generating 7% of its energy needs from lights and telecom towers use solar panels to get on the evaluation and potential development the broad boundaries of the renewable renewable sources. the sufficient energy supply. Great opportunities of peaceful nuclear energy, which outlines energy and sustainable technologies industry. Masdar integrates the full renewable and lay for investors and traders who supply the solar the government’s fundamental principles for equipments and invest in developing new solar clean technology lifecycle - from research Entry Points its work in this area. In 2009, the UAE joined power plants across the UAE. International Atomic Energy Agency (IAEA). to commercial deployment – with the aim of Renewable Energy Projects in Dubai creating scalable clean energy solutions. To Another significant milestone of the UAE achieve that it works with global partners Prospects exist for investing in Dubai’s in the renewable energy was marked in 2009 and institutions to integrate new research solar power and renewable energy sector. As when the Preparatory Commission of the with proven technologies to produce efficient controlling emissions becomes an increasingly International Renewable Agency (IRENA) systems and processes that can be replicated important issue worldwide, these technologies designated Abu Dhabi as the headquarters and projects could experience increased demand globally. Masdar operates through five of the agency. Since then, strategic projects in Dubai. Strategic projects in this sector are to integrated units: Masdar Power, Masdar to achieve its goal have been initiated. be executed. Dubai Solar and Wind Power was Capital, Masdar Carbon, , and Emirates Nuclear Energy Corporation (ENEC) contracted to the Greek Portland Group, a marine was launched to deliver safe, clean, efficient Masdar Institute. and financial solutions company, for USD 130 nuclear energy to the United Arab Emirates, Masdar Power is a developer and operator million. The company will develop solar plants with a target of delivering electricity to the of renewable power generation projects. in the UAE, aiming to turn Dubai as a leading UAE grid in 2017. By 2020, it is projected that In building a portfolio of strategic utility- renewable energy provider. Dubai Thermal solar nuclear energy will produce nearly a quarter scale projects, Masdar Power makes direct power plant is also been planned and negotiated of the nation’s electricity needs. investments in individual projects in all areas with contractors. Why UAE ? The Unlimited Opportunities 2012 Chapter 4 The United Arab Emirates A World of Opportunities 150 151 has reached USD 456.39 million (0.17% of Key - UAE Mineral Source the total real GDP), a 56% growth increase since 2005. Fujairah has 74% of the quarries, Mineral Location followed by Sharjah, and Ras Al Khaimah; Northern Emirates particularly between Masafi Copper other emirates do not have quarries. Quarrying and Fujairah Mining and Quarrying is expected to experience a growing trend Following the discovery of oil and the within the coming years driven by the UAE’s Northern Emirates particularly in Manama, Chromites Ore creation of the union, Mining and Quarrying policies, one of the main factors behind the Masfut, and Alsijy sector emerged as a new domestic sector’s growth by attracting FDIs. production field. Realizing the short period Developments in mining are gathering Radioactive Minerals Al Ain particularly in Al Fyadhah Spring Water of discovery, are the mineral resources well pace in the UAE. In 2009, the UAE formed a (Uranium, Radium, and Crude Bitumen) discovered in the UAE? Are the potential joint venture with GSL limited, an Indian opportunities in this sector well realized ? steel manufacturer, to explore for chrome Ornamental Stones Northern Emirates particularly in Al Faya Mountains Since its formation in 1971, the UAE has ore. ASCOM, an Egyptian mining company (Marble, Granite, Serpentine, Schist Tablets Masfut, Masafi, and Hafeet Mountain been identifying its economic pillars that specializing in the management of quarry and Limestone) structure the overall economic picture. operations for the cement industry as well as the exploration of precious minerals, has Mining and quarrying sector in fact began Rock wool Masfut and Fujairah been operating in the UAE since 2004. Ras when the country decided to diversify its Al Khaimah Minerals and Metal Investment Saltpeter economy. To attract the global investors’ (RMMI), a global mining company in precious minds, the government declared its avoidance metals such as copper, cobalt, silver, and gold Al Ain particularly in Hafeet Mountains, Dubai of using the traditional methods of research Gypsum has multi-activities in the UAE. and Western Region and exploration that have been used for a long time and decided to use the latest Local and international recognized operators in the sector of quarrying are Dhanna Mountain, Sir Bani Yas, Hafeet Mountain, scientific technologies methods instead. Barite and Hormuz series Detailed geographic academic studies, aerial Turkish Gulf Quarry, Global Crusher, Gulf Rocks photographs, and geological maps have Co. Shawkah Crusher, Lootah Crushers, and proved the richness and the diversity of the Fujairah Building Industries. UAE’s mineral resources. Today, the UAE produces a wide range Saltpeter and Barite of minerals that include but not limited to copper, gypsum, natural and cultured pearls, Opportunities in silver, gold, and precious stones. The figure Sir Bani Yas Island below shows the latest minerals discoveries Huge amounts of salt with a purity reaches found on the UAE and the location of each 91.6% of sodium chloride lays in the forms salt deposits were found on the land surface. mineral. The land of the UAE is very rich in GDP Contribution (Millions per AED) of amorphous pink rocks tinged with a small These are just a small fraction of the large terms of the diversity of minerals. However, quantity of sulfur and iron impurities. The deposits that lay underneath. Other sources of the commercially-viable minerals range commercially-viable quantities of salt and salt in the emirate of Abu Dhabi are marshes, is comprised of gypsum, salt, copper, and the cost-effective and simplicity of extraction buried blocks, and sea salts that contain various marble. The capacity of gypsum found in the methods provide attracting investment other salts such as calcium sulfate, magnesium 1,750 UAE is enough for self-sufficiency for the GCC opportunities for both local and international sulfate, sodium sulfate, and potassium chloride, countries. 1,500 investors. and calcium carbonate. The total export of precious metals has The mineral can be used to manufacture Around 4% of the island is also covered with 1,250 reached USD 11.72 billion in 2010, achieving a different types of chemical compounds such as the mineral of barite. Its deposits are located on growth rate of 30% comparing to 2009. The 1,000 Sodium hydroxide (caustic soda) and chlorine. “Fars Al Adna” area and on the series of Hormuz. The sparse barites are found in the form of most exported precious metal was crude gold It can be used also in the manufacture of soap, crystals that result from the rocks interaction 750 that makes up about 89.2% of the total export, laboratories’ and chemical plants solutions, with the natural forces. The mineral is mainly jewelry, pearls, and silver share the remaining and petrochemicals industries. Salt can also be 500 used in the drilling processes of oil wells as well 2005 2006 2007 2008 2009 2%. More than 41 countries imported the used to conserve fish and other foods. UAE’s precious metals last year. as in the manufacture of dyes. The barite is Throughout history, Sir Bani Yas has been also found on the mountain of Dhanna, Dilma Quarrying subsector’s GDP contribution has a source of salt. An old mine was found Island, Arzanha, Zakorah, and the eastern side been steadily increasing. In 2009, its revenue in the northern part of the island where of Haffeet Mountain but with small quantities. Why UAE ? The Unlimited Opportunities 2012 Chapter 4 The United Arab Emirates A World of Opportunities

The United Arab Emirates A World of Opportunities

Real Estate and Construction

“ With the world’s tallest building, the largest man-made island, the world’s largest man-made marina and many other icons, innovation appears as the most unique character of the UAE’s real estate sector, giving

it an edge that will assure its long-term attractiveness to investors and developers. “

Why UAE ? The Unlimited Opportunities 2012 Chapter 4 The United Arab Emirates A World of Opportunities 154 155 change after the discovery of oil which Real Estate and Construction Major Indicators triggered peoples’ migration from rural areas to more developed cities like Sharjah and Contribution to GDP (2010 Estimates) USD 64,183 million (21.57%) Dubai in the late sixties. The Realization of Contribution to Gross Fixed Capital the importance of a property or a land and 23.81% Formation (2010) he human settlement in the area called initial signs of the growth of the economy Ttoday the UAE was first recognized in drove many to start accumulating lands, which 5000 B.C., as archeological evidences have created the beginning of the real estate sector. Ministry of Public Works demonstrated. Throughout that time, each The following years, prices of properties Abu Dhabi Real Estate Regulatory Authority tribe was living in a designated area and it had been gradually increasing, forced by Dubai Real Estate Regulatory Authority might have moved to another place searching demand and supply. Because lands and natural Federal and Local Regulators for water and food resources. Recording resources are owned by the local governments, Sharjah Real State Regulatory Agency or registering property ownerships did not as granted by the UAE constitution, each Ajman Real Estate Regulatory Authority exist then. However, verbal agreements and emirate created its real estate authorizing and Ras Al Khaimah Real Estate Regulatory Authority understandings between the Sheikhs of the regulating entity to manage and organize this tribes solved every possible conflict in that activity. Total Number of Buildings (2005) 335,487 regard. In the early 1960s, laws of registering The years 1970-2000 witnessed a historical and owning lands and properties started to renaissance in the construction sector in the Total Number of Housing Units (2005) 722,859 take a place in the UAE. UAE. Large cities came out of the desert and a Total Worth of Projects Under In addition, the building materials state-of-the-art infrastructure was built across USD 930 billion (45% of projects in GCC region) Construction (2011) that made up people’s dwellings at that the country. Buildings from skyscrapers, lavish time were very simple and came straight villas, large shopping malls and luxurious An important transformational change The result was significant in the coming years. from the nature like palm leaves, animal hotels began to decorate the landscape of the occurred in the real estate sector during the Another remarkable step was the issuance of skins, and stones. The situation started to emirates. following years. Freehold property ownership Dubai’s property law.7 2006, being one of the in designated areas was introduced to most comprehensive regulations of the real international investors by Dubai in 2002, estate sector not only in the UAE but also in the followed by Ras Al Khaimah, Ajman, and Umm whole GCC region. This freeing law and the Al Quwain. The capital and Sharjah have also following regulations by other emirates have passed their laws, allowing a 99-year leasehold helped to establish a base of trust that will for non-GCC nationals (expatriates, foreign continue to attract international investments individuals, and foreign owned corporations). into this vital sector.

Why UAE ? The Unlimited Opportunities 2012 Chapter 4 The United Arab Emirates A World of Opportunities 156 157 the Ministry of Foreign Trade in the annual trade policy report. The real estate development and investment sector is the first stage and Today, a well-established real estate the most important one in the real estate development and investment, a solid industry. Projects initiated by developers and construction sector, a growing property and investors pull the rest of the sectors. A massive facilities management sector, a demand- expansion of developments was witnessed in driven infrastructure development sector, Abu Dhabi and Dubai as the decade of the new (this coma is called a serial comma used to millennium was approaching. The number of omit readers’ misunderstanding) and a real buildings in Dubai alone rose to 97,953 upon estate consultancy and urban planning make the end of 2009. More than USD 163.4 billion the UAE’s superb real estate and construction is also planned to be pumped in the real estate cluster. The UAE’s aim in the realm of real development line by Abu Dhabi to effectively estate is determined and clear which is to reach its urbanization ambitions plan by position itself as an attractive global place 2030. Other Emirates, Ras Al Khaimah, Ajman, for investment. According to the Ministry of Sharjah, Umm Al Quwain, and Fujairah are Economy, the real estate, business services also investing heavily in the sector to supply and construction sector contributed around reliable real estate outputs for its residents. 22% per cent (USD 64,183 million) to the The UAE, today, is the largest construction number of residential housing communities, their roads networks, airports and seaports country’s GDP in 2010. The bulk of foreign market in the GCC with a value of $930 commercial units, and industrial districts as well as establishing new facilities, meeting direct investment has been mainly directed billion of projects under construction. It has across all emirates. the demands of the growing population and into real estate projects, as demonstrated by also announced the development of a great Rapid actions were taken to implement economy. the priorities of the UAE’s strategy since its Facilities management started to emerge creation. All emirates have been effectively as a new market in this industry due to the working to construct strong infrastructure of increasing number of buildings and housing roads, ports, airports, and sewage systems. A units that require continuous care and high quality highway network comprised of maintenance. The demand for mechanical, about 4,000 Km asphalt paved roads, 15 large electrical and plumbing engineers, cleaners, commercial ports, 6 international airports, security guards and landscapers are growing and a state-of-the-art sewage public system as the construction projects in the UAE are marked the notable milestones achieved in this growing. International FM companies are regard. The emirates continue expanding their viewing the country as one of the most infrastructure by upgrading and remodeling favorable locations in this industry in the world.

Why UAE ? The Unlimited Opportunities 2012 Chapter 4 The United Arab Emirates A World of Opportunities 158 159 then. The massive commercial and residential developments such as Jumeirah Palm, Burj Khalifah, Burj Al Arab, and are only some of the accomplished projects by region’s real estate developers. Emaar, the Real Estate Development leading properties developer, has launched more than 50 projects in 2010. The major and Investment constructions have placed Dubai as one of the The rally that was witnessed in Dubai’s most attractive and growing real estate hub in real estate development gave a unique the world map. Dubai is also developing of a example of success to follow not just for number of outrageous construction projects other emirates but also for the whole world. and villas complexes. What are the real estate strategies of the emirates and how they are implementing them? The demographics fundamentals of the UAE, the mass available lands planned for urbanization and the encouraging properties’ ownership regulations are forming the new picture of the real estate sector. Dubai, Ajman, Umm Al Quwain, and Fujairah designated development of its real estate atmosphere. Hotels, parks, recreational areas, retail facilities, specific lands to be developed where the Developing mixed-use, residential, commercial schools, and community centers are planned. expatriates can have freehold ownership over and industrial construction projects as well The eastern emirate, Fujairah, has also launched their properties, while Abu Dhabi and Sharjah as infrastructure development are a priority several strategic real estate developments gave the green light for 99-year leasehold law. of Ajman’s real estate strategy in order to that are concentrated on the shore of the More attracting regulations are expected to transform the emirate to a modern urbanized Gulf of Oman coastline. The Fujairah Dana, be passed during the next coming years. city. Some examples of these mega projects a combination of villas and hotels, Fujairah Real estate development and investment include Al Hilal Tower, Al Ameera Village and Paradise, a multifaceted project, are being contribution to the country’s GDP has reached Ajman One. planned. Furthermore, the emirate is planning USD 29,514 million in 2010, an increase of The Government of Umm Al-Qaiwain is to build a large number of residential units as 52.3% since 2005. The astonishing real estate committed to the development of real estate well as commercial buildings. development projects that are planned or projects and has linked up with Emaar to create All emirates have their own authorizing underway are capable of increasing the sector’s a new development surrounding a purpose- entities. Abu Dhabi Real Estate Regulatory share in the GDP. All the emirates are putting built marina. Umm Al-Qaiwain Marina will be Authority, Dubai Real Estate Regulatory their hands together on the development’s Sharjah is also developing its residential a vast, master-planned waterfront community Authority, Sharjah Real Estate Regulatory wheel to take the real estate sector to a higher and industrial areas. Building approximately located on the shore of Khor al-Beidah. Agency, Ajman Real Estate Regulatory Agency, niche. 5,000 homes for nationals in Rahmania and Resort and hotel rooms as well as parks and RAKIA Real Estate Regulatory Authority, The emirate of Abu Dhabi is witnessing a Seouh, tow suburbs of the emirate, and a new recreational areas, retail facilities, schools and Fujairah Real Estate Regulatory Agency, and historical growing period in its real estate town in al Juwaiza that houses around 2,000 community centers are planned. Umm Al Quwain Real Estate Regulatory Agency sector. An estimated of USD 562 billion worth plots for villas and low-rise residential and Ras Al Khaimah is also undergoing an have the responsibility to oversee and regulate of projects are under construction or underway. commercial buildings are a few of the notable ambitious phase of development including the real estate activity in their designated Its current high hotels occupancy rate of over residential projects that are aimed to meet the investments in infrastructure improvement, jurisdiction. than 72% is giving a positive and secure increasing number of residents of the emirate. tourism, property, shopping, and efforts to PJSC is one of the largest feeling to local and international investors to The industrial real estate has also been under attract industrial and commercial enterprises. property developers and one of the leading continue investing in this vital industry. the emirate’s focus. The plan is to reconstruct USD 27 billion worth of residential and premier lifestyles providers. The company Greater heights of real estate development some of the existing industrial areas and commercial projects are currently in various has accomplished recognized properties and were reached in Dubai, encouraging the building new industrial complexes. Emirates stages of development across the emirate. master-planned communities in both markets emirate to issue more attracting regulations. Industrial City is the major industrial initiative Emaar, a leading real estate developer, domestically and globally. It is the prime In 2006, Dubai Freehold Law 7 was passed in the emirate. has been developing a number of real mover of Dubai’s real estate and construction in March 2006 which legalized foreign After liberalizing its real estate sector by estate projects that will surround the new sector. Burj Khalifah, the tallest free-standing ownership of property in designated areas. granting expatriates the right of leasehold, purpose-built marina, Umm Al Quwain structure in the world, is the most noteworthy Foreign capital has been flooding in since Ajman is heading forward with the Marina, located on the sore of Khor Al Beidah. project accomplished by Emaar. Why UAE ? The Unlimited Opportunities 2012 Chapter 4 The United Arab Emirates A World of Opportunities 160 161 Real Estate Developement in Emirates Sharjah and Ras Al Khaimah Emirate Main Developments Nakheel properties, a Dubai-based land reclamation and residential projects creator, Developing Industrial Areas , Saadiyat Island, Beach Development, Masdar City, is also a main player in the real estate To become the ideal industrial hub in the Ghantoot Green City, Najmat Abu Dhabi, , Lulu Island, Abu Dhabi development. By establishing imaginary UAE, Sharjah is developing one of its largest Abu Dhabi Airport Expansion, Mohammed bin Zayed City, Between the Bridges, Gate Project, Yas Island, A large number of mixed-use projects like the World, Islands, industrial projects in the Saja’a district. The communities and residential units and , it has driven the real estate mega industrial initiative, Emirates Industrial market. Sorouh Real Estate, Al Qudrah Real City, is designed to accommodate the dramatic Estate and Al Dar Properties are the largest influx of industrial enterprises into Sharjah Villas Complexes (the Villa in , Veneto in , real estate developers in Abu Dhabi. Other providing world class infrastructure and , Jumeirah Gulf Estates, Al Barari, Al Badrah, Dubai Silicon regional’s important players are Deyaar support in an easily accessible location. The Dubai Oasis, and Victory Heights), (an underwater hotel, Dubai Development PJSC, Rakeen Development PJSC, master plan of the industrial area is built over Sports City, Dubailand, Burj Al Alam, Falcon city of Wonders, RAK Properties, Aqaar and Burooj Properties. a total of 8.3 million square feet divided into , , Hotel for Emirates Airline, International companies have been 8 sectors to support different projects in the Emirates Industrial City, Villas Complexes in Seouh and Rahmanih, attracted by the great potential lay within areas of industrial plots, warehouse projects, Sharjah all emirates. International Trident Holdings commercial/industrial, and residential/ Nujoom Islands , Al Juwaizh Project succeeded to develop number of projects commercial. Emirates City, Al Hamra Village , Al Ferdus District, Falcon Towers, such as its signature project “Waterfront”, Ras Al Khaimah Investment Authority, the Ajman Meeza Villas, Ajman One, and Emirates Modern Industrial Area Marinascape, and Bayside Residence. Best emirate’s investment arm, is also developing Homes, a Canadian-based international a mega industrial area “Al Ghail Industrial Ras Al Khaimah Mina Al Arab , Julphar Towers, RAK Tower, Julphar Residence real estate developer, has also managed to Park”. With a zone of 23 square km, several develop number of excellent projects like the manufacturing units will be housed in the Umm Al Quwain Umm Al Quwain Marina Global Residencia, Rescom Tower, and others. park. Incentives such as low registration fees Fujairah The Fujairah Dana (Pearl), Fujairah Paradise International leading real estate developers and long licensing period are to be granted are working together with local companies for local and international companies that will properties developers like Sorouh were signed and local government offices and embassies. to develop properties in all emirates to meet operate this park. to develop a number of communities for The city is expected to be completed by 2030. the growing demands by the increasing Emirati families. Similar projects are expected Another gigantic construction project is the population and economic expansion. in all emirates. Government-backed properties Yas Island Development which a touristic are being preferred by many developers since development that will house hotels, marinas, they provide excellent liquidity especially resorts, and others. Abu Dhabi is on the top of during real estate crisis. Through public-private the most demanded construction destinations partnerships, international companies can in the world. engage on the development of the planned house communities.

Abu Dhabi Promising Market In 2008, the construction of major real estate projects in Abu Dhabi worth USD 208 billion namely Khalifa City, Yas Island Development, Building Local House Saadiyat Island, Masdar City, Al-Raha Beach Complex, Ghantoot Green City, Al-Reem Island Communities development, Abu Dhabi Light Rail project and Due to the increased rate of marriage in the MGM Grand Hotel was announced. Khalifah UAE, the government is reforming its strategy City, The massive amount of investment by of granting lands to the UAE nationals and the government and private investors as well planning to build residential communities as the great works needed from construction and sell the community houses instead. The companies grabbed opportunities-seekers’ new way will play a great role into organizing attention to engage in this UAE’s vital industry. the communities. Contracts between the Khalifa City, one of the largest planned government of Abu Dhabi and several projects, will comprise all federal ministries Why UAE ? The Unlimited Opportunities 2012 Chapter 4 The United Arab Emirates A World of Opportunities 162 163

Construction During the construction boom witnessed in the in 2004, its share of the UAE’s construction sector GDP flew to over 50%. In 2009 Abu Dhabi occupied the top in the construction sector by 65.1%. What are the under construction projects that were behind this dramatic shift and how will the under planned ones shape this figure? The global economic distress had, in fact, slowed down the growth of the construction sector in the UAE in the late 2008. However, ambitious plan of boosting its infrastructure, signs of the economic recovery are now very residential, and commercial properties. The visible to the UAE visitors and residents. largest construction and infrastructure The sharply-decreased prices of lands and projects by value in the GCC show that five construction materials began to shape new of the region’s 10 biggest schemes planned obtainable opportunities to properties or under way are in Abu Dhabi. The UAE was developers in order to get back to the ranked as the most buoyant property market development track. The UAE government in the world. has also announced its strong willingness of The construction sector’s contribution to investing in the infrastructure development the country’s GDP has reached USD 34,664 sector by initiating strategic projects such million in 2010 (11.6% to the UAE GDP in as the building of the union rail system, the 2010 at Current Prices). It has been gradually roads’ networks connecting Fujairah to Dubai, growing, with an average annual rate of 15.5% and Jebel Al Jais of Ras Al Khaimah to Emirates road, and other multiple massive projects. The government’s announcement along with an at interval 2001 - 2010. The mega projects that Abu Dhabi and Dubai but also in all emirates overall economic stimulus plan has caused a are underway or under the planning phase that are committed to develop state-of-the-art positive stir among the construction companies will significantly increase its share in the next residential and communities. The estimated and has also being playing an important coming years. Across all sectors and over all value of residential projects in the UAE was role toward lifting up the real estate and emirates, opportunities in the construction more than double in 2010 due to many construction sector. . In addition, the resulted sector are countless. projects in pipeline after a delay in projects low prices of sales and rents achieved demand The rapid economic diversification during 2009. for long terms. strategy is guiding the new directions of the The Emirates is also developing its Committed to its vision of making the construction sector. The ranges and types of commercial and touristic units to cope with UAE as one of the most desirable investment projects planned include but not limited to the rapid growth incurred in this sector. High locations in the world, approximately USD 930 infrastructure, residential, commercial, and rise developments are being either planned billion worth of projects are currently under governmental. or under construction. Establishing power construction in the UAE. In order to achieve social stability for plants, water desalination plants, road and Real estate developers and construction both the national and expatriate population, rail network systems are been under the companies are shifting their premier focus the UAE has announced a number of development’s microscope of the government. from private to public sector schemes due to residential housing communities. The The massive expansion plan of the UAE’s increase number of the governmental projects. expansion of , Porto Dubai rail system is one the largest infrastructure This trend is expected to continue due to the Al Furjan, Al Warsan, and give projects in the country. The plan is to develop massive infrastructure projects as stated by a clear indication of how the residential three rail schemes across all emirates from all emirates. Abu Dhabi had announced its construction subsector is boosting not only in Fujairah to Abu Dhabi. Why UAE ? The Unlimited Opportunities 2012 Chapter 4 The United Arab Emirates A World of Opportunities 164 165 Khansaheb Civil Engineering, Lootah Group of Companies, Overseas AST, Al Naboodah Group and Bukhatir Group are some of the leading Many local construction companies conglomerates in construction sector in the existed before the real estate boom in 2004. UAE. However, some of them have managed to take a full advantage of it to become leaders Foreign construction companies have in this sector. Arabtec Construction LLC, a also placed their prints across the different regional and global leader in the construction fields of the sector. Monolith Constructions, sector, accomplished a range of notable an international engineering and contract diversified projects such as Burj Khalifa, Burj services provider, successfully constructed a Al Arab, Jet Fuel Farm in Dubai International number of residential housings in Fujairah Airport, Mubarraz oil and gas island, and and currently working on a commercial project other luxurious residential and commercial in Al Jerf, Ajman. ACTO General Contracting developments. In order to perfectly Company, a multinational company, complete its projects, Arabtec engages with successfully completed various set of projects other international specialized companies in all emirates and from power stations to through partnerships and subcontracts. basic villas. ACTO is considered as one of the BelHasa Engineering and Contracting, leading companies in this sector.

Entry Points best practices for the public transport sector. The project is expected to be completed by 2016. Abu Dhabi Rail System Great efforts have been spent by the A More Promising 2011 to Come government of Abu Dhabi to successfully reach its desired heights that were set by its 2030 The UAE is experiencing one of the highest vision. Establishing a reliable rail system is one unprecedented growths in the number of of the emirate’s main goals toward creating a construction projects in the world. Abu Dhabi sustainable transportation system. The metro rail and Dubai share the majority of these projects. system will run approximately 131 kilometers. The Other emirates are also going through a system is also planned to connect the mainland development move in terms of types and quantity with its islands Yas, Reem, Sowwah, and Saadiyat. of projects. International construction companies The International Association of Public Transport are viewing the UAE market as one of the most (UITP) Charter on Sustainable Development was attracting markets in the world due to the strong signed by Abu Dhabi, raising the bar higher in commitment of the government to level up its public transportation with Mott MacDonald was infrastructure over all sectors and to the strong appointed as the main project consultant. UITP attendance by international investors who seek acts as the point of reference and a centre of opportunities in the real estate sector. Why UAE ? The Unlimited Opportunities 2012 Chapter 4 The United Arab Emirates A World of Opportunities 166 167 All emirates are planning to increase the capacity of their ports. Fujairah Port has been increasing its terminals’ capacity due to the increased demand by petroleum companies such as Gulf Petroleum, Oil Marketing & Infrastructure Trading group, and the Singaporean oil company Chemoil. Development The UAE has six international airports. During the harsh times of the economic Dubai Airport, one of the busiest in the region downturn, the government’s spending on with over 112 airlines Dubai, has become the infrastructure succeeded to give an enough main aviation hub in the Middle East. Dubai confidence to investors in the UAE market. has also been developing its second airport What are the undergoing infrastructure “Jebel Ali Airport” since 2005, with an area projects that will showcase the government’s covering 140 km2 . The new airport will be the commitment into building one of the most largest air-sea transportation centre in the advanced and modern infrastructures in the Middle East. While the Dubai Civil Aviation world? Authority controls and operates Dubai airports, The UAE is one of the fastest growing Abu Dhabi International Airport, Al Bateen, infrastructure markets in the world. The and Al Ain airports are operated by Abu Dhabi planned infrastructure projects are aimed to Airports Company (ADAC). Also,a Sharjah and meet all the essential needs in all aspects and Ras Al Khaimah have emergent airports due parts of the country. The country is not only to the increasing activities by RAK Air and Air planning to develop new infrastructures but Arabia. In addition to advancing the seaports also to maintain, advance, and reconstruct and airports network, strategic initiative have the old utilities that are unable to support the been also taken to enhance and develop the growing economy and the population. The roads inter- and intra- networks. In 2006, highly modern and sophisticated infrastructure the UAE established the National Transport Authority (NTA) with the task of developing a of the UAE includes ports, airports, a network licensing system pertaining to land transport of roads and rail system, and multiple business and granting licenses to relevant transport parks. The government’s spending on the bodies covering all modes of Land Transport planning to link all the northern emirates development of its infrastructure is planned for federal inter emirates transport and with Dubai and Abu Dhabi Railway. Major to reach USD 2.04 billion in the year 2011, international transport in accordance with construction companies are seeking the great 23% of the total government spending. The UAE relevant Laws and Regulations. Since then, opportunities. existing modern and sophisticated network the land transport sector has been witnessing Wastewater treatment and solid waste of ports and airports did not only advance a growth transition period. The UAE, currently, disposal sectors in the UAE are as well growing the economy of the country but they have has a high quality highway network comprised with the increased production of desalinated also become central to the entire region, of about 4,000 Km asphalt paved roads that water and the solid waste generated by the driving the government of the UAE to invest connect the all emirates as well as the country increased numbers of UAE residents. The UAE more in this subsector. Currently, the UAE to the Sultanate of Oman and Saudi Arabia. is one of the three highest per capita producers has eleven operating ports. Mina Zayed, the Abu Dhabi Transport Department itself has of solid waste in the world. Most urban and main gateway for container and general cargo announced its willingness of investing USD industrial areas and all new development vessels, Musaffah Port, located in the heart 68.1 billion in the transport sector (roads and projects are connected to the public sewage of the industrial city, and Freeport are the Rails) in the emirate. system. Solid waste disposal is run by the operating ports in Abu Dhabi. Dubai’s ports In order to reduce the dependency on municipalities and is well developed in the include Jebel Ali Port, a large and rapidly emissions-producing vehicles, Dubai started UAE. Plans of developing a sewage system expanding deep seawater port infrastructure, building its Metro in 2005. 10 stations were in the emirates of Ajman, Fujairah, and Ras and Port Rashid that is 13 meters deep and has launched in 2009 and 29 stations are expected Al Khaimah have been announced. Through a capacity of 1,500,000 twenty-foot equivalent to be operating by 2011. Abu Dhabi also has tenders, and partnering with the public sector units. Sharjah also has two ports, Sharjah Port set up its plans to develop its metro, covering or local companies, international companies and Khorfakan Port, while other emirates have 130 km and connecting major areas of the can participate to seize the benefits of these one port each. emirate. Another railway system is under great opportunities. Why UAE ? The Unlimited Opportunities 2012 Chapter 4 The United Arab Emirates A World of Opportunities 168 169 Major Infrastructure Projects in UAE Emirate Ports Airports Freezones The UAE was among the first nations that Abu Dhabi established specialized free zones with unique Abu Dhabi Airport Free Zone infrastructure designed to suite a specialized International Airport Higher Corporation for Specialized sector. The UAE has 47 free zones, with some Al Bateen Airport Abu Dhabi Khaleefa Port Economic Zones dedicated for specific services subsector such Al Ain Airport Industrial City of Abu Dhabi as Dubai Media city and Dubai Healthcare. Al Ain International Khalifah Port and Industrial Zon Recently, a number of free zones have been Airport established to encourage trade and investment in all emirates like Himriyah Free Zone, Fujairah Free Zone, and Ajman Free Zone. In May 2004, Dubai Airport Free Zone (DAFZ) the emirate of Abu Dhabi has established Dubai Car and Automotive City Free the Higher Corporation for Specialized Zone (DUCAMZ) Economic Zones in order to provide an Dubai Flower Center Free Zone at integrated infrastructure, a suitable business Dubai International Airport. environment, and professional services Dubai Gold and Diamond Park through the establishment and management Dubai Health Care City (DHCC) of special zones in Abu Dhabi. The planned 4 Dubai Industrial City (DIC) million square meters free trade zone in Abu Dubai International Financial Centre Dhabi Airport, and other 12 free zones are Dubai Airport (DIFC) planned to be developed. Al Maktoum (DIC) Dubai Jebel Ali Port International Airport Dubai Knowledge Village (DKV) Entry Points Dubai Media City Dubai Multi Commodities Centre Northern Emirates (DMCC) The Federal Government put the plan of Dubai Gold and Commodities improving the infrastructure of Northern Emirate Exchange (DGCX) - part of DMCC in the top of its priority list. It is initiating massive Dubai Silicon Oasis projects in order to improve the quality of life of Dubai Technology and Media Free its residents. USD 1.6 billion worth of projects Zone (TECOM) are expected to be pumped to upgrade the water and electricity networks by building mega Economic Zones World (EZW) power stations and water desalination plants in Jebel Ali Free Zone (JAFZ) Ajman, Ras Al Khaimah, Umm Al Quwain, and Fujairah. Major roads and networks are planned Hamriyah Free zone to be connecting the whole area. Sharjah Khalid Port Sharjah Airport Sharjah Airport International Free Zone An Integrated High-Speed Rail System In order to reduce emissions produced by Ajman Ajman Port Ajman Free Zone conventional transport infrastructure, reduce the traffic jams in the heart of the cities, and meet Umm Ahmed bin Umm Al Quwain Ahmed bin Rashid Free Zone the demand by the growing population, the UAE Al Quwain Rashid Port International Airport is taking strategic initiative to build an integrated high-speed rail system. With a capital of USD RAK Free Trade Zone 272 million, the UAE’s national railway will cover Ras Al Saqr Port RAK Airport RAK Investment Authority Free Zone 1,500 km, connecting the vital populated cities in Khaimah the UAE as well as being a part of the proposed Ras Al Khaimah Media Free Zone larger GCC railway network. Great investment opportunities lay for international investors Fujairah International Fujairah Free Zone Fujairah Fujairah Port to partner with local companies or establish a Airport Fujairah specialized company in this field. Why UAE ? The Unlimited Opportunities 2012 Chapter 4 The United Arab Emirates A World of Opportunities 170 171 number of existing and under construction for facilities management is gradually landmark residential and commercial growing due to the realization progress of such as Al Wasl Villas, its importance, the existing growth in the Creekside Residence, and the Control Tower construction, and most importantly the harsh TM, Burooj Properties, Deyar Properties, RAK environmental conditions of the UAE that Property and Facility Properties, and Northern Emirates Properties could reduce the capacity of the facilities. The Management are also regional leaders in this sector as well. new facilities management laws have also The attracting opportunities in the been contributing to the increasing demand property management subsector have pulled for FM services. They require buildings under Property Management the attentions of the global companies. After construction as well as existing buildings to The demand for property and facilities realizing the great potential in the UAE market, follow the guidelines set by the government management will continue to increase as Asteco Property Management LLC and Better that coincide with the globally-recognized the economy of the UAE is growing. The Homes, international property management green buildings regulations. companies and residents are demanding companies, established offices in the UAE. In addition, these new enforced regulations better serviced and managed buildings. are playing a great role into enlightening both How does the UAE plan to boost this new developers and owners of existing properties sector to meet the desired expectations? Facilities Management (FM) of the benefits that can be reaped of a The historical witnessed growth in the sustainable facility such as energy consumption, Property managers, household owners, number of existing properties in the UAE water use, and waste management. The landowners, and real estate developers in demanded real estate developers and huge ever-increasing demand in the UAE the UAE began to realize the importance of buildings’ owners to hand over the leasing and in particular and in the GCC region overall investing on the maintenance of the facilities sales operations to specialized agencies called has called international FM organizations of their buildings in order maximize their property managers. The volume of these attention to join the attracting market. Today, life’s expectancy and to attract tenants and existing residential, commercial, and industrial FM companies do not only operate after the buyers in a competitive market. The demand completion of the project, they also cooperate properties and the undergoing projects with the developers from the drawing necessitate the property management sector Entry Points phase. By implementing FM guidelines, the to be sufficient in term of quantity and quality. developers are ensured that their buildings Property and Facilities Between 2000 and 2005, the UAE will match the intended purpose which will Management Software experienced an unprecedented properties certainly reduce the cost of maintenance and growth. The total number of buildings reached maximize the buildings efficiency. The uprising number of existing buildings 335,487. In the late 2005, USD 35.42 billion requires a sophisticated methodology that Some of the leading providers of integrated worth of projects were under construction, is able and reliable to keep track of building facilities management solutions in the UAE, dominating the construction sector in the owners, property locations, commercial and are Imdaad, Edama, Al Shirawi FM . The latest GCC. The high demand drove the prices to a residential units, and tenant’s information. signed agreements between Imdaad and the Suppliers of such technologies are as much suddenly-uptrend move. However, the prices Dubai Roads and Transportation Authority declined as all the global market suffered due needed as the existence of the highly advanced (RTA) and the Abu Dhabi General Services facilities management companies. to the economic downturn in 2008 and late Company lined some of the company’s 2009. Early signs of recovery began to appear achievements in 2010. in the early 2010 and prices of properties Northern Emirates Require One of the leading international started to take a new correction move. The Sophisticated Property Managers companies in the UAE’s facilities management liberalizing real estate regulations encouraged In order to reduce emissions produced by field is Drake & Scull International PJSC. The the emergence of property managers. Since conventional transport infrastructure, reduce the originally British company has successfully then, the market has been experiencing a traffic jams in the heart of the cities, and meet completed a great number of projects in historical transformational move from “driving the demand by the growing population, the UAE Abu Dhabi and Dubai across all sectors such effect of pure investors market towards is taking strategic initiative to build an integrated as providing mechanical, electrical and greater emphasis on owner-occupier and end- high-speed rail system. With a capital of USD plumbing (MEP) services for Abu Dhabi user demand market.” 272 million, the UAE’s national railway will cover National Exhibition, Rashid Hospital, and 1,500 km, connecting the vital populated cities in National and international property International Airport Terminal. The company the UAE as well as being a part of the proposed management companies are greatly has over than 30 ongoing projects in the UAE larger GCC railway network. Great investment benefiting from the unique pulling attracting itself. Other recognized names in the realm of opportunities lay for international investors opportunities in the UAE. Union Properties, a FM are Hitches & Glitches, a subsidiary of the to partner with local companies or establish a subsidiary of Emirates Bank, manages a great Pakistani conglomerate Dreshak Group. specialized company in this field. Why UAE ? The Unlimited Opportunities 2012 Chapter 4 The United Arab Emirates A World of Opportunities

The United Arab Emirates A World of Opportunities

Tourism and Hospitality

“ Already an established location in the world’s top visited destinations map for leisure, business and

alternative tourism, the UAE is continuing to enrich its

offerings to tourists and open new avenues for innovative tourism concepts. “

Why UAE ? The Unlimited Opportunities 2012 Chapter 4 The United Arab Emirates A World of Opportunities 174 175 respond to wealthy consumer’s preferences, Travel & Tourism Total Contribution to GDP such as the shopping festival, prestigious horse Comparison Year Contribution (USD Billion) Real Growth (%) Share (%) races, tennis tournaments, car rallies, and other highly-prized sports events. 2011 31.43 5.2 10.3 In the past ten years the UAE has committed Hotels and Hospitality United 2012 33.451 6.4 10.4 substantial resources into the development of Travel and tourism is one of the fastest tourism and that effort is already paying off. Arab 2013 36.192 8.1 10.6 growing industries across the world and the According to Dubai Property Group, in 2008, Emirates 2014 39.399 8.8 11 UAE government is increasingly embracing the 8.5% of the total jobs in the UAE were travel & sector as a core part of its growth strategies. tourism related and the proportion of tourism 2015 42.188 7 11.2 Global travel and tourism is projected to grow related jobs was projected to grow to 9.1% of from USD 6.0 trillion in 2011 to USD 7.2 trillion total jobs by 2016. Travel and tourism has also 2011 159.482 3.7 8 by 2015. The share contribution of tourism become a notable contributor of the country’s 2012 167.118 4.7 8 to gross domestic product (GDP) is set to exports – with 10.4% of the UAE exports being Middle 2013 175.211 4.7 8 strengthen in the next five years, especially in tourism driven . East the Middle East with the UAE largely behind In 2008, the World Tourism and Travel 2014 183.864 4.8 8 the rapid growth of the sector in the region. Council (WTTC) recognized UAE’s spectacular 2015 192.784 4.7 8 The UAE travel and tourism sector contribution achievements in tourism and ranked the to Gross Domestic Product is set to significantly country 18th on international tourism 2011 5,991.94 3.8 9.1 outperform the global and the Middle East competitiveness . The World Tourism and percentage. Travel Council (WTTC) uses the following 2012 6,294.51 4.8 9.1 This growth could be attributed to large criteria in benchmarking a country on World 2013 6,609.80 4.7 9.2 public investment in airports, airlines, and international tourism competitiveness: safety other transport infrastructure, making it and security, health and hygiene, infrastructure, 2014 6,920.08 4.4 9.3 possible to travel to the UAE easily, large information and communication, technology, 2015 7,232.94 4.2 9.3 investments in hotels, and large and price competitiveness, human capital, varied sports and leisure projects that cultural and natural resources, air and ground transport policy rules and regulations. The investment the UAE is projected to The tourism and hospitality industry sector plough into the development of travel and is an integral part of the UAE business strategy. tourism in the next five years demonstrates While oil and gas still dominated the UAE the country’s commitment towards making economy as evidenced by the 2008 GDP results, itself a leading tourist destination. World other sectors are increasingly becoming Tourism and Travel Council (WTTC) predicts prominent and the hotel and restaurants the UAE’s investment to be proportionally sector is amongst them. In 2008, hotels and five times higher than the global average and restaurant posted a 15.1% growth, 7.7% ahead three times higher than that of the overall of the overall UAE GDP growth. Middle East region.

Why UAE ? The Unlimited Opportunities 2012 Chapter 4 The United Arab Emirates A World of Opportunities 176 177 in terms of the number of inbound tourists expected to arrive in 2010. Dubai expects to draw 7.9 million international visitors in 2011, According to the UAE Yearbook 2010, the representing a notable growth rate of 17.3 UAE is determined to attract foreign direct per cent when compared to 2010. MasterCard, investment into commerce and tourism and a global financial institution, has indicated is therefore offering an unrivaled business that, Dubai’s international visitor spending is base across the region. The country has an expected to surge 24% to USD 7.8 billion in open market system which is supported by a 2011 from USD 6.3 billion in 2010 and USD 5.2 world-class infrastructure and service culture billion in 2009 MasterCard . where the UAE government acts as a facilitator for business and free trade. International The Abu Dhabi Tourism Authority expects to companies setting up in the UAE can avail see an increase of 15.5 per cent in international business advantages that are generally visitors with the total tourist spending unmatched across the world. For instance, growing 21.8 percent to USD 2 billion this year. the highly successful UAE business free zones Abu Dhabi’s hotel guest figures also hit record allow companies full ownership and control of highs recently with occupancy levels up from their businesses, flexible investment options nine per cent to 65 per cent. Abu Dhabi is one and non-payment of customs excise duty destination that has highest number of hotel among others. rooms under active pipeline in the GCC. Dubai has made impressive accomplishment The Northern Emirates have also made in travel and tourism. CB Richard Ellis, a leading notable progress in tourism development. commercial real estate company, ranks Dubai In 1998, The World Tourism Organization Fujairah has made important initiatives in The growth potential of luxury and as the world’s ninth global tourist destination. crowned Sharjah, the “Cultural Capital of the the protection of the environment –advancing budget hotels, and student accommodation The emirate was set to outperform New York, Arab World” due to its remarkable museums the ideals of ecotourism particularly in the in the UAE, can be assessed by looking at Amsterdam, Kuala Lumpur and Shanghai that advance the Arab culture and heritage. protection of the mountain reserve that spans developments in each emirate, particularly, nearly 220 square kilometers . Ras Al Khaimah in Abu Dhabi, Dubai and Sharjah. The three has a landscape and the golden beaches emirates are the largest and account for more that offer unique scenery in the region and than three quarters of the country’s GDP. Ras therefore its potential to grow into a notable Al Khaimah has also made significant strides tourist destination is boundless. in this regard.

Capital Investment in Travel and Tourism

25%

20%

15%

10%

5%

0% 2011 2012 2013 2014 2015

United Arab Emirates Share (%) Middle East (%) World (%)

Why UAE ? The Unlimited Opportunities 2012 Chapter 4 The United Arab Emirates A World of Opportunities 178 179 like F1 Etihad Airways Abu Dhabi Grand Prix which attract high-end visitors and therefore its continued focus on high –end hotels. Another segment that could be given attentions is the budget rooms as India is also becoming an important source for visitors and the majority could be low to mid-segment. In 2009, Abu Dhabi was ranked the second Abu Dhabi therefore needs to ensure that most expensive city for hotel rooms in the it has the right balance of low to high- end world after . Abu Dhabi has since hotels . added more hotel rooms and the rates have since dropped by 15% (from an average of USD Abu Dhabi expects to see an increase of 301 to USD 256). The city is now ranked 24th 15.5 per cent in international visitors with the on being expensive and has in a way become total tourist spending surging 21.8 percent to a more competitive tourist destination. The USD 2 billion in 2011 . latest data shows that Abu Dhabi would have Dubai has made remarkable achievements more hotels added on the high-end market in the hospitality industry. CB Richard and this should add further pressure on the Ellis ranked Dubai within the top-ten most rates. Most of the hotels in the pipeline in popular business cities. Dubai’s success can be next coming months are high-end. Recently, attributed to the emirate’s ability to promptly a few of them have opened their doors to adjust to the needs of the market and provide tourists like the Monte-Carlo Beach Club in a balanced portfolio of accommodation that Saadiyat, The St. Regis Saadiyat Island Resort caters for all categories of customers –from and The Jumeirah Al Etihad Towers. low-end to high-end. The introduction of Abu Dhabi’s main source of guest has low cost airlines has seen a jump in demand traditionally been the UK and Germany. However, for budget rooms-which the emirate should visitors from Russia and Saudi Arabia are on the continually address. According to MasterCard increase. The later have significantly boosted Dubai’s international visitor spending is the 10% jump in guests over 2011. The Emirate expected to surge by twenty four per cent to USD 7.8 billion in 2011 up from USD 6.3 billion holds some of the Global premium sports events in 2010 and USD 5.2 billion in 2009 . Entry Points Sharjah, the third largest Emirate of the UAE, has made huge milestones in developing Providing Budget Hotel Rooms across culture related ecotourism. The emirate’s hotel all Emirates network is biased towards low to mid end The introduction of the budget carriers has segment and, with the introduction of budget led to the growth of the low-mid segment carriers like , demand continues to arrivals which has in turn increased the demand grow in the budget traveler segment. for budget rooms across Dubai, Sharjah and Abu There are a number of initiatives to address Dhabi. Rotana Hotel Group has partnered with the growing low to mid segment market. Air Arabia to provide budget hotels in Sharjah. Rotana Hotels, a popular hotel group, has Such partnerships can be replicated across all the partnered with Air Arabia, a budget air carrier, emirates. to launch a low- cost hotel brand called Centro, Investment into Hotels on Saadiyat Island to mainly targeted towards budget travelers. Support Abu Dhabi’s 2030 Vision The number of guests at Sharjah’s hotels The Abu Dhabi 2030 vision seeks to establish and hotel apartments in April 2011 stood at the emirate as a regional centre of culture 143,341 — 80,459 hotel guests and 62,882 with a global capital city as its hub. A massive hotel apartment guests — compared to infrastructure has to be put in place for this 129,046 guests in April 2010, recording a steep vision to be realized. Hotels are part of this eleven per cent growth . infrastructure development. A number of hotels are planned for Saadiyat Island and this offers opportunities for investment into Government backed programs.

Why UAE ? The Unlimited Opportunities 2012 Chapter 4 The United Arab Emirates A World of Opportunities 180 181

Spas and Recreation Facilities The word spa has become a familiar global term. According to Susie Ellis, the president of SpaFinder Inc., a global resource group that publishes yearly reports on Spas Worldwide, the word “spa” has captured people’s imagination and is now a term that people can relate to positively. The Middle East has registered a substantial 34% yearly growth in spa facilities in the past few years . The region’s wellness and Spa industry is estimated at USD680million of which about 40% comes the growing regional market which registered from the United Arab Emirates. nearly 10 per cent growth in the number of exhibitors and visitors from last year. In a report by the in 2008, the UAE shows to be well ahead of its Middle East For the majority of people in the UAE and North Africa counterparts in terms of the personal wellness is at the center of visiting number of spa facilities in the country and in a spa. The days have become busier and revenue. crowded and hence stressful for most people and a spa treatment brings some welcome The Dubai Chamber of Commerce attributes relief. Spa facilities have become an integral the growth of the wellness and spa industry part of the service offered by malls. Obesity in the UAE to two annual festivals; the Dubai is observed to be a growing occurrence in the Shopping Festival and the Dubai Summer region. Many spa facilities now offer specialty Surprises which are said to be directly raising the treatments to help people get into shape. annual sales trends. In May 2011, Dubai hosted yet another successful Beauty world Middle The UAE is also a home for some of the East Specialist Exhibition which hosted over world’s most innovative theme parks and have attracted a number of leading international Partnerships with Hotels to Provide Spas 700 exhibitors from 44 countries . The strong Entry Points participation in the exhibition is a testament to brands to bring about recreational facilities to Meet Increased Demand that have drawn a large influx of tourists who Specialized Wellness and Spa Treatments People across the UAE now have larger enjoy such activities. than ever disposable income. For many tourists Details of Spas in Middle Eastern Region In the larger Middle East and North Africa investment in their health is a natural way to enjoy Country Estimated Number of Spas Total Revenue (USD Million) regions, obesity has been observed to be an their leisure time. The UAE also has the longest United Arab Emirates 212 267.9 increasing problem among the population. pipeline of hotels under construction across the Wellness and Spa is a business that can help GCC. Hotels have to have a spa for them to be Saudi Arabia 96 52.4 people look good through engaging in regular seen as offering a full service. Qatar 19 19.9 exercising and specialized treatments to address this weight problem. Because UAE is the de facto Oman 25 32.1 tourism hub, establishing specialized wellness Spa Academies Offering Formal Training spas that provide these treatments can be a and Qualifications Bahrain 24 27.4 lucrative business opportunity. The country’s A number of people working in Spas do not Kuwait 33 22.2 diverse natural scenery, developed health care have formal training and qualifications. Spas have sector and ability to attract international brands become an integral part of community health Egypt 146 43.7 in this field are strong competitive advantages and should be manned by qualified personnel. Tunisia 41 86.2 that will serve this niche to flourish. Need for academies to provide formal training and qualifications would further increase as more Morocco 79 39.8 of these facilities open each year. Why UAE ? The Unlimited Opportunities 2012 Chapter 4 The United Arab Emirates A World of Opportunities 182 183 boarding, sand skiing, dune buggy driving, theme park tours and water park adventures. Special interest packages can also be arranged to suit the visitor’s specialized hobby or sport such as diving, deep-sea fishing, cultural tours Tourism and Travel or bird watching. Tour operators are licensed via the different Services tourism development authorities across the With the variety of touristic offering that seven emirates (refer to chapter 7 for more the UAE presents and the ambitious tourism details). In general, tour operators wishing to sector development plans embraces by the organize in-bound tours are required to have country, the establishment of capable tour qualified and licensed tour guides. Abu Dhabi operators and travel service providers is vital Tourism Authority (ADTA), Dubai Department to complete and complement the tourism of Tourism and Commerce Marketing and industry value chain. Continuously, new Sharjah Commerce and Tourism Development innovative ways can be developed to utilize Authority offer comprehensive trainings the country’s offerings and news concepts can programs in this field. Tour guides should be pioneered to further attract tourists from have at least a recognized college degree and around the world to enjoy the UAE experience. should have decent knowledge about the UAE history, geography and culture. Currently, tour companies offer tailor- made services to help visitors discover the UAE. As the global economy is regaining per cent rise in passengers in 2011 compared of outbound operator services provides several Organized tours range from a half-day city momentum, the inflow of tourists will receive with 2010 . Holiday Factory, a Germany owned opportunities given UAE’s long coastline and tour to one- or two-night desert and mountain a positive boost. The United Nations World company, launched in the budget traveler large number of ports. safaris plus daily programs for desert driving, Tourism Organization forecasts tourism related segment early 2011 in Dubai promising shopping tours, camel riding, canoe trips, sand revenues to hit a high of USD 2 trillion by year affordable and competitive package deals for Entry Points 2020. Global tourism expected grow from 1.06 the mass market. billion travelers in 2010 to 1.56 billion in 2020 Tour operators come in three categories: Capitalizing on the Sports Niche .Meanwhile the number of tourists travelling overseas operators, inbound and outbound to the Middle East is expected to reach 136 The UAE is renowned for having some of the tour operators. A number of operators provide best sporting facilities across the world therefore million by 2020 . both inbound and outbound services. Inbound the country attracts major sports events. The Today, the biggest tour operators in the tour Operators offer a number of possibilities Yas Marina Circuit annually hosts the Etihad UAE are Emirates Holidays and Dnata, both like Shopping tours in Dubai hailed as the Airways Abu Dhabi Grand Prix in November. owned by Emirates Airlines. Both of the shopping centre of the world with around The event will attract upper-end travelers with Emirates Airlines tour operators serve the twenty shopping malls, water sports like water diverse needs from across the world creating high–end segment of the market given the surfing, skiing, kayaking, helicopter and hot- opportunities for niche tour operators. The circuit airline’s position as a leading global carrier. air balloon tours give the tourist a bird–eye’s can accommodate 50,000 spectators. The Dubai In addition, Etihad Airway and Air Arabia view of the of the cities and the desert, and Duty Free Tennis Championships and the Capitala formed their own tour operators and are Mosque tour for non-Muslims to promote World Tennis Championship are other major servicing their own respective markets. In the cross-cultural understanding. sporting events expected to attract thousands of UAE market, major tour operators are either The UAE market of outbound tourist is high income travelers who can be targeted with owned by airlines or linked to major operators very diverse and therefore offers huge niche customized tours suiting their interests. outside of UAE. However, one should not marketing opportunities for tour operators. A underestimate the role of the locally-owned number of services offered in UAE can also be Targeting Budget Travelers tour operating companies, such as Net Tours, offered in other GCC countries as the countries UAE airlines are consistently adding new Arabian Adventures among many other small have geographic features and cultures destinations. Flydubai, one of the budget and medium-sized operators. similarities to the UAE. carriers, wants to add a holiday division and open more as it targets a 140% rise in passengers. The With budget carriers like Flydubai and Air Abu Dhabi Tourism Authority (ADTA) and carrier is expected to link up with tour operators Arabia recording phenomenal success in the MSC Cruises signed a landmark co-operation budget traveler segment, a number of tour and hotels to create budget-themed holiday agreement that will see the world’s fastest packages for UAE residents seeking short breaks operators are eyeing opportunities in this growing cruise operators deploy one of throughout the region, as well as international sector. Flydubai plans to add a holiday division its its top vessels to the UAE capital on a tourists looking to stay in the Emirates. and bring in new routes as it targets a 140 homeport basis from October 2011. This form Why UAE ? The Unlimited Opportunities 2012 Chapter 4 The United Arab Emirates A World of Opportunities 184 185 Abu Dhabi in partnership with the world renown Louvre Museum in Paris. The Museum is intended to be completed in 2014. Two other museums, namely the Zayed Museum in partnership with the British Museum, and Museums and Historical in cooperation with the Guggenheim Museum in New York are also Tourism underway. The UAE founding father, the late Sheik Sharjah has 17 museums and cultural Zayed once commented that ‘He who does centers. The museums are dedicated towards not know the past cannot make the best of showcasing the different aspects of the his present and future for it is from the past country’s past, such as literature, archaeology, that we learn .’ The present UAE government natural history and the pearl trade tradition. has continued to uphold this philosophy. The Dubai’s main archeological sites are located best places to witness the initiatives the UAE is in Jumeirah and Al Sufooh. The Dubai Museum taking to preserve and understand its past are is located in Al Fahidi Fort, built around 1787. the museums and the historical sites around There are also other specialized museums and the seven emirates. Each emirate manages its historical areas that have been established own set of museums and heritage sites. Dubai, and refurbished traditional houses such as Abu Dhabi and Sharjah have a more established the Sheik Saeed’s house, the main house of network of heritage sites and museums when Sheik Saeed Al Moktoum who ruled Dubai compared to their counterparts. from 1912 to 1958, Traditional Architectural Abu Dhabi has developed 15 sites to serve Museum, Bastakiya Historical Area, and the as historical tourism destinations. For instance . Delma Island showcases the nation’s pearling The emirate of Ras Al Khaimah has an history while Al Ain is popular for its forts interesting heritage. The emirate also has areas. The Tourism Development and Investment and castles. There are major museum and art Entry Points its own national museum and has a number Company (TDIC) has been given the mandate to pavilion developments underway at Saadiyat of ancient buildings and archaeological sites oversee these major development projects and Island meant to turn the Island into one of the Saadiyat Island: Contributing to including the Queen of Sheba Palace and the is the point of contact for interested suppliers. major global cultural centers. a Future Cultural Hu “Tal Al Sanam” ancient sun-worshippers temple. The Tourism Development and Although these sites are not yet tourist-ready, Saadiyat Island Development is at the core Restoring Historical Jewels of the Abu Dhabi 2030 Economic and Cultural Investment Company (TDIC), as part of this the government of Ras Al Khaimah is seeking All over the world, viable commercial Vision. The Island will be the host for seven mega humongous cultural development, has serious partnerships to restore these sites are opportunities have been realized out of the projects including the three major museums: undertaken the project to develop Louvre turn them into tourist destination. restoration and effective marketing of sites with the , Sayed Museum and the historical significance. Throughout the forty Guggenheim Museum. All of these projects years of the nation’s federation, efforts have With diligent efforts and sound value been made by the federal and local governments proposition, the government of Abu Dhabi to renovate a number of historical sites including succeeded in securing key international forts, mosques, old souks and old houses, and partnerships with topnotch museums that will to turn them into attractive tourist destinations. provide some of its top-tier collections and However, there are still several sites that required will transfer technical know-how and expertise joint efforts by both the government and in this field to the young generation of talent. private sector for rehabilitation and commercial The first of these museums is to be completed development such as the Queen Sheba’s Palace in 2014. in Ras Al Khaimah and Al Bidya Mosque in While Abu Dhabi is undertaking the Fujairah. Opportunities are also available investments of these strategic projects, qualified across the seven emirates to develop innovative local and international suppliers, and expert concepts centered on the facilities and historical houses are invited to contribute to different sites that have been renovated. For instance, aspects of the projects and infrastructure the old houses in Historical Area in developments including facilities construction, Dubai are available to be used as a venue for technical consultancy, curation, international projects that can attract tourists and shoppers marketing, and interior design among other visiting or living in the country. Why UAE ? The Unlimited Opportunities 2012 Chapter 4 The United Arab Emirates A World of Opportunities 186 187 Moreover, the country has also become The Arab Strategy Forum, Arab Health a destination of choice for conventions, Congress, Leaders in Dubai and Middle East Entry Points conferences and international organizations’ Communications Exhibition and Conference meetings. Today, With 31 international (MECOM) in Abu Dhabi are some of many Capital Centre Development in Abu Dhabi association meetings held in Dubai 2010, it is other leading events organized that take The Capital Centre Development surrounds ranked by International Congress & Convention place regularly in the country. More of these the Abu Dhabi National Exhibition Centre Events and Incentives Association (ICCA) as the 51st destination accomplishments in this domain have been (ADNEC). It is considered to be a fully integrated Tourism globally in this category . Annually, the major attained in keeping the UAE as one of the project that will house a business and a cities of the UAE host hundreds of regional most preferred destinations for top-tier residential micro city of 23 towers, including 7 The Events and Incentives Tourism Sector and international conventions, conferences, international convention organizers. hotels, a shopping mall and restaurants. The project is government backed, while the project is a significant driver not only of the UAE forums and summits that draw professionals Each Emirate manages its own exhibitions development and management is undertaken economy but also of the global recognition of from different industries and with a wide and conference facilities. Abu Dhabi launched by ADNEC. Consultants, concept developments, variety of domain expertise. the brand UAE. The country has become known the Advantage Abu Dhabi in 2009 in view interior design experts and specialized firms as a host some of the leading international In 2003, Dubai orchestrated the Annual of promoting conference and exhibition in the planning and development of exhibition events and conferences, exhibitions, and Meetings of the World Bank Group and the initiatives. The Emirate has a number of and conference facilities can find interesting trade fairs spanning different industries and International Monetary Fund. Held on the projects underway, one of which is an AED 8 opportunities to participate in this strategic attracting both retail and corporate visitors custom-built Dubai International Convention billion (about USD 2.2 billion) capital centre project. and delegates thanks to the state-of-the-art Center, the event was remarkably successful, development, fully integrated community conference and exhibition facilities across the strongly re-enforcing the brand of the city project which is part of the Emirate’s vision Placing Fujairah in the International seven emirates, and the country’s position and the country in the international business for 2030. This huge development will include Incentives Tourism Map as a global airline hub that connects to the tourism arena. The annually held Abu Dhabi provisions for large exhibition halls and The emirate of Fujairah is on the path of world’s different continents. Recent estimates Future Energy Summit, pioneered in 2010 a number of state-of-the-art conference becoming a significant hub in the international indicate that 65% of the current exhibition facilities. Currently, Abu Dhabi National by MASDAR and attended by presidents logistics among other emerging industries. space available in the GCC is situated in UAE Exhibition Centre, with a total area of 73,000 and royalties, is another signal of the The government is determined to increase square meters, serves as the main venue indicates that the country has been able to foresightedness of the UAE in bringing the significance of the emirate in the business for major international exhibitions and capitalize on its strategic crossroads location together thought-leadership from around the tourism arena through hosting international conventions held on the capital. between Europe, Africa and Asia. world to strategize the road ahead in one of trade fairs and notable industry events. Currently, The UAE is today one of the leaders in the the most critical issues for humanity. Over the past three decades, Dubai has Fujairah has one exhibition facility with three international exhibition industry hosting some continued to upgrade its exhibition and halls, however, the emirates is in need for new of the largest and most significant exhibitions conference facilities to be at the top-most of concepts and ideas of exhibition and conference across different sectors globally. Some of the the global standards. The Dubai International facilities that can host larger events and position notable annual exhibitions held in the country Conference and Exhibition Center has evolved the emirate higher in this growing branch of include International Defense Exhibition and to be one of the largest and most advanced tourism. Conference (IDEX), one of the biggest shows conference and exhibition facility in the MENA for defense equipment and services, Gulf region providing a total area of 93,900 square Information Technology Exhibition (GITEX), meters. Some other notable conference and one of the world’s largest information exhibition facilities in Dubai include Dubai technology related exhibition, and Gulfood, Airport Expo, Conference the world’s largest annual food stuff related Centre, DIFC Conference Center and exhibition. Furthermore, the biennial Dubai Knowledge Village Conference Centre among Airshow is today one of the must-attend a wide choice of venues in Dubai’s well-known events for the global industry leaders being luxurious hotels and spacious buildings. the third largest aviation exhibition in the The other emirates of the UAE have also world. It is noteworthy that number of visitors joined the caravan, developing their own to the Dubai International Convention and state-of-the-art exhibition and conference Exhibition Centre (DICEC) and Dubai Airport facilities to aid the realization of their Expo Centre has increased by 10% in 2008 economic vision. The Expo Centre Sharjah and reaching a total of 1.2 million business visitors. the Ras Al Khaimah Exhibition Centre are some With its ability to conceptualize and attract examples of some of these well-established such caliber of exhibitions, the UAE now has facilities. Projects are underway in the other 50% market share in the total Middle East emirates to upgrade and develop new venues exhibitions industry. that would enable them to increase their share in the incentives tourism arena. Why UAE ? The Unlimited Opportunities 2012 Chapter 4 The United Arab Emirates A World of Opportunities

The United Arab Emirates A World of Opportunities

Manufacturing

“

With the ideal climate for export and one of

the most flexible employement regimes, the UAE is at the verge of promising industrialized future. “

Why UAE ? The Unlimited Opportunities 2012 Chapter 4 The United Arab Emirates A World of Opportunities 190 191 water and electricity is handled by the Abu EnergyManufacturing Sector - MajorMajor IndicatorsIndicators Dhabi Water and Electricity Authority. Three more phases are either under construction or Contribution to GDP (2010) USD 28,935 million (14.18% of non-oil GDP) at the planning stage. A USUS$2.17bn industrial zone in the Abu Ministry of Economy (Federal) ver since the coastal line of the UAE Dhabi desert for construction and building Federal and Local Regulators Local Dept of Economic Development (Each Emirate) Ewas inhibited by pearl divers and tribal materials firms is one of a host of projects the Respective Free Zone Authority (Each Free Zone) fighters, the roots of basic manufacturing Government is planning to industrialise the started to flourish with traditional weaponry emirate. The 34-square-kilometre Al Fayah Total Number of Factories (2010) 4960 and diving dhows. With the establishment of Industrial Zone, being constructed by the the modern state, the UAE’s manufacturing Higher Corporation for Specialised Economic Volume of Investment (2010) USD 27.553 Billion sector grew to become the 2nd strongest Zones (ZonesCorp), reflects the Government’s economic growth driver among non-oil latest efforts to create industrial clusters to Most significant in the last year was the much lower than in the services sector, and sectors. In terms of its GDP contribution, it has boost economic growth and diversify away rapid progress of the manufacturing sector equally productivity is much higher – reasons made 10.11% share in 2009 and 9.7 % in 2010. from oil revenues. The location, 75km east of in the emirate of Sharjah. Sharjah’s Economic for which labor import policy is likely to the capital, is also a sign of efforts to relocate Motivated by the nation’s desire to diversify Development Department reported that its remain liberal for the manufacturing sector, industries away from residential areas and the economy and the sharp increase of the industrial GDP amounts to 48 percent of the allowing the sector to grow further. relieve congestion. population, manufacturing at various levels UAE’s total industrial GDP. Rental and operational costs are also still of industries has been at the core of heavy In Dubai, pulling its weight alongside the In addition, the whole country is moving competitive compared to Europe and the government investment spanning the seven burgeoning number of free zones that support forward to ease up on regulatory affairs, and US; which adds another advantage; when federated emirates. Most emirates have also manufacturing in Dubai is the Dubai Industrial primarily raising the foreign ownership stake combined to location and entry markets. gone a step further by launching innovative City. DIC is targeting US$2 billion in investment in industrial projects registered outside the Of particular interest here is the policy initiatives that supported the growth over the next five years. So far DIC has invested free zones. empowerment of new ideas and innovative of free zones and dedicated industrial cities US$177 million and will build more than 500 Employment is one of the key advantages industries. Both local and federal to cope up both with the demand and the factories for light and medium industries by of the UAE over other spots. In fact, the UAE governments have launched a series of vision of being the world’s most dynamic 2015. Still, this doesn’t replace the six hyper is still better positioned in terms of cost of parallel initiatives that recognize industry manufacturing hub. By the third quarter active industrial zones that operate inside the employment compared to Western countries. distinction and business excellence. The Dubai of 2008, an official report placed the total city under regular licensing procedures. Though U.A.E. has high income and wage Quality Group, for example, is a voluntary cumulative industrial capital value of all non- levels as in the West, the U.A.E. economy can corporate body that helps companies embed oil and gas industrial projects in the UAE to be Factories per Emirates in the UAE still rely upon a reservoir of low cost labor from quality in their overall production process exceeding US$20 billion, accounting for about Asia (unlike Western countries which follow a and then consolidate it in terms of revenues 290,000 jobs. This new wave of manufacturers 326 Abu Dhabi strict policy against importing labor). and ROI. are catering for the ‘new economy’ providing 1718 Dubai This actually enables domestic Intellectual Property is a serious issue here machinery and tools for industries related manufacturing to grow further, unlike and the government has a zero-tolerance to construction, shipbuilding, infrastructure, the West where manufacturing is now policy regarding any violation of patent piracy power generation and even retail and stagnating in face of competition from and fake branding. the same regulations are consumer related industries. China and other low labor cost countries. applied regardless of whether the concerned Abu Dhabi has been successful with its Labor demand by U.A.E. manufacturing is company is a free zone company or not. Industrial City of Abu Dhabi operations. The first Industrial City of Abu Dhabi (ICAD 1) includes Development of the Manufacturing Sector (2004-2010) economic zones for base metals, building and Year No. of Factories Volume of Investment (USD) No. of Workers construction products, electronics, plastics manufacturing and automotive industries 2004 3036 17,149 231275 and has already attracted US$2.99 billion in 2005 3294 18,577 245707 investment. ICAD 2 has already attracted nearly US$1.63 billion with new projects including 92.58% Sharjah 2006 3567 19,176 264719 air conditioning water chillers, architectural 92.58% Ajman 2007 3852 19,778 288180 hardware and aluminum windows and 1.87% Ras Al Khaimah doors manufacturing. The ICAD zones have 2008 4219 20,979 317841 4.99% Um Al Quwain been built in a public-private partnership 2009 4644 22,100 347269 model that includes the cost of roads and 0.56% Fujairah sewerage and irrigation systems. Separately, 2010 4960 27,553 382296

Why UAE ? The Unlimited Opportunities 2012 Chapter 4 The United Arab Emirates A World of Opportunities 192 193 to transport the product to end users too. Abu While the direct objective is to speed up Dhabi National Oil Company (ADNOC); the Abu Dhabi’s plans to develop a plastics-based main and largest oil operations company in industry for domestic and export purposes, the country; has its own fleet of carriers and the indirect objective to utilize crude-derived container ships that cater for the needs of its naphtha as feedstock rather than ethane. This Petrochemical Industries investment partners. Ports of Abu Dhabi and will free up ethane supplies which are in high Dubai; although the busiest in the region; are demand from the power sector and utilize Abu The UAE is slowly graduating into the next far from any bottlenecks. Additional setup Dhabi’s more abundant supply of naphtha, phase of petrochemical product development is also being built in Fujairah; at the Indian thus guaranteeing future feedstock supply. – branching into specialized products instead Ocean; to provide an alternative route to the The underlying success factor behind all of ‘just the commodities.’ And with this global markets. of these initiatives is in fact the outcome transformation, there seems a growing Of particular interest here is the new of Borouge; which since its inception back emphasis on generating local consumption government sponsored initiative to develop, in 1998 as the Abu Dhabi sole operator in of these specialized plastics too. The driving as a first phase, one of the world’s largest petrochemicals, has been actively expanding logic behind the momentum is to pump out grassroot integrated Chemical Complexes in its portfolio in order to attract further crude form beneath the surface, add value by the newly planned Chemicals Industrial City investments to fully unleash the petrochemical converting it into plastics and then export it a at at Taweelah (Abu potential as outlined in its 3 project phases so few days later. Dhabi). The project will be one of a number far. Despite emerging as major plastic raw of complexes globally to combine aromatics, Even with some global slow down, Borouge material producer, for a host of reasons, the olefins and fertilizer production. While the Abu Dhabi Polymers Park is has solid reasons for investment optimism. The contribution of the downstream plastic industry focusing on providing value-added services The Chemicals Industrial City (or Abu Dhabi-based petrochemicals converter to the nation’s GDP is yet to prevail. However, specifically to the plastics converters the Chemaweyaat) is investor-oriented with a and plastics solutions provider reported a the government wants this to move faster; overall offering; country wide, is opening clear goal to help international business opt strong second quarter of 2011, overcoming which is why there are some major initiatives the door for five major industries to leverage in to develop the emirate’s industrial and the slowdown in market growth that was set to attract investment in the downstream the country’s downstream resources; downstream industries, create a sustainable to continue through second half. Its net profit plastic industry. Abu Dhabi embarked upon including automotive, consumer appliances, petrochemical and chemical hub and deliver reached US$229.3 million, bringing its total for the Polymer Park concept; while other plastic packaging, construction and metals joint benefits for both the industrial zone and the first half to US$465.5 million, up 133.6% emirates; especially Dubai, are alsoopening processing. port. year-on-year. up for downstream petrochemicals for both production and marketing operations. From an investor’s point of view, feedstock and logistics are the top two cost components of petrochemicals products; the UAE enjoys an advantage over Asia and Europe on both accounts. First, feedstock cost is lower in this part of the world, owing to its rich oil and gas reserves. The UAE procures ethane at US$1.5 per million BTU (mmbtu), compared with a minimum US$3.20/mmbtu in Europe and the US. As ethane is expensive and scarce, Asian and European firms use naphtha as a major feedstock. Secondly, the GCC’s closeness to demand clusters – specifically India and China – offers a significant logistic cost advantage (second largest cost component after feedstock). Logistics wise; the UAE is in fact the only GCC country that doesn’t face the bottleneck problem known to hinder petrochemical exports the region. The country has early realized that supply chain in the petrochemicals industry is a very important factor for success, as maintaining a feedstock advantage requires a reliable and cheap way Why UAE ? The Unlimited Opportunities 2012 Chapter 4 The United Arab Emirates A World of Opportunities 194 195 companies have been opting to JAIA since mid 1980s as a regional manufacturing base The estimated cost of the Borouge III for polymer-based chemicals and hydrocarbon expansion, currently under construction, derivatives. Thanks to its positions, just off is US$4.5 billion. The project is seen fully Jebel Ali Port and next to Al Maktoum Cargo operational by the middle of 2014 with the Airport; this industrial area is well-positioned project completion due by end 2013. Upon for manufactures looking to reduce imports/ completion of phase III, the production exports overheads. The port itself is equipped capacity at Borouge would increase to 4.5 with the Middle East largest liquid chemicals million metric tons a year. storage facilities; which serve the needs of the many chemical plants operating in the Jebel Ali Currently, the combined capacity of Free Zone and Industrial Area; such as Jotun Borouge I and Borouge II, located in Ruwais, is Polymer’s 10,000 b/d unsaturated polyester two million tons a year. There are two crackers, resin plant or Middle East Packaging plant one olefins conversion unit, five polyolefin that produces 600 tons/month of polystyrene plants — which include two polypropylene sheets and 300 t/m of polypropylene sheets. and three polyethylene units. Borouge II, which started operations last in 2010, was built at a cost of about US$5 billion. With the introduction of 2.5 million tons by mid 2014, the annual capacity of the plant will be further expanded to 4.5 tons. Moreover, and to provide an additional petrochemical makers to start their Middle Facilities include warehousing, laboratories as push to the nation’s supply of petrochemicals; East operations from the center; a feature that well as training and vocational institutes. Borouge revealed it was investing in an can be easily utilized by UAE based companies In average, the PolymerPark will consume an innovation centre in Abu Dhabi scheduled in conjunction with a manufacturing presence annual average of one million tons of polymer to be ready by the end of 2011. The step in the nearby Jebel Ali zone. to be supplied by Abu Dhabi National Oil will localize the firm’s own research and Company’s Borouge. development (R&D) capabilities after Entry points decades of relying on its European partner. Chemical Fertilizers For investors, Borouge can play a dual The Abu Dhabi Polymer Park The chemical fertilizer industry of the UAE role; firstly by providing raw petrochemical plays a significant role in the country’s economy polymers that can be used in further processing In an attempt to provide investors with a with daily production of 1,500 metric tones of and manufacturing; and secondly by providing dedicated industrial zone for polymer and plastic urea and 1,050 metric tones of ammonia. The conversion, the Abu Dhabi Basic Industries the plastics solutions themselves that can be state-owned Ruwais Fertilizer Industries (FERTIL) Corporation established in 2008 a US$4 billion utilized in the development of other plastics- is the largest of its kind in the GCC region. It Abu Dhabi Polymer Park; which is located at based solutions and products. According to actually provides a clear idea of international the Industrial City of Abu Dhabi (ICAD). The investment in the local fertilizer market, as it the company; its unique Borstar process and main purpose of the park, which hosts up to 60 catalyst technology enables a differentiated was formed in 1998 as a 36:64 joint venture plastic product manufacturers, is to provide for between SQM of Chile and Abu Dhabi National range of polyethylene and polypropylene downstream production and integrate with the Oil Company (ADNOC). innovative plastics solutions for infrastructure mid- and up-stream players in the UAE and the Although this complex produces an annual applications (including pipe systems, and region. capacity of 40,000 tones of granular compound power and communication cables), automotive The project comes as part of The government components and advanced packaging. and water soluble fertilizer, along with 200,000 of Abu Dhabi’s initiative to support and develop tones of suspension and liquid fertilizers and has Moving north in the country, Dubai strategic industries such as petrochemicals capacity of 200,000 tones, the market is still sounds like another hub for petrochemical through providing the basic needs capitalizing on in demand of further production, especially for downstream production. Although it’s not Meanwhile; the Dubai Multi Commodities the abundance of energy sources, the advanced exporting business. Many investors have opted as big as Abu Dhabi’s; the petrochemical Centre (DMCC) provides a unique marketing infrastructure, and the strategic location. to use Jebel Ali Industrial Zone as their base industry in Dubai has been so lucrative that a platform for petrochemical and plastics The 4.5 square kilometer park, which had 30% for chemical fertilizer manufacturing for this manufacturing giant such as BASF of Germany producers to operate freely and run their reservation upon launch in 2009, was expecting purpose. Jebel Ali is well-know for its logistics has built its construction chemicals plant in business development activities. In mid 2011, over US$4 billion of investments in its first phase and shipping center; which makes it much easier Jebel Ali Industrial Area (JAIA) to cater for its DMCC; which is actually a free zone, has from both local and foreign investors. The park to distribute to a wide array of countries with market across the Middle East. Petrochemical successfully attracted three international is expected to reach full capacity by end of 2012. ease. Why UAE ? The Unlimited Opportunities 2012 Chapter 4 The United Arab Emirates A World of Opportunities 196 197 Senior officials and market experts both agree Abu Dhabi has such a good potential to excel in the aerospace segment for three realistic reasons. Firstly, such a segment requires huge financial assets which are not High Tech and a problem for the oil-rich emirate. Secondly, this type of industry requires a lot of energy, Heavy Industries which can be provided by Abu Dhabi at competitive rates. The third factor is related The UAE’s drive to focus on high tech to the human capital, as high tech industries industries was primarily motivated by the usually relies heavily on expert systems and country plan to switch to high income industrial robotics rather than a huge workforce. With activities at the long run. Abu Dhabi was in the active educational system applied in the fact the first emirate to adopt this policy when emirate, Abu Dhabi will be able to provide this Mubadala was formulated few years back. The Figures also show the high-tech free zone In addition, Jebel Ali Free zone has been industry with the required skills based on its company currently owns and operates several has witnessed a 32% increase in company home to several investments in the assembly highly trained national workforce. high tech industrial initiatives including the registrations, taking the total number of and configuration of transportation buses, manufacturing of airplanes and advanced Another high income segment is the entities operating at the technology park to ambulances as well as firefighter vehicles. The processing chips among other disciplines. manufacturing of advanced processing chips. 482 . DSO’s client portfolio currently comprises ambulance and firefighter vehicle market is Abu Dhabi has acquired the flagship processor While this particular segment is yet to 65% of technology companies, ranging from actually dominated by one company but the company Advanced Micro Devices, best known contribute to the local GDP, it is foreseen as IT and electronics to telecommunications, market is far from closed, for either local sales as AMD. The company is now partnering one of the future power sources of income semiconductor and energy companies. or regional exports. with The Advanced Technology Investment that comply with Abu Dhabi’s long term Engineering and the retail sector represent 6% A newly emerging segment is the assembly Company (Atic) ; the technology unit of the strategic development plan. Abu Dhabi each of the total number of companies, while of heavy vehicles and machines for various Abu Dhabi government’s investment fund has set a goal to reduce its oil-based GDP 25% encompasses diverse businesses. uses. A recent study by Dubai Industrial City Mubadala, and Global Foundries to build a European and American companies make estimates the market for heavy machinery in from 65% to 36% of the overall GDP. US$6 billion semiconductor factory in Abu up 47% of the total number of companies the GCC countries to exceed 1 million new A good example of such a thriving Dhabi. Although it is just the beginning, the operating at DSO. Asian and MENA companies machines every year. In particular, some investment approach is Mubadala Aerospace2 step is expected to generate further financial make up 19% and 34% respectively. To further investors have shown interest in assembly of ; which announced earlier in 2011 it would sustainability for the shareholders as well as empower its partners with well-prepared vehicles used for mining, mountainous road capitalize on its partnership with Ferrari and generating more investment opportunities for employees, DSO has recently opened Rochester works and construction mega projects Tata to produce the first UAE-made medium the various stakeholders. Institute of Technology (RIT), which is now size business jet by 2018. In fact, this is going Meanwhile, Dubai Silicon Oasis provides an located inside the free zone enabling it to to be one of four streamlines in the aerospace Entry points interesting opportunity to setup and establish accommodate the fast pace of growth in the industry Abu Dhabi has defined as potential high tech industries and to use the dynamic number of students, with new applications revenue generators. The other three include The Logistics Zone of Al Ain Airport emirate as a regional launch pad. Over the first expected to register an increase of over 50%. commercial and military airplane maintenance, half of 2011, DSO has achieved over USD 88 A lucrative opportunity is emerging at Al Ain While high tech industries are an emerging manufacturing of airplane parts and high level million in revenues; a 4% increase compared Airport, in central Abu Dhabi, for aerospace segment in the UAE, heavy industries are not training. to the same period in 2010. and logistics companies to establish their own and still provide compelling opportunities logistics, maintenance and spare parts services for many. The growing demand for marines and manufacturing plants. carriers have encouraged international Abu Dhabi Airport Company, which owns partnerships to build dry docks for the and operates several airports in the emriate, has built-up of large vessels that can be used for said it has opened the door for foreign investors various cargo and transportation purposes. and big international companies in the new Al Boat and yacht industry is another promising Ain Airport. segment comprising both full manufacturing Foreign companies and investors will be, for and partial assembly. There are currently few the first time, allowed to build projects in the companies involved in this segment but the airport and the surrounding development area. market is growing, especially as the dollar- The airport is scheduled to re-open in its new millionaire count in the UAE has now jumped form before the end of 2011, and is expected over 50,000. The segment is also a promising to draw big demand by foreign investors and export business. At least one of the UAE yacht companies working in aviation, air cargo and makers has an active export base in the USA. logistics sectors. Why UAE ? The Unlimited Opportunities 2012 Chapter 4 The United Arab Emirates A World of Opportunities 198 199 that has hugely benefited from the infrastructure and construction boom. Glass is an essential factor in the GCC construction scene due to its role in heat reflection. Solar reflective glass is highly demanded as an Light and Mechanical external covering of towers and buildings for the protection it provides from conducted Industries heat-gain (air-to-air) when ambient temperatures are high during the summer. The rise of light and mechanical industries The local demand for glass sheets is growing in the UAE was mainly affected by the diverse at a fast pace, although it slowed down during economic scene along with the large business over 2008/2009, but now it is bouncing back infrastructure in the country. Companies with the resumption of construction projects that manufacture business supplies, building and the launch of newer ones. materials, hardware accessories, etc have found refuge in the nation’s wealth of opportunities There are four key factories in UAE, derived from the unprecedented infrastructure manufacturing glass sheet products for boom over the past two decades. buildings. Installed capacity is roughly 850 thousand square meters. The products In addition, the country’s open and include high performance solar control and dynamic export-friendly economy gave these thermal insulation glass, tempered glass, heat companies the added value of reaching out to strengthened glass, single and double glass, the neighboring nations and even to the rest The advantages that drove such laminated and architectural glass. Roughly of the world. For example, Dubai is now home success were taken in consideration at the Entry points 30% of the output is exported to countries to the world largest producer BoPP and CPP international level as well. In 2006, a group such as GCC, other Arab and African countries. films for packaging purposes. The same can of Korean investors teamed up to establish a Power and Telecom Cables Virtually, all countries in the region depend on be said about many factories based in the UAE Dubai based auto-technology manufacturing The current total demand for power cables imports to meet their demand, and it is easier serving both local and global demands. plants for the production of light items that is more than US$272 million1 . Approximately for them to import from U.A.E. than from far do not require heavy employment. One of 2.5% of the value of a building comprises the With the fact that most surrounding away sources like USA, Europe, Russia and the factors behind their decision was the value of cables used in these buildings. More economies are oil-centric, that are in the same China (the key global exporters). facilities provided by Dubai Airport Free Zone than 60% of the demand for power cables is for time having a boom in their infrastructure, A similar success story has prevailed in the and the cost effective equation they found in installation in new buildings. Demand for power UAE-based light and mechanical industries manufacturing of steel bars and rods which terms of energy, transportation and premises. cables remains high despite recent technological got an additional golden chance to grow and changes which have seen the emergence of exceeded US$2 billion in 2006, and is in position Dubai Airport Free Zone is actually an profit. optical fiber cables. Domestic manufacture, to export to regional markets. The segment example of the local initiatives that cater The glass industry is one of the ever three factories in Dubai and Abu Dhabi, is for has also developed a niche market of its own; for this level of investments in order to power cables only. appealing segments in this regard and one which the recycling of steel rods and bars. help them maintain a steady return on investments and reduce the operational Local production of power cables also caters overheads. By combining flexible regulatory for regional needs as the U.A.E.’s exports of all affairs with centric location and lucrative kinds of cables has reached US$3 million per annum. Cables are being exported to Saudi markets, these initiatives became ideal for Arabia, Yemen, Jordan, Iran, India, East Africa many manufacturers who want to penetrate and the Levant Arab countries. Power cables the regional market and beyond. However, with a 10mm cross section for 300-1000 Volts businesses outside the free zones are in good form the greater part of exports. A particular shape too. Both federal and local authorities successful effort has been to supply cables to the continue to ease up on many issues to facilitate Delhi Metro project in India. growth. An important opportunity here is to cater Of particular interest here is the light steel for the fiber optics need of cables. Currently, industry; other than bars and rods, which the national need of optical fiber cables is actually operates from outside the free zones, entirely imported. Optical fiber cables are and have reported huge success. The segment overwhelmingly used in telecommunications. has an active export portfolio that even Since it’s becoming the norm in all mega projects includes the United States as one of the top across the region, such an investment sounds ten importers in this regard. lucratively feasible. Why UAE ? The Unlimited Opportunities 2012 Chapter 4 The United Arab Emirates A World of Opportunities 200 201 market, the wide demographic spread within the UAE means that the demand for cosmetics is widespread and across the price spectrum. Along with the strong demand for high-end luxury products, there is also a robust market Consumer Industries for the everyday, reasonably-priced product lines, making the UAE an attractive market The consumer industry sector spans a wide for cosmetic manufacturers and suppliers range of products that cater for day to day of all kinds. A recent study by Euromonitor needs for both domestic and business needs. International shows that the consumption of While a large portion of the country’s annual facial and eye make-up, lip care and nail care consumption is imported, the consumer products will continue to grow at a healthy industries sector has grown up at a fast speed pace over the next few years in the United for two main reasons; the sharp increase in Arab Emirates (UAE) to reach US$141 by 2014. population over the past two decades and the Exports wise, although neighboring consolidation of the UAE as a regional hub for countries have developed some local cosmetics export-oriented manufacturing complimented labels, the main selling factors is actually with re-export-oriented partial manufacturing. international labels which they all depend on In fact, one of the main drivers in the success the UAE market to cater for, thus providing an of UAE as a hub for consumer manufacturing additional momentum for the industry here. is the centric position it plays as a regional Jewelry and gold design, perfume logistics and exports hubs, which enables manufacturing and ethnic hair products are manufacturers to reach their target markets at ease. In addition, the country has become a world destination for shopping tourism; with an estimate of 10 million passengers arriving just examples of the new niche markets the in the emirate of Dubai alone every year. The consumer industry is embracing in the UAE. Entry points country’s shopping malls and duty free shops However, the higher end of the industry are some of the busiest destination year round. is also showing positive signs of attraction. Paper Tissues With such a lucrative market, it’s no wonder For example, the local footwear industry is The paper tissue industry belongs to the that many international manufacturers have worth around USD354 million, namely the second wave of industrialization in U.A.E. which established production and fabrication units demand for its products in 2010 based on net roughly dates back to the late eighties and in the country to help dominate the regional import figures. Since there is a large demand nineties, and was more focused on consumer market. for footwear products unique to the region, products. While a couple of paper converting A recent study by Jabal Ali Free Zone (JAFZA) namely Gulf Arab sandals for men and women, factories had established by mid 1980s, the reported that JAFZA outbound consumer a significant footwear manufacturing industry larger part of capacity was added in the nineties and cosmetics trade has grown over the past has developed, based on a niche demand and in the 2000’s. decade to exceed US$3.6 billion by the end of specific to regional styles. According to the Emirates Industrial Bank, U.A.E. is now a substantial exporter of paper 2010. Over 444 companies are operating from According to the UAE Industrial Bank, the tissue products. However, exports have been the zone in this segment. Market leaders such demand for local style sandals is too large to be as Uniliver, Procter&Gamble and L’Orial as well growing steadily and are now close 28 thousand entirely manufactured in distanced factories, tons a year. This is roughly half of the total as some local brands do actually have their and this has opened room for domestic regional production plants in JAFZA. Moreover, production which is quite impressive. Exports manufacture with advantages of reduced lead destinations are firstly in the neighboring region; the wide spread of industrial zones across times, lower inventory, customized orders – the country allowed for further presence of i.e. GCC countries, Iran, Indian subcontinent and even though the raw material and labor is Eastern Africa, and also far away in industrial various types of consumer industries including imported. countries such as Australia, UK and Singapore. contract manufacturing facilities that serve There are 7 reported footwear local and international labels alike. Tissue production is in jumbo rolls from manufacturers in U.A.E., two are located in mostly virgin pulp for final products such as As a case study, the cosmetics industry Dubai, three in Ajman and one in Sharjah and facial, toilet, kitchen towels, napkins, C-fold provides some interesting indicators of how Al Ain each. The first factory was set up in 1988, and carrier tissues. The country has now over appealing this country can be for consumer and the others in the nineties. The estimated 21 paper tissues factories, and the demand is manufacturers. In terms of the domestic capacity is above 250,000 pairs per annum. growing. Why UAE ? The Unlimited Opportunities 2012 Chapter 4 The United Arab Emirates A World of Opportunities 202 203 this segment due to logistical reasons. Major Two years back, and on the eve of the companies that were based in Saudi Arabia international economic challenges, Nestlé and Kuwait have moved to Jebel Ali over the has opened a 100,000 square-metre factory past decade to utilize its strategic position and in Dubai’s Jebel Ali Free Zone to provide a Food Processing easier access to manpower. The well-known regional center for its products. Industries meat packaging company; Americana, is now The rise of private label with its fast growing based in Jabal Ali. market is proving a tough challenge for branded Food processing and manufacturing Furthermore, the establishment of private- food manufacturers, says Americana. More and constitute 46% of the UAE’s non-oil industrial sector slaughterhouses inside the country’s more local businesses are gaining wider market sector as per government records; which free zones allowed for many companies to shares both locally and regionally. Al Ghurair highlights the potential hidden as a major import their own livestock and consequently Foods, one of the leading investors, has recently growth opportunity for processed food start fresh meat processing lines for regional opened a huge oats mill that caters for the oats manufacturers. The sector posted annual distribution. The overall meat processing market markets in the Middle East, Sub-continent (India, growth of over 11% since 2005, when across the GCC is estimated at US$18 billion with Srilanka, Pakistan, Bangladesh etc) and African foodservice providers spent about $1.43bn on a booming growth rate year on year. countries. In addition, the rise in the number of foods and ingredients bought at wholesale An essentially emerging factor is the hotels and conventions across the country has outlets. franchising and branding of food products. created a bigger demand for catering services; By definition, the Food Industries segment With roughly three-quarters of the population which is now becoming one of the fast moving include meat processing, dairy products, foreign born, international food products are food services segments. The UAE currently vegetable oils, sugar refineries, bakeries, in high demand and represent a major growth has more than 400 hotels operating across deserts, bottled water, etc. Until the end opportunity. the seven emirates and at least one major of 2005, total investment in this segment convention center in each emirate. Dubai hosts International brand owners are now using at least two regional exhibitions/conferences reached over US$8.4 billion (56% of total Dubai as a manufacturing base to establish manufacturing investment). Although the each week, year long. Abu Dhabi and Sharjah their regional presence in an attempt to get have a relatively similar count. surge in the investment (from US$0.82 billion a larger slice of the Gulf’s $12bn food sector in 2001) was mainly caused by new investments and to cater for the local demand of their in bottled water, the hidden indicator here is potential areas for foreign investment that franchised products as well. the huge increase in the population; which Entry points are bound for growth; to increase the local The demand for internationally branded tripled the size of main market for all food production catering for the growing demand products in the country. food items is also boosted by the UAE’s Date Products in the UAE and to utilize the country’s central booming tourism sector. At the socio economic level, there are position for regional production. A recent The UAE is a regional for innovative various factors that make the UAE’s food study by the Arab Forum for Food Industries manufacturing of date based products; such market a unique investment opportunity reveals that the UAE produces only 36% of its as coffee, chocolate, drinks etc. However, the for many reasons. With its immigrant guest- food consumption; a gap that highlights the market is still virgin and has a growing potential worker based economy an estimated 75% of hidden potential in this segment. Agricultural with many people across the region embracing the UAE’s population is made up of single men, production, meat and poultry and processed date products as a healthier alternative to sugar- a fact that has shaped the food industry in the food are just examples of what this gap is based products. In addition, with the large number of palm trees in the country, the potential region and led to increased demand for fast, awaiting for. is always strong for palm oil investments. Palm easy-to-consume, low priced meals. Recent figures from the Ministry of Economy oil production is currently the fastest growing The sharp increase in the population show that Food Industries account for 46% vegetable oil business in the world. has is an added opportunity by itself. The of the nation’s total non-oil manufacturing population has increased from 4.3 million in investments with 150 companies operating in Ethnic Food 2007 to over 11 million by the end of 2010, the segment. Ethnic food industries provide an interesting which was reflected in an increased demand The meat market is growing exponentially opportunity to pay attention to. The region on food supplies. These sociological changes due to various social traditions combined with has a majority of expats from various parts of are not only expanding the area’s food market, high individual purchasing power. While the the world with different ethnic and cultural they are also changing consumer habits, and prime business in this segment is livestock backgrounds; which reflects in their dietary consequently opining the door for fresh ideas imports, it actually leaves the door open for needs. The large expatriate Asian population is on day to day basis. a huge process and packaging business that driving demand for Asian products, particularly While the country imports 90% of its caters for the needs of working families and Indian and Pakistani foods, while European and US$4 billion food market (for both local individual expats. Currently the Jabal Ali American foods appeal to Western emigrants consumption and re-exports), there are two free zone plays an essential regional role for and the local populace alike. Why UAE ? The Unlimited Opportunities 2012 Chapter 4 The United Arab Emirates A World of Opportunities

The United Arab Emirates A World of Opportunities

Healthcare and Pharmaceuticals

“

Becasue human comes first to for the UAE, investment

and healthcare was made a priority by the country’s government.

A productive citizen can only be a healthy citizen. “

Why UAE ? The Unlimited Opportunities 2012 Chapter 4 The United Arab Emirates A World of Opportunities 206 207 infrastructure, including the privatization of (DHA), the Ministry of Health (MOH) and the opportunities in the sector are in specialized publicly owned healthcare facilities and the Armed Forces, and Police Medical Services. healthcare delivery and supporting services. introduction of compulsory private health While each entity has its separate autonomous insurance. operation authority and runs independent of Although in terms of GDP contribution, each other, they all share the same national lthough healthcare as an industry is an healthcare expenditure is low, the UAE is goal of excellence in healthcare. Aemerging economic activity in the UAE, actually among the top 20 highest in the The establishment of health related free it has proven over the past decade to be one world in terms of per capita spending. The zones has increased the interest of global of the segments with high growth potential overall health expenditure is estimated at USD healthcare players. This has encouraged such and lucrative opportunities for long term 5.4 billion in 2009, equal to 2.6% of GDP , per players to set up regional centers in the UAE, investments. capita spending is at USD 926. The growth rate so as to expand their presence in the MENA This particular industry was highly of health expenditure in the UAE is expected region. The Dubai Health Care City (DHCC) is stimulated with the sharp increase in the with 6.7% annually. Due to its very dynamic one of these free zones and is looked at as population which doubled the country’s nature, the UAE healthcare market is expected part of the Government efforts to develop residents in less than ten years combined to grow from USD 3.2 billion in 2005 to USD medical facilities that will attract patients to with the fact that UAE has become one of 11.9 billion in 2015 . Dubai from other regions. Another initiative the leading travel destinations globally for From a structural point of view, the is DuBiotech which enabled many companies holiday makers and shopping enthusiasts. The healthcare industry includes pharmaceutical and universities to establish their own research modern tourism infrastructure and the tourist- manufacturing, hospitals and clinical facilities in the country which in effect helps friendly environment have even opened doors treatment, wellbeing and plastic treatment, pharmaceutical companies eager to penetrate for appealing opportunities in health and health tourism, medical supplies and medical the region to further understand various clinical tourism as well. education & MICE. While operating in the UAE, environmental and local issues associated with the development of region-specific Until recently, the UAE has been a major healthcare and pharmaceutical businesses may medications. consumer rather than provider of healthcare need to obtain proper licensing from both services. Now, there are first indications to the federal Ministry of Health as well as the The government of the UAE, at both the reverse this trend. The rising interest in the concerned emirate’s Health Authority in Abu federal and local levels, has shown commitment Dhabi and Dubai. healthcare sector is largely due to the UAE to expanding access to medical services and In terms of foreign investment, the UAE is Government’s initiatives to modernize the The public healthcare services are run by healthcare facilities including pharmaceuticals. the second largest recipient of foreign direct healthcare systems. Progress is being made by different authorities: The Health Authority of The country boasts strong and high-quality investment in the Gulf region. The UAE received focusing on improving and building healthcare Abu Dhabi (HAAD), the Dubai Health Authority healthcare provision, with the government USD 66.2 billion of FDI from 1998 to 2008, planning further investment in such resources. representing 19% of total foreign investment To this end, the UAE is building multiple in the region. According to investment experts, healthcare facilities, expecting demand for some of the biggest opportunities are likely to healthcare to more than double by 2025. be found in healthcare projects, which have Furthermore, the UAE has USD 2.9 billion already attracted major global companies such worth of healthcare related projects currently as General Electric and , both of which underway and an additional 100 hospitals in have large infrastructure businesses as well the planning stage. Key drivers for growth in as being major suppliers of healthcare IT and the coming years are growing health insurance diagnostic imaging technologies. Initiatives penetration, rising per capita income, and such as the creation of free zones, including the increased health awareness, coupled with an two free zones mentioned earlier, are expected increased incidence of lifestyle diseases and a to increase FDI in general and investment in favorable demographic profile. healthcare research in particular. In addition, the country has become an More opportunities will arise in health attractive market for foreign investments in insurance, which until now has been a the medical technology sector given that it is relatively underdeveloped sector in the region. only at the “grass roots stage” of its potential In addition to the market for healthcare capacity, and many companies are willing to products, there will be a growing market for become early adopters of new technology. regulatory consultancy services as the region’s There are plentiful business opportunities for Governments struggle to adapt international international medical equipment investors. best practices to local organizational, One of the more lucrative investment legislative and legal frameworks. Why UAE ? The Unlimited Opportunities 2012 Chapter 4 The United Arab Emirates A World of Opportunities 208 209 this end, the pharmaceutical and healthcare Both initiatives are part of the authorities’ of the UAE’s pharmaceutical production. The industries have been identified as important plan to attract foreign investment. DuBiotech Dubai Chamber of Commerce and Industry industries to develop. Among the reasons is aimed at developing the UAE’s biotech expects the segment to become “one of the behind such a step is the fact that local industry, while (DHCC) key sectors in the UAE” when foreign majority production is way behind the level that caters should enhance the country’s healthcare ownership will be granted under a liberalized Pharmaceutical to local consumption. Presently, domestic system and should enhance the UAE’s ownership law, which is under preparation. Manufacturing producers only account for around 20 per cent reputation as a centre for premium healthcare, Current rules specify that overseas investors of the market by volume. encouraging growth as a medical tourism can own up to 49 percent of most businesses destination. Some of the world biggest names The United Arab Emirates may not be the Some experts believe that the sector in the country. Foreign investors can only hold have already started ghost manufacturing of largest pharmaceutical market in the Middle should grow at the same speed as the fast full control of companies in government-run some of their popular medications in the UAE East and Africa (MEA), but it possesses several developing biotech and healthcare sectors.A free trade zones, such as DuBiotech, which are to cater for the regional demand and to gain a advantages that make it an attractive prospect wealthy population with a preference for predominantly located in Dubai. The new law faster time to market. to have the largest pharmaceutical industry novel therapies ensures there is a high was welcomed by local drug producers, who in the region. Over the next 10 years, BMI demand for patented drugs. In addition, the Industry experts say that there is potential would benefit through an influx of investment forecasts that sales of prescription drugs and regional demand is a successful factor where for further growth in the pharmaceutical and technology. over-the-counter (OTC) medications will grow the country’s strategic position as a logistics products sector in the light of the changing from USD 1.59 billion in 2010 to USD 3.27 hub can be utilized. Julphar, the UAE’s lifestyle dynamics in the region which is based billion in 2020, representing a compound largest domestic player, exports over 93% of on an increasingly Westernized disease profile annual growth rate (CAGR) of 7.5%. its production capacity to the neighboring with non-communicable diseases such as countries including the GCC and beyond. obesity. Areas of growth for manufacturers Drivers of growth include increasing public include targeting the overweight and obese and private wealth fuelled by the oil boom, and Interestingly, a recent study by Dubai residents of the UAE. a strong healthcare infrastructure that ensures Chamber of Commerce and Industry found high-tech treatments are always available. A that pharmaceutical exports outpaced imports Other diseases associated with a relatively friendly regulatory environment and absence over the last 7 years. Since 2003, imports of sedentary lifestyle such as increased heart of significant local competitors are other pharmaceutical products have risen by 275 disease and diabetes will likely remain the factors influencing a growing number of small percent from USD 218 million to USD 817 mainstay of growth for patented drug research firms locating to the country. million in 2010 while exports too have risen by manufacturers. New areas for pharmaceutical 300 percent from USD 27 million to USD 109 product growth could also include tapping the The government is keen to attract foreign million over the same period. rising demand for medical tourism connected investment and diversify the country’s to these changes in lifestyle. economy, which is highly reliant on oil. To Meanwhile, the UAE continues to lead the region in terms of investment in its home- Other regional drivers for growth are grown pharmaceutical sector. According access-related. The UAE is proving to be an to a recent report by Gulf Organization efficient re-export regional hub and several for Industrial Consulting, UAE companies regional markets are proving to be lucrative have invested USD 64 million in eight local for companies that are establishing operations production facilities. Domestic production in Dubai. This is compounded by the fact that is almost exclusively of non-patented drugs, profitability for pharmaceutical products also which have been identified as a key growth remains high because they are, in comparison Entry points area if the industry is to survive the entry of to other sectors, relatively light-weight in foreign generics, even if these are subject to distribution and highly profitable at retail Venture Capital price controls. despite their regulated prices. The Pharmaceutical production sector in However, the growing local demand versus At the regulatory level, the UAE has been the UAE is in fact in need of greater access to venture capital (VCs) in order to help it develop limited domestic production is only one of widely known for its strict and zero-tolerance and expand and to encourage start-ups in fields several marketing and regulatory factors that policy with intellectual property issues. such as biotechnology and R&D. Large-scale made the pharmaceutical industry increasingly Also, provisional data issued by the World projects, such as DuBiotech and the Dubai attracted to the UAE. Major international Intellectual Property Organization (WIPO) Healthcare City, will help raise the profile of players such as GlaxoSmithKline, Novartis, has revealed that, international patent filed the UAE’s drug industry and should help to Abbott Laboratories, Pfizer and Johnson & by the UAE under WIPO’s Patent Cooperation secure greater foreign investment. There are Johnson have also expanded their operations in Treaty were 29 in 2010, despite the challenging several VCs operating in the country now, but the country, attracted by major developments economic conditions. they mostly focus on soft businesses rather such as the USD 400 million DuBiotech and the Another regulatory factor is believed to be than manufacturing, leaving the door open for US$3 billion Dubai Healthcare City. a major decisive factor in foreign penetration manufacturing oriented VCs to penetrate. Why UAE ? The Unlimited Opportunities 2012 Chapter 4 The United Arab Emirates A World of Opportunities 210 211 In particular, Dubai Health Authority started a plan to invest around USD 999 million in healthcare projects until the end of 2012. The planned projects will see DHA’s bed capacity increase by 650 beds, while the Hospitals and Clinical private sector projects will also increase bed capacity by an additional 500 beds. Treatment Abu Dhabi is also gearing up. Abu Dhabi The demand for hospital beds across the GCC Health Authority says the emirate needs 1,000- is expected to rise, with the UAE registering 1,500 new hospital beds in the next 5 years the highest projected growth in demand for to meet demand as the emirate’s population hospital beds at 160% by 2025 . Motivated expands. ADHA plans to increase spending by both the surge in the population and the 10-15 percent annually and was looking to development of the country as a medical boost private sector investment by privatizing tourism hub, the UAE is rapidly moving toward government assets. a higher than even demand for hospital beds Abu Dhabi and Dubai are planning and relative clinical services. children’s hospitals, the Danat Al Emarat There are now approximately 68 hospitals Women and Children’s Hospital and Al Jalila in the UAE. Dubai Healthcare City (DHCC) Bint Mohammed Bin Rashid Al Maktoum alone comprises of 9 hospitals and 1,100 beds Hospital, respectively, each with about 200 and is due to be fully operational in 2017. By beds. 2015, the need for hospital beds will more At the federal level, a wide range of public than double to about 165,000 and treatment health facilities are run by the Ministry of demand will rise by 240%. This will push up Health, including hospitals, Primary Healthcare health care costs fivefold to USD 60 billion. Centers, School Health and Maternity & Child a shortage of 9,000 hospital beds in the facility will offer a wide range of medical UAE’s private sector, which provides a huge services to middle to higher income groups of Well on the path to becoming a regional Health Units. In addition, there are facilities investment opportunity. The standard in all nationalities. Staffed with medical experts medical centre, DHCC added 17 hospitals with run by other public sector bodies, including healthcare is one hospital bed per 250 people, across fifteen specialties and primary care 2,325 new beds in 2010, according to Grant the police and the armed forces. while in the UAE the number is one per 555, departments, they are as diverse as the local Thornton’s Healthcare Guide. This follows a In mid-2011, a press release by the Ministry leaving a large gap in supply. community with European, Indian, Arabic and fast-track industry expansion which saw 61 of Health has revealed that a number of Filipino doctors. The investment company says hospitals set up in the UAE to add to the 7 that specialised hospitals will be built across the With Abu Dhabi government declaring it’s looking at over 500,000 patients by early existed in the 1970s. UAE over the next two years that will cost private insurance mandatory, the demand 2012. nearly USD 272 million. The largest of the has gone up, when previously, patients would hospitals will be the 200-bed, Saqr Hospital in travel out of the country for cheaper treatment. Ras Al Khaimah, which will cost USD 136 million Private clinics across the country have shown Entry points and is scheduled for completion in 2013. In tremendous growth and are participating Diabetes and Cardiovascular Diseases addition, a specialized psychiatric hospital for well to the primary care of the population patients in Dubai and the northern emirates that some international players are showing Future trends have something to say about will also be built. The 200-bed, Amal Hospital, interest. The market has proven lucrative even the potential in clinical treatment in the UAE. will cost USD 163 million, and is currently in the to a giant such as JP Morgan; which owns By 2025, diabetes is expected to affect one quarter of the population. One third of Emiratis design phase. a strategic share in the Dubai-based Gulf are overweight. Of those 36% are obese. 17% Healthcare International (GHI). Operating at A few of these hospitals are specialized in of UAE nationals have high blood pressure. In a regional level for few years now, GHI has one field. Mafraq, for example, is known for the UAE, there are 260 known genetic diseases being a cardiac center. Corniche Hospital is a unveiled a USD 27 million program to expand ranging from blood disorders to cancers. maternity hospital. Tawam Hospital specializes affordable healthcare facilities in the UAE. The In addition, treatment for cardiovascular in radiotherapy and cancer treatment healthcare provider plans to open six Amber Clinics in Dubai and Abu Dhabi over the second disease is expected to account for 24% of the being the first hospital in the UAE to install total healthcare expenditure in 2025 compared half of 2011. radiotherapy systems. to less than 12% of the total expenditure today. However, it seems the private sector is yet The first Amber clinic was opened in Dubai This will be followed by significant spending on to jump to speed in this regard leaving an in September and it actually gives an idea of infectious diseases, digestive diseases, maternal immense room for new investments. Industry the target audience such an investment will and prenatal conditions, genetic disorders, resources estimate that there is currently be dealing with. The new 22,000 square feet cancer and other diseases. Why UAE ? The Unlimited Opportunities 2012 Chapter 4 The United Arab Emirates A World of Opportunities 212 213 UAE is an ideal medical destination for those The UAE’s Ministry of Health is at the Middle East, Africa, Central and Southern Asia, coming from the US and Canada as coming forefront of developing the necessary it is much easier for many people especially here is still affordable compared to the high infrastructure to attract medical tourists. wealthy patients to bring in family members cost of medical care in their countries. Some According to the Ministry, the country is ready to enjoy a holiday in Dubai while being treated resources also mention privacy as an important to receive medical tourists coming with their at one of the country’s hospitals. Medical Tourism factor for choosing the UAE as a health tourism families, whether for plastic surgeries, knee Private sector hospitals are active in this destination. The UAE authorities apply a zero- replacements or treatment of cardiovascular field as well. Dubai was for years the chosen Demand for medical tourism has escalated tolerance policy regarding privacy breaching diseases. For the Ministry officials, the UAE has destination for treatment of American over the years, driven by deteriorating national incidents especially when it concerns celebrities managed to reverse the equation when people government officials located in the GCC and healthcare services in many Western countries, and dignitaries. Government and private would go to London for shopping with their neighboring regions. Plastic surgeons and exorbitant medical costs and long waiting sector initiatives alike are actually targeting families and receive a check up or undergo a cosmetic clinics in Dubai are known to be a lines. This has contributed to strong demand these two segments though the competition small operation. Now Dubai is ready for this favorite destination for many people in Europe for affordable medical treatment performed is not with low-cost Asian markets, but with and has so much to offer now, with certified and even Russia. by highly trained medical specialists in state- the rocketing costs in the Western hemisphere. hospitals from international agencies. of-the-art facilities. Among the significant initiatives to cater In fact, the UAE is quickly gaining popularity Entry points The UAE has been able to provide medical for GCC nationals is the newly announced as a medical tourism destination due to its services at a lower cost – when compared to Cleveland Clinic Abu Dhabi. As part of Abu low cost, English speaking medical staff, and Self Venturing North America and European counterparts in Dhabi’s push to expand its healthcare facilities, virtually no queues for treatments. One of the appealing opportunities that the private sector – with no waiting times in Cleveland Clinic Abu Dhabi was announced as In terms of treatment, the country offers specialty hospitals in Europe and the US should modern, fully equipped facilities. These factors a joint venture between Mubadala Healthcare a myriad of first-class medical treatments consider is to establish their own ventures provide significant incentives to patients who and the Health Authority-Abu Dhabi (HAAD). including cochlear implants, diabetes in the UAE to cater for their share of medical would otherwise face extensive queues for The 364-bed hospital on Sowwah Island has a treatments, orthopedics, cardiology, oncology, tourism. Whether it is for driving new business treatment in public healthcare facilities in their target market of residents of the Gulf. obesity surgery, neurology, plastic & cosmetic or to follow up on old patients, such a move home countries. In addition, the UAE is hoping Initiatives introduced by Dubai such as the surgery, physical therapy, dermatology, would benefit the concerned hospital of further international reputation as well as higher to become an ideal alternative for patients USD 3 billion Dubai Health Care City have rheumatology, ophthalmology, lung profitability by operating in a wealthier region. from neighboring GCC countries who prefer to succeeded in attracting international health treatments, and urology. stay at a reasonable proximity of their families Working with the right insurance company on care brands including Mayo Clinic and Great In addition to the healthcare level, the UAE in a culturally similar environment. plans for medical tourists from US would also Ormond Street Hospital as well as leading is relying on its tourism excellence in attracting give such hospitals a competitive edge to be the Easy accessibility for some elective surgical pharmaceutical and medical technology patients from different parts of the world. tourists’ choice while enjoying their holidays in procedures is another attraction, compared to suppliers such as Johnson and Johnson, Being the leading shopping destination in the the UAE. between two to three months waiting time in Novartis and Novo Nordisk. When fully Canada for a knee surgery. Geographically, the operational, the Dubai Health Care City will continue to attract a large number of patients from the Middle East and particularly the GCC who would travel to the West in the past. DHCC was built to become a state-of-the-art “centre of excellence” for clinical and wellness services, medical education and research. The emirate has also teamed up with Harvard Medical School to operate at DHCC. Dubai Healthcare City, which includes 90 medical centers, and more than 2,000 specialists, received more than 400,000 patients in 2010, compared to 220,000 in 2009. In addition, reforms such as the introduction of an international accreditation and certification organization, the Joint Commission International (JCI), is increasing confidence in the market internationally. The JCI has now accredited 16 hospitals in the UAE; the latest of which is Shaikh Khalifa Medical Centre in Abu Dhabi.

Why UAE ? The Unlimited Opportunities 2012 Chapter 4 The United Arab Emirates A World of Opportunities 214 215 the UAE: Diagnostic equipment, therapy and rehabilitation equipment, disposables, monitoring equipment, medical aids and surgical tools and devices. However, one of the emerging segments that deserves paying attention to is the pre- Medical Equipment hospital care equipment such as ventilation and Technology and resuscitation equipment which keep people alive on the way to hospital, whether Despite the economic downturn, the UAE for use in police and ambulance vehicles or at has retained its status as an attractive market home. These devices are gaining popularity for medical equipment in search of near-term among local citizens and expatriates alike as returns with a high potential. In 2009, the part of every home’s first aid kit. UAE’s medical devices market size was USD For a country with one of the highest 600 million, the second largest in the GCC after diabetes patients in the world glucose Saudi Arabia. The medical device expenditure monitoring devices, insulin pump, insulin pen, per capita in the UAE is USD 128. and insulin syringes are becoming a significant The UAE imports of medical equipment segment of the market. account for an estimated 96.6% of the market Another interesting growth segment is in value terms. Due to a strong demand and mobile medical devices (also referred to as the country’s limited domestic production mHealth), which allow medical professionals Mobile medical devices represent a new companies are more involved in localization capability, growth is expected to remain to manage many patients remotely. These and booming trend in the healthcare industry, and integration of systems to match both strong over the next years. UAE’s major devices can monitor their conditions in real and are set to become a trillion dollar industry cultural and regulatory requirements. Of trading partners in this segment include Italy, time and pass on vital statistical information allowing the delivery of better healthcare particular interest here is the rise in hospital France, Germany, US, UK, Sweden, Japan between the healthcare provider and the while positively impacting the bottom line and clinic oriented Customer Relationship and China. The high percentage of imports patient. across the range of stakeholders in the Management (CRM) applications. There is a highlights the necessity of local production of healthcare industry. growing demand on Arabic-based hospital either complete medical devices, components Currently, 94% of physicians are using and clinic management applications especially or spare parts and maintenance services in mobile health consulting apparatus while for use with public sector entities. additional to specialized training. on the job and 63% of physicians are using Hospital Technical Services is an emerging The medical equipment market is projected personal devices for mobile health solutions business line but it is yet to prevail to its full to grow at an average 6.4%, reaching USD that aren’t connected to their practice . At potential. The transformation taking place is 819 million in 2014. The accelerating growth least one mobile phone operator in the UAE to move from hospital cleaning services, as it is actually motivated by several factors has started a business unit to support the was in the past, to a more technical role that that include increasing public and private mHealth market and facilitate its integration helps with various technologies and devices. wealth fuelled by the oil boom, strong and into the country’s healthcare scene. strengthening healthcare infrastructure, At the sides of this segment lies the Entry points approvals of more medicines, internationally healthcare information and technology recognized medical education institutions and (IT) sub-segment which is rapidly growing Local Manufacturing a friendly regulatory environment. since the country itself is the region’s sole IT The local production of medical equipment Public spending has its share in the capital. The market for IT solutions in the UAE in the UAE is limited and accounts for only development of this segment as well. healthcare sector has been driven by several 7.5% of the market for medical equipment and Approximately, 5% of the Ministry of Heath factors including the worrying rise of several supplies. In 2008, only 4% of imports and locally budget is spent on medical machines, tools, chronic diseases in the region, most notably produced medical supplies were reexported. So and supplies. The budget share allocated diabetes. While the medical industry is gearing far, most local manufacturers produce medical to the MOH in 2010 is USD 762 million, an up to address this disease, particularly type consumable items such as syringes for the government sector. With the expanding economy increase of about US$38 million over year one and type two diabetes, the aim is to obtain and the growth of the population it sounds a 2009 budget. solutions for the facilities - the technical and wise move to inspect industrial opportunities in While the medical equipment market back-end operations - to improve the overall this segment. The advantages are not limited is growing at a speedy rate in general, care for the public. to the local market, though, especially with the the following sub sectors have shown Both international and local firms operate country’s strategic position as an exporting hub promising signs of accelerated growth in in the healthcare IT market although local for the region. Why UAE ? The Unlimited Opportunities 2012 Chapter 4 The United Arab Emirates A World of Opportunities

The United Arab Emirates A World of Opportunities

Telecommunications Media and Information Technology

“ Rooted in its unique fundamentals of unlimited ambition, flexibility and openness, the United Arab Emirates succeeded to evolve to be the energetic modern civilization asperceived today. The same cultural foundations that have built

the blocks of the nation along with the foresighted strategic

planning by visionary leadership have been driving the country’s economy to a higher level. “

Why UAE ? The Unlimited Opportunities 2012 Chapter 4 The United Arab Emirates A World of Opportunities 218 219 The International Data Corporation (IDC), Sector’s Main Information the global market intelligence forum for the information technology and Institution Contact Informations telecommunication industries, forecasts that IT spending in the UAE to reach USD 1.8 billion Telecommunications Regulatory Authority (TRA) by 2013. Communications P.O. Box 26662, Abu Dhabi ince the establishment of the economic Regulator Tel. +971 2 6269999, Fax. +971 2 6118209 Sfoundations of this country, the UAE Email. [email protected], Website. www.tra.gov.ae Government has always been focusing into diversifying its sources of income, significantly National Media Council (NMC) increasing the non-oil sector contribution to the national GDP. Plans of establishing Media Regulator Tel. +971 2 404 4333, Fax. +971 2 404 4368 knowledge-based industries across all Email. [email protected], Website. uaeinteract.ae emirates were implemented. The Information, Communication, and Media Technology Emirates Telecommunications Corporation (Etisalat) industry sector which makes the higher Telecom Operators Emirates Integrated Telecommunications Company (Du) portion of the knowledge-based industries has Professional Communication Corporation (Nedaa) particularly received a significant importance from the federal and local governments. Thus, the incredible growth of it is clearly noticeable. Thuraya Telecommunications Company Satellite Government spending is continuing to boost Yah Sat Communications this growing industry in order to take its place Al Yah Advanced Satellite Co. Operators that suits the UAE in the global economic map. Star Satellite Communications Co. The UAE’s information technology and According to Telecommunications communications sector is one of the most Regulatory Authority (TRA), the Federal advanced industries not only in the region Communication Regulator in the UAE, GITEX (www.gitex.com) but also in the world. This success was mainly mobile’s subscriptions rate has exceeded MECOM (www.mecomexpo.com) attributed to the strong commitment by the 200% upon the end of 2009. The Existing Arab Media Forum (www.arabmediaforum.ae) Major Events Regulative and motivating environment that CABSAT (www.cabsat.com) national government to develop an efficient and activities advanced communications network. In 2006, best reflects the country’s vision of becoming Media and Marketing Show (www.dubaimediashow.com) USD 2.5 billion was invested to develop and one of the best competitive communications Dubai International Film Festival (www.dubaifilmfest.com) maintain the telecommunications network markets along with the high demand for Abu Dhabi Film Festival (www.abudhabifilmfestival.ae) in the UAE. Further investment was also advance telecommunications services were the main drivers that positioned the country made in 2007 by the emirate of Abu Dhabi Mobile Active Subscribers 11,086,704 to develop its two first satellites. The as a regional telecommunications provider. government support coupled with the strong Telecoms sector is currently among the Number of Fixed Lines 1,731,659 leading sectors attracting the Foreign Direct demand for telecommunications and satellite Internet Subscribers 1,420,701 communications by government entities, Investments. different organizations and individuals give To best represent the continuing growth of Middle East and North Africa region. This was a ICT utilization. Policies that protect IT services this sector, TRA conducts studies and surveys result of the strong fundamentals of the sector against piracy played an important role in Indicators Global Ranking in regular basis. The table below shows the in the UAE. Business parks designed as media promoting innovative and creative contents. Mobile Penetration Rate 1 latest figures in this sector. clusters like Dubai Media City, twofour54 zone Free zones have also contributed to the success The media sector has also accomplished and Creative City have been playing a great of the IT and BPO sectors. Government Procurement of driver of the media sector. 2 remarkable achievements, growing from a Great investment options lay within these Advanced Technology Products small number of broadcasters to a different Government spending in the Industries industries, boosted by the government’s variety of television and radio channels, of Information Technology (IT) and Business commitment to enlarge knowledge-based Government Capacity to hundreds of newspapers and magazines and Process Outsourcing (BPO) gave a strong industries contribution to the national GDP. Promote Information Systems 2 a growing number of publishing houses. The thrust to this growing sector in the year of Realizing the infrastructure and supportive- and Communications Sector media industry in the UAE is the leading 2011 when a total of USD 3.5 billion were policies, existing and new coming companies market in the Middle East. Renowned invested in IT services and products. As a result understand the feasible reasons of positioning media broadcasters like CNN international, of these continuing contributions by both the in the UAE which does not only serve the Modern Technologies 4 New Licenses Rate Bloomberg and BBC World have chosen public and private sector, the UAE ranks the domestic market but also serve the whole the UAE as a main headquarter to cover the first among the Arab countries in terms of MENA region. Why UAE ? The Unlimited Opportunities 2012 Chapter 4 The United Arab Emirates A World of Opportunities 220 221

Telecommunications During the year of 2009, the UAE has achieved the highest mobile penetration rate in the world, with 200% active subscribers. As of April 2011, there are 11,086,704 million mobile active subscribers in the country, an increase of 12.68% comparing to 2009. Accordingly, the TRA has defined an ‘active subscriber’ as having placed or received a call or SMS within a 90 day period. Mobile penetration rate has been growing modestly from 166% in 2007 to 199% in 2011. The rate is expected to grow not only due to the high level of tourism and the continual of population but also because mobiles today cover a wide range of advanced services that goes beyond voice and text services to services like data transfer and TV subscribers across 18 countries. It still controls Entry points streaming. Fixed line subscriptions have also the majority of the market share (80%) in the achieved a 10% increase at the end of 2010 UAE’s telecommunication is also rated as one UAE. Etisalat is currently owned by the UAE Supplying Telecom Providers of the highest GDP per capita (USD 43,859) Ministry of Finance (60%) and 40% is publicly comparing to the end of 2007. Telecom companies in the UAE obtain a great traded on the Abu Dhabi Exchange (ADX). In addition, the number of internet in the world. The growth of the ICT sector number of tenders offered by Etisalat and Du. users at the end of 2010 increased by 160% reached 45.7 billion including revenues and Du, in contrast, commenced commercial Upgrading telecom exchange sites, supplying from the end of 2005, reaching 1.4 million investments, with estimated contribution to operations in 2007, ending Etisalat’s near 30- and installing Ac and Dc cables, installing and subscribers. The UAE has one of the highest GDP touching 4.9% at the year of 2009 (up year monopoly on the provision of telecom testing plant cable network, and installing and broadband penetration rates in the MENA from 4.4% in 2008). services in the UAE. Du has a market share of operating antennas site, towers fabrication region. Offering new technologies for The telecoms sector in the UAE is regulated 30% and 4.5 million active users by March 2011. works are a few examples of these tenders. internet access with competitive tariffs have by the Telecommunications Regulatory It is 39.5 per cent owned by the UAE Federal Supplying the service provider with high and been considered by telecom companies. The Authority (TRA). The TRA has full authority Government, 19.75 per cent by Mubadala efficient technology in order to solve the telecommunications industry as a whole has for issuing and implementing regulations for Development Company, 19.5 per cent by recurring issues like the short coverage in some evidenced substantial total growth in recent telecom services and all licensed operators. Emirates Communications & Technology remote and indoor areas. years due to the significance growth of the It is also responsible for the management of Company LLC and the remaining stake by population and of the number of tourists. The the frequency spectrum, for establishing and public shareholders. It is listed on the Dubai Fiber-Optic Next-Generation implementing standards for type approval Financial Market (DFM). Infrastructure of equipment, and for national numbering International telecom companies can Realizing the benefits of fiber-optic technology, policy. TRA has not announced any intentions penetrate the telecom sector in the UAE by Telecom operators in the UAE are developing of giving a third license in the UAE in the partnering with the main telecom providers, their networks using this efficient technology. near future, allowing the second operator Etisalat and Du, or through applying A study conducted by Etisalat showed that the in the country “Du” to fully establish its for tenders and obtaining projects. In amount of carbon dioxide produced could be infrastructure and secure its market share. collaboration with Tata Communications and cut by approximately 85% and that the energy required by the network could be slashed by up Cisco, Etisalat launched its virtual broadrooms The sole players of the telecommunications to 73% when using this technology. The study in Dubai in 2010. The process of transforming sector are Emirates Telecommunications also showed that by using fiber-optic networks Corporation (Etisalat) and Emirates Integrated Etisalat’s conventional infrastructure to fiber- data are transported over greater distance. Telecommunications Company (Du). Etisalat optic next generation infrastructure has also Advantages are great. Thus, Etisalat established is one of the largest telecommunications engaged participation of international telecom its new infrastructure using this technology. companies not just in the region but also in the companies. During 2004, Techcorp, a Pakistan- However, more stations and networks are to world with a market value of approximately based company, won a contract with Etisalat be built and other telecom operators are also USD 25 billion and 100 million active for construction of GSM towers over two years. building their new infrastructure. Why UAE ? The Unlimited Opportunities 2012 Chapter 4 The United Arab Emirates A World of Opportunities 222 223 observing the UAE’s initiatives and considering them as attractive opportunities to form partnerships, contracts and alliances for the design and building the satellites as well as the infrastructure of the launch’s bases. Satellite Communications Driven by its vision, Abu Dhabi has made strategic initiatives to become a global satellite Driven by its ambitious aim of positioning communications leader in 2007. Mubadala, itself as a global distinguished location in terms established by Abu Dhabi to facilitate the of offering advanced communications services diversification of its economy, incorporated its of all kinds, the UAE has been actively building satellite communications company “Yahsat”. its satellite communications infrastructure. USD 1.58 billion was invested to develop two Currently, it has five satellites and is planning satellites.2 Partnerships with EADS Atrium to launch another two by 2012, maximizing and Thales Alenia Space, world-class players, its capacity to not only meet the domestic’s were made for the design and construction of demand but also to serve the whole MENA these two satellites. Yahsat 1A was launched region by providing high advanced solutions on April 2011 by Arianespace and Intelsat in this realm. New Dawn telecommunications satellites, the The Telecommunications Regulatory fifth satellite sent by the UAE into space for Authority (TRA), the communications’ regulator communication purposes. Partnerships with in the UAE, issued new regulations and policies Arianespace and International Launch Services in order to create a balanced competitive (ILS) were also made to launch Yahsat 2A environment, thus encouraging more satellite satellite by the end of this year. services providers with innovative technologies Furthermore, the TRA granted tow satellite and competitive solutions to emerge in this communications services licenses for a period young market. In 2009, the TRA issued four of ten years for Al Yah Advanced Satellite additional licenses authorizing GMPCS and Communications Company and Star Satellite The realization of the great demand for high- and naval vessels are among the most- PAMR services as well as mobile television Communications Company in July 2010. Both resolution Ariel images by the government to demanded services not only in the UAE and satellite communications. Governmental companies are subsidiaries of Yahsat. Services efficiently develop its infrastructure and urban but also in the whole region. Realizing this and local and international private are mainly provided for military entities as planning as well as by the commercial sector fact, SmartSat, an alliance of Jordanian and companies have been established to meet the well as for the commercial sector in the Middle drove Dubai to take the initiative of launching Kuwaiti companies, was launched in Dubai as growing demand for satellite imagery and East, Africa, Europe and South West Asia. The the first Earth observation satellite program the MENA’s first company specialized in the communications services. International space satellites control is operated from Yahsat’s in the country “DubaiSat-1”. The launch took satellite industry in 2009. and satellite manufactures have been closely gateway in Abu Dhabi. a place in July 2009. Partnership with Satrec Initiative, a pioneer satellite manufacturing Entry points company in South Korea, was made to design and develop the satellite. Dubai is also Supplying the Service Providers planning to launch its second imaging satellite International companies can engage by “DubaiSat-2” in 2012. initiating strategic relationships with the satellite Thuraya Telecommunications Company, the communications service providers by supplying first UAE’s satellite communications company, them with the equipment, electronic programs, control systems, maintenance and repairs. The ramped up commercial operations in 2001. demand by local and regional maritime and oil Through its three geo-mobile satellites into and gas companies, where telecommunications orbit, the company continues providing a services can not function, is growing as the wide range of voice and data solutions via whole economy of the region is growing. satellites. Since its inception, the company has been singing numerous Service Providers Providing Satellite Communications agreements with more than 40 countries across the world. Services in the Remote Regions The lack of telecommunications infrastructure The different satellite communications in most of the remote areas provides an excellent services like call transfers, data and video opportunity for satellite communications images, tracking and locating vehicles, tankers providers. Why UAE ? The Unlimited Opportunities 2012 Chapter 4 The United Arab Emirates A World of Opportunities 224 225 these zones is Dubai Outsource Zone (DOZ) which was established in 2004. DOZ currently hosts a number of companies in diverse sectors such as banking and finance, accounting, IT, payroll processing, engineering, Business Process research and development as well as design. Outsourcing Current companies operating in DOZ include Siemens Networks, Emirates airline, Business Process Outsourcing (BPO) services AXA Insurance, du, Mashreq Bank, Arab Bank, have been growing in the Middle East and First Data, Cupola, Larsen & Toubro Infotech North Africa region especially in the UAE and Ltd, Al Futtaim Willis, and the Jumeirah Group. Egypt. According to Frost and Sullivan, a global Due to the great benefits gained as a consulting firm, the outsourcing industry result of outsourcing noncore businesses, is expected to grow at a compound annual many companies and government entities growth rate (CAGR) of approximately eight are taking that approach. Abu Dhabi Water percent for the period 2009-2016 with market and Electricity Authority (ADEWA) is studying revenues touching USD 2.69 billion. plans to outsource administration. ADEWA Due to the competitive compensation cost, has already signed a USD 81.74 million a growth in the quality of its management contract with Injazat Data Systems, a leading schools and an improvement in the literacy company in outsourcing services in the region, rate, the UAE has successfully become the awarding it a ten-year Information Technology second largest market for the outsourcing (IT) outsourcing contract to manage all industry in the MENA region in 2010. Many of ADWEA’s IT requirements. Etisalat also Call centers which makes a great part of BPO multinational corporations have chosen the outsourced maintenance work in telecom services are becoming integral to the UAE UAE as their main headquarters functions and to third parties in several projects as a cost- business sector. Contact and customer services services. savings plan. activities of many banking, insurance, telecom The UAE was among the first countries Understanding the demand of this and consumer goods sector are outsourced. in the region that felt the importance and industry in the MENA region, international realized the potential growth of this market in BPO companies have been considering the Entry points the MENA region. Accordingly, it established a potential growth. In 2009, Sundaram Business number of specialized zones that are equipped Services, the Business Process Outsourcing arm Operating the Non Core Businesses for with BPO infrastructure and issued a number of Sundaram Finance Ltd. has formed a joint Government Entities of policies and regulations to organize and venture with ETA Group of Dubai to start a first The principle of outsourcing the non core monitor the progress of this activity. Among BPO outlet in Dubai, targeting the GCC region. operations has become the accepted industry norm in the UAE. The federal government and local private entities began to understand and realize the benefits they can reap when they outsource their noncore businesses. The UAE Federal and Local Governments are focusing on conducting their core business Dubai Outsource Zone is one of the places and at the same time assigning parts of their where activities such as Business Process non core Information and Communications Outsourcing, HR Outsourcing, IT Outsourcing Technology (ICT) to a third reliable partner. and back office thrive. The facility offers an environment that allows companies and Penetrating the MENA Market individuals to operate with collective synergy Through DOZ and freedom. Companies based in Dubai Outsourcing Zone Dubai Outsource Zone (DOZ), one of the first enjoy Free Zone benefits including 100% business free zones dedicated to outsourcing companies ownership and exemption from taxes as well as value the region, has been significantly contributing to added services such as networking opportunities, the performance of this industry not only in the venue management services, industry awareness UAE but also in the whole region. programs and government services.

Why UAE ? The Unlimited Opportunities 2012 Chapter 4 The United Arab Emirates A World of Opportunities 226 227 Communication Technology (ICT) Fund was formed in 2011. ICT Fund is the first of its kind in the Middle East. Software, hardware and IT services are the pillars of the UAE’s IT sector. The UAE is a key Information Technology market for software companies. Applications from desktop accounting packages to ERP, IT market, which represented around CRM and HRM solutions are demanded by the 1.2% of the UAE’s GDP in 2009, is expected UAE’s software growing market. IT Software to grow to reach USD 4.1 billion in 2013 . within the GCC Government’s sector spending This estimation was based on the planned has reached USD 2.6 billion this year. In government’s investment of USD 1.828 billion addition to the steady growing demand by the in this growing sector by the end of 2013. public and private sectors, the UAE is leading The UAE overall spending on IT services and the way in terms of software piracy level in the products is forecasted to reach USD 3.5 billion whole region. In fact, the UAE has posted the by the end of 2011. The UAE currently ranks lowest piracy rate in the region for the past 24th in the world and first among the Arab ten years. countries in its utilization of ICT to enhance its The IT services market in the UAE is also competitiveness and development according growing significantly. A new study by market to the Global Information and Technology research and analysis firm International Data Report 2010-2011 that was released by the Corp (IDC) shows that IT services market may World Economic Forum. touch USD 2.3 billion by 2012. Sector like However, the main driver behind the government sector along with agriculture, DIC, one of the largest information and Entry points success of the information technology construction and mining sectors are the main communications technology clusters in sector in the UAE is the strong belief of the demand drivers now. the Middle East and North Africa (MENA) Enterprise software (EAS) government on the power of innovation. This Free zones have been providing exceptional region, has been providing a strategic and The expansion of the enterprise software was evident and reflected on the latest figures opportunities for international IT companies. cost effective platform for ICT companies industry, also known as enterprise application released by TRA (mentioned in the overview Dubai provides three highly-sophisticated targeting emerging markets in a vast region software, in the UAE is mainly contributed to of this sector). In order to fuel innovative zones equipped with advanced ICT extending from the Middle East to the Indian the increasing focus of government entities research and development projects within the infrastructure. These are Dubai Internet City subcontinent, and from Africa to Central and organizations to maximize its efficiency. UAE ICT sector by giving financial support for (DIC), Dubai Outsource Zone and E-Hosting Asia. Today, DIC is the home for more than Healthcare, education, retail and public sectors firms and individuals, the Information and Datafort. 1,400 companies ranging from , , are among the growing EAS spenders. The and IBM to Canon, General Electric and targets of these tailored applications as there is Cisco. Other Fortune 500 technology giants no single software works for all types of entities such as Oracle, HP, Samsung, Nokia, RIM are very wide and can penetrate any industry. (BlackBerry), Yahoo, , IBM, Symantec The UAE is currently the second largest EAS and AT&T have also planted roots in the DIC market in the GCC. with new permanent regional headquarters in Dubai. Dubai Silicon Oasis (DSO) is another Providing Cloud Services technology park established in 2006 to host The UAE’s General Information Authority technology-based companies. (GIA) is leading efforts to provide cloud services to federal government entities. This new way of The capital, Abu Dhabi, is also developing computing, which involves the use of Internet- its 3 square kilometer technology cluster based services and intelligent clients and devices, near Abu Dhabi International Airport. This is not new only to the UAE but also to the development is an implementation of its 2030 global IT market. Cloud services are central to comprehensive vision that plans to transform the Emirate’s e-Government strategy for the the city to an IT globally-recognized hub. The next three years. International Data Corporation park is expected to host the first microchip (IDC), a premier global market intelligence factory in the Middle East that will be built by firm, estimates that cloud services could add 2015. This initiative is carried out by Advance more than USD 4.2 billion in net new business Technology Investment Company (ATIC), a revenues to UAE’s economy between the end of regional leader in the semiconductor industry. 2009 and the end of 2013. Why UAE ? The Unlimited Opportunities 2012 Chapter 4 The United Arab Emirates A World of Opportunities 228 229

Media Specialized zones established to solely serve the media sector along with business- friendly regulations and a strategic location in the heart of the GCC, the UAE is definitely the ideal central place to serve not only the domestic market but also to provide high quality media services including advertising and marketing, publishing, broadcasting and media consultancy to the whole MENA region.

The substantial growth in the media sector The UAE’s print industry has also achieved of printing in comparison to other countries since 1999 when there was a counted number a growth in terms of number newspapers of the region to make economic gains. of broadcasters is a result of the country’s titles, increasing from 9 titles in 2003 to 14 Recognizing the significance of the commitment to position itself as a global media Establishing an efficient technical in 2009. Given the various interest of the modernized, standardized and cost effective hub. The UAE today is the home of more than broadcasting foundation has always region’s population, the UAE has also fostered printing industry to the growth of a healthy twenty five national television channels, ten been a priority of the UAE. In 2006, the creation of a regional magazines and and competitive media cluster, specialized national radio stations, morethan two hundred Telecommunications Regulatory Authority journals industry. The number of magazines business parks and infrastructure has been satelite TV broadcasters,a large number of acquired rights to 225 digital channels at the that are operating from the UAE has reached established that allows the creation of a conventional and online newspapers and ITU Regional Radio Communication Conference over than one hundred magazines. Although regional printing hub. The International magazines. Through fostering innovation to allow more channels to be carried across the UAE is a relatively small market with Media Production Zone (IMPZ) was and high quality in its emerging media sector, fewer airways by converting from analogue limited reach, most of the magazines look established in 2003 to as a specialized media the UAE has been attracting global media broadcasting to digital broadcasting. at the larger picture, making the UAE its production zone to develop a business companies from all over the world. By locating in the UAE, the TV and radio hub to distribute its copies, digitally and environment that is uniquely geared towards As an efficient step toward developing broadcasters can have access to different via print, throughout the region. The the needs of graphic art, printing, publishing, a globally-competitive media sector, the regional markets that speak multiple newspaper and magazine publishing industry and packaging and media production National Media Council (NMC) was established languages and with various interests and makes efficient use of the relatively low cost companies. in 2006 to oversee media development in the needs. They can easily source the talents for country and to support media initiatives. The this form the local and neighboring countries. council’s mission of providing an integrated regulatory environment for media sector has Provided the accommodating regulatory been setting up a clear vision of how the environment and the supportive climate for nation is really committed to build up a world- innovation and given the multicultural nature class industry. of the society, the UAE is well in the position to continue its leadership role as a regional broadcasting hub. Already, the UAE is now the host of the largest number of TV and radio channels that are free to air in the Arab world; they operate out of the different media business parks that are scattered around the country. The country dose not only provide the infrastructure and attract, with its liberal culture and business-friendly policies, and the right talents to vitalize this sector, but it also creates the needed facilities that enable broadcasters to use the cutting-edge technology to enhance their reach and quality.

Why UAE ? The Unlimited Opportunities 2012 Chapter 4 The United Arab Emirates A World of Opportunities 230 231 media and social media are now dominant means for marketing and advertising in the region, leading to the need to use different It is also one of the fastest growing skill sets and production resources. The UAE is countries in terms of advertising in the GCC today the host of the top-notch international region. Revenues of this vital media segment names in the international advertising industry have been increasing since 2003. According agencies and is truly the regional capital for to data released by Pan Arab Research Centre the advertising and promotion industry. (PARC), the UAE has an overall spend of USD 349 million during the first three months of A range of well-established free zones 2011; accounting 12 per cent of the all overall and business parks was built to provide all spend of the Middle East in the first quarter necessities that a media company could ask of 2011. for. Dubai Media City, Fujairah Creative City, In spite of the relative downturn that was twofour54 zone in Abu Dhabi and RAK Media experienced in the advertising spend due to City are only a few examples of the strategic the general economic conditions caused by the locations for setting up a media company in global economic and financial crisis, the UAE’s the UAE. advertising industry is well on the way to Dubai Media City, an initiative of the recover and is undergoing a major shift in the Dubai Technology Electronic Commerce and means and in the industry structure. Digital Media Free Zone Authority was established

in 2000 to provide an advanced high-tech infrastructure and a supportive environment Entry points for media related businesses to enable them to operate globally out of Dubai. The Dubai A Fertile Environment for Television Media City is the place where every kind and Radio Broadcastings of media business, especially broadcasting, Positioning in the UAE does not only mean publishing, advertising, public relations, music, the company is serving the domestic market. news media, production and post-production Using the advantageous location of the country will thrive. Very well-known media groups as a central location to serve the MENA region like MBC media group that has the highest as well as other regions has given major media viewership’s rates in the region have chosen groups the fruits they have expected. In 2009, DMC as their headquarters. Orbit Showtime Network (OSN), after the merger of Showtime and Orbit, chose the UAE as the Media sector in the UAE is rich of world-class main headquarter. OSN, with over 75 television media companies. Abu Dhabi Media Company and radio stations, is the major Arabic pay- (ADMC), established in June 2007 to revitalize tv player. The UAE has also given exceptional the media industry in the UAE’s capital, has privileges to renowned media groups, proving its already established itself as a leading multi- commitment toward positioning itself as a media platform media and entertainment provider hub in the globe. in the MENA area. ADMC owns and operates three television channels, four radio stations, English Television Channels three newspapers, three magazines and a Even though the majority of the television press. The company is also planning to enlarge viewers in the Arab region prefer TV in Arabic, its portfolio by investing USD 1 billion to the UAE has the highest number of those who develop and produce 40 feature films. prefer TV in English. According to Arab Media Dubai Media Incorporated (DMI), another Outlook conducted by Dubai Media Press in media giant in the UAE and the region, has 2009, 22% of TV consumers in the UAE prefer under its umbrella six television channels, three watching English channels. The large number newspapers, a press and two radio stations. In of English speakers in the country has been and order to diversify its portfolio, DMI plans to will continue to be the primary factor behind this launch a magazine and a radio station. result. The demand, thus, is relatively high. Why UAE ? The Unlimited Opportunities 2012 The United Arab Emirates Seven Pearls and Beyond Chapter 5

The United Arab Emirates Seven Pearls and Beyond

“ It is not only because of the unbeatable incentives and state-of-the-art facilities offered by the

UAE’s free zones and special economic parks that their

success can be inferred to; the reasons of their evident achievements go beyond than that. “

The Unlimited Opportunities 2012 Chapter 5 The United Arab Emirates Seven Pearls and Beyond 234 235 Abu Dhabi

n 1962, the first oil commercial shipment The current plans in the energy sector indicate Ileft Mina Zayed, bringing with it a new the emirate’s great interest in diversifying bright future not only for the emirate of Abu its energy resources. In 2006, it established Dhabi but also for the UAE. For the last four Masdar, seeking to leverage the emirate’s decades, the oil industry has been the main substantial resources and experience in the engine behind the unprecedented economic renewable energy sector. It also established growth in the capital city of the UAE. As of Emirates Nuclear Energy Corporation (ENEC) in 2010, official data show that Abu Dhabi has 98 2008, maintaining its leadership position in an billion barrels of proven oil reserves, making it evolving world energy market. the sixth in the globe. Its daily oil production The technology sector was boosted by has reached 2.7 million barrels. More than USD the launch of the Advanced Technology 90 billion comes from the oil revenues yearly. Investment Company (ATIC). The company Over the past decade, Abu Dhabi has was mandated to focus primarily on the global become one of the world’s fastest growing advanced technology sector. ATIC is a wholly- economies. Real GDP growth reached 15.9% owned subsidiary of Mubadala Development in 2010 and was as high as 19.4% in 2004. In Company, an investment arm of Abu Dhabi 2009, it contributed around USD 162.39 billion government. to the national GDP which makes 60% of the Established and owned by the Government total national GDP. of Abu Dhabi, Mubadala is a catalyst for the Oil has been playing a vital role in the Emirate’s economic diversification, managing development of the emirate and the country long-term, capital-intensive investments that economy. From day one, the huge revenues deliver strong financial returns and tangible from oil were invested in the key areas of the social benefits to the region. economy in order to diversify its economic Abu Dhabi has also been creating an profile for a more sustainable prosperity. environment where industrial activities can Abu Dhabi economic priority today is to flourish, as it believes that the Industrial sector build a sustainable economy while ensuring must be a pioneering economic sector that social and regional growth despite its huge adequately contributes to the diversification capacity of oil and hydrocarbons. The Main strategy. Three main industrial zones in Abu economic sectors in the diversification strategy Dhabi are Abu Dhabi Industrial City, Khalifah are sustainable energy, manufacturing, Port and Industrial Zone and Industrial area in communications, technology, media, tourism Mussafah. and education. Various strategic plans have The plan of developing a diversified been carried out by the different bodies of the economy consisted also of building a number emirate in order to implement its ambitious of economic and special zones where attracting 2030 vision that simply aims to reduce the competitive incentives are offered. Towfour dependence on the hydrocarbons sector and 54 free zone is aiming to make Abu Dhabi the creates a diversified economy. home of the media content development in the Arab region.

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Abu Dhabi Free Zones

Masdar City WHY Year of Establishment Masdar City? 2007 • The first-of-its-kind global business location that places companies at the Licensing Authority heart of the dynamic and thriving clean technologies and renewable energy Masdar City Authority clusters • Features a world-class research Sectors Targeted university specialized in renewable Renewable Energy, Energy Production, energy and clean technologies studies Energy Storage, Cleantech and ICT, (the Masdar Institute) Marketing and Events and General (Service • An emerging international cluster with providers and Consultancy) many international companies operating or have the intention to operate from Legal Forms Licensed Masdar city. • A branch of a foreign company or UAE- • An established clean technologies and based company (including companies renewable energy community where incorporated in other UAE special economic research and development, pilot projects, zones) technology testing, and construction of • A special economic zone limited liability the some of the world’s most sustainable company with corporate shareholders buildings are taking place. • A special economic zone limited liability • Every aspect of operating in Masdar company with individual shareholders City has been designed to allow partner organizations to focus all their energies Facilities and Services Offered on their core activities. Masdar City’s Annual License Fee • Registration, incorporation and licensing of • ICT connectivity and services One-Stop Shop can handle the rest – AED 20,000 (USD 5,446) new entities from government services to visas to • Translation Services Key Clients numerous business services, such as travel • Issuance and renewal of lease agreements • Insurance Services arrangements. • Pre-registration approvals from Abu Dhabi • Utility Bill Payments Siemens, Mitsubishi Heavy Industries, General Department of Economic Development Electric, Schneider Electric, Bayer Material • 0% import tariffs and 0% taxes on • Travel Services (Visa, Air-ticket booking, Science companies and individuals • Company Name registration with the Hotel booking) Department of Economic Development • No restrictions on capital movements, • Car Rental Services President profits or quotas • Employee Visa Services – new, renewal and cancellation (Entry Permit, Residence Visa Ahmed Ali Al Sayegh • 100% foreign ownership Stamping, Visit Visa, Dependent Visa, etc) Contact Details • No currency restrictions • Post Box set up – new and renewal Business Development Department Senior Management • Hiring of expatriate staff • Customs Administration – Assist with Masdar City, Abu Dhabi, Khalifa City “A” C.E.O. : Dr. Sultan Ahmed Al Jaber • Gateway to the vibrant market securing Import Code and Customs Clearance opposite Presidential Flight Director : Alan Frost opportunities of the Middle East and Asia • Other government services (driving license, car Tele.: +971 2 653 3333 • Outstanding logistics network registration, health card issuance) Fax: +971 2 653 1006 incorporating air, sea, road and eventually rail • Approval of fit-out / retrofit activities Email: [email protected] • A safe, friendly working environment • Effective facilities and asset management Website: www.masdarcity.ae

Why UAE ? The Unlimited Opportunities 2012 Chapter 5 The United Arab Emirates Seven Pearls and Beyond 238 239

TwoFour54 Year of Establishment WHY 2007 Towfour54 ? • Strategic location: in the heart of one of Licensing Authority the fastest growing cities in the world and Media Zone Authority – Abu Dhabi a gateway to Arabia; a vast, young and fast developing market. Sectors Targeted • A campus-style environment: Where networking and strategic alliances with other A/V Production Firms (TV Programs, Children’s creative professionals and businesses can Animation etc.), Broadcasting Firms (TV and easily be established and are encouraged. We Radio), Publishing Houses (Books, Magazines, facilitate these partnerships by bringing the Newspapers etc.), New Media Firms (Mobile right people together at the right time for our App Developers, Digital Content Producers partner companies’ projects. etc.), Advertising or Marketing Services, Public Relations, Events, Print Publishing, • A supportive and fiscally beneficial Information & Data Services, Business Support environment: Businesses are entitled to 100% Services, Film, Training, Mobile content, ownership, cost-effective set up, currently Gaming, Entertainment Devices, Web a full exemption from corporate taxation Facilities and Services Offered Publishing & services and ongoing support from the Abu Dhabi • Training Services: media courses, that are • Retail: The retail facilities include a convenience Government. both world-class and practical, and that store, café, digital printing, ATM and laundry Legal Forms Licensed • A transparent licensing and cost structure: immediately improve participants’ media services • A free zone limited liability company A world-class regulatory frameworkwhich working performance • Travel Services: From commercial and protects IP rights, ensures compliance with (FZ-LLC) • Support Services: finance and support business air travel to car rental and hotel laws, promotes strong governance and a clear businesses and individuals targeting the Arab accommodation • A branch of an existing company transparent pricing structure to ensure there media and entertainment industry • or license as a freelancer are no hidden set up or operational costs. • Production Services: state-of-the-art facilities Available Business Premises • A comprehensive one-stop shop: 3 integrated for production services • Serviced Office Incorporation Fees business pillars, offering world-class training; • Government Services: a one-stop-shop, a team 1 Desk – AED 8,950 per month project funding and support; HD production, Company Creation – AED 2,500 was established to liaise with government 2 Desks – AED 13,250 per month post-production, media asset management, Initial Payment for PO Box – AED 1,250 authorities and ministries relating to 4 Desks - AED 20,700 per month digital archiving, play out and broadcast visa applications, residency procedures, facilities; enabled with on-the-ground logistical • Fitted – out office – AED 4,550 per square Key Clients government licensing and filming, event business set-up and support. meter per annum ADMC, Charisma, Sky News Arabia, Fox, permits and more • Being part of the regions’ leading content • Core and Shell – AED 3,450 per square meter Financial Times, CNN and Turner • Residential Services: a team can work with creation community. per annum businesses to source a furnished or unfurnished Senior Management • Efficient and clear regulatory framework home at a variety of locations across Abu Contact Details C.E.O.: Tony Orsten including an enabling company law Dhabi environment for investors. Business Development Department C.O.O.: Wayne Borg • Office Space management: the office space • Competitive rents and business services solution available to partners includes serviced Khalifa Park, Abu Dhabi (government related, travel services etc.) offices, fitted-out offices and core and shell Tel.: +971 (0)2 401 2454 / offices Fax: +971 (0)2 401 2345 • Hospitality: catering services suitable for Email: [email protected] all occasions, including training courses, Website: www.twofour54.com conferences, office parties and meetings.

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Khalifa Industrial Zone Year of Establishment WHY 2010 Kizad ? •Centrally located with equal distance from Licensing Authority Jebel Ali Port and the city and the airport of Abu Dhabi, both providing easy access Khalifa Industrial Zone Authority market and resources promising rapid Sectors Targeted growth potential •Multimodal connectivity with an integrated Vertically Integrated Clusters, Aluminum, port (Khalifa Port), access to future rail Food, Steel, Petrochemicals & Chemicals, network development and proximity to Pharmaceuticals & Healthcare Equipment, Abu Dhabi International Airport Paper, Printing & Packaging , Trade & Logistics, Engineered Metal Products, Mixed Use and •One Stop Shop business services to deliver Other Industries value and convenience by facilitating relationships with Government and Legal Forms Licensed Licensing Authorities as well as utility companies to ensure rapid processing and • Branch approvals aimed at helping businesses • Free zone Establishment (FZE) speed up the process of obtaining the • Free zone Company (FZCO) necessary permits, licenses, approvals and clearances Incorporation Fees •Business efficiency, easy access to various Application fee: AED 5,000 markets, low-cost operational environment and other essential support to achieve Key Clients long-term competitive advantage. Emirates Aluminum (Emal) Chairman Sultan Al Jaber Facilities and Services Offered • Advice and practical assistance for setting up Senior Management a business quickly and easily Khaled Salmeen Al Kawari • Fulfilling Human Resources and immigration Executive Vice President, Industrial Zones requirements Company • Providing utilities connections, waste management, logistics and facilities Available Business Premises Contact Details management • Built-up area Factory Business Development Department, • A dedicated Relationship Manager, based • Warehouse Al Taweela Island, P.O. Box 54477 Abu Dhabi in the Zone, always on hand to provide Tel: 800 10 20 30 answer and assistance that a business may • Office Tel: +971 800 10 20 30 Outside UAE) require and to ensure timely processing of • Utility Storage Fax: +971 2 695 2030 paperwork to obtain all necessary licenses, • Open Land clearances and permits in a swift and Email: [email protected] efficient manner Website: www.kizad.ae

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Abu Dhabi Airport Free Zone WHY Year of Establishment Abu Dhabi Airport Free Zone? • Take advantage of Abu Dhabi International 2009 Airport strategic geographical position on the crossroads between the East and Licensing Authority the West, and the large-scale economic Abu Dhabi Airport Free Zone Authority development of the Emirate of Abu Dhabi Location • World-class business facilities and services • All required amenities under one cluster Close to Abu Dhabi International Airport Facilities and Services Offered Section Targeted • Conferencing facilities Aviation & Aerospace, Logistics, Cargo & Freight, • Business centers Electronics & electrical, Consultancy and • Banking and insurance facilities business development, Computers, internet • Hotels & restaurants and IT solutions, Telecommunications, Express Transportation and 3PLs, Pharmaceuticals and • Food courts medical equipments • Duty free shops • Postal services Legal Forms Licensed • Travel agencies • A Branch of a Foreign Company • Clinics • Free Zone Establishment • Petrol station • Free Zone Company • 24 hours security Key Clients In progress Chairman Facilities and Services Offered Khalifa Al Mazrouei • Advice and practical assistance for setting up a business quickly and easily Senior Management • Fulfilling Human Resources and immigration requirements Executive VP – Business Development: • Providing utilities connections, waste Ramy Jallady management, logistics and facilities management Available Business Premises Contact Details • A dedicated Relationship Manager, based Abu Dhabi Airport Company in the Zone, always on hand to provide • Commercial offices answer and assistance that a business may • Light industrial units Tel: +971 2 505 3425 require and to ensure timely processing of • Serviced lands Fax: +971 2 575 8300 paperwork to obtain all necessary licenses, Email: [email protected] clearances and permits in a swift and efficient manner Website: www.adafz.ae

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tiny fishing and trading settlement financial services and transport storage and A located in the coast of the Arabian Gulf communications. In 2009, it contributed USD managed to create a brand synonymous with 80.09 billion, 29.6% to the national GDP, less luxury, multi-billion dollar real estate ventures than 2% of its GDP came from oil sectors. and 10 million visitors in 2010. Dubai has Dubai is a unique blend of East and West; undergone an impressive transformation for rich local culture, a bustling metropolis the last four decades. The commencement of where 195 nationalities live side by side, and the development cycle started in 1968 with the growing investment on a daily basis. Dubai widening of Dubai Creek in order to contain offers some of the best education, healthcare, larger ships and the creation of Jebel Ali Port in shopping, sport and leisure opportunities in 1972. This was followed by the introduction of the world. It is also a leader in travel, tourism the free zone concept, allowing international conference and exhibition industries, and businessmen within the jurisdiction of these offers outstanding infrastructure, a state- zones to fully own their businesses and of-the-art telecommunications network and operate in state-of-the-art infrastructure with unparalleled connectivity. excellent facilities and a close proximity to the Dubai is a preferred choice for seaport. international companies to establish their Since its establishment, Dubai realized that regional headquarters. According to Economic it had a limited supply of oil and gas reserves Intelligence Unit – Middle East, 90% of the comparing to its neighboring states. Thus, French companies prefer to establish their through a thought-out development strategy, regional headquarters in Dubai. Its strategic it managed to build an outstanding non-oil location between Europe and Asia, and close profile, mainly depending on trading, services, to both wealthy countries in the Gulf as well as tourism and finance. Dubai strongly encourages the Indian subcontinent is providing companies the private sector activity. This encouragement based in the emirate an access to a market of is felt through its business-friendly regulatory over two billion people. Its speedy and cost- environment, its entrepreneurial initiatives effective incorporation procedures along with and purpose-built economic and free zones the implementation of latest technology in that are scattered over its different parts. most government services are vital grounds These business hubs have been actively for choosing Dubai. participating in the development of the city’s The emirate’s government is continuing its GDP generally and the export sector especially, economic diversification strategy. Its current 40% of the emirate’s total export economy in focal point though is over the subsectors of the first half of 2011. the non-oil sectors such as sports, exhibitions Dubai’s GDP has been significantly and shows in the tourism sector. Technology increasing over the past two decades, mainly and education are among the government’s driven by the non-oil sectors. Since 2000, supported sectors. This support is not only real GDP of Dubai has been growing at a limited through easy procedures but it also compounded annual growth rate of about extends to offering funding for specific 15%. The growth was largely driven by non- initiatives in these fields. In addition, Dubai oil sectors, a unique differentiator in a region is constantly working to introduce dynamic where economies are dependent on oil incomes. regulations that aid the formation of small Major drivers of economic growth include and medium enterprises (SMEs). manufacturing, construction, real estate,

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Dubai Free Zones

Jebel Ali Free Zone WHY Year of Establishment JAFZ ? 2007 • Excellent location between the region’s largest sea port and airport, both located in Dubai Licensing Authority • The oldest and most established free zone Jebel Ali Free Zone Authority (JAFZA) in the MENA Region with more than 6,400 companies Sectors Targeted • A recognized global brand with more than Licenses companies related to industrial, 120 of the Global Fortune 500 companies Logistics, trading, services and other sectors operating in the free zone • Ability to register branches in main land Dubai Legal Forms Licensed to take advantage of the GCC customs union • Free zone establishments (FZE) • A multi-national business environment with Facilities and Services Offered firms representing the six continents of the • One Stop Shop: Customers are offered all the employees. Its proximity and facilities such as • Free zone companies (FZCO) world services required to establish and operate recreational activities, supermarkets and • Branch Companies • An investor-friendly environment, world-class a business in the free zone, thus saving time, restaurants provide an ideal environment for • An Offshore Company as a non-resident infrastructure complemented by value-added effort, and cost, giving them the advantage company employees. company, with a corporate legal entity services and incentives, expanding facilities to focus on their business rather than dealing • Hotels: Jafz also offers economical hotel convenient regulations, a customer-centric with multiple entities whenever they need to facilities through its joint venture named Easy Incorporation Fees business policy carry out a transaction. Hotel, A budget hotel (2 stars) with 216 rooms. Application fee: AED 3,100 • Easy and efficient access to a potential market • Integrated solutions from on site residences The hotel offers absolutely first class “sleep and shower” experience at an affordable price Registration fee: AED 3,510 of over two billion people in the greater (staff accommodation) to recreation, medical Middle East region facilities and food courts. for visitors to the free zone. Commercial License: AED 15,010 • Advisory and updating: Jafz assists customers • The free zone has developed a red-tape Available Business Premises Key Clients free, efficient and dynamic system including in setting up a business and selecting desirable the ‘one-stop- shop’ concept, which allows sites or locations for their ventures. The free • Core and Shell Offices Unilever, P&G, GE, Sony, LG, Shell, BP, , investors to set up businesses at the free zone zone also helps them to determine operational • Standard Warehouse ExxonMobil, Johnson & Johnson, Colgate- requirements and, additionally, keep them at an incredibly fast pace. • Land Palmolive, Xerox, Pepsi, Kraft, Ford, Goodrich, updated on various developments in their • JAFZ offers its clients many incentives to enable and Goodyear specialized business sector. • Build-to-Suit Warehouses them to do business with greater ease and Chairman profitability. These incentives include 100 per • Business Matching: This service helps companies • Business Centre Offices cent foreign ownership, 0 percent corporate leverage opportunities of joint ventures and • Showrooms Hisham Abdulla Al Shirawi other mutually beneficial partnerships in the tax for a period of 50 years (a concession that • Retail is renewable), transfer of capital as required, 0 local and international market. Senior Management percent import or re- export duties, 0 per cent • Dubai Trade: Through a single bilingual CEO: Salma Al Hareb personal income tax, no currency restrictions, portal (DubaiTrade.ae), Jafz offers customers Contact Details JAFZA Commercial Sales Deputy CEO: Ibrahim Mohammed Al Janahi and no restriction on hiring foreign employees. 24/7 secure access to all services. The portal • An integrated industrial and logistics consolidates all the services of complementary Jebel Ali, Dubai community with a port, container terminal, organizations including DP World and Dubai Telephone: 800-Jafza (52392) factories, warehouses, labor and staff Customs and gives customers the added Fax: +971 4 8815001 accommodation and recreational areas in close convenience of a single logon. Email: [email protected] proximity • On Site Residential facilities: Jafz offers onsite Website: www.jafza.ae accommodation within Jafz for company

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Dubai Maritime City Dubai Cars and Year of Establishment WHY Automotive Zone WHY 2007 DMC ? (DUCAMZ) DUCAMZ ? • The world’s first purpose-built maritime centre • An easy access to all airports and seaports Licensing Authority • The first choice for maritime businesses not Year of Establishment in the region. The automobiles can be reloaded onto feeder vessels for Authority (DMCA) just because of the facilities provided, but 2000 also because of the trategic location, it unique easy transport via a modern network of integration of maritime players around the Licensing Authority highways linking all the neighboring countries Sectors Targeted globe, the fame of lifestyle and infrastructure in the Middle East and beyond Jebel Ali Free Zone Authority (JAFZA) Maritime services, maritime management, of Dubai and its renowned financial clout. • Strategic location with unique concept vessel and yacht registration, vessel and • The Maritime Centre is designed to be a vibrant Sectors Targeted • Providing all services in the space of yacht ownership and charter, maritime and thriving community unique not only in terms one building and the Space for all the educational research, vessel and yacht design of sea-based location but also in the enduring Automotive trading, sales and some services Facilities needed by the Auto trade, and building, maritime shipment organization, maritime ambience it creates. such as insurance, banking, repair and Export & Import Client maritime exhibition, conferences, training and • Houses the Middle East’s first ship registry maintenance of automobiles • No import/export duties and no restrictions on workshops, maritime tourism office maximum import of automobiles • A superlative environment for workplaces Legal Forms Licensed Legal Forms Licensed withthe highest standards of service and • Trading license for a branch of foreign • Registration Fee – AED 15,000 (FZCO), excellent amenities. company (including offshore company) Facilities and Services Offered All services related to the Government • AED 10,000 (FZE) • A world-class maritime legislative and • Free Zone Company regulatory body entities associated with the Auto Trade, • AED 8000 (Branch) • Free Zone Establishment Import and Export Client are located • 100% foreign ownership, exclusive maritime within the same area. • License Fee – AED 10,000 activities & customer friendly service and process Incorporation Fees • Dubai Customs Inspection Incorporation Fees • Exclusive maritime authority in the emirate of Licensing Fee – AED 5,500 • Dubai Customs Operations Application fee: AED 3,100 Dubai Registration Fees – AED 10,000 (EZE), • Dubai Ports Documentation Registration fee: AED 3,510 • Proximity - very close to the central business AED 15,000 (EZCO), AED 5,000 (Branch) • RTA Department district Facilities and Services Offered Commercial License: AED 15,010 • Shipping Agencies • Registration and licensing of maritime related Chairman • Bank Key Clients companies Hisham Abdulla Al Shirawi • Money Exchange United Arab Shipping Company Services, • Dedicated ship registry Emirates Shipping, APM Terminals AMI • Visas Senior Management • Workshops Management DMCEST, MUR Shipping DMCCO • Residential facilities CEO: Salma Al Hareb • Insurance and Middle East Shipbuilding DMCCO • Health Services Deputy CEO: Ibrahim Mohammed Al Janahi • Restaurants Chairman • Postal Services • Supermarket • Spacious car parking facility Available Business Premises Khamis Juma Bhuamim Office Units Available Business Premises Contact Details Warehouse Contact Details Communications Department Marketing Department - JAFZA Office Premises Workshops North of the main city center and creek , Dubai area business district Showrooms Tel: +971 4 333 5000 Telephone: 04345 5545, Fax: 043452234 Fax: +971 4 333 7871 Email: [email protected] Website: www.dmca.ae Email: [email protected]

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Dubai TechnoPark Year of Establishment WHY 2003 TechnoPark ? • The nucleus of new technology, where Licensing Authority ideas become reality, training creates excellence and research unearths new Economic Zones World understanding Sectors Targeted • The only research and development technology park in the region Technology, Telecommunications, Engineering, Health, Water, Logistics and Mobility, and • Located in the heart of the Middle East Energy region’s international business hub • A hub that enables research partners Legal Forms Licensed to access the resources of academic and research institutions, and international • Limited Liability Company associations worldwide • Free Zone Establishment • An advanced communications network, a • Free Zone Company full range of administration services • A Branch of a local or a foreign company • As a special economic zone, it offers 100% foreign ownership, 0% corporate tax rate, Incorporation Fees etc. Application fee: AED 3,100 • A prestigious networking and Registration fee: AED 3,510 research partners’ profile that includes International Association of Science Parks Commercial License: AED 15,010 (IASP), World Association of Industrial and Technological Research Organizations Key Clients (WAITRO), Fraunhofer- Gesellschaft (FhG), Trox Group, 3M, Nestle, Harsco, Baker Hughes, Boston University and others Sika, SunEdison, Nestle Water, Culligan, Park • Covers 21 million square meters of land, Water Co, Metito, Torishima Pump, Pacific about 30 percent of which is open space Facilities and Services Offered Available Business Premises Control Systems, Voith, Emro Armaturen, areas. Tencate, Proclad Group, Oil States, Geepas, • Consultancy services in evaluating and • Commercial Offices • Brings the most advanced organizations selecting water technologies • Light Industrial Units Basf, Woods Hole Group in the world together, fostering shared • Mega mall, retail outlets, showrooms, business understanding through research into and • Showrooms class hotels and two 8-storey office buildings Chairman development of new technologies. • Open land Hisham Al Shirawi • Aims to cultivate greater knowledge • Staff Accommodation Facilities for the future, by promoting continuous • Specialist Medical Research Centers and innovation and progress. Educational Facilities Contact Details • Residential areas with sports and Commercial Sales Department Al Qouz entertainment centers, as well as retail shops, (west Jebel Ali Free Zone), Dubai health care and civic amenities Telephone: +9714 881 4888 • Government Services window: including visas, Fax: +9714 8811444 RTA services, etc. For Enquiries: http://pilot.dubaitrade.ae ezwemext/ enquirysetup.do

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Jumeirah Lake Towers Free Zone WHY Year of Establishment JLT ? • Close proximity to the Dubai Logistics 2002 Corridor, the world’s largest multi- modal logistics platform linking sea, Licensing Authority land and air, makes JLT an ideal location Dubai Multi Commodities Centre Authority for internationalcompanies seeking to establish regional headquarters in Dubai. Section Targeted Dubai has a considerable logistics network Commodities, Finance, Shipping, Recruitment, ensuring fast transportation of goods. IT, Advertising, Fashion among other economic Moreover, JLT is around 45 minutes away activities from Abu Dhabi and is adjacent to an extensive road network that links Dubai with the other Emirates and surrounding Legal Forms Licensed countries. • Branch, Free Zone Establishment (FZE) • Different licenses: DMCC offers a secure • Free Zone Company (FZCO), Subsidiary regulated environment and licenses a full • Representative Office range of business activities. • A one-stop-shop Licensing Authority: Key Clients DMCC offers its members services ranging Alcan Middle East DMCC, Antwerp Diamond from registration and licensing to general Bank, Clarksons DMCC, Conoco Phillips services that ease the process of setting up International Trading PTE LTD, Continental a business in JLT. DMCC, Dhamani, Emirates Gold, Harley • Quality commercial and residential Davidson, Hudson, Louis Dreyfus Commodities properties with lease or buy option: MEA Trading, LVMH, Lukoil, National Shipping With 60 completed residential, office and Facilities and Services Offered Available Business Premises Co Saudi Arabia, Posco Steel & Alloys DMCC, mixed use towers, JLT offers a variety of Reliance Industries (Middle East) DMCC, Rosy property types that are as distinctive as • Secure regulated environment with a full • Commercial office space - units and entire Blue DMCC, RWE Supply & Trading GmbH, each tower design. There is a choice of range of business activities floors to lease or buy Talent Partners, Topaz, Unilever shell and core space for companies who • 100% business ownership and sole • Serviced offices/Flexi desks /Virtual Offices want to design their own workspace, shareholders are permissible • Business Centers / Workshops / Retail space fitted out offices, short term serviced Chairman • Quality commercial and residential properties offices, virtual offices and flexi desks. • Land plots for development with freehold or lease options Ahmed Bin Sulayem Spaces offered also include different sized land plots for development as well as • Guaranteed 50-year tax holiday Senior Management office floors and units in DMCC developed • 100% capital repatriation Contact Details CEO: Malcolm Wall and third party developers’ buildings. Client Service Centre • Invaluable business incentives: As a free , Jumeirah Lakes Towers, zone, JLT offers a guaranteed 50-year tax Incorporation Fees Dubai Telephone: Inside the UAE 800 holiday on personal and corporate tax. DMCC (3622) License Fee – AED 22,030 (new company) 100% foreign ownership, JLT does not International inquiries: +971 4 424 9600 restrict foreign exchange and allows 100% AED 20,020 (branch) Fax: +971 4390 3897 capital repatriation. Email: [email protected] Website: www.dmcc.ae

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Dubai Textile City Year of Establishment WHY 2005 Dubai Textile City ? • The first free zone dedicated to facilitate Licensing Authority the storage of textile fabrics for long Jebel Ali Free Zone Authority (JAFZA), periods without customs duty, which is 5% Trakhees currently. It was established to help traders who are mainly in re-export business. It is Section Targeted estimated that 85% of the goods imported to Dubai are re-exported, at one time or Trading in Textiles another. • Long lease period +15 years (30 years Legal Forms Licensed initially, renewable thereafter) • Free Zone Establishment • Better costing due to the absence of • Free Zone Company intermediaries • A Branch of a Foreign Company • Better business turn over due to new markets being introduced as a result of Key Clients global publicity Royal Traders, Kabul Textiles, Maladar Textiles, • Lower administrative cost. As much as 35% Rajhans Trading, Far East Trading, Deepak, savings on the cost when compared to the Kaysones Plaza, Neelam Khamas, Rajneesh present working system Traders, Renoka Textiles, Sona Textiles, • International media publicity Kessuma Jaminal, Sataym Trading, Ratti • Dubai Textile City, which sits at the center Trading of a 1.4 billion booming consumer market extending from the CIS to Africa and the Chairman Indian subcontinent, has emerged as one Ashok Sawlani of the most modern and profitable trading points in this region’s commercial map. Available Business Premises Facilities and Services Offered Senior Management • Exemption from the payments of custom • Warehouse: Rent-free period first 15 •DTC has the full support of Dubai Ports and C.E.O.: Lakhi Ramchandani duties years, only ground leases payable AED Customs, the Customs authority will help • Option to sublease the premises 0.90 (90 fils) per square feet per year. processing visa requirements of DTC members. • Option to transfer goods to the city From 16th to 20th year AED 3.50 and •Meeting and conference facilities 21st – 30th year, rent as per market price without customs duty •Maintenance and Security less 50% with a minimum of AED 8.5 • Stability and discipline is anticipated in per square feet DTC, a smart and integrated complex. • Offices Contact Details • Showrooms Texmas Sales Department Al Awir Free Zone, Dubai Telephone: +971 4 3531551 Fax: +971 4 3530257 Email: [email protected] Website: www.texmas.com

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Dragon Mart Year of Establishment WHY 2004 Dragon Mart ? • The prime gateway for Chinese products in Licensing Authority the Middle East Trakhees • Strategically located to maximize the retail opportunities within and around the Sectors Targeted MENA region wholesale and retail trade of a variety of • The largest trading centre for Chinese Chinese products including home appliances, products outside mainland China stationery, office appliances, communication and acoustic equipment, lamps, household items, building materials, furniture, toys, Facilities and Services Offered machinery, garments, textiles, footwear and 30,000 square metres of warehousing general merchandise 2,500 parking spaces In house post office Legal Forms Licensed One-stop-shop government service Trade license for Chinese Nationalities only: • Free Zone Establishment Available Business Premises • Free Zone Company • Warehouses • Retail Shops Incorporation Fees • Offices Similar to mainland Dubai licensing fees (refer to Chapter 7) Key Clients Chinamex Middle East Investment, Trade Promotion Centre, Auchan Senior Management Acting Director: Omar Khoory Marketing Executive: Aisha Al Kindi

Contact Details Marketing Department International City Al Warsan area- Dubai Telephone: +971 4 4336 200 Fax: +971 4 4336 199 Email: [email protected] Website: www.dragonmart.ae

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Dubai International Financial Center (DIFC) WHY Year of Establishment DIFC ? • DIFC is the first world class,international 2004 centre serving the region which includes the Middle East, East and North Africa, the Licensing Authority Caspian states and the Indian Subcontinent. DIFC Authority It is a region of 1.8 billion people (about a third of the world population) and a Section Targeted combined economy worth $1.5 trillion in terms of GDP, growing at an annual rate in Banking Services (Investment Banking, excess of 5 per cent a year. Legal Forms Licensed Incorporation Fees Corporate Banking & Private Banking), Capital • DIFC is designed to span the time zones not Markets (Equity, Debt Instruments, Derivatives 1.Retail Entities: Limited Liability Company, 1. Retail Outlets covered by New York, London and Hong and Commodity Trading), Asset Management Company Limited by Shares, Foreign Organized •Application for Reservation of Name – USD Kong. It will complete the missing quarter Company and Fund Registration, Insurance and Re- in the 24 hour, 7 day week, global financial 340 insurance, Family Offices and Islamic Finance. system. DIFC will act as a catalyst to the 2.Non Retail Entities: Limited Liability Company, •Application for Incorporation of a Limited region’s economic development-just as Wall Company Limited by Shares, General Liability Company USD 3,400 Street, the City of London and Hong Kong Partnership, Limited Liability Partnership, Key Clients •Commercial License fee (payable upon have contributed to the growth of the US, Protected Cell Company, Investment Company, Standard Chartered Bank, Bloomberg, Dutche incorporation and annual renewal) USD 5,100 Bank, Credit Suisse, UBS, HSBC, AIG, Standard European and Asian economies. Foreign Recognized Company, Recognized 2. Non Retail Outlets Moodies, Delloitte, DME, EFG Hermes, Saxo • A regulatory framework built on the best Limited Liability Partnership, Recognized Bank, SMBC, Kingdom Hotel Investments, ES practices found in those leading jurisdictions Partnership, Spura Company •Application for Reservation of Name USD 800 Bankers, ICICI Group • Dubai satisfies all of the conditions that 3.Dubai Mercantile Exchange: Limited Liability •Application for Incorporation of a Limited banks and other financial institutions look Company, Company Limited by Shares, Liability Company USD 8,000 Governor for. It is a cosmopolitan, first world city with Limited Liability Partnership, Dubai Mercantile •Commercial License fee (payable upon a long history of political and social stability. Exchange (DME) – Recognized LLP, DME - Abdullah Muhammed Saleh incorporation and annual renewal) USD It has a large highly educated, multi-lingual, Foreign Recognized Company, DME – General 12,000 multi cultural work of skilled professionals. Partnership, DME – Recognized Partnership, Senior Management It has excellent communication links within DME – Limited Partnership 3. Dubai Mercantile Exchange CEO: Abdullah Al Awar the region and to other financial centers. •Application for Reservation of Name US$ 800 It has a proven record over 30 years of Head of Insurance and Business Entities: delivering ambitious business projects such Facilities and Services Offered •Application for Incorporation of a Limited Hana Al Herz as technology, trade, sport, travel and •One-Stop Shop government services Liability Company US$ 8,000 Head of Financial Services: tourism. It has a very supportive government •Fast-track fund registration services •Commercial License fee (payable upon and an un-bureaucratic approach to incorporation and annual renewal) US$ Kevin Berkett •International Arbitration Center in partnership business, with some of the best tax and 12,000 Head of Corporate Communications: other financial incentives anywhere in the with London Center for International Arbitration (LCIA) Maryam Al Falasi world. Its sophisticated lifestyle and safe living conditions make it a popular place •Independent Laws and Courts Contact Details to locate for business executives and their •Hotel Corporate Communications Available Business Premises families. The fact that 120 of the Fortune Global 500 companies have located in •Art Gallery Dubai International Financial Centre Leased offices Dubai is proof of this. •Restaurants Authority, The Gate, Level 14 Serviced offices and meeting facilities • A centralized client-servicing model Tel: +971 4 362 2222 that delivers a breadth of services that Fax: +971 4 362 2333 would involve numerous uncoordinated Website: www.difc.ae counterparties in other jurisdictions

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Dubai Airport Free Zone WHY Year of Establishment Dubai Airport Free Zone ? • DAFZA’s integrated infrastructure and 1996 proximity to the facilities of Dubai International Airport with 120 airlines and Licensing Authority over 210 destinations mean, investors, their Dubai Airport Free Zone Authority (DAFZA) employees and clients will find travelling to and from the investor’s office simple and Section Targeted straightforward Aerospace, Aviation and related services, • Businesses can operate around the clock Automobiles and Vehicles, Computers, and offer a 24-hour customs service and rapid cargo clearance through a dedicated Internet & IT Solutions, Consultancy & logistics center Business Development, Cosmetics and Perfumes, Electronics and Electrical, • State-of-the art facilities and location Engineering & Building Materials, Engines • Hassle-free procedures and Machines, Food, Beverages & Tobacco, • A one-stop-shop with office space Home and Office Appliances, Jewellery, requirements, registration, licensing and Watches& Precious Stones, Logistics & Freight, visa Luxury items, Oil &Natural Gas Products and • Worldwide certificates Services, Packaging and Printing Materials and Equipments, Pharmaceutical, Nutritional • Very competitive financial agreements with & Medical Equipments, Plastic, Chemicals & clients Petrochemical Products, Telecommunication • Security of an established and well-run free zone with the zone’s emphasis on service, Legal Forms Licensed facilities and incentives that has attracted over 1,450 companies to the Dubai Airport Facilities and Services Offered Key Clients • Branch Free Zone, which all enjoy the excellent tax •Modern facilities and superior logistics services Airbus, Boeing, Rolls Royce Engines, Bombardier, • Free zone Establishment (FZE) & investment incentives packages •Employee Sponsorship (Employment residence NEC, Sandisk, Sumitomo, Burns &McDonell, TNT, • Free zone Company (FZCO) sponsored by the free zone) DHL, Heinz, Irish Dairy, Hershey, Actavis, The Himalayan Drug Company, Johnson & Johnson, •Online transactions processing for all services Fossil, Rivoli Group, Kawasaki Heavy Industries, Incorporation Fees Available Business Premises (Tas’heel) Mitsubishi, Audi VW, Maserati, Ferrari, Chevron • Office Units Registration fee – AED 10,000 (FZE) •24 hours security service Philips, BP, Clarins, Chanel, Estee Lauder AED 15,000 (FZCO) • Light Industrial Units (LIU ) •Housekeeping and Building Maintenance • Business Enabled Offices •Government Services: Immigration, Customs, Chairman Chamber of Commerce Contact Details Sheikh Ahmed bin Saeed Al Maktoom •Post, Telecommunications & Banking facilities Sales Department •Food court with a wide range of restaurants , Next to Terminal 2 Senior Management and cafes Dubai International Airport Managing Director: Dr. Mohammed Al •Business centre, conference room, business Telephone: +9714 2027000 Zarooni lounge and lecture room Fax:+9714 202 7766 Director of Sales: Mr. Mohammed bin Swailim •Travel Agent, Car Rental Email: [email protected] •Catering Website: www.dafz.ae

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Dubai Silicon Oasis Year of Establishment WHY 2004 DSO ? • The only technology park in the region Licensing Authority that provides both a living and working Dubai Silicon Oasis Authority integrated community • A full package of incentives and benefits Section Targeted includes 100% foreign ownership, 100% repatriation of capital, Zero income and Mobile Technologies, Internet, Data Centre, corporate tax, and more Arabization / Localization Technologies, • State of the art IT infrastructure and facilities Software / Software-As-A-Service (SAAS), with tier 3 data centre Semiconductor • Fast-track business set-up & licensing Legal Forms Licensed • Dedicated business support services • Free Zone Establishment including integrated online E-Business system offering tenants fast and efficient • Free Zone Company services at the touch of a button • A Branch of Foreign Company • Access to regional pool of talented technical • Entrepreneurial and Startups and engineering professionals • Access to consumer markets of 5 billion Incorporation Fees people (Middle East, North Africa and License Fee – AED 15,000 Indian subcontinent) • A hi-tech ecosystem that offers businesses Key Clients a plethora of advantages including a state- of-the-art infrastructure, in-house business Fujitsu, Siemens, Schneider, Wacker Chemie services and strong business support such AG, Porsche and Western Digital as technology investment incentives for large enterprises, entrepreneurial support, Chairman an incubation centre and venture capital Facilities and Services Offered Available Business Premises funding Sheikh Ahmed Bin Saeed Al Maktoum • Conference Facilities • Commercial offices • A dedicated ICT fund to finance promising start-up companies • Shops, restaurants and amenities • Multiple-use warehousing and manufacturing Senior Management • In-house government services • Land for development CEO: Dr. Mohammed Al Zarooni • IT services • Dedicated client support Contact Details • A range of Mentorship programs designed for startups and entrepreneurs Company Establishment & Affairs • Advice on market strategy & business planning Dept & Sales Department • Introduction to large DSO network facilitating Emirates Road, Dubai business development and relationships Tel: +971 4 501 5000 • Support and protection for IP development Fax: +971 4 501 5030 • Incubator program and facilities Email: [email protected] Website: www.dsoa.ae

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Dubai Flower Centre (DFC) WHY Year of Establishment DFC ? • Strategically located at Dubai International 2004 Airport Licensing Authority • the is a new hub of growth for the floriculture industry in the Dubai Airport Free Zone Authority 21st century Sectors Targeted • With the explosive growth in global trade of flowers and perishables, there is an Floriculture, Horticulture, Fruits & Vegetables increasing demand for innovative logistics and commercial solutions to enable the Legal Forms Licensed industry to reduce transit times, improve • Free Zone Establishment quality and grow profits • Free Zone Company • The latest technology to ensure • A Branch maintaining the cool chain throughout the handling process Incorporation Fees • Attractive business incentives including Facilities and Services Offered •Registration fee – AED 10,000 100% foreign ownership, a corporate tax holiday for 15 years, no personal income • Customs, Phytosanitary Inspection •5% service charge and 9% water and tax, freedom to repatriate both capital • Conference and Meeting Facilities electricity charge on top of annual rent apply and profits and no currency restrictions. • Handling and Logistic Services Key Clients Available Business Premises • Data and Telephone Sockets Fujitsu, Siemens, Schneider, Wacker Chemie • Business Units – AED 1,278 per square meter • Air conditioning, with individual thermostat AG, Porsche and Western Digital control • Office Units – AED 1,825 per square meter • Carpeting and Lighting • Warehouse units – 75 AED per square feet Chairman • Refrigerated dollies capable of carrying an Sheikh Ahmed bin Saeed Al Maktoom entire aircraft pallet from airside to facility • Automated handling equipment that moves pallets from airside to facility quickly and Senior Management efficiently through airlocks placed at the Director Manager: Dr. Mohammed Al Zarooni entrance Director of Sales: Mr. Mohammed bin Swailim • Segregated storage chambers with varying temperature zones to suit the optimum Contact Details temperature requirement Sales Department • Hermetically sealed bays for meat, fish and Dubai International Airport ethylene producing products Telephone: +9714 2027000 • Vacuum cooling and forced air cooling facilities Fax:+9714 202 7766 • Landside security systems include access control systems such as 50 CCTV Cameras, Email: [email protected] Video Over IP (VOIP) security systems, scanners Website: www.dafz.ae and walk through metal detectors

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Dubai Internet City (DIC) WHY DIC ? Year of Establishment • One of the largest Information and Communications Technology (ICT) 2000 clusters in the world, hosting over 1400 companies including multinationals, Licensing Authority growing enterprises, entrepreneurships Dubai Technology and Media Free Zone and ventures. Authority (DTMFZA) • Founded on solid fundamentals of state- of-the-art infrastructure and a unique Sectors Targeted technology-oriented community, DIC is Software, Internet & multimedia, firmly established as the most lucrative telecommunication & networks and allied platform in the region for ICT companies services. with regional and global perspectives. • DIC is home to companies specialized Legal Forms Licensed in software, Internet & multimedia, • Free Zone Limited Liability Company telecommunication & networks and allied • A Branch of a Foreign Company services. • A Freelance Permit • As a Free Zone, DIC offers 100% tax-free ownership, 100% repatriation of capital Key Clients and profits, no currency restrictions, easy registration and licensing, and solid Microsoft, IBM, Google, Yahoo!, Oracle, Cisco, intellectual property protection. HP, Canon, Dell, Nokia, MasterCard, AT&T and • DIC’s modern facilities, state-of-the- Sony Ericsson art infrastructure and ICT value chain Facilities and Services Offered Available Business Premises advantages have attracted global giants • Licensing, Registration, Immigration, • Commercial Offices building and fit out permits are offered as a Chairman • Opportunities for business interaction and • Business Centre Offices Sheikh Ahmed bin Saeed Al Maktoom networking, opportunities for channel one-stop-shop facility and market development • communications infrastructure based on • DIC is also the Winner of the “Best Free next-generation technologies Senior Management Zone in the Middle East” by Financial • Digital voice and high-speed data services Times in 2007 and 2009. offered at competitive rates CEO: Abdullatif Al Mulla Contact Details • Conveniences such as restaurants, banks, Managing Director: Malek Sultan Al Malek supermarkets, travel agencies, beauty and Business Development Department fitness centers Dubai Internet City is about 25 kilometers • courier services, 24- hour security, prayer south of city, on Sheikh areas, WIFI access, Conference and meeting Zayed Road between Dubai and Abu Dhabi. room facilities It is located adjacent to Dubai Marina. • Facilities management services, events Tel: +971 4 391 1111 venues and promotional areas for Fax: +971 4 391 3991 advertisement (kiosks, roll ups, bus shelters, Email: [email protected] outdoor branding banners, lake branding). Website: www.dubaiinternetcity.com

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Dubai Outsource Zone (DOZ) WHY DOZ ? Year of Establishment • The first Free Zone in the world dedicated to the outsourcing industry 2004 • Ideally located to benefit from the growing Licensing Authority market demands of the outsourcing Dubai Technology and Media Free Zone industry Authority • DOZ provides a comprehensive purpose built infrastructure to both captive and Sectors Targeted non-captive companies looking to set Business Process Outsourcing (BPO) services up in the region, control costs and gain like customer contact centre support, efficiently by leveraging the talents, accounting and billing, sales and business technology and expertise in the UAE. development, human resources, payroll • DOZ offers 100% tax-free ownership, processing to Knowledge Process Outsourcing 100% repatriation of capital and profits, (KPO) like research & development, science and technology, engineering as well as Legal no currency restrictions, easy registration Process Outsourcing (LPO). and licensing, and solid intellectual property protection. Legal Forms Licensed • Companies set up in DOZ enjoy an • Free Zone Limited Liability Company environment that attracts different • A Branch of a Foreign Company elements of the value chain from Banking and Finance, Insurance, IT, Legal to Airlines • A Freelance Permit and Hospitality. Key Clients Nokia Siemens Networks, Emirates Airlines, AXA Insurance, Du, Mashreq Bank, Arab Bank, First Data, Cupola, Larsen & Toubro Infotech Ltd, Al Futtaim, Willis, and Jumeirah Group Facilities and Services Offered Incorporation Fees Chairman • Licensing, Registration, Immigration, Registration fee: AED 3,500 for FZ-LLC/ CEO: Abdullatif Al Mulla building and fit out permits are offered as a branch; not applicable for freelancer one-stop-shop facility License fee: Average AED 15,000 for FZ-LLC/ Contact Details • DOZ retail outlets provide the business branch, AED 10,500 for freelancer support services a business needs to cater Senior Management Business Development Department to daily requirements of dining services, Available Business Premises Managing Director: Malek Sultan Al Malek Dubai Academic City Road, Dubai banking, courier service Commercial Offices Tel: +971 4 367 6666 • DOZ provides residential units for workers in Open Land Fax: +971 4 367 0400 the Business Parks Email: [email protected] • Parking facility to accommodate over 1000 Website: www.doz.ae cars conveniently located at the zone

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Dubai Media City (DMC) WHY DMC ? Year of Establishment • The largest regional media hub that provides advanced commercial 2001 infrastructure and supportive business Licensing Authority environment for companies to operate globally out of Dubai Dubai Technology and Media Free Zone Authority • A thriving media community comprising leading international and regional Sectors Targeted companies and hundreds of freelance Advertising & Communication, Media & media professionals Marketing Services, Media Support Services, • In 2010, DMC was recognized for the Event Management, Event Support Services, ‘Best FDI Promotion Strategy’ in FDI’s – Media Consultancy, New Media, Business Global Free Zones of the Future 2010/11 Information, Freelancers, Association (Non (FT Business) ranking. DMC also includes a Profit) Business Centre to promote SME, talent & Legal Forms Licensed entrepreneurship in the region. • Free Zone Limited Liability Company • A Branch of a Foreign Company • A Freelance Permit Incorporation Fees Registration fee: AED 3,500 for FZ-LLC/branch; not applicable for freelancer Facilities and Services Offered License fee: Average AED 15,000 for FZ-LLC/ • Shooting location management services • Courier services, 24- hour security, prayer branch, AED 10,500 for freelancer • Accelerated approvals for publishing and areas, WIFI access, Conference and meeting Key Clients distribution of publications room facilities • Facilities management services, events CNN, BBC, MBC, Al-Arabia, Showtime, Contact Details • Licensing, Registration, Immigration, venues and promotional areas for and CNBC Arabiya, Thomson building and fit out permits are offered as a Business Development Department advertisement (kiosks, roll ups, bus shelters, Reuters, Lowe, Associated Press one-stop-shop facility Al Sufooh Road, Dubai outdoor branding banners, lake branding). • Communications infrastructure based on Senior Management Dubai Media City is about 25 kilometers next-generation technologies south of downtown Dubai City, on Sheikh Available Business Premises • Digital voice and high-speed data services CEO: Abdullatif Al Mulla Zayed Road between Dubai and Abu Dhabi. offered at competitive rates • Business Centre Offices `Managing Director: Muhammad Abdulla It is located adjacent to Dubai Marina. • Loft Offices Tel: +971 4 3914555 / • Conveniences such as restaurants, banks, supermarkets, travel agencies, beauty and • Commercial Offices Fax: +971 4 391461 fitness centers • Boutique Villas Email: [email protected] Website: www.dubaimediacity.ae

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Dubai Studio City (DSC) WHY DSC ? Year of Establishment • DSC fosters the growth of the television, film and music sectors in the MENA region. 2005 • DSC offers world-class industry Licensing Authority infrastructure to meet the needs of Dubai Technology and Media Free Zone companies offering services in production, Authority sound stages - TV and film, back lots and sets, water tanks, recording studios, Sectors Targeted production offices, ancillary services like Broadcasting TV, Broadcasting Radio, green room facilities, catering facilities, Broadcast Support Services, Broadcast Service modeling and casting agencies, post Providers, Animation, Film Support Services, production facilities, labs and telecine, Production (Film/TV and Radio), Production printing facilities, online and offline Support Services, Music and Entertainment. editing suites, animation and SFX studios, specialised sound studios, set construction Facilities and Services Offered Legal Forms Licensed workshops, stunt shops and Warehouses. • Services in production • Free Zone Limited Liability Company • Through the department of Location • Sound stages - TV and film • A Branch of a Foreign Company Approval Services (LAS), DSC also provides • Back lots and sets • A Freelance Permit a single window service for obtaining • Water tanks filming/shooting permits in Dubai. • Recording studios Incorporation Fees • Production offices Registration fee: AED 3,500 for FZ-LLC/branch; • Ancillary services like green room facilities, not applicable for freelancer catering facilities, modeling and casting agencies License fee: Average AED 25,000 for TV or • Post production facilities Radio Broadcasting, AED 40 for TV network or Radio Network, other activities AED 15,000 • Labs and telecine • Printing facilities Key Clients • Online and offline editing suites MBC, Endemol, NBC Universal and Spacetoo • Animation and SFX studios Chairman • Specialised sound studios Contact Details • Set construction workshops CEO: Abdullatif Al Mulla Department of Location Approval Services • Stunt shops and Warehouses (LAS) Senior Management Al Qudra Road, Dubai Land, Dubai Available Business Premises `Managing Director: Jamal Al Shareef Tel: +971 4 3914664 • Business Centre Offices Fax: +971 4 3909905 • Loft Offices Email: [email protected] • Commercial Offices Website: www.dubaistudiocity.ae • Boutique Villas

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International Media Production Zone WHY (IMPZ) IMPZ ? • An unparalleled, eco-friendly and flexible production and service environment in Year of Establishment Dubai meeting the needs of the printing 2003 and publishing industry in the world Licensing Authority • The growth in the media production sector particularly in the printing and Dubai Technology and Media Free Zone publishing segments Authority • The world’s largest Media Production Sectors Targeted Zone Printing Machinery and Printing Consumable • Diverse industrial, commercial and Manufacturing, Printing Press, Packaging residential community projects with eco Machinery and Consumable Manufacturing, friendly policies Publishing, Graphic Arts Support Services, • IMPZ provides a pro-business work Support Services, Storage and Design. ambient, sophisticated technology and state-of-the-art community infrastructure Legal Forms Licensed to support and foster the growth of • Free Zone Limited Liability Company media production focusing on the Graphic • A Branch of a Foreign Company Art, Printing, Publishing and Packaging • A Freelance Permit sectors.

Incorporation Fees • Registration fee: AED 3,500 for FZ-LLC/ branch; not applicable for freelancer • License fee: Average AED 15,000 for FZ-LLC/ Facilities and Services Offered branch, AED 10,500 for freelance • Custom built warehouse facilities that can • Conveniences such as restaurants, banks, Key Clients house publishing and graphic production supermarkets, travel agencies, beauty and offices courier services, 24- hour security, prayer ITP, Xerox and McGraw Hill Contact Details • In-house customs offices to facilitate logistics areas, WIFI access, Conference and meeting handling room facilities Chairman Business Development Department • Centrally located plots for building, printing • Facilities management services, events CEO: Abdullatif Al Mulla Emirates Road, Dubai and packaging facilities venues and promotional areas for IMPZ is located 30 kilometres from Dubai advertisement (kiosks, roll ups, bus shelters, International Airport and 25 kilometres • Licensing, Registration, Immigration, Senior Management outdoor branding banners, lake branding). from Jebel Ali Port building and fit out permits are offered as a `Managing Director: Muhammad Abdulla one-stop-shop facility Tel: +971 4 3613501 Available Business Premises Fax: +971 4 3918067 • Communications infrastructure based on • Offices Email: [email protected] next-generation technologies • Business Center Offices Website: www.impz.ae • Digital voice and high-speed data services offered at competitive rates

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Dubai Knowledge Village (DKV) WHY Year of Establishment DKV ? • DKV is the world’s only Free Zone 2003 area dedicated to Human Resource Licensing Authority Management and learning excellence. Dubai Technology and Media Free Zone • DKV is a unique hub that offers the Authority best selection of Human Resource Management, Consultancy, Training and Sectors Targeted Personal Develoment programs on a picturesque 1km long campus in the heart HR Development, Executive Search, Content Development, Assessment and Testing, of Dubai. Linguistics, Research & Development, • A trusted business partner (450 business Academic Service Provider, Human Resources partners) and a centre of excellence for Consultancy, Freelancers Professional professional development Associations (non-profit) • With the aim of developing the region’s Legal Forms of Business talent pool and establish the UAE as a knowledge-based economy, DKV is Entities Licensed offering competitive incorporation • Free Zone Limited Liability Company procedures. • A Branch of a Foreign Company • A Freelance Permit • Non-profit Association Key Clients Facilities and Services Offered • DKV offers a state-of-the-art campus with • Courier services, 24- hour security, prayer Gallup, Towers Watson, Hays, Hewitt and fully-equipped conference halls, classroom, areas, WIFI access, Conference and meeting Innovative HR Solution computer laboratories and meeting rooms. room facilities • A variety of facilities including a food court, • Facilities management services, events venues Chairman coffee shops, restaurants, supermarkets and and promotional areas for advertisement CEO: Abdullatif Al Mulla other retail services are also available on site. Contact Details Incorporation Fees Business Development Department . • Licensing, Registration, Immigration, Senior Management building and fit out permits are offered as a • Registration fee: AED 3,500 for FZ-LLC Al Sufooh Road, Dubai, Dubai Media City `Managing Director: Ayoub Kazim one-stop-shop facility is about 25 kilometers south of downtown / branch; not applicable for freelancer Director of Business Development: Leigh Ann Dubai City, on Sheikh Zayed Road between • Communications infrastructure based on • License fee: Average AED 15,000 for FZ-LLC Jones-Khosla Dubai and Abu Dhabi. It is located next-generation technologies adjacent to Dubai Marina. / branch, AED 7,500 for freelancer • Digital voice and high-speed data services Tel: +971 4 3901111 offered at competitive rates Fax: +971 4 3901110 Available Business Premises • Conveniences such as restaurants, banks, Email: [email protected] • Offices supermarkets, travel agencies, beauty and Website: www.kv.ae fitness centers • Business Center Offices

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Dubai International Academic City (DIAC) WHY Year of Establishment DIAC ? • DIAC is the world’s only Free Zone dedicated 2007 to Higher Education, aiming to develop the Licensing Authority region’s talent pool and establishing the UAE as a knowledge-based economy. Dubai Technology and Media Free Zone Authority • An established higher education cluster with 27 Academic institutions including Sectors Targeted world-renowned universities Higher Education Providers, Academic Service • DIAC currently hosts over 18,000 students Providers, Online Universities, Education from more than 100 nationalities. Students Services Providers, Non-Academic Support have access to over 300 Higher Education Services, Freelancers programs, including Undergraduate and Post Graduate programs, from fields such Legal Forms Licensed as Engineering, IT, Media, Business, Fashion • Free Zone Limited Liability Company Design, Healthcare, Mass Communications, Media and many more. • A Branch of a Foreign Company • Centralized campus management and • A Freelance Permit partner relation approach: DIAC offers its Key Clients partner institutions a centralized way to Facilities and Services Offered manage the campus facilities and provides • Located on an 18 million sq ft. campus with • Special student visa scheme built-in for Michigan State University, University of a dedicated department for student modern facilities universities to sponsor their students while Wollongong, Hult International Business enrolled School, Heriott Watt University, Murdoch services and programs that enables multi- • Licensing, Registration, Immigration, University and the University of Bradford, institutional activities and programs, building and fit out permits are offered as a • Shared classrooms, computer laboratories Cambridge University, SAE Institute and assists in finding the right academic one-stop-shop facility and event halls for multi-purpose use. programs, interships and careers. Registration fee: AED 3,500 for FZ-LLC / • Communications infrastructure based on branch; not applicable for freelancer • DIAC is committed to developing a next-generation technologies Available Business Premises Land for lease License fee: AED 100,000 for Higher Education sustainable, environmentally responsible • Digital voice and high-speed data services Provider or Branch university, AED 50,000 for campus. Recently DIAC Phase III achieved offered at competitive rates Offices / campus / Business Center Offices Post Graduate Providers only, AED 7,500 for a “Green” status and was awarded Silver • Conveniences such as restaurants, banks, freelancers LEED certification. supermarkets, travel agencies, beauty and fitness centers Contact Details Chairman • Courier services, 24- hour security, prayer Business Development Department CEO: Abdullatif Al Mulla areas, WIFI access, Conference and meeting room facilities Al Ruwayyah / Ruwaya off the Dubai Al Ain Road Senior Management • Facilities management services, events Tel: +971 4 3602060 `Managing Director: Ayoub Kazim venues and promotional areas for advertisement (kiosks, roll ups, bus shelters, Fax: +971 4 3604886 Director of Business Development: Leigh Ann outdoor branding banners, lake branding). Jones-Khosla Email: [email protected] • Dedicated department for student services Website: www.diacedu.ae and programs.

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Dubai Biotechnology and Research Park WHY (DuBiotech) DuBiotech ? • Proximity to customers and suppliers – Year of Establishment DuBiotech is geographically sited close 2005 to the Middle East, Central Asia, Africa, the Asian Subcontinent and the Eastern Licensing Authority Mediterranean. These regions have a population of over 2 billion people and a Dubai Technology and Media Free Zone combined GDP of around US$ 7 trillion. Authority Facilities and Services Offered • Strong regulatory frame work • The park enjoys a strategic location with • Cluster specific infrastructure suiting the Sectors Targeted • Excellent networking opportunities in the a world-class infrastructure and offers needs of the biotech industry cluster services for business centers, regional Therapeutics, Food, Agricultural, Forestry, headquarters, Research & Development • Ability to participate in regional and global Horticulture, Environment, Medical/Scientific • Sustainable and favorable business (R&D) laboratories, biotech-related industry and business development events Devices or Equipment, Specialty Supplies, environment educational and research institutions, along with other partners from the cluster Diagnostics and Analysis, Life Science Services, • Worldwide recognition of the cluster light manufacturers, logistic operators and • Business friendly environment Life Science Associations (non-profit) • One-stop shop services including licensing other service providers. • Licensing, Registration, Immigration, Legal Forms Licensed and visas • DuBiotech is the ultimate business park building and fit out permits are offered as a • Commercial, residential, educational and for life science companies to set up Middle one-stop-shop facility • Free Zone Limited Liability Company recreational facilities East operations, offering a wide range of • Communications infrastructure based on products ranging from office, laboratory, • A Branch of a Foreign Company • Special facilities tailored for the Life next-generation technologies pre-built to land plot for sales and Sciences industry to support the rigorous • Digital voice and high-speed data services marketing, distribution, manufacturing, Incorporation Fees requirements of research and development, offered at competitive rates after-sales services and R&D operations. Registration fee: AED 3,500 for FZ-LLC/branch; manufacturing, distribution and high • Conveniences such as restaurants, banks, • The cluster has provisions for hotels, retail not applicable for freelancer added value services supermarkets, travel agencies, beauty and facilities, a hospital, schools, safety and License fee: Average AED 15,000 for FZ-LLC/ • All DuBiotech buildings are classified fitness centers security measures, and residential facilities branch, AED 10,500 for freelancer as LEED certified ‘green’ buildings. This to ensure a convenient quality lifestyle • Courier services, 24- hour security, prayer extends to the laboratory complexes, within the park. areas, WIFI access, Conference and meeting Key Clients warehousing facilities and community room facilities services buildings. The BIO headquarter Pfizer, Amgen, Maquet, National Reference • Facilities management services, events Towers, once completed, are expected Lab and Firmenich venues and promotional areas for to be one of the world’s largest ‘green’ advertisement (kiosks, roll ups, bus shelters, buildings. Contact Details Chairman Business Development Department, outdoor branding banners). • Business-friendly company laws and legal CEO: Abdullatif Al Mulla between Al Khail and Emirates Road • Shared laboratories and research area framework highways in Dubai It is just 10 minutes Senior Management • One-stop–shop services that provides from Dubai International Airport and 60 .Available Business Premises business partners with a variety of minutes from Abu Dhabi, the capital of the CEO: Abdullatif Al Mulla Warehouses for light manufacturing, logistics, government services , including licensing, UAE Executive Director: Dr. Marco Baccanti visa, traffic and postal services and showrooms Nucleotide Complex: Core Tel: +971 4 3902222 and shell commercial office and laboratory Managing Director: Murwan Abdulazeez • 24-hour visa service Fax: +971 4 3908444 space Business Centre: Fully fitted-out, plug • Quick access to Knowledge Workers due to Email: [email protected] & play commercial offices fast-track immigration process Website: www.dubiotech.com Land for lease or for sale

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The Energy and Environment Park WHY (ENPARK) ENPARK ? • ENPARK provides a comprehensive support Year of Establishment system to ensure the success of its Business 2007 Partners. • ENPARK provides an enabling platform for Licensing Authority sustainable business operations through Dubai Technology and Media Free Zone the integration of eco-friendly policies, Authority standards, education programs and technologies, combining environmental, Sectors Targeted social and economic elements to reflect Facilities and Services Offered Dubai’s benchmark forz sustainable • Licensing, Registration, Immigration, Renewable Energy, Energy Generation, • Quick access to Knowledge Workers due to development. building and fit out permits are offered as a Energy Storage, Energy Transmission and fast-track immigration process • Proximity to customers and suppliers – one-stop-shop facility Distribution, Energy Efficiency Equipment, Air • The park enjoys a strategic location with ENPARK is geographically sited close to a world-class infrastructure and offers • Communications infrastructure based on and Environment, Water and Waste Water, the Middle East, Central Asia, Africa, services for business centers, regional next-generation technologies Recycling and Solid Waste, Transportation, the Asian Subcontinent and the Eastern headquarters, Research & Development Green Building, Organic Products, General Mediterranean. These regions have a • Digital voice and high-speed data services (R&D) laboratories, biotech-related Consultancy, Regional Headquarters population of over 2 billion people and a offered at competitive rates educational and research institutions, combined GDP of around US$ 7 trillion. • Conveniences such as restaurants, banks, light manufacturers, logistic operators and Legal Forms Licensed supermarkets, travel agencies, beauty and • Strong regulatory frame work other service providers. • Free Zone Limited Liability Company fitness centers • Excellent networking opportunities in the • ENPARK is the ultimate business park for • A Branch of a Foreign Company cluster life science companies to set up Middle • Courier services, 24- hour security, prayer areas, WIFI access, Conference and meeting • A Freelance Permit • Sustainable and favorable business East operations, offering a wide range of environment products ranging from office, laboratory, room facilities • Association • Worldwide recognition of the cluster pre-built to land plot for sales and • Facilities management services, events marketing, distribution, manufacturing, venues and promotional areas for Key Clients • One-stop shop services including licensing after-sales services and R&D operations. advertisement (kiosks, roll ups, bus shelters, and visas Veolia, Averda, PTL Solar and Etap Lighting • The cluster has provisions for hotels, retail outdoor branding banners). • Commercial, residential, educational and facilities, a hospital, schools, safety and Chairman recreational facilities security measures, and residential facilities Incorporation Fees CEO: Abdullatif Al Mulla • Special facilities tailored for the Life to ensure a convenient quality lifestyle Registration fee: AED 3,500 for FZ-LLC / branch; Sciences industry to support the rigorous within the park. not applicable for freelancer requirements of research and development, Senior Management License fee: Average AED 15,000 for FZ-LLC / manufacturing, distribution and high Managing Director: Murwan Abdulazeez branch, AED 10,500 for freelancer added value services Contact Details Commercial Dept.: Mr. Ismail Al Hammadi • Business-friendly company laws and legal AED 25,000 for all manufacturing activities Investor Relations Investor Relations: Mana Al Zarooni framework Business Bay Area, Dubai .Available Business Premises • One-stop–shop services that provides business partners with a variety of Tel: +971 4 3613512 • Warehouse government services , including licensing, Fax: +971 4 4447205 • Neucleotide Laboratory Complex visa, traffic and postal services Email: [email protected] • Business Center Offices • 24-hour visa service Website: www.enpark.ae • Land for sale or lease

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Dubai HealthCare City (DHCC) WHY Year of Establishment DHCC ? • The world’s first healthcare free zone that is 2002 a home of two hospitals, over 90 outpatient clinics and diagnostic laboratories with Licensing Authority over 2,000 medical professionals Dubai Healthcare City FZ LLC • Low operating costs Sectors Targeted • State of the art facilities • Flexible real estate design to suit the Conventional Medical Services, industry Complementary and Alternative Medicine, Medical Education and Research, Healthcare • Integrated healthcare community providing specialized first-class medical care Commercial Services, Hospitals, Diagnostic Laboratories, Support Services • Access to network of regional healthcare professionals Legal Forms Licensed • Attractive investment opportunity and • Branch of a Foreign Company financial return • Increased brand exposure • Branch of a UAE Company / Establishment • Hassle-free company registration and legal • Free Zone Limited Liability Company (FZ LLC) framework Key Clients • Fast track immigration process • Flexible real estate to suit different business American Academy of Cosmetic Surgery needs Hospital, The City Hospital, Dubai Bone & Joint Center, German Medical Center, London • Specialized health care facility management Facilities and Services Offered Centre for Aesthetic Surgery, Magrabi providers • On-site, one stop shop for government • Strong regulatory framework to maintain Eye Hospital, Moorfields Eye Hospital • In-house, fast-track staff registration services (such as visas and permits) Dubai, Nicolas and Asp University College, facilities Dubai Healthcare City’s reputation for quality and safety AstraZeneca, Novartis, Novo Nordisk, Sanofi • World-class quality control for health • Assistance with clinical services planning and Aventis, and Wyeth Pharmaceuticals – Pfizer, services assuring top international design • Relationship manager to assist with any post- Dr. Sulaiman Al Habib Medical Center standards • Integrated community with on-site facilities setup relations such as restaurants, banking and mini- Chairman market Incorporation Fees HRH Princess Haya Bint Al Hussein • Parking facilities Application fee: AED 3,100 • As a professional community, Dubai Registration fee: AED 3,510 Senior Management Contact Details Healthcare City also offers many value-added Commercial License: AED 15,010 Managing Director: Dr. Ayesha Abdullah Business Development Department services including access to a wide network of healthcare professionals, networking and Executive Director: Oud Metha Road, Bur Dubai, Dubai Available Business Premises knowledge sharing events to encourage Dr. Abdulkareem Sultan Al Olama • Core and Shell Telephone: +971 (04) 324 5555 patient referrals Fax: +971 4 362 4775 • Average unit size: 1,500 feet2. • Special interest seminars to promote Email: [email protected] professional standards and business growth • Average annual rent: AED 150 AED/feet2 Website: www.dhcc.ae • Land for lease and sale

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International Humanitarian City WHY (IHC) IHC ? • IHC enables humanitarian organizations Year of Establishment through its global reach, infrastructure and 2007 custom designed services to facilitate aid and development efforts across the globe Licensing Authority • IHC provides nonprofit organizations, International Humanitarian City Authority companies, donors, volunteers, governments and those striving to save lives Sectors Targeted with a common ground for collaboration. • IHC offers commercial companies Aid distribution and storage by the the opportunity to operate from a international aid organizations and highly strategic location in a free zone community environment that is adapted to their particular industry, while benefiting from Legal Forms Licensed attractive incentives and an array of value- • Branches of international nonprofit added services organizations and commercial companies/ • Exemption from tax and custom duties from subsidiaries imported and re-exported aid equipment • Free Zone Establishment and supplies • Free Zone Company • A community of local and international humanitarian nonprofits and commercial Incorporation Fees suppliers Registration Fee – AED 5,000 • A fully integrated one-stop-shop, with access to procurers, suppliers and business License Fee – AED 8,000 (service license), AED partners and fast multi-modal logistics Facilities and Services Offered Available Business Premises 5,500 (trading license) capabilities • Customized warehousing solutions Commercial Offices • Increased visibility and networking • Facilities Management: Maintenance, Warehouses Key Clients opportunities security and leasing ACTED, Aga Khan Planning and Construction • A platform for humanitarian information • Conference and meeting facilities Management, Al Basar International and knowledge exchange Foundation, Al-Muntada Al-Islami, All As • Government Services • A socially responsible operating One, Automotive Management Services FZE, • Press Office: Publication of IHC members’ environment Bukkehave Global Spareparts (BGS) FZE, Child latest news on the IHC website • Facilitated access to job seekers, volunteers Foundation, Children’s Hope Foundation • IH Media watch: Online news monitoring and CSR endeavors services, including daily e-mail alerts Contact Details Sales Department Chairman • Recruitment e-Portal: Access to online CV HRH Princess Haya Bint Al Hussein Database and posting Job Openings Oud Metha Road- Dubai- UAE • Volunteer e-Portal: Access to online Telephone: +971 4 3680202 Senior Management Volunteer Database and posting Volunteer Fax: +971 4 3681099 CEO: Ms. Shaima Al Zarooni Appeals Email: [email protected] • Pro Bono e-Portal: Access to online Pro Bono Website: www.ihc.ae Database

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hroughout the history, the people of visited Sharjah, an 8% increase on 2009 TSharjah depended on fishing, pearl performance, according to data issued by the diving and trading as main sources of incomes. Sharjah Commerce and Tourism Development These three economic activities were supported Authority (SCTDA). In 2009, tourism sector by its busy port that has always played a vital contributed around 11% of the GDP which is role connecting the trading routs between considered relatively high. the East, particularly India, and the west. As a Sharjah also is a manufacturing hub, result, it has become one of the most important responsible for 12% of the UAE’s total ports on the lower Arabian Gulf since the industrial production. In 2009, 19.5% of its nineteenth century, turning Sharjah to be one GDP came from the manufacturing industry. of the most important modern commercial To further boost its position in this vital sector, and trading centers not only in the UAE but the government has been executing plans also in the region. The wise leadership has also to expand its industrial base by attracting boosted the emirate’s economic performance FDIs, granting them more privileges and by adopting a diversified economic strategy constructing purposely-built industrial zones while sustaining and maintaining its cultural equipped by advanced facilities and support heritage. Today, the key economic sectors services. Due to these factors, Sharjah-based in the emirate are tourism, manufacturing, international manufacturers have already trading, energy and real estate. shown a growth in their performance. Sharjah The tourism sector started its official take- Economic Development Department recorded off in the emirate’s economic map when the a 7.1% increase in the number of new and first Airport was built in Sharjah in 1932. In renewed business licenses in 2010 compared to addition, the natural and geographical diversity the previous year. Among the overall increase has given Sharjah an additional advantage in new licenses, which saw growth of 18.4% to develop its tourism sector. Sharjah City, there was solid rise in the number of industrial the capital, overlooks the Arabian Gulf. The permits issued, up from the 78 of 2009 to 97 central region of the emirate combines lush in 2010. green oases, gravel plains and rolling red Sharjah is also home to 5% of the UAE’s sand dunes. To the east the emirate reaches gas reserves, which are located offshore the Gulf of Oman coast where the landscape and in the interior desert area. Moreover, it changes to a spectacular rocky coastline enjoys a steady real estate market. All these backed by mountains. Furthermore, Sharjah growing sectors make Sharjah the third largest is prominent throughout the Arab world for contributor to the national GDP. In 2009, its its commitment to art, culture and heritage. GDP reached USD 16.59 billion, 6.1% of the It was named the Capital of Islamic Culture country’s total GDP, recorded annual growth for 2014 in recognition of its contribution to rate of 11% over the last seven years. preserving and promoting Arab culture. In line with supporting foreign investments, These entire factors along with the Sharjah Airport International Free Zone government’s promoting campaigns that (SAIF - Zone) and Hamriyah Free Zone were target global fairs and trade events indicate established, offering a range of competitive the potential growth of the tourism sector. incentives in highly sophisticated business In 2010, more than 1.55 million tourists centers.

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Sharjah Free Zones

Sharjah Airport WHY International Free SAIF Zone ? Zone • SAIFZ is built adjacent to the Sharjah International Airport, a key hu b for logistics Year of Establishment and air cargo in the region 1995 • Easily accessible to seaports on the Indian Ocean (Port Khor Fakkan) and the Gulf (Port Licensing Authority Khalid) Sharjah Airport International Free Zone • One of the oldest and largest Free Zone in the Authority UAE in terms of number of companies, housing more than 4,530 companies Sectors Targeted • SAIF-Zone offers its patrons extremely Trading, Manufacturing, Services and Aviation attractive incentives such as modern premises, equipped with the latest facilities and a secure Legal Forms Licensed environment that ensures maximum returns for the investor. • Free Zone Establishment • Flexible short and long lease options for offices • Free Zone Company and warehouses • A Branch of a Foreign Company • Licenses issued within 24 hours Incorporation Fees • Sponsorship and visas for all staff • Simplified procedures and competitive Registration fee – AED 10,000 (FZE and FZCO), structure of fee, property and management AED 5,000 (A Branch) • A strategic location in the Emirate of Sharjah, License Fee – AED 7,500 (Trade, Industrial and an emirate that centers its economic plans Commercial), AED 15,000 (General Trading) around the development of the industrial Facilities and Services Offered Available Business Premises Aviation License – AED 15,000 sector • Temporary Storage Area • Offices Freight Forwarding – AED 8,500 • SAIF-Zone is the symbol of efficient operations, • Container Parking Area • Executive Desk: AED 15,000 the better alternative for business ventures in • 24 hour hotline for equipment and provision • Executive Offices: AED 34.500 Key Clients the UAE and beyond of labor • Land on Lease Air Arabia, Sky Plan FZC, KMart Gulf, Asia • Bunkers • Warehouse Today LTD, Zee Telefilms Int’l LTD, Aramex • One site Labor Accommodation Chairman • Back up services provided by the Sharjah Chamber of Commerce and Industry and the H.E. Sheikh Abdulla bin Mohammed Al Thani Sharjah Expo Contact Details Director General: Taryam Matar Taryam Market and Sales Department • Post Office, Pharmacy, SAIF-Zone Medical Clinic (FZC), Municipality Clinic, Travel Sharjah Airport, Sharjah City Agencies Telephone: +9716 5570000 • Licenses issued within 24 hours Fax: +9716 5571010 / +9716 5571131 • Sponsorship and visas for all staff Email: [email protected] Website: www.saif-zone.com

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Hamriyah Free Zone Year of Establishment WHY 1995 Hamriyah Free Zone ? • The 2nd oldest and 2nd largest Free Zone in Licensing Authority the UAE in terms of number of companies, Hamriyah Free Zone Authority housing more than 5000 companies from more than 150 countries Sectors Targeted • An integrated seaport that is capable of Trading, Manufacturing, Logistics across handling petrochemical exports and cargo wide industry sectors with special focus on containers seven strategic clusters comprising of oil and • Proximity to control labor accommodation gas,petrochemical,steel, construction, timber, facilities maritime, and perfume • Access to UAE and GCC markets Legal Forms Licensed • No red tape or bureaucracy • Branch of a Foreign Company • Branch of a UAE Company / Establishment Available Business Premises • Free Zone Limited Liability Company (FZ-LLC) Office: AED 17,000 – 70,000 Executive Suite office Packages Incorporation Fees Warehouse: AED 65,000 – 110,000 General Trade License: AED 12,00 per year Open Land: AED 30 per square meter Trade License: AED 2,750 per year Commercial/industrial License: AED 3,750 Registration fee: AED 9,000 General Service fee: AED 5,000 Key Clients Unger Steel, Metito, Mamutt, British Petroleum Senior Management Khaled Bin Abdullah Bin Sultan Al Qasimi Director General: Rashid Al Leem Contact Details Sales and Marketing Department Hamriyah, Sharjah Tel: +97155263333 Fax: +9716 5263555 Email: [email protected] Website: www.hfza.ae

Why UAE ? The Unlimited Opportunities 2012 Chapter 5 The United Arab Emirates Seven Pearls and Beyond 294 295 Ajman

he economy of Ajman has mainly Ajman’s vision to become a realty destination Trelied on maritime (shipbuilding and came as a result of the uprising prices of fishing) and trading sectors. The economic properties in the neighboring emirates and its performance of the emirate today does not, central position to the other cities in the UAE. however, rely on these two. Tourism, real Thus, it passed property freehold legislations estate and manufacturing sectors began to in 2004 and commenced the development take larger portions of the emirate’s GDP. of mega multi-purpose projects, calling the In 1977, Ajman Chamber of Commerce and attentions of local residents and international Industry was incorporated to enhance the investors. Since then, the real estate and emirate’s economic position and exploit its construction sectors have been steadily rising, capabilities within different sectors. The leading other sectors as well to flourish in the young visionary leadership has also given emirate. Ajman City now has the third largest the instructions to the competent bodies property market in the UAE. Construction of the government to remove all obstacles and real estate contributed more than 24% hindering business activities, paving the way in the emirate’s GDP in 2009, according to the for realization of remarkable achievements on National Bureau of Statistics. the economic front. As a result of these efforts, Boosted by the growth witnessed in the Ajman’s share in the national GDP increased by multi-purpose built developments such as 200% since 2001, reaching USD 3.78 billion in Ajman Marina and the One, tourists were 2009 (1.4% of total national GDP). The major attracted to come to Ajman. In addition, contributors were manufacturing (39.5%), Ajman Festival has a great role in flourishing construction (14.5%) and real estate (10%). the trade movement and tourism. The diversity Today ranked third among the emirates for of presentations and programs of the festival industrial development, Ajman houses more and its suitable prices for all have led to the than 550 plants and factories with investments attraction of a great number of visitors from value reaching approximately USD 407.62 inside and outside the Emirates. The opening million in 2010. The light industry segment of Ajman’s China Mall in 2010 attracted makes the majority of this growing sector. The foreign investments as well as tourists from establishment of well planned industrial areas around the world. such as Ajman Industrial Area which has been In addition to the growing different sectors provided with all the services and utilities to especially manufacturing and real estate, the accommodate various industrial and business establishment of Ajman Free Zone in adjacent activities, the lucrative rents of real estate and to Ajman seaport which houses the greatest land, and the freehold property laws were ship maintenance workshop has also driven the main grounds that manufacturers choose the Emirate’s economy in recent years. Since to operate from Ajman. It is important to it provides many incentives and advantages, mention that Ajman has the biggest group of more than 3000 companies are now operating textile industries in the UAE. from the free zone.

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Ajman Free Zone

Ajman Free Zone WHY Year of Establishment Ajman Free Zone ? 1998 • The only downtown Free Zone that is strategically located in the UAE i.e. close to Licensing Authority major commercial cities providing an excellent access to the other Emirates (12 kilometers Ajman Free Zone Authority away from Dubai and 2 kilometer away from Sectors Targeted Sharjah) • The liberal economic climate in Ajman has Trading, Logistics, Services and Manufacturing been specifically designed to welcome foreign business and investment to encourage Legal Forms Licensed production, provide incentive for trade, •Free Zone Establishment develop international commerce, and above all •Free Zone Company promote industrial activity. •A Branch of a Foreign Company • 20 years land contract is renewable for another 20 years guaranteeing 40 years tax free Incorporation Fees operations • 100% Business Ownership License Fee (Annual) – AED 3,900 (Trading), AED 9,100 (Industrial), AED 6500 (Professional) • Competitive pricing on premises • No hidden fees, no hidden charges and cheap Key Clients energy Meridian VAT Reclaim, Abdolasons Trading, • The most economical wage structure and easy Hanifa Motors, Ranco Impex, United Bottling access to vast work force Company • Total exemption from all import and export duties and total elimination of all service Chairman charges and hidden fees Ahmed Bin Humiad Al Nuaimi • Exceptionally low handling charges Senior Management • Lowest lease prices • World class infrastructure Director General: • Single Window Clearances (Licensing, Mahmoud Khalil Al Hashemi Facilities and Services Offered Available Business Premises Immigration) Head of Investor Relations: • Business Facilities (Conference Room and • Electronic Office Centre – AED 18,000 Business meeting rooms) annually Obaid Al Matrooshi Contact Details • 24 hours Security Services • Executive Offices – AED 25,000 annually Investor Relations Department • Bank services • Warehouses – AED 300 per square meter Rashid Bin Saeed Al Maktoum Street, annually Ajman, Opposite to Ajman Port, • Postal services • Open Lands – AED 20 per square meter Al Bustan, Ajman • Access to Ajman Port Facilities annually Telephone: +971 6 7011555 • Smart Office – AED 14,800 annually Fax: +971 6 7429222 Email: [email protected]

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imilar to the other emirates that are focusing to strongly facilitate businesses Slocated on the coast of the Arabian Gulf, through e-services and granting privileges, Umm Al Quwain, one of the smallest emirates thus attracting local and foreign investments. in the UAE, has always relied on agriculture, Umm Al Quwain through its Strategy livestock and fishing as the key sources of 2011-2013 specifies real estate and tourism as earnings since the ancient times. This sector is economic directions of the emirate. Future still vital, contributing about 10% of its GDP economic growth, as indicated by the Strategy, yearly. However, the accumulated expansion is based on the development of antiquities of the national economy has significantly and heritage, infrastructure, and public sector. contributed to the rise of other sectors not Developing multi-use projects like Al Salam only in Umm Al Quwain but also in all emirates. City and Umm Al Quwain Marina are drawing The real estate, construction, manufacturing more FDIs and tourists traffic. and tourism sectors were the main sectors The rich historical and natural heritage of that started to appear more on the economic the emirate that includes plenty of monuments, sphere of Umm Al Quwain. natural reserves and islands are also capable of Despite its tiny area and lack of oil and gas improving the tourism development. Besides reserves, Umm Al Qaiwain contributed USD 63 preserving the natural and cultural heritage, million to the national GDP in 2009, entirely the government of Umm Al Quwain initiated depending on the non oil sectors. The main many tourism developments such as the economic contributors are real estate and Dreamland Aqua Park, the largest Aqua Park business services sector with 19.4%, transport, in the UAE, and supported touristic activities communication and storage (12.53%), trading such as sky diving. These initiatives have played (11.24%) manufacturing industries (8.99%) a role in terms of attracting tourists not only and government services sector (17.72%). from the UAE but also from the region. Today, a In 2009, the manufacturing sector UAE visitor does not leave the country without contributed USD 77.83 million to the emirate’s paying Umm Al Quwain a visit. GDP. The cement, light petrochemicals Although the traditional occupations of products like rubber and plastics and fishing and date cultivation are still important aluminum industries are making the largest in Umm Al Quwain, a mariculture research portions of this steadily growing sector, a 44% centre, port and economic free zone have increase since 2001. boosted investment and business in the According to the latest data released by emirate. Umm Al Quwain was among the the economic department of Umm Al Quwain, first emirates that established a free zone, the number of business licenses increased by realizing the important role of free zone on 84% in 2008 comparing to 2007 due to the the development of the local economy. In economic and population growth the emirate 1989, Ahmed bin Rashid Free Zone launched has experienced. Using its strategic location in adjacent to the active port of the emirate, and natural capacities, the emirate has been allowing foreign business ownership.

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Umm Al Quwain Free Zone

Ahmed bin Rashid WHY Free Zone Ahmed bin Rashid Free Zone ? Year of Establishment • Easy connectivity to international markets • 845 meters of quay wall with 400 meters 1989 capable of handling ocean-going vessels, and 118,000 square meters of land reserved for Licensing Authority light Industrial development. It also provides Ahmed Bin Rashid Port and Free Zone a comprehensive administrative and logistic Authority support to the tenant. • A one-stop-shop for all government related Sectors Targeted and procurement related activities Manufacturing and Trading • State of the art communications, infrastructure and networks Legal Forms Licensed • Excellent logistics management and cargo •A Branch of a foreign company handling services •Free Zone Company •Free Zone Establishment Facilities and Services Offered • Standard services of water, electricity, Incorporation Fees communications and labor accommodation License Fee (Annual) – AED 3,900 (Trading), are all available. AED 9,100 (Industrial), AED 6500 (Professional) Key Clients Meridian VAT Reclaim, Abdolasons Trading, Hanifa Motors, Ranco Impex, United Bottling Company Incorporation Fees License Fee - AED 2,000 (Industrial License),AED 5,000(General Trading License), AED 5,000 (Management & Consultancy)

Available Business Premises Contact Details Office Units – USD 6,812 per annum Sales Department Open Land – USD 5.45 per square meter Umm Al Quwain - Adjacent to Ahmed bin Rashid Port Telephone: +971 06 7655882 Fax: +971 06 7651552 Email: [email protected]

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ocated on the coast of Arabian Gulf, at producer in the region, the largest medicine Lthe crossroad of the east and the west, producer in the UAE and one of the largest the emirate of Ras Al Khaimah was among ceramics producers in the world. In order to the first towns that best utilized its strategic best organize and support the industrial sector, location throughout the history. Not only the Al Hamra Industrial Park was established in strategic location that pulled international order to provide state-of-the-art facilities to investors to choose RAK but also its excellent this vital sector. infrastructure, strong government support RAK is planning to increase the contribution towards the private sector, and not to mention of the tourism and real estate sectors. Massive its unmatched natural beauty. Ras Al Khaimah construction projects such as Mangroves Island has become a growth-driven emirate with an and Mina Al Arab are taking place in order to increased focus on manufacturing, services, cope with growing population. By utilizing its real estate, construction and tourism. rich natural capabilities of beautiful beaches An economic diversification strategy and mountains, RAK is aiming to attract was adopted by RAK government, primarily 2.5 million tourists by 2012. To do so, it aims focusing on industry, trade, tourism and to increase the number of its hotels and real estate. International investors were apartments. The tourism sector was boosted attracted by the business-friendly policies by creating a dedicated Tourism Development and its strategic location. Recently, it was Authority in 2011. rated the best investment destination by the The establishment of economic and free FDI Magazine, Financial Times, and London. zones has been a target of the government. Ras Al Khaimah has been witnessing an RAK Free Trade Zone and RAKIA Zone are outstanding economic growth due to its among the most growing zones in the UAE. diversification strategy. In 2009, USD 4.30 RAK FTZ is currently housing more than 5,000 billion was contributed to the national GDP active companies, reaping the advantages and by Ras Al Khaimah. Despite the global crunch, incentives that are offered by the business hub. the financial sector in RAK has shown strong RAKIA free zone has also shown a good growth. returns, indicating the wise management of It licensed about 800 new companies in the its visionary leadership. The main economic first half of 2011, a 31% increase comparing to growing sectors in the emirate include trading the same period of last year. and repair services, mining and quarrying, According to Oxford Business Group, small real estate and business services, agriculture, and medium-sized enterprises (SMEs) have livestock and fishing and manufacturing. been playing a growing role in RAK’s economy, Dominated by three main industries, cement, benefiting from the advantages offered by ceramics and pharmaceuticals, the industrial the emirate and its free zones. About 95% of sector in RAK has been one of the pioneering the registered business entities in RAKIA up to sectors in the UAE. RAK is the largest cement 2010 were SMEs.

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Ras Al Khaimah Free Zones

Ras Al Khaimah Free WHY Trade Zone (RAKFTZ) RAKFTZ ? Year of Establishment • One of the most cost effective free zones in the region that specifically targets small 2000 and medium businesses aiming to seize the Licensing Authority opportunities in MENA, Asia and beyond • A fast and flexible registration process RAK Free Trade Zone Authority allowing businesses to start operations Sectors Targeted with a minimal requirement Services, Industry, Aviation, Technology, • Facilities and virtual offices in different Media and Education emirates (Dubai and Abu Dhabi) allowing smooth and productive business activities Legal Forms Licensed for the Free Trade Zone clients • Free Zone Establishment • Ability to register off-shore companies for • Free Zone Company non-resident entrepreneurs • A branch of a foreign company • An established education, technology and media cluster environment Services and Facilities Available Business Premises Incorporation Fees • More than 5000 SMEs from 106 countries • Affordable value-added services can be • Standard Offices – AED 31,000 per annum License Fee (annual) – AED 3,650 • RAK FTZ provides business and selected either during the initial start- • Executive Offices – AED 26,00 per annum (Commercial), AED 5,000 (Industrial), up phase, or at a later date which include entrepreneurs to enter the Middle East, • Warehouse – AED 200 per square meter per AED-7,500 (Professional), AED 15,000 (General Insurance, Creative Design, Advertising, and with the UAE gateway between annum Trading) Procurement, Event Management, Europe, Asia and Africa, investors have • Temporary Warehouses – AED 2,000 for 15 Registration Fee – AED 7,000 Recruitment and Training direct access to emerging markets. days • a variety of affordable courses in Training Services Fee (annual) – AED 1,200 • Open door economic development policies delivery, Training materials/books, Library, • Land for Development – AED 50 per square that gained the confidence of investors Key Clients University placement services, ICDL, TOEFL meter from across the globe iBT, Microsoft Prometric testing, Event/ • Virtual offices Oranci Steel, Brochot, Micro Cdp, Ramjet, • 100% tax free and 100% foreign ownership Program organization, Venue rental, Rak-German, Dolphin International, Birla Training resource rental and Corporate • Customized investment packages Institute of Technology International Centre needs assessments (BITIC), Western International College– University of Bolton, Royal College of Applied Facilities and Services Offered Science and Technology, and Ras Al Khaimah Contact Details Medical and Health Science University • Offices spaces, warehouses and land required to setup a manufacturing unit Sales Department Senior Management • Issue of visas for investors and staff Al Nakheel Area, Ras Al Khaimah with facilities in Al Hamra Area and virtual Faisal Bin Saqr Al Qasimi • Availability of executive and staff offices in Dubai and Abu Dhabi CEO: Oussama El Omari accommodation Tel: +971 7 2041111, Fax: + 971 7 2077120 Deputy Director General: • Facilitation in obtaining services from utilities such power and water supply, gas, Email: [email protected] Maryam Al Murshedi telephone connections Website: www.rakftz.com • Staff Accommodation

Why UAE ? The Unlimited Opportunities 2012 Chapter 5 The United Arab Emirates Seven Pearls and Beyond 306 307

Rakia Industrial Park WHY Rakia Industrial Park ? Year of Establishment • Ease of setting up a business due to availability of a single window clearance 2005 for all matters relating to establishment Licensing Authority of the company, which includes licensing, office/ land lease and processing of RAKIA Industrial Park investor as well as employee visas. RAK Investment Authority (RAKIA) • Low setup costs due to competitive lease rentals, with industrial land available for Sectors Targeted as low as AED 10/ sqm. Plastics, glass and rubber products • Rapid company formation, with licenses manufacturing, Fabricated metal product manufacturing, Non-metallic mineral as well as office/ land lease agreements product manufacturing, Automobile and processed within 2 working days Auto components, Chemical products, Food • Assured supply of electricity and water: processing RAKIA has installed dedicated power plants in the industrial parks at Al Hamra Legal Forms Licensed and Al Ghail as well as a desalinization • Industrial Licenses plant. • Trading Licenses • Land, air and sea connectivity from RAK to • Commercial Licenses major markets in the UAE and Middle East • Consulting/ Service Licenses • Access to finance from Banks, as RAKIA • Media License has Memoranda of Understanding in place with HSBC and Bank of Baroda, the two Key Clients leading banks in the emirate. Arc International Middle East LLC, Ashok • Developed infrastructure and road Leyland (UAE) LLC, Duscholux Emirates, networks Guardian Glass, JBF RAK LLC, Mahindra • Ease of recruiting manpower Armoured Vehicles FZ LLC, Mitsui Japan, Mabani Steel LLC, Middle East Specialized Cables (MESC) LLC, Becker Industrial Coatings Contact Details Facilities and Services Offered Available Business Premises LLC Business Development Department • Offices spaces, warehouses and land • Commercial Offices required to setup a manufacturing unit. Chairman Opposite Al Hamra Mall, Near Exit 119 on • Desk Space Emirates Road, • Issue of visas for investors and staff • Warehouses Sheikh Saud Bin Saqr Al Qasimi Ras Al Khaimah • Availability of executive and staff • Land for Lease industrial Facilities accommodation Senior Management Telephone: +971 7 206 86 66 • Facilitation in obtaining services from Fax: +971 7 243 44 64 CEO: Dr. Khater Massaad utilities such power and water supply, gas, Executive Director: Serge Guillaume Email: [email protected] telephone connections Website: www.rak-ia.com

Why UAE ? The Unlimited Opportunities 2012 Chapter 5 The United Arab Emirates Seven Pearls and Beyond 308 309 Fujairah

ujairah, the mountainous emirate, is ships visit Fujairah each year. Fujairah Tourism Fthe only emirate located in the Eastern Bureau was established in 2009 to create a Coastline of the UAE along the Gulf of Oman. comprehensive tourism industry by stimulating Its economic performance has witnessed different tourism activities and creating a a remarkable growth due to its perfect business-friendly regulatory environment. utilization of its strategic location and natural Its soil is fertile and irrigated by rainwater and heritage capabilities. from the Hajar Mountains, making it ideal Its strategic location as a gateway to the for farming. As a strategic initiative to best major shipping routes of the world has made utilize the valleys’ water in the emirate, it a preferable choice over its sister emirates Fujairah Municipality is giving the order to in the shipping industry. Major local and construct 16 dams and one aquatic channel in international companies have been benefiting 2011. Fujairah is home to the world’s largest from this geographic location. International livestock shipping companies, which use its Petroleum Investment Company (IPIC), an port as a holding station for sheep and cattle investment vehicle of Abu Dhabi, ordered destined for the Arabian Peninsula. Other local the construction of a 360-kilometer oil export industries include mining and stone crushing, pipeline to transport up to 1.5 million barrels a which have benefited from the recent boom in day of crude to Fujairah in order to reduce oil construction in Dubai and Abu Dhabi. transportation through the Strait of Hormuz, Fujairah’s government has implemented the narrow waterway through which Arabian several strategic initiatives to stimulate the Gulf oil producers ship their crude exports. economic performance of the emirate. It plays Even though it is currently one of the top a supervisory role in issuing legislation, which three bunkering destinations in the world, organizes the functioning of the various this mega project has caused a positive stir economic sectors while causing no hindrance among international attentions, indicating to the business activities. The Fujairah Free the potential growth the emirate enjoys. Zone, adjacent to the Port of Fujairah, was The tourism sector is one of the most established to promote foreign investment in important targets of the government since banking, trade, manufacturing and logistics. Fujairah has historical monuments . Tourism The commercial activity since then has seen a programs including family entertainment, remarkable growth not only in the free zone cultural tourism and marine tourism are the key but also in the emirate. In the first half of 2011, tourism segments in the emirate. As stated by Fujairah Municipality has issued 171 economic the local officials, the current number of rooms licenses and renewed 1,173 licenses. In 2009, is not enough to accommodate the growing Fujairah’s contribution toward the national GDP numbers of the visitors, inviting foreign and has reached USD 2.54 billion in 2009. However, local investors to take advantage of this rising its share is expected to rise due to the growing sector in the emirate. More than 50 touristic sectors especially trading and tourism.

Why UAE ? The Unlimited Opportunities 2012 Chapter 5 The United Arab Emirates Seven Pearls and Beyond 310 311

Fujairah Free Zones

Fujairah Free Zone WHY Fujairah Free Zone ? • One of a few free zones located on the Year of Establishment Gulf of Oman providing direct access to 1987 the Indian Ocean • Strategically located on the world’s most Authority busy routes for oil transportation with Fujairah Free Zone Authority state-of-the-art bunkering facilities • Adjacent to Fujairah Port, one among Sectors Targeted the three most significant bunkering Trading, export and import, logistics, destinations in the world manufacturing and warehousing • Liberal commercial policies • Within a maximum of 48 hours after Legal Forms Licensed application’s submission, the license will • Branch of a Foreign Company be granted • Free Zone Company (FZCO) • Exemption of customs duties on imports of all commodities and finished products • Free Zone Establishment for the purpose of export and re-export outside the UAE. Clients need not pay Incorporation Fees duties on factory machinery or raw Chamber of Commerce (p.a.): AED 3,020 material used in production Commercial License: • Availability of establishing an offshore Formation Fee (for FZCO): AED 5,000 business • Multi-access to neighboring and global Free Zone Utilities: AED 500 (one time charge) markets by land, sea and air. Key Clients • Variety of investment fields. Enoc Bunkering, Microsol International, • Investor-oriented policies Eagean, Atlantic Marina • Efficient and cost-effective investment facilitation Chairman • Full investment security Saif Bin Hamed Al Sharqi • Served by Fujairah Port and the Fujairah International Airport Facilities and Services Offered Available Business Premises Senior Management • Prompt assistance in obtaining service Pre-built manufacturing unit: Director General: Sharief Habib Al Awadhi from related Federal Ministries with regard • AED 220 per square meter Contact Details to driving license, registration of cars, • Warehouse: AED 220 per square meter Managing Director: Muhamad Natafji Business Development Department notarization of legal documents, entry Adjacent to Fujairah port, Fujairah permits, residence visas, transit and visit • Virtual office: AED 12,000 annually Tel. : +9719 2228000 visas for investors and employees • Open land: AED 12 per square meter Fax : +9719 2228888 • Recruitment services for personnel at all levels E-mail : [email protected] Website : www.fujairahfreezone.com

Why UAE ? The Unlimited Opportunities 2012 The United Arab Emirates An Accommodating Legal Environment Chapter 6

The United Arab Emirates An Accommodating Legal Environment

“ Toned with international recognized standards and customized to derive from the local enriched culture and

tradition, the legal business framework of the UAE forms a

very unique system that is compelling to accommodate and facilitate all types of business activities. “ Chapter 6 The United Arab Emirates An Accommodating Legal Environment 314 315 the said Provisional Constitution came into Existing local courts (Dubai and Ras Al Khaima) effect, introducing the current Constitution. apply the federal laws in addition to the local Just like other modern states, the UAE legislation that is laid down by the concerned Constitution serves as the wide legislative local authority. These courts follow the same umbrella that supersedes over and orchestrates system as the federal courts; allowing three stages of litigation. ne of the key pillars to the UAE being the different organs of the state in terms of Oa pulling and attractive market for roles and responsibilities, at both federal and international trade and investment is the local levels. Characteristics of the accommodating and business friendly legal It also sets and defines the general guidelines Legal System environment. This fact supported by the of governance and the constitutional relation The UAE is considered to belong to the policies of transparency and good governance between the seven member Emirates, as well keenly overseen by the state organs, sets the family of the states which adopt the Civil Law as Freedoms, rights and public duties; the system (Latin) that represents, together with UAE aside from many of its peer countries in fundamental social and economic basis of the the common law, the main systems found in the surrounding region. union, security and armed forces, among other today’s modern world. The development of the legal framework typical constitutional issues. The Egyptian law, which has its basic source regulating business in the UAE has gone a Judicial Authorities in the French law, has an obvious influence long way in the path to match the highest The Constitution of the UAE assigns a well on UAE legal system. Also, the Islamic Shari’a international standards in many areas. Legislative Authorities defined scope of judicial authorities to the is normally another component of the UAE’s Specialized and well-drafted legislations have A legislative body; ‘the Supreme Council’ federal court system, which is divided into legal system. Shari’a is not a codified law, but made the UAE a first in the region in many was formed by the Constitution and given three levels of litigation: the Court of First an Islamic jurisprudence consisting of many areas. the authority to pass federal laws; mostly Instance, the Court of Appeal, and the Federal schools of thought. In the presence of a presented by the National Assembly (the Supreme Court. written code or legislation, there is no room Parliament) or the Federal Council of Ministers. for applying Shari’a principals. The Constitution In addition, the individual Emirates have a Courts are divided into the following The first UAE constitutional document was right under the constitution to issue decrees sections: On the other hand, provisions of the Provisional Constitution which was passed and regulations concerning their internal international treaties to which the UAE is a in July 1971. Later, in 1996, a law amending matters. Civil Courts: with jurisdiction over all civil party are strictly applied by the courts. It is issues e.g. disputes arising from commercial important to state here that a set of factors transactions, property related disputes, and have contributed in creating a unique school recovery of debts of application of the Civil Law System. Criminal Courts: with jurisdiction over The UAE, being the attractive regional criminal matters e.g. theft, assault. and international hub that, it is continuing Shari’a Courts: concerned with personal to represent a desirable market for highly status and family laws matters e.g. qualified legal professionals from various Arab inheritance, marriage and divorce. countries as well as the west. The positive impact of this fact can be easily The flexible federal model adopted in seen in the evident capability of members of the structure of the union of the Emirates is the Judiciary seated in the UAE different courts, well reflected in the Constitution, as it allows as well as the strong presence of the most the member Emirates to have their own prominent international law firms; especially legislations and judiciary. those originated in the UK and the US. Although this license could have This diversified legal environment has represented a window for a contradiction helped in enriching the arena of legal between the federal and local authorities; interpretation and jurisprudence, providing a this was cautiously and effectively avoided chance for continuous improvement. throughout the walk of the legal development Within this context, it is also to be that the individual Emirates were undergoing. highlighted that the responsive attitude In fact, the risk factor highlighted above and mentality tended to be adopted by the was turned into an advantage with the legislative authorities and the judges has positive complementary role that the existing also helped to lean the restricted, sometimes local courts have been playing, in support of hindering characteristics of the Civil Law the federal judiciary. System as applied in other jurisdictions. Why UAE ? The Unlimited Opportunities 2012 Chapter 6 The United Arab Emirates An Accommodating Legal Environment 316 317

Civil Litigation Process Litigation proceedings typically start by the submission of the defendant’s pleading (memorandum) explaining his case, together will documents supporting his the claim. For submissions to be processed and considered as a case, certain fees, depending on the value and nature of claim, are to be paid. Thereafter, the court serves a notice to the Arbitration defendant(s) including the plaintiff’s name, In addition to the Judicial system, the UAE and the time scheduled for the first hearing, on has shown a lot of respect to parties’ decision which (or at a later time decided by the court) to resort to ADR methods. defendant would respond by submitting his defense pleading. Currently, the legal community in the Once litigants have exchanged submissions, UAE awaits the issuance of the new federal the court sets a date to deliver its judgment. arbitration law, which is expected to complete Legal Environment in For most companies incorporated outside A party who is not happy with the outcome the legal infrastructure of commercial Free Zones Vs. Inland the free zones, no restrictions on the of the proceeding may refer the case to the arbitration. repatriation of capital and profits and freedom court of appeal, after fulfilling the procedural Till the new law is fully operative, the issue The UAE accommodates a large number of from currency restrictions and import duties. requirements. of arbitration remains to be governed by free zones, which are partially exempted from the application of the UAE federal and local The most advanced step in the direction It is a common practice by the UAE courts to the Civil Procedure Law of 1992 (“CPL”). Said laws. This exemption is particularly relevant to of diversifying the legal environment in the refer issues involving technical knowledge to law deals on different sections: about the areas of business set-up formalities, tenancy UAE was the establishment of the Dubai experts, with a mandate to study the parties framework of arbitration, the enforcement of and labor relations. International Financial Centre in Dubai (DIFC). claims and submit a report. Hearings are foreign judgments and the relevant procedural conducted in Arabic language, which is the aspects. The rationale behind that is to allow free DIFC is a world class financial centre that has zones a wider span of liberty in order to attract official language of litigation. Since 1982, The UAE has been a member its own laws which are heavily influenced by foreign investors. One of the most appealing of the Convention on the Settlement of the common law system; courts and arbitration features that most free zones make available Investment Disputes between States & centre. The legal infrastructure available in is the acceptance of 100% foreign ownership Nationals of Other States (ICSID). Also, it has the DIFC is considered to be matching the best of businesses, compared to 49 per cent in the in November 2006 formally acceded to the international practices adopted in the major UAE inland. New York Convention on the Recognition and financial centres. Enforcement of Foreign Arbitral Awards of 1958. In line with the rapid growth in the number of arbitration cases taking place in the UAE, the presence of arbitration centers have witnessed a similar progress. Currently, the list includes: The Dubai International Arbitration Centre The DIFC-LCIA Arbitration Centre The Abu Dhabi Conciliation and Arbitration Centre The Sharjah International Commercial Arbitration Centre Ras Al-Khaimah Commercial and Arbitration Center

Why UAE ? The Unlimited Opportunities 2012 Chapter 6 The United Arab Emirates An Accommodating Legal Environment 318 319 competition; mortgage and international Commercial Activities (By Nature) sale of goods. Additionally, CTL places the The purchase / hiring of commodities and other material and non-material movables with basic concepts and definitions for commercial the intention of leasing out/selling them at a profit, whether in the same condition or after activities such as brokerage, commercial processing or manufacturing them. agency and transportation by different means. Legal Topics Relevant to It extends also to cover areas of banking The banking, exchange, stock markets and investment companies operations, trust funds, activities; commercial papers and bankruptcy. financial establishments and all kinds of other financial brokerage operations. doing Business in the UAE All kinds of transactions related to commercial papers, irrespective of the capacity of the concerned persons therein or the nature of the transactions for which such operations are Commercial Transaction Definition of ‘Trader’ carried out. Broadly, a trader is every person who works In the early 1990s, when the world started All kinds of sea and air navigation activities, including construction, sale, purchase, chartering in his own name and for his own account in to look at the UAE as a potential major player or taking on charter, repair or maintenance of vessels and aircrafts, as well as sea and air commercial activities and has the proper in the regional market, the legislature has shipment and carriage. b. The sale and purchase of vessel and aircraft supplies, tools and qualification when taking on such activities positively responded to the pressing need materials and supplies thereof; loading and unloading activities; maritime and air loans; as his occupation. This definition expands for a separate law to govern the commercial employment contracts for commercial vessel and aircraft captains and pilots. to include any company which undertakes activities. Before that, such activities were Formation of companies, current accounts, all kinds of insurances with the exception of the a commercial activity or has adopted one of only regulated by the Civil Transactions Law cooperative insurance. the legal forms defined by the Commercial (Civil Code). Public auction sale premises, hotels, restaurants, movie halls, theaters, play grounds and Companies Law, even if such an activity amusement centers activities. This development was a landmark in the whereof civil nature. advancement of legal literature and practice Publication of newspapers and magazines with the intent of making profit through the Commercial activities were defined by the in the area of business laws. It actually publishing of advertisements, news and articles, post, telegraph and telephone activities; and law as those activities which are carried out had a considerable influence on the legal broadcasting, television, recording and photography studios activities. by traders in the normal course of their trade environment that accommodated the UAE Water, electricity and gas distribution activities, and the activities of public warehouses and affairs. That includes those activities carried boom which started in the second half of the mortgages on property deposited therein. out by a person, though not a trader, with the 1990s. intent of realizing profit. However, certain The Commercial Transactions Law activities were specifically defined by the law Commercial Activities (By Profession) (CTL) defines the scope of activities that as commercial whether by their nature or are considered as commercial, and then Water, electricity and gas distribution activities, and the activities of public warehouses and when practiced as profession (please refer to mortgages on property deposited therein. deals with a wide array of relevant issues, tables below). such as trade name (goodwill); unfair Brokerage, commercial agency, commission agency, commercial representation, Supply contracts, purchase and sale of lands or real-estates with the intent of making profit by selling there in their original condition or after transforming or dividing Land transport, real estate activities at times when the Contractor undertakes to supply the materials or the workers. Industry; and the income from extraction industries of natural resources. Tourism, travel, export, import and customs clearing activities, as well as the activities of services and recruitment offices. Printing, publishing, photography, recording and advertising activities.

Special Commercial Transactions the freedom of trade nor the duty to protect Commercial Transactions Law puts clear the public. regulations to organize certain types of commercial transactions. That includes public International Sale of Goods auctions, sale of goods by installments, sale of goods at reduced price usually conducted by The law includes a chapter that adopts a set chain and department stores. of frequently used and predefined forms of commercial terms (incoterms) used to identify The spirit and view in which the law deals responsibilities with regards to the costs with these transactions, is very balanced, as it associated with sale of goods (transportation, considers giving the public authority a room insurance etc...). to supervise the market, without jeopardizing

Why UAE ? The Unlimited Opportunities 2012 Chapter 6 The United Arab Emirates An Accommodating Legal Environment 320 321 The mortgagor shall have priority right to collect his debt- principal, interests and Features of Commercial Agencies expenses incurred in his claim of it - from the Commercial Agencies under COML: price resulting from the sale. Commercial activities like distribution of Hereunder is a brief overview of some of the goods and services are usually conducted by important features of commercial agencies Commercial Mortgage appointed local agents. Such activities often under COML: Brokerage and Commercial CTL defines the special provisions introduce certain challenges that require For a local agent to be legally recognized, he pertinent to commercial mortgage, where Representation special attention by the authorities in charge must be either a UAE national or a company a party surrenders the possession of a of legal regulation in any given country. The As one of the very common activities in the wholly owned by UAE nationals. movable property to another, in security of a world of trade, brokerage contracts whereby UAE legislature has responded to this fact by commercial debt. a broker undertakes to another person to issuing the federal Commercial Agencies Law, All commercial agencies must be registered 1981 (“COML”), which has been subject to at the Ministry of Economy. Once the mortgaged item passes to the look for and mediate in the negotiations with several updates, the latest of which was issued custody of the mortgagor or such other a second party in order to execute a specific Principal-Agent relationship must be in 2010. agreed upon third part, then the mortgagor contract in consideration is also covered by the exclusive in relation to territory or to a specific is bound to take all the necessary measures law. This covers a great deal of potential areas product and foreign principals may appoint to safeguard the mortgaged article and of dispute, such as the broker’s scope and COML defines a commercial agency as: a sole agent to be their representative in the UAE, or appoint several agencies in any or undertaken maintenance thereof. limits of responsibility, and the time in which “The representation of a Principal he is entitled to his remuneration. by an Agent on the distribution, sale offer each of the emirates. Where the mortgagee fails to pay on the A commercial agent is entitled to receive date of maturity of the debt secured by the or presentation of commodities or services commissions on sales activities in the mortgage, the mortgagor may, after the within the UAE” designated areas, no matter whether such lapse of seven days from the date of service of Carriage sales are made by or through the agent. notice on the debtor to pay, submit a petition The law does apply on dealings relevant to the Court to the effect of authorizing him to all types of carriage with the exception of Commercial Agency Committee: to sell the mortgaged item. The petition shall Before resorting to competent courts, carriage by sea; a domain that is covered in Termination: be looked into promptly and without delay detail by the provisions of the UAE Maritime disputes arising between principals and and the Court shall determine the mode of Law. commercial agents are to be brought before Provisions of COML relevant to terminating payment. the /commercial Agency Committee, of a commercial agency have been subject of the MOC The Committee’s decision can be several amendments. Currently, for a foreign Good to Know challenged before a competent court within principal to terminate or refuse to renew When you wish to transport goods that, owing to their nature, need special preparations 30 days of the date of the Committee’s an agency, it is required to show a material (packing or wrapping), you shall have to take such precautions as would protect the goods decision, otherwise, the Committee’s decision reason justifying its termination or non- from perishing or being damaged and would not expose other persons or goods carried with it shall be deemed final. renewal, e.g. failure to meet sales target. to injury or damage respectively. The carrier’s liability shall cover his acts and those of his subordinates (employees) when such acts are committed by them in the course of rendering their services. All persons employed by the carrier for the performance of his obligations under the carriage contract shall be considered as his subordinates. The carrier shall be responsible for the safety of the goods during the performance of the carriage contract. No persons other than a U.A.E. nationals may practice trade in the, unless he has one or more U.A.E. partners according to the conditions and within the limits stipulated by the Commercial Companies Law. Professionals (e.g. engineering consultant cannot import building materials) may not practice import and export activities. As a trader, you would be under a legal obligation to keep correct and orderly books of accounts of your business. + UAE law recognize the use of software to keep record +UAE laws recognize lenders’ right to claim for interest over commercial loans with a cap of 12%.

Why UAE ? The Unlimited Opportunities 2012 Chapter 6 The United Arab Emirates An Accommodating Legal Environment 322 323 either by approval of all the partners or in the manner prescribed by the memorandum of association, which is required to include Foreign Companies particular details covering the main areas of Provisions of the CCL are applicable on partnership e.g. company’s capital, shares Commercial Companies foreign companies who are licensed to do and rate of profit/loss distribution. business in the UAE. All matters relevant to commercial companies, starting from formation till Limited Partnership (LP): winding-up are regulated across the seven Shareholding A limited partnership company comprises Emirates by the provisions of the Commercial CLL recognizes and permits certain types of general partners together with one or more Companies Law, 1984 (CCL) as amended. companies. Any company that takes another silent partner(s). Liability of general partners, Although the CCL is applicable on the federal form is considered void and liabilities arising who are involved in company’s dealings with level, individual Emirates has the powers out of its dealings shall be born be the person(s) third parties, is similar to partners of a joint to issue local supplementary regulations. dealing in its name. Recognized forms are: venture company i.e. they are individually Orchestrated by the federal Ministry of and mutually liable for the obligations of the company, while those sleeping partners Economy, Local authorities are also entitled to General Partnership (GP): oversee and regulate the formalities relevant is limited to the value of their shares in the to companies within the respective Emirate, A general partnership is a company company. including setting-up, transfer of shares, and comprising two or more partners who Unless the parties agree to the contrary, winding-up. are jointly and severally liable (meaning decisions in this type of companies are to individually and mutually) for the obligations be made by ammoniums agreement. CCL of the company. Such liability extends puts restrictions on the position of general facilitate registration formalities. to partners’ personal assets. This type of Nationality and Corporate partner, as it is only allowed for UAE nationals, companies is restricted to UAE nationals. although non-UAE nationals may participate Identity Shareholding Name of a GP company shall be composed as sleeping partners. A company registered under the CCL is of the names of all or part of the partners Partners of a company may settle the value Name of an LP company shall be composed considered to be domiciled in the UAE and together with what may show the existence of their shares by way of an allocated fund (cash of the names of all or part of the partners have its nationality. However, this would of company, or it may simply have a special share) or in kind (corporeal share). Within this (except silent partners) together with what not necessarily entitle such a company to trade name of its own. context, even efforts undertaken to be exerted may show the existence of company, or it may privileges reserved only to U.A.E nationals, by a partner may be acceptable as a value for In a GP company, shares may be assigned simply have a special trade name of its own. such as purchase of immovable property his shares. However, it is not permitted for a outside permitted zones, and being given the partner to contribute in the shareholding right to have a registered commercial agency. of a company against his reputation or any Except for joint-ventures, companies authority which such partner may have. shall attain their respective corporate entity (legal capacity), and shall perform their functions only after being registered. However, during establishment, a company Profits and Loss Allocation would enjoy a corporate entity to the extent Usually, parties’ profits and losses are linked that allows registration procedures to be to the percentage of shares they hold. However, completed. For example, companies have if the parties are in a lawful agreement to the right to open bank accounts even before adopt another allocation methodology, that obtaining the official license, in order to would be permitted.

Good to Know A company’s purpose must be lawful with due consideration given to standardization and specialization of its main objectives. Companies taking any permitted form other that joint venture have to have a written and duly notarized memorandum and articles of association. Unlike the case in UAE free zones, 51% of the shares of an inland company shall be held, as a general rule, by one or more UAE national.

Why UAE ? The Unlimited Opportunities 2012 Chapter 6 The United Arab Emirates An Accommodating Legal Environment 324 325 company’s shares and 45% at maximum. Steps for Setting-up an LLC After the required approvals are granted, Selecting a commercial name and have it approved. Joint – Venture (JV): invitations for public subscription shall be announced to the public. In addition to a A JV company is an association between Preparing the Memorandum of Association and have it notarized by a Notary Public. summary of the Memorandum and Articles two or more partners to share profit or loss of association, the announcement shall Getting approval from the Economic Department in the desired Emirate and apply for of a commercial business or businesses carried contain all details relevant to payment, shares, entry in the Commercial Register. out in the private name of one of the partners, board membership requirements and any while is other remain undisclosed to third other matters affecting the entitlements or Enrollment in the Commercial Register. parties. obligations of the shareholders. Management Issuance of the license by the Economic Department. All essential elements defining the partners’ responsibilities of a PJSC are to be borne by relationship are to be spelt out in the JV a board of directors (3-15) members, and Registration with the Chamber of Commerce and Industry. agreement, including their entitlements and the financial affairs of the company are to obligations, the manner of distribution of be audited by an accredited auditor. CCL Limited Liability (LLC): Orderly books of accounts are to be maintained obligations, profit and loss. Unless the parties defines the framework of managing PJSCs An LLC is an association of a maximum by the management of an LLC, and the annual agree to the contrary, decisions in this type in a reasonable detail, so as to ensure sound number of fifty and minimum of two partners. statements of accounts are to be audited by an of companies are to be made by ammoniums management of shareholders funds invested Partners in an LLC are liable only to the extent accredited auditor. agreement. in the company. of their shares in the capital. LLCs are noticed to be the preferred vehicle Public Joint-Stock (PJSC): Private Joint-Stock (PrJSC): of doing business by expatriates, for the great With few exceptions, all companies PrJSC is another option available for investors deal of flexibility it provides. Notably, this interested in the business of banking, under the CCL. Number of founders in this option gives an opportunity for the expatriate insurance, or investment of funds is to take type of companies shall not be less than partner to assume full management of a the form of a PJSC. In a PJSC, capital must three, and shares shall not be offered for business, as well as agreeing on a methodology be adequate for the achievement of its public subscription. Founding partners may for profit/loss distribution that does not objectives, and in all cases may not be less subscribe to the full amount of the capital necessarily follow the percentage of shares. than USD 2.7 million. which is to be USD 0.54 million or more. LLCs are also recognized as offering a suitable Capital is to be divided into negotiable Except for provisions concerning public structure for entities interested in developing shares of equal value. It is important here subscription, all provisions contained in the a long term relationship in the local market. to mention that founding members are of a CCL with regard to public joint-stock shall With the exception of banking, insurance PJSC are required to hold at least 20% of the apply to private joint-stock companies. and investment of funds, an LLC may practice any lawful activity. Capital of an LLC should not be less than USD 47,850 (81,700 in Dubai), and is to be divided into equal shares of a value not less than AED 1000 each (USD 272). Managers (1 to 5) shall be appointed to assume management responsibilities. With regards to managers, there is no restriction on the nationality status i.e. it is not mandatory for managers to be of UAE nationality.

Good to Know One of the requirements for a branch to a foreign company to operate in the UAE is to have a local agent, who must be a either a UAE national or a company that is 100% owned by UAE nationals. Local agents are not involved in running the business. They just liaise in issues similar to obtaining visas, labor cards, etc and are usually paid a lump sum and/or a percentage of profits or turnover.

Why UAE ? The Unlimited Opportunities 2012 Chapter 6 The United Arab Emirates An Accommodating Legal Environment 326 327 The company management shall be assumed by one or more general partners. Name and scope of responsibility of such manager(s) are to be mentioned in the Partnership Limited with Shares (PLS): memorandum and articles of association of A PLS is an association comprising two the company. types of partners: general partners (must be UAE nationals) who are mutually liable, to Branch and Representative Offices of the extent of their personal assets, toward the company obligations; and shareholding Foreign Companies: partners who are liable only to the extent of CCL also regulates with formation and their shares in the capital of the company. regulation of branches and representative The capital of a partnership limited with offices of foreign companies in the UAE. It shares shall be not less than AED five hundred is important to understand that a branch thousand (USD 136,147), and is to be divided does not have a legal identity and is, legally into negotiable shares of equal value. The speaking, considered as part of the parent name of one or more general partners shall company. be reflected in the name of the company. In Branch offices have a restricted status, many aspects, such as establishment, issuance as they are not allowed to directly engage of stocks, functions of directors, accounts and in the UAE market, save to representation alike, a PLS is to follow the same provisions and marketing of the parent company, and applicable on PJSCs. provision of services similar to maintenance.

Bankruptcy the documents submitted by the debtor and A bankruptcy or insolvency law was will reschedule debts and lodge them as per promulgated by the UAE as early as 1973, which the court’s instructions. A copy of the schedule was later amended under the UAE Federal along with a statement of the amount that the CTL. Rules governing bankruptcy in the UAE court intends to accept as debt will be sent to aw similar to those applied internationally. By every creditor and the bankrupt entity. the declaration of a debtor as bankrupt by The creditors could object to the amount the court, a notice is issued to all creditors to stated by the court and the judge supervising register their claims. the bankrupt merchant or company will decide Emirati creditors of a bankrupt merchant whether to accept or reject the objection must register their claims within 10 days of It is important to state that one of the publication of the notice. Foreign creditors major consequences faced by those who staying outside the country must register are declared as bankrupt will not be able to their claims within one month of the carry out businesses. As well, the bankrupt announcement. merchant cannot leave the country without The judge of the bankruptcy court will verify informing the court.

Why UAE ? The Unlimited Opportunities 2012 Chapter 6 The United Arab Emirates An Accommodating Legal Environment 328 329 Due to the special nature of their activities Employment contract is considered as ‘Indefinite’ if it: and professions, EL excludes employees of the Is not written if it concluded for an unspecified period. federal and local government, members of the armed forces, police and security, domestic If it was originally written and concluded for a definite term but both parties, without a written servants employed in private households, agreement between them, continued to perform it after its expiry; or Employement and the like, as well as farming and grazing Was originally concluded for the execution of a specific work that had no specific duration or workers, other than those working in that is recurrent by nature, but the contract continued after completion of that specific work. All matters relevant to employment agricultural establishments that process their relationships in the UAE are regulated by the own products, and those who are permanently provisions of the federal Labour Law, which continues in employment, said period shall be employed to operate or repair mechanical Employment contract shall be written in was issued in1980 (LL). That was only the calculated as part of his period of service. equipment required for agricultural work. duplicate, with one copy to be delivered to beginning for many significant developments the employee and the other to the employer. in the regulation of the area of employment. Contract shall particularly specify the date of Employment of Non-UAE Employment Contract its conclusion, the date on which work is to Scope The EL defines the employment contract begin, the type and place of the work, the Nationals as any agreement, concluded between an duration of the contract, (if definite) and the As the UAE is considered a preferred The EL covers all the employees, regardless employer and an employee, whereby the latter amount of the wage. destination for professionals and skilled human of nationality, and contains a wide definition undertakes to work in the employer’s service resources from over the world, it was necessary of “employee”, which includes all persons An employment contract may be for a and under his management and control, in that the EL outlines the legal framework for who, for wage of any kind, are in the service definite or indefinite term. Below table return for a certain wage that the employer employment of non-UAE nationals. or under the management or control of an summarizes the differences between the two undertakes to pay. employer. types, as follows: Non-Nationals may not be employed without the prior approval of the MOL and Definite Contract Indefinite Contract before first obtaining an employment permit Probation Period in accordance with the revealing procedures Shall not exceed four years. Indefinite. EL recognizes inclusion of a condition and regulations such permit shall not be may be renewed by mutual Agreement Does not need to be renewed. of a non-renewable probation period not granted unless the following conditions are exceeding six months in employment contracts. fulfilled: Renewal shall be deemed as an extension of During such a period the employer, without That the employee possesses professional the original term and shall be added thereto Employee’s total period of service starts notice or severance pay may terminate competence or educational qualification when calculating the employee’s total from joining till termination of service. employee’s services. An employee shall not the country is in need of. period of service. be placed on probation more than once with That the employee has lawfully entered the the same. Where an employee successfully UAE and satisfied the conditions prescribed completes the period of probation and in the residence regulations in force.

Why UAE ? The Unlimited Opportunities 2012 Chapter 6 The United Arab Emirates An Accommodating Legal Environment 330 331 accommodation, medical insurance and any other benefit) and ‘basic wage’ which does not include any allowances. Employment of Children and Understanding the difference between Women basic and total salary is particularly important for both employers and employees as the basic Termination In line with the public policy of the wage is the one to be taken into account when Employment contracts terminate in any of UAE, EL lays down several measures that calculating a gratuity for end-of-service. aim at the protection and regulation of the following cases: employed children and women. That includes By mutual agreement of the parties, determination of the minimum age for a child Working Hours Upon expiry of its term, unless it has been to be employed (15 years) and limiting the The maximum normal working hours for expressly or implicitly extended; working hours for children to six a day. adult workers are eight hours a day, 48 a For the convenience of either party to an Additionally, EL prohibits employment week. For certain types of establishments, this indefinite term contract. may be increased to nine hours a day (hotels, of women and children in jobs that are Termination by the Employer: hazardous or detrimental to health, or at night cafeterias, security services etc…). An employer may dismiss an employee without shifts except in very restricted conditions. Also, notice if and only if the employee: female employees are entitled as per the EL to Safety & Protection maternity leave with full pay, and child nursing Assumes a false identity or nationality or time within working days. Each employer shall provide appropriate submits forged certificates or documents. safety measures to protect employees against Is engaged on probation and is dismissed the hazards of occupational injuries and during or at the end of the probationary Wages diseases that may occur during the work and period; also against fire and other hazards that may EL differentiates between ‘total wage’ Commits a fault resulting in substantial result from the use of machines and other comprising the whole package payable to material loss to the employer employee (including for instance travel, work tools. Disobeys instructions on the safety of work or workplace, provided that such Where an employment contract is for a instructions are in writing and posted at a definite term and the employer revokes it conspicuous place and are communicated for reasons other than those specified above, verbally to the worker, in case he is he shall be required to compensate the illiterate; employee for any damage the latter sustains. Defaults on his basic duties under the Said compensation shall in no case exceed contract and fails to redress such default the aggregate wage of three months or the despite a written interrogation and a remaining period of the contract, whichever warning that he will be dismissed if such is shorter, unless otherwise stipulated in the default is repeated; contract. Is finally convicted by a competent court of An employee may abandon his work without a crime against honour, honesty or public notice in either of the following cases: morals; If the employer fails to honour his obligations towards the employee, as Reveals any confidential information of his provided for in the contract or in the EL. employer; If he is assaulted by the employer or the Is found in a state of drunkenness or under employer’s legal representative. the influence of a narcotic drug during working hours; Where a contract is revoked by an employee for reasons other than those specified above, Assaults the employer, the manager in he shall be required to compensate the charge or any of his workmates during employer for any damage the latter sustains working hours; or as a result, provided that the amount of Absents himself from work without a valid compensation shall not exceed half a month reason for more than 20 non-successive wage for three months or for the remaining days in one single year, or for more than period of the contract, whichever is shorter, seven successive days. unless otherwise stipulated in the contract.

Why UAE ? The Unlimited Opportunities 2012 Chapter 6 The United Arab Emirates An Accommodating Legal Environment 332 333 Cooperation Treaty; WIPO Convention and WIPO Copyright Treaty. The UAE also adopts the International Classification of Goods and Services under the Nice Agreement, 1957. Additionally, the UAE Intellectual Property has agreed with other members of the Gulf Protection of Intellectual property rights is Countries Council on the adoption of a unified one of the areas that the UAE has considered trademark law. as vital to achieve its ambitious economic plans. Historically, Ras Al Khaimah was the Trademarks first among the Emirates to enact a law to Registration of a trademark extends regulate the registration of trademarks. protection for renewable period of 10 Later, numerous laws regulating the rights years from the date of filing of application. considered as intellectual has been enacted. Trademarks eligible for registration include In 1992, the federal Trademark Law names; signatures; letters; numbers; drawings; was issued, introducing a modern reliable symbols and pictures. trademark protection system for the business community. In the same year, the Copyright Applications for trademark registration are Law was also enacted. The latter was repealed to be submitted to the Ministry of Economy in 2002, by the Copyright and Related Rights. (MOE); the government body in charge of the In 2002 another relevant law was passed which trademark registers in the UAE. Application is the one regulating the industrial property is to be accompanied by all relevant rights for patents, designs and models. documentation like labels of the mark desired to be registered, and a duly notarized power of commercial use of the material subject to duties as an employee, where in such a case, The UAE is a committed party to a member of attorney, if the application is submitted by intellectual property rights. the rights pertinent to the invention will be of international intellectual property treaties, granted to the employer. like the Agreement on Trade-Related Aspects an agent. Such protection is granted for 50 years of Intellectual Property Rights (TRIPS); Berne Once the application for registration is for the lifetime of the author, and 50 years Convention for the Protection Literary approved, the trademark shall be published in thereafter. As to applied arts the protection Enforcement actions period is 25 years, and 20 for broadcasted and Artistic Work; Paris Convention for the official trade mark bulletin as well as two The UAE legal system provides an extensive materials. the Protection Industrial Property; Patent newspapers. The purpose of publication is to protection to intellectual property related allow any party that claims interest or right Protection of copyrights is granted rights, including very efficient enforcement on the trademark to oppose the registration, regardless of the fact that the material was actions whether through the civil court, or the and such oppositions, if any, are to be decided registered at the Ministry of economy or not. police or the public prosecutor. upon by the MOE and the competent court. If However, it is advisable to register intellectual Certain government departments have no opposition is successful, the MOE shall issue works and materials as this would make the also the authority to take some immediate a registration certificate in the name of the process of evidence much easier in case any actions against proven cases of infringement applicant. conflict arises. of intellectual property rights, like seizing and even destroying counterfeited goods and Copyright and Related Rights Industrial Property Rights for impose fines. Copy right and Related rights Law governess Patents, Designs and Models It is important to highlight that, during the past decade, the UAE has very much the protection given to authors on their The important area of intellectual property intellectual works like books and other forms increased its cooperation with regard to rights relevant to inventions and industrial enforcement with WIPO, the International of written materials, computer softwares, know how and models is also covered by Anti-Counterfeiting Coalition. music pieces, audio and video productions, the UAE laws. In broad terms, for such kind The role of government departments in drawings, paintings, photographs and alike. of intellectual works and materials to enjoy However, some materials cannot be registered charge of customs is being played by local protection, they are to be new, and do not in authorities at local level. Within this context, due to their nature, like laws, materials which violation of the law and public policy. enters the public domain. it is important to state that the UAE is Rights over inventions are granted to the extensively co-operation with the members Rights granted include both moral rights inventor himself, unless the invention was of the Gulf Cooperation Council as well as the (such as use for the first time), as well as the a result of the inventor’s work as part of his World Customs Organization in this area.

Why UAE ? The Unlimited Opportunities 2012 Chapter 6 The United Arab Emirates An Accommodating Legal Environment 334 335 (“ADX”); NASDAQ Dubai; and most recently Dubai Gold and Commodities Exchange (“DMCC”). Since then, these markets have witnessed considerable growth and expansion in terms of Exchange of Securities trading, which made them on top of the list of & Commodities regional stock exchange markets in the region. In order to understand the legal framework In its quest to actualize the vision of being under which the DFM and AD… operate, it is the preferred destination in the region for necessary to give a brief account of the main financial institutions and attract corporations features of the SCEL, including its objectives and investors involved in the sector of financial and the regulatory body it created. services and stock exchange, it was vital for the UAE to carefully set-up its legal and institutional platform. The SCA The first step in that direction was the SCEL was intended to serve as the umbrella enactment o the Securities and Commodities of rules governing the stock exchange Exchange Law (“SCEL”) in 2000. Under the activities within the UAE, leaving a room for law, a federal authority called the Securities local legislations and regulations issued by the and Commodities Authority (“SCA”) was respective exchange markets. established, to undertake regulatory To that end, it created SCA which was authorities over the exchange markets assigned the mandate of providing the As soon as the law came into effect, the opportunity for investment of savings and Dubai Financial Market (“DFM”) started funds in securities in a manner that servers the trading, followed by Abu Dhabi Exchange national economy and ensures accuracy and soundness of transactions, further to the SCA, the law gives the latter powers to assuring interaction of supply and demand suspend the dealings of any market or in the factors with a view to fix prices with a view shares of any company in case exceptional to fix prices and protect investors through circumstances that threaten the progress or consolidating proper and fair transacting regularity of occur. principals among the various investors. Additionally, the authority was sought to play a role in developing investment awareness by conducting studies and recommendations to the concerned authorities, as well as to seek to insure financial and economic stability.

Scope of the SCA The SCEL envisages the establishment of markets for negotiation of securities and commodities, either in the form of a local public institute, or a public corporation. Such markets are to be licensed by the SCA, and are to operate under its supervision. The SCEL also requires markets operating in the UAE to display prices of securities and commodities in the manner prescribed in the regulations that are issued to detail its provisions. To enforce the regulatory authority of Why UAE ? The Unlimited Opportunities 2012 Chapter 6 The United Arab Emirates An Accommodating Legal Environment 336 337

Disclosure and Transparency Understanding that transparency is a corner stone in the stability of securities and commodities exchange markets, SCEL dedicated a whole chapter to place the rules that shall govern this area. For that purpose, a wide range of powers is given to the SCA, including: To conduct investigations deemed to be necessary in the course of applying the Law To publish any information that may affect the prices of securities pertinent to any company To order any firm whose securities are various investors. listed in the market to publish explanatory Securities and Commodities Impose stringent controls over securities information regarding its position and Exchanges transactions to ensure sound and conduct activities in a manner that would guarantee procedure. safe dealing. Abu Dhabi Exchange (ADX) Develop investment awareness ADX was established on 15 November 2000. by conduction studies and issuing Functions assigned to the Abu Dhabi Exchange recommendations in order to ensure that Brokers include: savings are invested in productive sectors. As per the SCEL, transactions in exchange Provide opportunities to invest savings Ensure financial and economic stability markets within the UAE are to be undertaken and funds in securities in order to benefit and develop trading methods in order to national economy. ensure liquidity and stability of prices of by licensed brokers only. Being positioned from involving themselves from any Ensure the soundness and accuracy of Securities listed on the market. in this particularly sensitive role, the Law practices which may be in any way harmful transactions and to ensure the interaction required brokers to act honorably and comply to the markets in which they operate; or the Moreover, ADX has the authority to between demand and supply in order to establish centers and branches outside the with its provisions, as well as the terms and investors, with specific emphasis on fictitious determine prices. Emirate of Abu Dhabi. To date it has done regulations issued by competent authorities. transactions not actually leading to transfer of Protect investors through establishing fair so in Fujeirah, Ras al Khaimah, Sharjah and Under the Law, brokers are also to refrain securities or funds. and proper dealing principles between Zayed City.

Good to Know Foreign companies applying to list in the UAE must exist for more than two years prior to application, their capital must exceed AED 40 million (USD 10,900) and the number of registered shareholders in the company must exceed 100. All stock brokers must be registered in the Register of Brokers. There are separate licenses for brokers dealing with domestic shares and bonds and foreign shares and bonds. Listing is restricted to the following: Shares in joint stock companies incorporated in the UAE or those whose head office is located in the UAE. Shares of companies not holding the nationality of the UAE which are approved for listing by the Board of the respective institution. Bonds and debt instruments which the Board resolves to list. Any other securities approved for listing by the Board

Why UAE ? The Unlimited Opportunities 2012 Chapter 6 The United Arab Emirates An Accommodating Legal Environment 338 339

Dubai Gold & Commodities Exchange (DGCX) DGCX commenced trading in November 2005 as the region’s first commodity derivatives NASDAQ Dubai exchange and has become today, a leading Formerly called the Dubai International derivatives exchange in the Middle East. Financial Exchange, or (DIFX), NASDAQ Dubai DGCX has a fully operational Compliance started operation on Sept 26, 2005. NASDAQ Department which, in liaison with ESCA, Dubai is located in the Dubai International ensures that Members maintain strict Financial Centre (DIFC); the Dubai dedicated adherence to the relevant laws and by-laws in financial free zone. Financial activities in the place. DIFC are governed to international standards In addition, all DGCX Broker Members that by an independent regulator, the Dubai are licensed by ESCA are required to apply Financial Services Authority (DFSA). robust ‘Know Your Customer’ (KYC) disclosure NASDAQ Dubai has recently taken a giant procedures to their clients’ account opening step by outsourcing its key market operations formalities. Furthermore, they are required to functions for equities to Dubai Financial conduct their business with clients to DGCX in Market (DFM). The outsourcing is considered accordance with the international ‘best’ code an important step in exchange consolidation of practice and standards observed on other in the GCC. major exchanges around the world

Dubai Financial Market (DFM) DFM is operating as a secondary market supply and demand based on fair and for trading of securities issued by public equitable trading practices between joint-stock companies, bonds issued by the investors. Federal Government or any of the Local Organizing the transfer of securities Governments and public institutions in the ownership through the Clearing, country, units of investment funds and any Depository and Settlement Department, other financial instruments, local or foreign, which operates an electronic system which are accepted by the Market. The Market ensuring efficiency and timeliness of commenced operations on 26 March 2000. transfers. Implementing rules of professional conduct Objectives of the DFM include. and discipline between brokers and DFM Regulating the process of trading in securities staff to maintain a high level of integrity ensuring the protection of investors from and provide them with proper training. unfair and improper practices. Collecting data and statistics about Creating highest liquidity in the securities and issuing reports based on this marketplace through the interaction of information.

Why UAE ? The Unlimited Opportunities 2012 Chapter 6 The United Arab Emirates An Accommodating Legal Environment 340 341

Insurance Authority By virtue of IL, a federal regulatory authority; the Insurance Authority (“IA”) was Insurance established. The IA is aimed to take charge Insurance activities in the UAE are of organizing and overseeing the insurance regulated by the provisions of the Insurance sector in a way that would ensure suitable Law 2007 (“IL”). Said law replaced the environment to develop it and enhance Insurance Companies and Agents Law, 1984, the role of the insurance industry to secure and it applies on national and international lives, properties, and liabilities against risks insurance and re-insurance companies licensed in order to protect the national economy; to carry on business in the UAE. IL provisions collect, develop, and invest the national also regulate roles, liabilities and relationship savings to sustain the economic development of different parties involved in insurance of the State; encourage fair and effective operations including insurance agents, brokers competition; provide the best insurance and loss adjusters. services in competitive premiums and coverage, and Emiratize the insurance markets jobs. Insurance and re-insurance operations are Insurance Categories reserved to be carried out by public stock companies established in the UAE; branches IL divides direct insurance operations into of foreign insurance companies and insurance Insurance Policies Protective Measures three categories, as follows: agents, who are duly registered and licensed Any insurance contract concluded by a To protect the public, the IL obliges Life assurance and funds accumulation by the IA. The IL also provides for that company not duly registered according to the insurance and re-insurance companies to operations insurance companies licensed to operate in provisions of the IL is deemed invalid and any observe rules of disclosure and transparency Properties insurance the free zones shall not carry on any activity party affected by such unregistered insurance in their dealing with their patrons and in Life liability insurance outside these zones other than the activity of company may claim compensation by reason of respect of all the documents, papers, bulletins, re-insurance. so invalidation. advertisements, propaganda and articles and Insurance policies are required to be written scientific materials of their issue. in Arabic and a translation into another The Authority is also required by the IL to language may be attached therewith. conduct periodical inspection of the insurance As it is a common practice by insurance and re-insurance companies to ensure safety companies to include in insurance policies of the financial situations, observance of the clauses that are intended to limit their liability, provisions of the law and the technical basis IL provides for that such clauses shall be of conducting the insurance and re-insurance written in bold letters, different color and operations. endorsed by the insured.

Why UAE ? The Unlimited Opportunities 2012 Chapter 6 The United Arab Emirates An Accommodating Legal Environment 342 the UAE Telecommunications Regulatory Authority (“TRA”) was established. This structural reform was intended to prepare the ground for new players to join the market as telecommunication network Telecom operators, which made it necessary to assign Since its early days, the UAE has given much the regulatory authorities to an independent of importance to the Telecommunication body. That resulted in sector. The first relevant law to be issued was the Wireless Telecommunications & Devices Law, 1973, followed by the establishment The TRA of the Emirates Telecommunications The mandate assumed by the TRA includes Corporation (Etisalat). Grant of licenses related to the operation Said corporation was assigned all of telecommunication networks and use of regulatory authorities over this sector, telecommunication devices; including the licensing of telecommunication Ensuring that up-to-date devices of all types and purposes. Additionally, telecommunication services are available the corporation was granted an exclusive across the UAE, by overseeing the operators’ license to plan, develop, construct and adherence to the quality standards and operate telecommunication networks within policies, as stipulated in the licenses; the UAE. Facilitating and overseeing the In 2003, a further step into developing the interconnection between operators and sector was taken by the federal government networks and parties compliance to by enacting the Telecom Law, under which interconnection agreements.

Why UAE ? The Unlimited Opportunities 2012 Chapter 6 The United Arab Emirates An Accommodating Legal Environment 344 345 shall be collectively referred to as the “UAE ETC Laws”. Scope Objective UAE ETC Laws focus on providing definitions UAE ETC Laws made a clear statement as and regulations relevant to electronic signature, Electronic Transactions to their objectives, which, broadly speaking as well as electronic records or documents that revolve around regulating, encouraging and are created, stored, generated, copied, sent, and Commerce facilitating electronic commercial transactions communicated or received by electronic means. As in many other fields, the UAE was and communications by means of reliable However, certain transactions and documents the first country in the region to recognize electronic records, while ensuring the rights were excluded from the scope covered by the and regulate the electronic documents and of persons doing business electronically are UAE ETC Laws, namely: transactions. An early sign to the sensitivity maintained, and their obligations are clearly and responsiveness to the rapid growth determined. Transactions and issues relating to personal law such as marriage, divorce and wills; in the reliance on electronic means can be Said laws also aim at facilitating seen in the UAE’s Commercial Transactions and eliminating barriers to electronic Deeds of title to immoveable property; Law where the legislature adopted and commerce and other electronic transactions Negotiable instruments; recognized commercial and financial records resulting from uncertainties over writing produced and kept in electronic forms. Transactions involving the sale, purchase, and signature requirements, and to lease (for a term of more than 10 years) and The first major step to regulate the use promote the development of the legal other disposition of immoveable property of technology in business transactions was and business infrastructure necessary to and the registration of other rights relating taken by Dubai in 2002, when the Emirate implement secure electronic commerce to immoveable property; issued its law on the subject. The federal Considerable attention is also given by the government took a similar path in 2006. Any document legally required to be UAE ETC Laws to facilitate the electronic filing attested before a notary public; and These developments were highly praised by of documents with governmental and non- the local business community as it allowed governmental agencies and departments and Any other documents or transactions the use of the many flexible features and promote efficient delivery of the services of exempted by special provision of law. advantages that today’s technology makes such agencies and departments by means Important Definitions available. of reliable electronic communications. To As both Dubai and the federal laws that end, it is also aspired that uniform Electronic Record or Document: A record or document that is created, stored, generated, copied, sent, communicated or referred to above are very similar in terms rules, regulations and standards for the received by electronic means, on a tangible medium or any other Electronic medium and is of structure and topics covered, the below authentication and validity of Electronic retrievable in perceivable form. overview shall cover them both, where they Communications. Electronic Signature: Any letters, numbers, symbols, voice or processing system in Electronic form applied to, incorporated in, or logically associated with a Data Message with the intention of authenticating or approving the same.

Why UAE ? The Unlimited Opportunities 2012 Chapter 6 The United Arab Emirates An Accommodating Legal Environment 346 347 ‘attestation certificate’, issued by data messaging and IT service providers. UAE ETC Laws did not leave this sensitive area to be a grey one, as it puts strict Electronic Signature obligations on such service providers, to An electronic signature is one of the ensure accuracy and reliability of attestation key tools used in the domain of electronic certificates. Even more, activities of service transactions and commerce. It is very similar providers involved in this type of service are in terms of value and reliability, to the regular being overseen and controlled on the federal signature. level. Electronic signature can be made in A person may rely on an Electronic many electronic forms like letters, numbers, Signature or Electronic Attestation Certificate symbols, voice or processing systems that are to the extent that such reliance is reasonable. incorporated in, or associated with a data In determining so, the following factors are message, with the intention of authenticating to be considered, including: or approving the same. The nature and value of the transaction With such a flexible definition, many tools that electronic signature was intended to provided by the modern technology can support; contribute in ascertaining that a certain data Examination of whether the parties to message has been produced by a particular the transaction in question had taken person. appropriate steps to determine the However, such reliance requires some reliability of the electronic signature sort of assurance in order to mitigate any Any agreement or course of dealing manipulation. The most common verification adopted in general or by the parties to the tool to electronic signature is called transactions. be taken into account while using electronic Requirements for Electronic means to communicate in commercial Transactions transactions: Under the UAE ETC Laws, deals, contracts If you wish to rely on electronic or agreements that are concluded or documentation, then you have to make performed, in whole or in part, through sure that proper documentation and electronic communication means e.g. e-mail, document retention system is in place. are legally recognized. In case of electronic correspondences, you That includes contracts and deals made for will have to keep the messages retained example by two traders living and practicing in a way that enables identification of the business in two different countries, or simply origin and destination of the message. between banks and their customers using As long as it is considered as legally reliable, their ATM machines. electronic signature has the same value as Some key considerations that should regular signature.

Good to Know UAE Laws does not restrict recognition of electronic signatures and attestation certificates to those issued in the UAE. Many UAE government departments do: Accept the filing, submission, creation or retention of documents in the form of Electronic Records; Issue any permit, license, decision or approval in the form of Electronic Records; Accept fees and other payments in Electronic form; Put out tenders and receive bids relating to Government procurement by Electronic means.

Why UAE ? The Unlimited Opportunities 2012 Setting Up a Business in the UAE Seizing The Opportunities Chapter 7

Setting Up a Business in the UAE Seizing The Opportunities

“ The ease of doing business through the simplified incorporation procedures and the various

government services channels is one approach of the

government’s strategy toward creating an encouraging competitive business environment in the UAE. “

The Unlimited Opportunities 2012 Chapter 7 Setting Up a Business in the UAE Seizing The Opportunities 350 351 established government entities contact the Committed to excellence in service quality branches of government entities easily, but various government bodies involved. Whereas and higher levels of convenience for investors they can also contact the concerned authority this process is time consuming in most of the and businessmen, the UAE’s different by dialing free toll numbers around the clock. countries by running from a government entity authorities have insured the availability and As the world is moving virtual, the UAE to another, it only takes 20 to 30 days to pick accessibility of the services offered in all parts government is always at the cutting edge he UAE government always aims at up the new industrial license in Abu Dhabi. of the country through conventional and by providing the latest of electronic and Tencouraging the establishment of new digital channels. The different government mobile services to investors, businessmen businesses by providing easy incorporation entities established customer service centers and residents. The UAE is currently ranked procedures and reducing the bureaucratic and offices in key locations to be around the 2nd in e-Government Readiness Index 2010, steps that an investor may face in other cities near its clients. proving the government’s strong commitment. countries, in addition to the government’s Superior customer-service has always Today, most of the procedures for licensing grants given to support selected initiatives. been a key figure of the performance of the and registering businesses can be conducted According to the World Bank’s Doing Business government efficiency. In April 2011, the Prime within a mouse-click through the different report 2011, it only takes 15 days to set up a Minister of the UAE launched the Emirates government entities e-portals. All documents new business in the UAE while it may take up Program for Excellence in Government required can be submitted and verified to 60 days in other countries across the region. Services. Under this program government electronically from all over the world. For Making business entry easier has always service centers will be classified using a 7-star- example, checking the availability of a trade been a target for the UAE government. In this ratings system, with the quality of service name and reserving it can be done over the regard, a one stop-shop was introduced in determining the number of stars awarded. The internet. In fact, gaining the initial approval some emirates. These one stop-shops either rating is based on the level of customer care for setting up a new business entity is easily serve a type of business or a location where and the ease of process the entity has achieved done by using the departments of economic the entity to be established. Abu Dhabi and or was able to achieve. Various government development web portals. Dubai, for example, established separate excellent programs were also launched in all Furthermore, Government entities have industrial licensing authorities as a “one- emirates across the UAE to encourage the gone the extra mile by introducing convenient stop-shop” where investors and businessmen simplification of processes and to establish a and user-friendly applications that can be used can submit all the required documents and culture of quality and customer-orientation. over the different smart phones’ platforms. obtain industrial license easily. These new These strategic initiatives have caused a For example, all immigration procedures positive stir among government entities and can be pursued through a state-of-the-art E-Govt Official Portals their employees, driving them to provide application over iPhone. Potential investors the best possible services to all investors and can also browse all the laws and regulation Federal Government The continuous efforts in Dubai extended businessmen in the country. related to business by using phones and iPad www.uae.gov.ae by initiating strategic decisions including In realizing the UAE’s vision to become the devices. Social Media tools have also been incorporating Trakhees, a business licensing location of choice for investors around the globe used efficiently as an integral part of different Abu Dhabi authority to serve selected business locations and taking forward its promise to simplify the government entities’ communication strategy. www.abudhabi.ae such as Dragon Market and Atlantis. Tas’heel, business set-up and run businesses, local and Most government entities today are ready an online government system, was also federal entities have established various digital to address stakeholders’ issues and queries Dubai launched to simplify all labor related processes, channels through which its clients can obtain directly on and twitter. For example, www.dubai.ae improve output volume and increase their services at any time and in any location. Dubai Department of Economic Development’s efficiency. It allows companies to make online Not only clients today can find offices and news can be followed on Sharjah transactions and payments to Ministry of www.sharjah.gov.ae Labor. In addition a service called “Enjaz” was initiated by Dubai Department of Economic Ajman Samples of Government Entities’ Customer Communication Channels Development to facilitate the renewal and www.ajman.ae cancelation of commercial licenses from Ministry of Labor 800 665 the workplace without the need to visit the Umm Al Quwain Ministry of Economy 60 052 2225 www.uaqcci.com authority. The abolishment of the minimum capital General Directorate of Residency and Foreigners Affairs Dubai (DNRD) 800 5111 Ras Al Khaimah requirement condition in establishing an Ministry of Environment and Water 800 3050 www.rak.ae LLC company in the UAE has also stimulated growth in small and medium enterprises sector. Abu Dhabi Government Contact Centre 800 555 Fujairah This new decree also reduced the bureaucratic Dubai E-Government Contact Centre 70 004 0000 www.fujairah.ae hurdles like producing a bank certificate showing the required capital. Sharjah Contact Centre 800 8000 Why UAE ? The Unlimited Opportunities 2012 Chapter 7 Setting Up a Business in the UAE Seizing The Opportunities 352 353 and transparent statistics. National Bureau of Statistics Centre was established in 2009 as the national statistics centre that provides comprehensive social and economic data. Attracted by the economic expansion Outside Free Zones Understanding the and the productive business environment, international business and industry UAE Market intelligence units headquartered in the UAE to A vital tool in succeeding any business in not only serve the country’s market but also Select the Bussiness the world is understanding its market: its to provide data that cover the MENA region. Location conditions, demand and supply. Providing Examples of the most noteworthy these the historical and today’s in-depth data units are Pan Arab Research Centre (PARC), allows investors to draw the conclusions of Nielsen, CB Richards, Jones Lang LaSalle and tomorrow’s success and therefore value the Zaway. In addition, growing local business Inside Free Zones presented opportunities. Since the success of intelligence units such as Medialogy, an (Refer to Page -380) businesses partially indicates the growth of intelligence house that provides tailored and the country’s economy, the UAE government customized business intelligence solutions for is keen to provide transparent up-to-date firms that are interested to operate in various information through its statistics centers and emerging sectors within the UAE, are taking by encouraging the establishments of business their appropriate positions today’s emerging Establishing a Business in intelligence units. market. the UAE Obtaining updated economic information The UAE is the home for some of the top has become relatively easy with the global tier consulting firms that are prepared In order to operate a business in the UAE, establishment of official statistics centers, to assist investors and entrepreneurs for the business entity must be registered and the coming of internationally-recognized setup and best advice with strategies to licensed by the authorizing body. There are consulting firms and the rise of young business utilize the opportunities in this growing two main locations where to establishing a intelligence houses. The advancement in region of the world. Not only do consultants business in the UAE: establishing a business technology has also boosted the methodology provide business planning services but many outside free zones and establishing a business of presenting the figures. This enabled consultants also can help investors project- in a free zone. They differ in the government investors and businessmen to obtain manage their business setup process and authorizing entity, forms of business entities, secondary-research data from various sources facilitate in the process of employing new local types of business licenses, procedures and fees. at a convenient time. or expatriate staff, finding good premises, the best jurisdiction and office rent. Names Free zones are districts arranged by the like Price Water House Cooper (PWC), KPMG, government to encourage investors and National Statistics Centers Mckinsey & Company and Deloitte based their businessmen to do businesses in selected The UAE is among the first nations that entire Middle East and North Africa offices in sectors such Dubai Media City, Ras Al Khaimah realized the importance of providing updated the UAE. Many small growing consulting firms Creative City, with exclusive incentives and also exist to serve investors and businessmen. privileges for foreign investors. A Business National Bureau of Statistics entity established in a free zone must comply www.uaestatistics.gov.ae with the regulations and follow the procedures of the free zone. For example, a company that intends to be established in Dubai Media Statistical Centre – Abu Dhabi www.scad.ae City (DMC) must follow the regulations and procedures of DMC (refer to chapter 5 for more information on free zones). Dubai Statistics Centre www.dsc.gov.ae In contrast, a business entity established Ministry of Economy outside free zones is treated as a fully Emirati www.economy.ae entity and can operate within the jurisdiction of the emirate. They must comply with the Ministry of Foreign Trade regulations of the Federal and local licensing www.moft.gov.ae authorities.

Why UAE ? The Unlimited Opportunities 2012 Chapter 7 Setting Up a Business in the UAE Seizing The Opportunities 354 355 Business Licensing Authorities in the UAE Dubai Services

Contact the Dubai Department of Economic Development Local Emirate’s P.O. Box: 13223 Dubai, To Establish a Industrial Tel.: +971 4 4455555, Fax: +971 4 4455554 Business Entity in Licensing Authority Email: [email protected], Abu Dhabi Establishing Website: www.dubaided.gov.ae a Business Outside Dubai Department of Tourism and Commerce Free Zones P.O. Box: 594 Dubai, Toll free number: 800 70 90 To Establish a Tourism Tel.: +(9714) 2821111, Fax: +(9714) 2821131 Business Entity in Email: [email protected], Abu Dhabi Follow the Processes Website: www.dubaitourism.ae (Refer to Page -376) Dubai Trakhees To Establish any Type P.O. Box: 17000 Dubai Business Entity in Designated Tel.: +971 4 3636888, Fax: +971 4 3636858 Areas in Dubai (Dragon Email: [email protected], Market, Atlantis and Ibn Business Licensing Website: ww.trakhees.ae Battuta Zone) Authorities in the UAE Sharjah Services Investors and businessmen wishing to establish a new business in the UAE (outside Sharjah Department of Economic Development Call Centre: 600 567777, To Establish any Type of free zones) should contact the licensing Tel.: +971 6 5122222, Fax: +971 6 5287999 Business Entity in Sharjah authority of the emirate. Each emirate has its Email: [email protected], Website: www.sedd.ae own business licensing authority that grants commercial, industrial and civil licenses (as indicated in the table below). Ajman Services Abu Dhabi and Dubai established separate Ajman Municipality To Establish any Type of industrial and tourism licensing authorities P.O. Box: 3 - Ajman, Tel.: +971 06 7422331, Fax: +971 06 7457566 Business Entity in Ajman to best sever their clients and enhance Email: [email protected], Website: www.am.gov.ae government’s efficiency.

Umm Al Quwain Services Business Licensing Authorities in the UAE Umm Al Quwain Department of Economic Development To Establish any Type of Abu Dhabi Services P.O. Box: 1333 Umm Al Quwain Business Entity in Tel.: +971 06 7652200, Fax: +971 06 7653322 Abu Dhabi Department of Economic Development To Establish a Commercial Email: [email protected] Umm Al Quwain Tel.: +97126727200, Fax: +97126727749 Business Entity in Email: [email protected] Website: www.adeconomy.ae Abu Dhabi Ras Al Khaimah Services

Ras Al Khaimah Department of Economic Development To Establish any Type of Abu Dhabi Higher Corporation for Specialized Economic Zones P.O. Box: Business Entity in P.O. Box: 36000 Abu Dhabi, Toll free number: 80096637 To Establish an Industrial Tel.: , Fax: Tel.: 00971 (2) 5500000, Fax: +971 (2) 5500550 Business Entity in Email: , Website: Ras Al Khaimah Email: [email protected] Abu Dhabi Website: www.zonescorp.com Fujairah Services Abu Dhabi Tourism Authority To Establish a Tourism Fujairah Municipality To Establish any Type of P.O. Box: 94000,Toll free number: 800 555 Business Entity in P.O. Box: Fujairah - 7, Tel.: +971 9 2227000, Fax: +971 9 2222231 Business Entity in Tel.: +971 2 444 0444, Fax: +971 2 444 0400 Email: [email protected], Website: www.fujmun.gov.ae Email: [email protected], Website: www.abudhabitourism.ae Abu Dhabi Fujairah

Why UAE ? The Unlimited Opportunities 2012 Chapter 7 Setting Up a Business in the UAE Seizing The Opportunities 356 357

www.adeconomy.ae Trade Name (Refer to Page -377) (Refer to Page Processes of License Pay Trade Name Fees Trade Pay Reseve a Trade Name Trade Reseve a Trade Name Reserved Trade

Selecting a Trade Name 4. The name must be compatible with the required type of activity and legal status. Before the new business entity can operate in the UAE, a trade name must be selected and registered at the “Licensing Authority” of The registration of the Trade Name shall be the emirate. Checking the availability of trade denied in the following cases: names and reserving them is now accessible 1. If the name depicted Allah Almighty’s Names, online through the websites of the licensing religious or denominational names, governing authorities (in Dubai and Abu Dhabi). authorities names or names or logos of local, www.dubaided.gov.ae Trade license regulations are similar Arab and international bodies, institutions and throughout the UAE. The licensing authority organizations. of each emirate provides detailed trade name 2. If the name was identical or similar to a registration conditions which are also available registered local or international trade name, on their websites. knowing that such names may be registered by The registration of the Trade Name shall be their owners or attorneys thereof. subject to the following conditions : 3. If the trade names stood in violation against public law and order. 1. The name should not have been previously 4. If the trade name was misleading to the used or registered in someone else’s name for consumer with regard to the type of business it the same category of activity or for a similar depicted or its importance, size, etc. type of activity that might cause ambiguity. 2. A unique name not commonly used in the By selecting the appropriate trade name type of activity to be employed for, unless the that fits the business activity to be conducted, trade name was composed of the person’s fees must be paid. Fees might slightly differ name or title or was similar to a trade name that from an emirate to another. As illustrated was already registered with the Department, in in the fees table which represents the fees which case an addition must be made to the involved in establishing a business entity in name in order to make it distinctly recognizable Dubai, AED 100 is charged for reserving a new in order to avoid any potential ambiguity. trade name. 3. The individual trader or the company must After selecting and reserving a trade name clearly display the trade name on the façade either online or at the licensing authority, an of the establishment, and in case the latter investor will be given a receipt which should is a branch, the displayed trade name must be kept to be submitted with other required highlight this fact accordingly. documents for initial approval.

Why UAE ? The Unlimited Opportunities 2012 Chapter 7 Setting Up a Business in the UAE Seizing The Opportunities 358 359 in more details in terms of ownership, legal requirements, minimum capital levels and incorporation procedures. All foreign business Business License entities wishing to operate in the UAE, in Selecting the Form of the districts other than free zones, must have a local partner or a local sponsor or local service Business Entity agent depending on the legal form of the Once the Trade Name is reserved, investors business entity. The role of the local partner and businessmen are then allowed to choose or sponsor or agent may vary from a business from a variety of forms of business entities that entity to another (illustrated in the below exist under the UAE federal legal system, after diagrams when needed). complying with conditions and requirements The definitions of business forms and as illustrated in the diagrams. The Federal process of incorporation are almost similar to Commercial Companies Law and the UAE Civil all emirates. However, the licensing body (refer Transactions Law regulate the formation and to “Licensing Authorities section”), third party Business Entity or Service Agent Business License Select the Type of Type Select the functioning of professional, industrial and approvals required and the setting up fees may Recieved Trade Name Recieved Trade Select the Form of the Select the Form Select a Local Sponsor commercial companies. These two codified slightly vary. The below process charts explain legislations are applicable throughout the those procedures and requirements. More UAE. The most common business forms are details can be obtained from the competent Selecting a Local Partner shown in the diagram below and explained licensing bodies within the emirates. Sponsor or Service Agent

Establishing a new business entity outside a free zone in the UAE requires having a local (UAE national) sponsor/partner or service Private Shareholding agent. This depends on the entity’s business Public license (refer to “Types of Business Licenses in Shareholding Company Company the UAE” section). The sponsor national is a Limited Liability silent partner. advertisements as well as the web may provide Company some results. Finding a local partner or service agent mainly depends on personal contacts. The table provides a clear distinguishing Partnership shares Searching on newspapers and magazines between the local sponsor and the service limited with agent:

Procedure Local Sponsor/Partner Local Service Agent Forms of In all Professional Licenses and Business Entities In all Commercial Licenses can Civil

General

Required for Branches or Representatives in the UAE Company Company

be in Professional Licenses Partnership Offices of foreign companies

None. But for civil works At least 51% of the company’s company, the agent must have VentureJoint Ownership status capital percentage of the company’s Sole capital even if 1%.

Limited Proprietorships Assisting in obtaining visas, Partnership A Branch or a labor cards, and issuing the Assisting in obtaining visas, Company representitive Role license and can have other labor cards, and issuing the office of a operation and managerial role license Foreign Company as agree upon the partners

As agreed in the Articles How much is paid A lump sum and/or a percentage of Association of profits or turnover.

Why UAE ? The Unlimited Opportunities 2012 Chapter 7 Setting Up a Business in the UAE Seizing The Opportunities 360 361 Form Form Limited Liability Company (LLC) A Branch or a Representative office of a Foreign Company

Ownership Ownership Minimum of two and not more than 50 persons 100% foreign owned but must appoint a local service agent Shares can be transferred between partners or to third parties A part of the parent company and does not have a seprate legal identity Foreign equity in the company may not exceed 49 percent The UAE national sponsor does not own shares No public subscription to make up capital Liability Liability The parent company holds the liablitiy of the brnachs or the representitive offices Each shareholder is liable to the extent of his share capital Management Management An expatriate may be a manager and carry out full authority to manage the affairs of Not more than 5 managers and the method of operation for each manager must be specified the company An expatriate may be a manager and carry out full authority to manage the affairs of the company The Local Agent can’t perform any management role nor hold any share of the company

Minimum Capital Minimum Capital No minimum capital required AED 250,000 (in Abu Dhabi) Shareholders have the right to determine the share capital of the company and the company must have sufficient capital to achieve its objectives. Documents Required for Initial Approval

Documents Required for Initial Approval “General Documents Required” for Initial Approval Company Registration Certificate from the Ministry of Economy (for commercial license only) The “General Documents” for initial approval The Company’s Board of Directors’ Resolution authorizing opening of the branch The Company’s Board of Directors resolution to subscribe to the new company if the Partner is an existing corporate entity in UAE or abroad (the resolution must be attested by UAE Power of Attorney to the representitive Embassy / Consulate or by a GCC State Embassy / Consulate and UAE Ministry of Foreign Parent Company’s Memorandum of Association Affairs, and duly translated into Arabic). Photocopy of the main company’s certificate of Incorporation Photocopy of the director’s passport, and no-objection letter from the director’s current sponsor. Documents Required for Final Approval Documents Required for Final Approval Financial Statments for the past two years The “General Required Documents” for final approval Contratual Agreement with the local sponsor authenticated by the Notary Public Memorandum of Association authenticated by Notary Public Details of the national sponsor Certificate of Capital Contribution from A bank Auditor’s Certificate for all shares Fees

Fees General Fees Incorporation of a froeign company branch- AED 5000 General Fees Ministry of Economy registration fees- AED 10000 Commercial Register Issuing- AED 230 (Dubai) Service Agent Fee- AED 700 LLC Incorporation Application (Ministry of Economy)- AED 3000 Partner Addition Fee- AED 500 Special Terms Special Requirements A UAE national must be appointed as a “Local Service Agent” “Company with limited liability” must be added to the company name The office may only carry out the name and activities of the parent company and not permitted Capital must be stated to carry out commercial activities Mandatory to appoint auditors on an annual basis Account must be audited annually An LLC can not be formed for professional activities Note Note Most preferred choice for expatriates since it allows them full management control of the Popular form for foreign companies to benefit from 100% foreign ownership Company The representitive office is more limited than the branch Business performing banking, insurance and investment Activities can not form an LLC

Why UAE ? The Unlimited Opportunities 2012 Chapter 7 Setting Up a Business in the UAE Seizing The Opportunities 362 363 Form Form Public Joint Stock Company (PJSC) Private Joint Stock Company

Ownership Ownership

A minimum of ten founding members unless incorporated by the government A minimum of three founding members who fully subscribe to the company’s capital between them Local equity in the company must be a minimum of 51 percent Local equity in the company must be a minimum of 51 percent Shares cannot be offered to the public unless conditions met

Liability Liability Each member is liable to the extent of his respective share value Each member is liable to the extent of his respective share value

Management Management Board of Directors (3 to 15 directors) manages the company Board of Directors (3 to 15 directors) manages the Company The Chairman of the Board must be a UAE national The Chairman of the Board must be a UAE National

Minimum Capital Minimum Capital AED 10 million, a minimum of 25% and a maximum of 45% of the share capital of the company can be listed Not less than AED 2 million

Documents Required for Initial Approval Documents Required for Initial Approval General Documents required for Initial Approval General Requirments for Initial Approval Memorandum and Articles of Association Memorandum and Articales of Association Project’s Feasability Study Project’s Feasability Study Approval of UAE Securities and Commodities Authority Photocopy of the director’s passport, and no-objection letter from the director’s current Photocopy of the director’s passport, and no-objection letter from the director’s sponsor. current sponsor. Documents Required for Final Approval Documents Required for Final Approval General Documents Required for Final Approval The General Documents for Final Approval Certificate of Capital Contribution from A bank Auditor’s Certificate for all shares Fees A written contract between the partners General Fees Partner Addition Fee – AED 500 Fees General Fees Special Terms and Conditions 10% of the net profit must be retained as a statutory reserve until it makes half Special Requirements of the capital 10% of the net profit must be retained as a statutory reserve until it makes half of the capital Mandatory to appoint auditors on an annual basis Mandatory to appoint auditors on an annual basis

Note Note Preferred choice for local and foreign investors since it raises a huge a mount of capital May be converted to a PJSC after a period of not less than the expiration of two financial years.

Why UAE ? The Unlimited Opportunities 2012 Chapter 7 Setting Up a Business in the UAE Seizing The Opportunities 364 365 Form Form Partnership Limited with Shares Limited Partnership Company

Ownership Ownership

Owned by one or more general patners and one or more participating partners Owned by one or more general patners and one or more limited partners General Partners must be UAE nationals and Participating Partners may be non-UAE nationals General Partners must be UAE nationals and Limited Partners may be non-UAE nationals

Liability Liability

General Partners are jointly liable to the extent of their assets for the company liabilities General Partners are jointly and severally liable to the extent of all their assets for the liabilities Participating partners are liable only to the extent of their shares in the capital of the company Limited partners liable for the company liabilities to the extent of their respective shares in Management the capital only General Partners take the mangement role Limited Partners can take internal management roles Management General Partners take the mangement role Minimum Capital Limited Partners can take administrative roles AED 500,000 The capital of Partnerships Limited with Shares shall be divided into negotiable equal shares Minimum Capital None Documents Required for Initial Approval General Documents Required for Initial Approval Documents Required for Initial Approval General Documents Required for Initial Approval Documents Required for Final Approval Documents Required for Final Approval General Documents Required for Final Approval Memorandum of Association (MOA) General Documents Required for Final Approval Memorandum of Association Fees Simple Liability Contract or “Partnership agreement”

General Fees Fees Partner Addition Fee – AED 500 General Fees Partner Addition Fee – AED 500 Special Requirements (MOA) must be signedby general partners Capital must be divided into negotiable shares of equal value Must have a Board of Supervisors Account must be audited annually

Why UAE ? The Unlimited Opportunities 2012 Chapter 7 Setting Up a Business in the UAE Seizing The Opportunities 366 367 Form Form Joint Ventures Sole Proprietorship or Individual Establishment

Ownership Ownership

Two or more foreign and local partners agree by contract to share the profits and losses of one Owned by a sole proprietor or more enterprises Can be 100% foreign owned only in professional licenses and must appoint a “local service agent” One or more partners will carry out the the commercial enterprise in thier names while other partners will remain undisclosed to third parties Liability Local equity in the company must be a minimum of 51 percent The proprietor shall be responsible for all its financial obligations to the extent of his assets Liability Management Each shareholder is liable to the extent of his share capital Profits and losses can be prescribed An expatriate can the role of management

Management Minimum Capital An expatriate can carry out the management role None

Minimum Capital Documents Required for Initial Approval None General Documents Required for Initial Approval

Documents Required for Initial Approval Documents Required for Final Approval The General Requirments for Initial Approval General Documents Required for Final Approval Appointment Contract of Local Services Agent Documents Required for Final Approval The General Documents for Final Approval Fees General Fees Fees Service Agent Fee – AED 700 General Fees Special Requirements Special Requirements The role of the local service agent is to assist in obtaining licences, visas, labour cards, etc. The joint venture should be disclosed to third parties The local service agent shall not own any share in the company’s capital.

Note Note

Practically, a joint venture is a preferred form for companies working together on specific A preferred choice by many expatriate since no sponsor or partner needed to operate this form projects of company The Contract of Joint Participation is formed bewteen the partners and regulates the rights and obligations of the partners and the distribution of profits/losses Does not have to be registered or declared Existance of Joint Venture may be proved by any method of proof

Why UAE ? The Unlimited Opportunities 2012 Chapter 7 Setting Up a Business in the UAE Seizing The Opportunities 368 369 Form Civil Company or Civil Works Company

Ownership A number of partners Can be 100% foreign owned, however must appoint a “Local Service Agent”

Liability

Partners are jointly or severally liable to the extent of their personal assets for all of the liabilities of the company

Management Can be 100% foreign managed The local service agent has no direct involvement in the business and is paid a lump sum and/or percentage of profits or turnover

Minimum Capital None

Documents Required for Initial Approval The General Requirments for Initial Approval

Documents Required for Final Approval General Partnership consists of two or more company’s liabilities. This type of company partners. All partners are jointly and severally is confined to UAE national as most assets of General Documents Required for Final Approval liable to the extent of all their assets for the foreign investors are located outside the UAE. Contract of Civil Works Company authenticated by the Notary Public in the emirate Appointment Contract of Local Services Agent The General Documents Required for all forms of Business Entities

Fees General Documents Required for Initial Approval for all business entities

General Fees A proof of reserved trade name (not applicable for branches or representative offices of Partner Addition Fee – AED 500 or Service Agent Fee – AED 700 foreign companies) Photocopy of applicants’ passports (with residence permit / visa details for non-GCC Special Requirements nationals) Photocopy of applicants’ naturalization identification for UAE nationals only. The role of the local service agent is to assist in obtaining licenses, visas, labour cards, etc. Non-objection letter from the applicants’ current sponsor for non-GCC nationals. The local service agent shall not own any share in the company’s capital. Activity must involve the use of intellectual faculties such as consultancy, research, medicine Authorization of signature form (not applicable for establishments and civil works companies) Activity to be liscened must not be commercial Permission from the court to practice business, for applicants under 21 years. Approval issued by other Government authorities according to the type of activity (if Note needed). Prefered by foreign investors since it gives them 100% ownership General Documents Required for Final Approval for all business entities

Initial Approval receipt. All documents submitted before in order to get the Initial Approval Lease/A copy of valid lease contract in the name of the business entity

All foreign documents should be translated into Arabic by a Legal Translator, attested by the Ministry of Justice and attached to the file submitted.

Why UAE ? The Unlimited Opportunities 2012 Chapter 7 Setting Up a Business in the UAE Seizing The Opportunities 370 371 Commercial License

License Type Initial Approval Commercial License

Issued for Business entities wishing to practice commercial activities in the UAE

Examples Import, export, sell, distribute or store items Banking and insurance Hotels and transport Recieve Approval Approval Obtained (Refer to Page -377) (Refer to Page Initial Approval Initial Approval Initial Approval Special Requirements Submit the Required Documents for Initial Pay the Fees for Initial the Fees Pay Commercial companies (e.g. LLC) must register the company Articles of Association in the Ministry of Economy commercial registry Types of Business Licenses

in the UAE activity. The below diagrams identify these By selecting the legal form of the business different types and its classifications in terms entity, a business license must be obtained of documents needed, special requirements from the same licensing authority. In general, and examples of business activities that fall three different business licenses exist in the under the respected license type. UAE: commercial, industrial and professional. As explained previously, these licenses are all issued by the business licensing body of the In addition, a new business license – tourism Industrial License – was lately introduced by Abu Dhabi and respective emirate (please refer to “Business Dubai in order to best organize the business Licensing Authorities in the UAE page ). License Type Industrial License

Issued for

Business entities wishing to practice industrial activities in the UAE Commercial Professional License License Examples Discover natural resources Transform raw materials in terms of its structure or appearance into manufactured or Types of semimanufactured products Business Licenses Transform the semi-manufactured products into fully manufactured products by using mechanical power, and segregate the products, filling, in the UAE Assembling or packing

Special Requirements Industrial Tourism License License A minimum capital of AED 250,000

Why UAE ? The Unlimited Opportunities 2012 Chapter 7 Setting Up a Business in the UAE Seizing The Opportunities 372 373 Professional License

License Type Professional License

Issued for

Issued for business entities wishing to practice professional or artisan and service activities in the UAE

Examples Accounting and Marketing Consultancy Services (law, medicine, engineeting and research activities)

Special Requirments The number of staff members shall be limited

Special Requirements

Can be 100% foreign owned if conditions met (check sole pro and civil companies in Business Forms Section of this chapter) Previous procedural steps including Some activities require an approval submitting the required documents as The most common form of civil entity used by foreign investors from a third party, other than the licensing indicated in the forms of the business entities authority of the emirate. The third party and the general documents section, and paying could be a ministry, a national department or the fees (for trade name reservation and initial a relevant local authority. The following step approval). This segregation is needed to best is considered the most important procedure organize the formation of business entities in order to obtain a business activity, keeping Tourism License and give investor the different options of in mind that the larger portion of business License Type incorporating. activities does not need an approval from third parties such as trading. Tourism License (Only apply in Abu Dhabi and Dubai. In other emirates, tourism activities fall under the commercial license.)

Issued for

Issued for business entities wishing to practice tourism activities in the UAE

Examples

Hotels and Restaurants Travel Agencies and Tour Operators Recreational and cultural activities – pictures and libraries Sporting Activities – Adventure sports and amusement parks

Special Requirements Commercial companies must register the company Articles of Association in the Ministry of Economy commercial registry

Why UAE ? The Unlimited Opportunities 2012 Chapter 7 Setting Up a Business in the UAE Seizing The Opportunities 374 375 Business Activity Third Party Approval Authority

Banks, Money Exchange & Transfer, The Central Bank of the UAE Final Approval Financial Consultancies Insurance and Related UAE Insurance Authority

1) Ministry of Economy and All Industrial Activities 2) The Environment Department of the Emirate

Hospitals, Private Clinics & Practices, Medical Ministry of Health approval Approval Laboratories, Pharmacies (Procedure Ends) Final Approval (Refer to Page -377) (Refer to Page Pay Fees for Final Fees Pay Required for Final Obtain Third Obtain Third Party

Approval if Needed Approval Relevant Traffic and Transportation Car Rental Activities Submit the Documents Department of the Emirate

All Media Related Activities: Third Party Approvals Advertising & Publicity Office, Drawing & Scripting, Computer Trading, Digital TV & National Media Council By selecting the business license and the the licensing body of the emirate or the web Cable Services, Publishing, Broadcasting, legal form of the business entity wished portals of the third parties bodies. Distribution of Publishments to be established in the UAE (outside free Obtaining a business activity that needs zones), investors and businessmen should be an approval from a third party depends on aware that some business activities require an meeting the conditions set by the authority Accounts Auditing, Foreign Companies Ministry of Economy approval from third parties such as ministries such as the location of the business, the Branches and other authorities. The chart below lists technical staff requirements, the minimum the most common business activities in the capital needed, etc. To obtain the procedures, Babysitting Services, Nurseries Ministry of Social Affairs UAE and the third party approval needed fees and regulations for each activity, Labor Services Ministry of Labor for each activity. For a detailed list of third businessmen are strongly recommended to party approval, please refer to the website of visit the websites of the relevant authority. Plant Nurseries, Farms, Cattle & Bird Trading 1. Ministry Environment & Water Fish Trading, Seeds & Fertilizers Trading 2. The relevant Environment Department Quarries, veterinaries

Organizing Hajj and Omrah Campaigns, Quran Islamic Affairs and Awqaf Recital Centers

Law Firms Ministry of Justice

Private Schools, Kindergartens, Educational Ministry of Education Institutions, Gymnasiums

1. Department of Civil Aviation Air Transport, Air Cargo 2. General Civil Aviation Authority

Telecommunications Regulatory Telecommunications Equipments Authority

Engineering and Construction The Relevant Municipality of the Emirate

Why UAE ? The Unlimited Opportunities 2012 Chapter 7 Setting Up a Business in the UAE Seizing The Opportunities 376 377 Trade Name Reservation fee Trade Name Reservation AED 200 Check the availability Fees If Trade Name Not-Arabic AED 2000 and Reserve a “Trade Pay Trade Name” at the “Licensing Name Fees Businessmen and investor come across If Trade Name Arabic AED 1000 Authority” a different range of fees prior and after incorporating their business entities. Most Initial Approval Fees of them are paid to the licensing authority Preliminary Approval Fee AED 100 while some are paid to other authorities such the relevant municipality. The fact box below Registration Fees / Activities 100 % Register the “Trade (Percentage of the Activity fees) Select a Local differentiates between the fees that are paid Name” at the “Licensing Trade Name Sponsor or a Local for trade name reservation, initial approval Special Services Fees – VIP Authority” of the Reserved AED 1000 Service Agent fees and final approval fees from those that (optional) Emirate are applied once the entity is established. Final Approval Fees The provided fees underneath are for establishing a business entity in Dubai. Commercial License Fee AED 480 However, Fees might slightly differ from an Submit the License Professional License Fee AED 440 emirate to another. To review a detailed list Pay Initial Application and the Industrial License Fee AED 600 “Documents Required” of fees in each emirate, website of licensing Approval Fees for Initial Approval at the authorities are the best relevant source. Manager Insertion Fee AED 500 Licensing Authority Commercial Registration Issuing Fee AED 500 (Only for Commercial Companies)

Improve Services Fees 25% Select the “Type (Percentage of the Activity Fees) Select the “Legal Form” Select the “Activities” of License” to be of the Business Entity to be Conducted Market Fee Conducted (Percentage of Rental Charges) 5% Local Fees AED -- Cleaning Fees AED --

Obtain the “Third Parties Final Approval Fees Initial Approval Approval” Depending of Advertising Sign Fees AED 150 Granted the “Business License” and “Activities” Activity Addition Fee AED 500 License Renewal Fee AED 500 Activity Change Fee AED 500 Prepare all the Submit All the “Required Company Name Change Fee AED 500 Documents” at the “Required Documents” Pay the “Fees” Depending on “Type of Legal Form Change AED 500 “Licensing Authority” License” and “Form for Final Approval of Company” Register Fees AED 200 License Transfer Fee AED 500 Legal Form Amendment Fee AED 500 Inscripte in the Temporary Advertising Final Approval AED 1,100 Commercial Register if Sign Boards Granted Commercial Company Issue License of General AED 15,000 Trading Merger Fee AED 500

Why UAE ? The Unlimited Opportunities 2012 Chapter 7 Setting Up a Business in the UAE Seizing The Opportunities 378 379

Commercial Registration Appointing a Commercial Agent: An Alternative Form of Commercial Registration is a condition that precedes the operating of the business Investment activity. Within two months from the Carrying out business activities in the UAE date of establishment and preceding the does not require foreign investors to maintain commencement of the business of a company, a physical presence. Investors have the choice every merchant, branch manager, managers to appoint a commercial agent to represent of commercial companies’ agents of foreign their interest in the country. The Agencies companies must inscribe their companies in the Law regulates and governs the appointment Commercial Register of the licensing authority of commercial agents, sales representatives in accordance with the terms and conditions and distributors. According to this federal determined by the law. Commercial Companies legislation, a commercial agency is defined as and Branches of Foreign Companies must be “any arrangement whereby a foreign company inscribed in the Register and Companies that is represented by an agent to distribute, sell, practice professional services are not subject offer, or provide goods or services within the to this inscription. UAE for commission or profit”.

Commercial Agencies Requirements in the UAE Must be a UAE national or a Company wholly-owned by UAE nationals

Agent must be registered at the Ministry of Economy as a commercial agent in order to gain the protections of the Agency Law

Commercial Agency agreement must be written, notarized and registered in the Ministry of Economy

Agent entitled to receive commissions on the sales he makes The agency must be exclusive Must be a UAE national or a Company wholly-owned by UAE nationals

Why UAE ? The Unlimited Opportunities 2012 Chapter 7 Setting Up a Business in the UAE Seizing The Opportunities 380 381 emirates. Some are designed as purpose- built zones to serve a specific sector like Dubai Health Care City and Fujairah Creative City; and some were built to best utilize the geographic location such as Jebel Ali Free Forms of Business Entities Zone. Since some free zones are dedicated to within a Free Zone Establishing a Free Zone serve a particular sector such as Dubai Internet Business Entity: City, which a unique free zone dedicated to The below types of business forms are IT and e-business companies, they only allow generally offered in freezones. A free zone does not have to offer all types. Some free Where some conditions are viewed the establishment of the business that fit their zones offer only one type such as FZCO. Please by foreign investors and businessmen as specific categories. contact the relevant freezone authority. restrictions in establishing a business entity Overall, free zones are united on two outside free zones, free zones in the UAE main pillars; reducing bureaucratic steps and were established to compete on attracting allowing foreign ownership. Free Zone Company Branches of Foreign Free Zone Establishment Freelance Permit foreign investments by providing outstanding Before operating a business in a free (FZCO) Coms. privileges and incentives especially for zone, the business entity must be registered international entrepreneurs who seek and licensed by the free zone authority. opportunities and grave for business success Businessmen must choose the legal form and Not a Separate Not Offered by all and prosperity. type of license they will practice business Legal Entity. Free Zones. Over 50 free zones are scattered all over the activities under. A Single 2-5 Shareholders Shareholder Must follow the Only can Perform Parent’s Company a Freelance Free Zones Incentives Activities. Professional and Benefits Types of Licenses A “one-stop-shop” Prior establishing a business in a free zone, it is necessary to obtain a license from the free 100% Foreign Ownership zone’s authority. The license must relate to the business activities the business entity will undertake. 0% Corporate Tax Mainly, there are four types of licenses issued in the freezones. Free Capital Transfer Free Zone Company Branches of Foreign Free Zone Establishment Freelance Permit 0% Import and Re-export Duties (FZCO) Coms.

0% Personal Income Tax Issued to industrial companies Issued for registered within Issued to businesses Unlimited Foreign Employees Issued for businesses that or outside the UAE, wish to provide a businesses that wish to import raw provided they meet service like business wish to import, materials, carry out the conditions of No Currency Restrictions management, export, distribute the manufacture of having at least marketing, and store items specified products 51 percent GCC consulting, IT Low Operating Costs specified on the and export the equity and their within the free licence. finished product to local production zone. State-of-the-art Facility any country. accounts for at least 40 percent Effecient Communication Infrastructure value added

Why UAE ? The Unlimited Opportunities 2012 Chapter 7 Setting Up a Business in the UAE Seizing The Opportunities 382 383

Fill out an Application Select Type and Form Select Business from the Relevant Procedures and Documents Selling Outside Free Zones of Business Entity Activities Free Zone Authority The procedures of establishing businesses In order to sell products outside free zones, in the UAE free zones are very similar. The the business entity must appoint a UAE official following procedures and documents required agent. Other, a 5 percent customs duty is are shown only for demonstration purposes. applied on most goods. However, obtaining To obtain detailed procedures, documents services and products from and within the UAE required and fees, please contact the free is not confined to this restriction. Submit “Required zone authority. Pay the Fees Documents”

Documents Required for Business Entity in a Free Zone

Business Plan Company and personal details (passport copy, etc.) Certificate of Registration or Certificate of Incorporation or Certificate of Good A Legal Identity Acquire a Lease Obtain Operating Established Premises License Standing of the Mother Company Memorandum of Article and Association Board of Resolution calling to establish a branch in the UAE (for establishing branches only) Appointment of Negotiator of Legal Representative (optional) Power of Attorney, Specimen of his/her Signature and valid Passport Copy Applicant’s Personal Details/Profile, Specimen of Applicant’s Signature and valid Passport Copy

All documents must be notarized and attested

Why UAE ? The Unlimited Opportunities 2012 Chapter 7 Setting Up a Business in the UAE Seizing The Opportunities 384 385 businessmen can select from a relatively large number of either fresh graduates or experienced employees. Employment Visa The labor law, generally, governs the Holidays An employment visa is issued by the relations between employer/employee There are eight days of public holidays immigration department of the emirate. Employment in the UAE: relations such as working hours, termination (paid) in the year, as shown in the table “Public Approval must be obtained from the Ministry rights, medical benefits and repatriation. Holidays in 2012”. In private sector, annual Easy Regulations and of Labor, allowing a foreign national to work in paid leave is usually 22 working days or 30 The nationality is important when it comes the UAE. Sponsorship is required to obtain the Spirited Workforce calendar days to employment. Employing a GCC-national visa. A business entity can sponsor a non-GCC (Saudi Arabia, Kuwait, Bahrain, Qatar, the national in order to obtain an employment Amid the developmental factors that Public Holidays (2012) UAE and Oman) does not require issuing an visa. contributed to the evident growth in the employment visa. Expatriates, however, must UAE across all fields, the role of the colleges be sponsored to obtain a visa in order to New Year’s Day Jan 1, Sun and universities could not be ignored. It work in the UAE. The issuing authority differs Working Hours is the government’s belief on the human based on the location of the business entity. The UAE Labor Law sets the maximum Prophet Mohammed’s Feb 5, Sun factor as the prime pillar of consistent The Ministry of Labor is the legal government working hours at eight hours per day, or forty Birthday development that drove the rise of the entity to be contacted for businesses eight hours per week. However, for certain universities and colleges in terms of number established in the UAE (outside free zones). In industries such as retail trade, hotels and and specialty. More than forty higher contrast, businesses established in free zone restaurants, this extends to nine hours per day. Ascension of the Prophet Jun 17, Sun educational institutes in the UAE pump the should contact the free zone authority to During the holy month of Ramadan, normal market with qualified manpower. Today, apply for a visa for their employees. working hours are reduced by two hours. Eid al-Fitr Aug 22, Under the same law, Friday is an official (End of Ramadan) Wed day off but the government sector and many organizations in the private sector give two days off weekly which are Friday and Saturday. Arafat (Haj) Day Oct 25, Thu The official working hours in both sectors may vary depending on the emirate and the department. Eid al-Adha Register and Open a File Oct 26, Fri Submit an Application at (Feast of the Sacrifice) at the Ministry of Labor to the Ministry of Labor Generally, they can be summarized as: Recruit Staff Government Sector: Al-Hijra Oct 25, Thu 7:30 am – 2:30 pm (Islamic New Year’s Day)

Private Sector: 8:30 am – 4:30 pm UAE National Day Dec 2, Sun An Emplyoment Visa is Issued

Labor Card Issued by Employee goes Under a Ministry Medical Test

Why UAE ? The Unlimited Opportunities 2012 The United Arab Emirates A Rooted Business Culture Chapter 8

The United Arab Emirates A Rooted Business Culture

“ Embedded openness, ingrained hospitable nature,

highly responsible manners, and continues drive for excellence

are characters carved in the Emirati personality. Those are the ingredients making up the essence of the UAE’s success story. “

The Unlimited Opportunities 2012 Chapter 8 The United Arab Emirates A Rooted Business Culture 388 389

he United Arab Emirates’ present-day The Emirati Identity Tmake-up is a balanced combination of tradition and modernity. From the world’s A lot has changed for the original tallest skyscraper in Dubai to one of the inhabitants of the UAE. In its earliest days, world’s spectacular mosques in Abu Dhabi, the area now joined under the banner of the both the Islamic heritage of the country and United Arab Emirates was a split culture that the adopted global ethos sit happily side consisted of desert-oriented Bedouins and by side, creating an indomitable cultural seamen who dealt in trading and pearling, society that offers the best of both worlds across seven small, separate emirates. Despite to all who function within it. While the UAE being individual entities though, the emirates might be viewed as a more liberal society in were interdependent with similar subcultures comparison to other countries in the region, that relied economically, socially and many present-day laws are rooted in Islamic politically on one another, casting somewhat principles. Thus, a general overview of what of a unifying web that allowed them to share a is acceptable in a Muslim society will help the common culture and, to a degree, a communal UAE’s newcomers to successfully integrate social identity. into the local community. This remains true to this day. Each emirate still has its own unique flavor, but the overall feeling is one of unity and familiarity. Bedouins

may be a thing of the past and pearling may be nothing more than an admired re-enactment of days gone by, but the culture in the UAE is still very much thriving, having adapted to the global revolution better than any other Middle Eastern country. Today, visitors can spot an Emirati wearing jeans at a shopping mall as easy as finding an Emirati wearing a traditional kandoorah and ghetrah. Times have changed, but traditions and customs are still valued. A plenty of ways to experience them are amidst the modern surroundings.

Why UAE ? The Unlimited Opportunities 2012 Chapter 8 The United Arab Emirates A Rooted Business Culture 390 391

Modern Identity Burj Al Arab, Dubai The heritage of the UAE may go back The Burj Al Arab dominates the Jumeirah centuries, millennia even, but it is the cities coastline, an impressive sail-like structure that that are standing today that draw the most is repeatedly voted the most luxurious hotel attention. Think of Dubai and what comes to in the world and has been described as being mind? A glittering metropolis of extravagance, ‘seven-star’. Popular with celebrities and others entertainment and enjoyment, where living affluent travellers, room rates aren’t cheap is easy, business is good, and the sun shines – but you can get a peep inside by paying a nearly every day of the year. Things in the other minimal fee. Emirates are not so different; Abu Dhabi, for example, is no less glittering than its sister city, what with hosting the Formula One being only Burj Khalifa, Dubai one of the latest feathers in its multi-plumed Another record-holder for Dubai, the Burj hat. This is where the old meets the new, Khalifa is the tallest building in the world. Part where the UAE is playing it smart and keeping of the Downtown Dubai project, attached up with the times by creating a name for itself to it is the world’s largest shopping and by going above and beyond what would have entertainment destination, the Dubai Mall, been expected from a Middle Eastern country which even has its own aquarium – with the not so very long ago. It is undeniably modern, world’s largest viewing panel. but with a definite Arabian twist.

Why UAE ? The Unlimited Opportunities 2012 Chapter 8 The United Arab Emirates A Rooted Business Culture 392 393

The Palm Trilogy and The World, Dubai These man-made islands are renowned the world over and have sparked a regional craze, if not an international one, for their innovation and creativity. The Palms, consisting of The Palm Jumeirah, Deira and Jebel Ali, and The World, could quite possibly be considered the ultimate symbol of how the UAE is bolstering its appeal to the world, by demonstrating not only its wealth, but its ingenuity too.

International Sports A plethora of sporting associations hold major events in the UAE every year. The International Cricket Council has settled in Dubai and Formula One is one of the more recent additions at the Yas Marina no need for the part in brackets, several Circuit in Abu Dhabi, but the high-stakes golf tournaments attract the top Saadiyat Island, Abu Dhabi Yas Island, Abu Dhabi Cup has drawn in international horse- sportsmen in that field, and the Dubai Duty Although it’s not yet complete, Saadiyat The go-to spot for, well, just about racing contenders for years (champion Free Tennis Championships call in the big Island, expected to be entirely finished in 2020, everything, Abu Dhabi’s manmade island is jockey Frankie Dettori now calls Dubai home) names… and that’s just to mention a few. is set to become the UAE capital’s cultural no small feat. It is currently home to the Yas hub. Alongside the residential and commercial Marina Circuit, which hosts Formula One races, sectors there will be a Guggenheim Museum, Ferrari World (a theme park dedicated to the designed by Frank Gehry, a Louvre, a New car manufacturer) and the Yas Arena where York University campus and an 18 hold some of the biggest names in music have championship golf course and academy, performed, and soon to come are a whole host designed by Gary Player. of other attractions, including a Warner Bros. Theme Park.

Why UAE ? The Unlimited Opportunities 2012 Chapter 8 The United Arab Emirates A Rooted Business Culture 394 395

Down to Business Interaction How to Deal with Government Authorities While the UAE tends to be a lot more Most expatriates appoint an Emirati to You may have fathomed the traffic systems welcoming of foreign customs than its fellow handle ministerial-related matters, as they and got to grips with the weather, but do you GCC and Muslim countries, it is also important are able to use contacts and know-how to know how to walk the walk and talk the talk? to remember that the UAE is an Islamic nation, get the job done quicker. which means that certain normalities that are Remember that English is spoken as a The Emirati Perspectives applicable in the rest of the world are not as concession, not a necessity. well accepted. Obviously the rules of common It is essential to have at least a basic Time runs on a different scale in the UAE to with honour, it is more important to protect decency will apply wherever you are in the understanding of the concepts and the rest of the world. the family honour than to acknowledge the world, but bear in mind some of the points perspectives that make the UAE society tick, as Manners are important; you’re more individual’s wishes. Slights against the family mentioned in the following section, and many notions are held in a very different light likely to be seen quicker if you’re patient are taken to heart. remember that being conservative is the best to how the Western world perceives them. way to behave. and respectful, than if you’re angry and Friendship demanding. Religion How to Behave with Women Very important. Religion is the key to life, Considered important, but not valued as Good to Know Women are respected in Islamic societies and everything is done by the will of God. highly as family, which will always come first. for being the ones who give birth to and The general reaction to someone losing their All mention of religion should be done in a Society raise the next generation. temper or an overly serious situation is laughter, respectful manner. as a way of clearing the air; it definitely isn’t Family comes first. Islam encourages acts In the UAE and even in other GCC countries, intended to anger you further! Family of charity, and so most Muslims are generous they are very much a prominent part of the (This depends on the personality of an individual) Very important. Families are a patriarchal to those in need, especially when it comes to workplace. structure, and ties between family members human causes. Remember to respect a woman’s privacy. tend to be strong – even with distant cousins. Respect It is best not to approach or speak to an How to Get a First Meeting Emirati professional woman, unless it is for You may find it difficult to establish initial Honour Very important. Respect is paid to elders, business reasons. contact with someone on your first phone The honour of a family is often held with a special focus on age, wisdom, and, to a Only shake hands if they offer their hand call or email, especially if you haven’t met in higher regards than the wishes of the degree, wealth. first. the person previously. individual; it is considered vital to maintain a Time good reputation. Be aware of boundaries; do not flirt, touch, Speaking to a secretary or personal Very laid back. Don’t be surprised if an hug or maintain eye contact – definitely assistant will not necessarily land you a Shame appointment turns up late; time is considered don’t stare! meeting; most do not have the authority to schedule their boss’s time, and will need Shame is avoided as much as possible, a rough guideline as to when something Some men may find it offensive if you ask to seek his or her approval before doing so. especially when it comes to family. Much as should start. as to the well-being of the female members of their family. Due to the naturally hospitable trait of Government emiratis, setting up a first meeting might Laws are mostly secular and based on not be difficult Its advisable to make an Islamic beliefs. effort to contact the person one is trying to visit through phone or email before Justice showing up. Muslims believe that equality and justice If you already know someone, it is an should be held in equal regard, and justice is expected courtesy that you will call in to considered important. visit them if you’re in their area. Be aware Tradition that they will likely do the same for you though. Held in high regard, even if it is being overtaken by modern advances in some cases; this can lead to a conflict of interests.

Why UAE ? The Unlimited Opportunities 2012 Chapter 8 The United Arab Emirates A Rooted Business Culture 396 397 It is the host’s place to set the topic of conversation. How to Give and Receive Gifts How to Address Someone If you arrive and there are already guests You’ll find that giving and receiving gifts is While it may be fine to call someone by in place, then you will be enlightened on an important part of Emirati culture. their first name in the West, it is best to the topic of conversation and asked to Be wary of the circumstances in which start out relationship by using last names, contribute to it. with a title affixed. There is no equivalent you give a gift; offering one to a boss or Conversations Remember to always be polite. Being to Mr. or Ms., however Sayed or Sayeda, superior without due cause may look as if You’ve got your first meeting, or you’re forthcoming is fine, and a reasoned, followed by the first name (for example, you are trying to bribe them. about to go to a business lunch with new intelligent argument is welcome – so long Sayed Mohammed) will suffice. Different Arab nationalities prefer colleagues, acquaintances or potential as it is presented in a courteous manner, different gifts, on top of personal An alternative is the use of the Kunya, or business partners… but what do you talk and does not fall into quarrelling or preferences; a little bit of research can go a teknonym; Abu for men, or Umm for about? Here are some guidelines to help you bickering. women, which literally means ‘father/ a long way! pick acceptable conversation topics – and to Provoking feedback through your mother of’. This will usually be followed A general rule of thumb is to always buy let you know what to avoid. conversation will place you in good stead by the eldest son’s name (for example, Abu the best quality gift within your budget, – so long as the feedback isn’t the result of Khalifa, or Umm Hussain). A conversation will always begin with from a reputable brand – and local is good, platitudes – these may go on for some angered emotions. Royal family members should be addressed too! time, and, in the case of two Arab Do not be afraid to disagree with an as in the West, using ‘His/Her/Your Highness’ A well-received gift is traditional perfume, nationals greeting one another, will likely opinion, bearing in mind the above- Samu al-Emir, in Arabic, and Ministers and which is as much a status symbol in the UAE, be accompanied by kissing on the cheeks. mentioned points, as the object of raising Ambassadors should be ‘Excellency’. though this should only be gifted to men Pleasantries such as inquiries into health, controversial subjects is to spark a debate as it may be considered an insult for a man Other titles that can be used are Doctor, business and home country are more than that isn’t for winning, but for enlightening to proffer it to a woman. Shaikh (meaning ‘chief’; use Shaikha for acceptable, as is a handshake – bear in mind one another to views which may not women), Mohendes (meaning ‘engineer’), Incense is also popular, such as oud, but though that handshakes in the Middle East otherwise be known. or Ustadh (meaning ‘professor’). Don’t be again be sure to pay special attention to are far softer than those used in the West, It’s considered more valuable to have a surprised if colleagues working under you the quality of the product. so don’t just someone on the strength of conversation in which all parties involved call you Shaikh, as it is a sign of respect their grip! learn something. Chocolate is always a popular choice, as and an acknowledgement that you are are traditional sweets such as baklava. It in charge. Shaikh may also be used in the is common for someone celebrating (a same manner as ‘Sir’ (as in knighthood) wedding, birth, purchase of a new home is used in the United Kingdom – always or car and so on) to bring in treats to share followed by a first name only, e.g. Shaikh with their colleagues. Ibrahim. What not to give: jewelry, silk garments (for men; both are considered effeminate items and should only be gifted to women), alcohol, pork or pig products, overly personal items, images containing nudity – even artistic forms. When receiving a gift, it is impolite to refuse. Common courtesy applies; show appreciation for the giver having gone out of their way to find something for you.

Why UAE ? The Unlimited Opportunities 2012 Chapter 8 The United Arab Emirates A Rooted Business Culture 398 399 It is always safer to err on the side of being Useful Arabic Phrases too conservative. English Arabic What to Wear The UAE’s weather is hot most of the year Salam / Asalaam Alaikum – and very hot in the summer. Bear this in (Peace be upon you) mind when choosing clothing. Lighter Response: fabrics and natural materials, like cotton, Wa Alaikum Asalaam are most suitable. Hi / Hello (And peace be upon you) While it may be hot outside, air Marhabah conditioning means that most interiors are cool, sometimes to the point of being cold. Response: If possible, carry a wrap or a shawl in case Marhabta’n it gets too cold. Sabah Al Khair Remember that the UAE is a multicultural English Arabic Good morning Response: society and therefore many forms of Do you speak national dress are visible on a daily basis. Sabah Al Nor Titakellem Ingleezi? English? Certain institutions (such as government Masah Al Khair I don’t speak offices and places of worship) have stricter, Good afternoon / Ana la atakellum Al Arabi Response: Arabic more conservative dress codes than Good evening elsewhere. If in doubt, call ahead to check Masah Al Noor I speak Arabic / Atakellum Arabi / Ingleezi what is acceptable. English Acceptable Dress Code in the UAE Ahlan Wa Sahlan Thank you Ocassion Men Women Response: Shukran (jazeelan) Welcome (very much Ahlan Beek (to a man) (Greeting) Acceptable casual dress could vary Ahlan Beech (to a women) You’re welcome Afwaan according to situation and place. Ahlan Beekum (to a group) For example, wearing shorts during Yes Na’am excersicing is acceptable but it may Casual Casual Western dress is sufficient. Kaif Halek? No La not be so in malls in some areas. Response: However, wearing longer trousers Please Min fudluk Al Hamdulillah, Bi-khair or skirts and sleeved tops is more How are you? advisable at all places. (Praise be to Allah (well) No problem Ma’afi mushkil Ana Bikhair, Shukhran Sorry Aasif (I’m fine, Thank you) Wearing an evening gown is fine, though bear in mind the location Excuse me Afwaan Wa Ant? (to a man) and the people who will be there. And you? Today Il youm Showing a little more skin is Wa Anti? (to a women) National dress, tuxedoes, dinner Formal acceptable if you’re going to a Tomorrow Bukhrah suits. predominantly Western-attended Ma’Salaamah Hopefully Inshallah function or a ladies-only event, but Goodbye Response: take a shawl with you to cover up if Fi Aman Allah Congratulations Mabrook needs be.

See you tomorrow Ashoofuk Bukhrah 0- Seffr 1- Wahid Avoid figure-hugging clothing, short hemlines, and plunging 2- Ithnain 3- Thalatha necklines as much as possible. Dependent upon the office, this Trousers or a long skirt with a shirt Good to Know Business could be anything from suit and tie 4- Arba’a 5- Qamsah (if it’s a light shirt, wear a vest When complimenting someone or something, to shirt and jeans. underneath to avoid underwear you can use ‘Ma’ashallah’, which means ‘What 6- Sitta 7- Seba’a showing through) will be suitable, Allah wishes’. This is especially used for health though office standards may vary. and when complimenting beauty or success. 8- Thamaniyah 9- Tissah

Why UAE ? The Unlimited Opportunities 2012 Relocating to the United Arab Emirates Chapter 9

Relocating to the United Arab Emirates

“ When the easy and cost-effective residency procedures combine with an environment that is set

to incubate different cultures and nationalities from

all around the globe, the relocating process becomes a tranquil and enjoyable experience. “

The Unlimited Opportunities 2012 Chapter 9 Relocating to the United Arab Emirates 402 403 it is a great place to raise a family or to further UK Citizens careers, due to the ample job opportunities British citizens are eligible for a free visa on and a decent standard of living on offer. arrival, which is valid for 60 days and can be Additionally, considering the fact that renewed for an additional 30 days by paying there is no personal income tax, it is the ideal Things to do Prior to an extension fee of Dh500 (US$ 137). Failure s much as its pulse peaks with the Burj place to save and repatriate money back home Arrival: to pay the fee or exit the country once the AKhalifa, it also knows when to bow too. This also facilitates shopping for goods at extension period is over can result in a fine. down to culture and tradition – striking a tax free prices – one reason why the world’s Obtain a Visa balance so unique that over 200 nationalities most recognized and sought after brands are Others have made the UAE their home away home. available here. As with all developed nations, there are Besides the UK, there are 33 other countries certain criteria in place to procure entry into Dubai and Abu Dhabi may have put the With nearly eighty per cent of people living whose residents enjoy similar privileges. These the UAE. However, a well-equipped and United Arab Emirates on the world map. in the UAE being expatriates, there is an ample include France, Italy, Germany, the Netherlands, updated immigration system facilitates this. However, with its contrasting landscapes, a choice of lifestyle, food and cultural options, Belgium, Luxembourg, Switzerland, Austria, While there are some categories and citizens skyline that boasts the world’s tallest tower, making it a great place to mix or match. This Sweden, Norway, Denmark, Ireland, Greece, from certain nations that do not require prior state-of-the-art facilities, a safe and welcoming is helped by the fact that the UAE is centrally Cyprus, Finland, Malta, Spain, Monaco, approval, others are required to follow a step- tax-free environment, the most coveted hotels located which makes it an easy access point Vatican City, Iceland, Andorra, San Marino, by-step process to secure a visa to the UAE. and designer brands, some of the world’s from anywhere in the world – one reason why Liechtenstein, United States of America, largest shopping malls, upscale infrastructure it is a convenient place to relocate for most This depends on the type of visa one is Canada, Australia, New Zealand, Japan, Brunei, and technology, and an effortless blend of since home is just a flight away. looking to procure, nationality, purpose of Singapore, Malaysia and Hong Kong. the planned visit and its duration, and other modern meets traditional, there are many Also, when moving out of one’s comfort essential factors. aspects to this nation that set it apart from the zone, a safe and secure environment is an Visit Visa rest of its GCC cousins. important factor for many. UAE’s low crime Regulations do change from time to time. This is the most sought-after type of visa, The world is watching the UAE. Its meteoric rate and political stability ensure just that, as However, the basic criteria remain the same. especially by tourists who wish to spend more progress and developments have made this do many other factors which will be explained It is best to check with the travel consultant than 14 days in the UAE. There are two types very young nation the envy of the region and at length in this chapter. and regional UAE embassy or consulate of visit visas and both are non-renewable. The prior to making any arrangements. The most showcase to the world just what’s possible However, it would be advisable to understand long-term visit visa allows visitors to stay in the important factor to keep in mind is that one’s with vision and an intelligent use of resources. the entry requirements and regulations to make UAE for 90 days, while the short-term visa is passport must be valid for at least six months Most expatriates are lured by the fact that the move as stress-free as possible. valid for only 30 days. - beyond the end of intended stay – before applying for any type of visa to the UAE. Key Points to Remember: Essentially, there are five types of visas The visitor must have a spouse or relative namely residence visa, visit visa, family visa, who is a legal resident of the UAE - in order tourist visa and transit visa. Here, their purpose to sponsor the visa. and requirements is explained at length. Proof of marriage or justification for the visit must be furnished prior to applying for Obtaining on Arrival Visa a visit visa. GCC Citizens The sponsor would be required to deposit Dh 1,000 as a financial guarantee. This will Citizens of Bahrain, Kuwait, Qatar, Oman, be refunded once the visitor exits the UAE. and Saudi Arabia – better known as the Arab Individuals with a visit visa will only be Gulf Co-operation Council (GCC) member allowed to re-enter the UAE if he or she has states - do not need a visa. Expatriates from stayed out of the country for a minimum the aforementioned countries are eligible for period of one month. a non-renewable 30-day visit visa upon arrival.

For Further Information for Visa Abu Dhabi Dubai

UAE Federal Government Naturalization and Residency Department www.eg.ae www.dnrd.gov.ae Tel:+971 6 00522222 Tel:+971 4 398 0000

Why UAE ? The Unlimited Opportunities 2012 Chapter 9 Relocating to the United Arab Emirates 404 405 cost - are issued only if a passenger has a valid ticket for an onward flight. Tourist Visa Overstaying Citizens of all other nationalities – from Residence Visa Visitors who overstay without securing the countries not included in the aforementioned Also known as an employment visa, such required permission or paying an extension list – would need to be sponsored by a resident visas are provided by an employer of the fee would incur a fine of Dh25 - Dh100 per day. of the UAE, hotel, travel agency, or company, individual. UAE employers may ask foreign in order to enter the UAE. employees to deposit their passports with the Exit Requirements Tourist visa for a relative or friend can only company as part of their terms and conditions Cancel the visa before permanently leaving be sponsored by a legal resident of the UAE of employment. While this is not an unusual the country. Failure to do this will result in who earns over Dh4,000 per month. Hotels practice, it is illegal under UAE labour law. the individual being listed as an absconder can also sponsor a tourist, only if the visitor Family Visa and could even lead to arrest on re-entry. stays at the hotel. Laws in the UAE require Key Points to Remember: This type of visa is required if an expatriate If the expatriate is subject to a travel ban, foreign guests to hand over their passports A visit visa can be transferred into a residence intends to bring a member of their family to is involved in legal proceedings, has unpaid when they check into a hotel. It is a normal visa by either re-entering the country or the UAE for an indefinite period of time. debt or are a child subject to a custody practice for hotels to take a photocopy and facilitating the transfer at the Immigration dispute, they may be prevented from leaving A family visa can be acquired based on the return the passport to its owner. However, department. the country. following criteria: some hotels insist on keeping the passport A residence visa is valid for three years Expatriates or residents (also known as until all payments are cleared. from the date of issue, following which the sponsors) earn a minimum monthly salary individual will have to undergo a medical of Dh4000 or Dh3000 + accommodation. test for the visa to be renewed. A short term visa, valid for 30 days, can be Transit Visa This will provide an individual with a health acquired for an application fee of Dh620 Certain UAE airlines offer to sponsor a visa for card at a cost of Dh300 (US$ 82). + typing fees, while Dh1,120 + typing fees their passengers as an additional facility. Also The health card - issued either by the known as a transit visa, this allows a passenger needs to be paid for a long term visa which Ministry of Health or a recognized private is valid for only 90 days. Neither of the visas entry into the UAE for a maximum period of 96 hospital - needs to be renewed every year. hours or four days. Such visas – normally free of can be extended beyond this period. A deposit of AED 1,000 needs to paid, which can be refunded after the relative has left the country.

Documents Required: A typed application form entailing personal details. Copies of the sponsor’s and family member’s passports. Passport sized photograph of the family member. Marriage contract attested by the Ministry of Foreign Affairs or UAE Embassy in case the expatriates wish to sponsor a wife or husband. The birth certificates need to be attested in case children are being sponsored. Proceduer: Attested documents in case the relationship Fill out a visa application form and submit it to the sponsor along with copies of the valid cannot be proven in the sponsor’s or relative’s passport pages. passports. An attested work contract is also A tourist visa costs Dh650 (US$ 178) and requires seven days to be issued. required if the sponsor is working in a private The tourist visa must be deposited at the relevant airport’s immigration counter at least one company or a salary certificate if he/she is hour before the visitor’s arrival. employed by the government.

Why UAE ? The Unlimited Opportunities 2012 Chapter 9 Relocating to the United Arab Emirates 406 407 are private employees), alongwith a tenancy contract of a two-bedroom apartment. Visa Formalities for Parents Hiring a Maid A typed application form from an authorized UAE expatriates with valid resident visas typing office. Domestic help is one of the most sought after must earn a minimum salary of Dh6,000 per Copies of the sponsor and maid’s passports. services in the UAE mainly due to the fact that month with accommodation or Dh7,000 per Minimum three passport-sized photographs of many expatriates can afford housemaids to do month without accommodation. This will the maid. allow them to get a one year renewable their home chores or take care of their children for very little money. There are guidelines An affidavit from the respective embassy/ resident visa. consulate certifying that the maid and sponsor designed to make the process more transparent The expatriate would need to sponsor both are not related, especially if they are from the for maids and sponsors. Unlike other types of parents, but only after providing proof same country. visas, domestic staff is subject to a different that he/ she is the sole provider. Once all documents are in place, approach the sponsorship and visa approval system. respective residency department for a ‘domestic Documentary proof is also required if worker identity card’. the parents are divorced or either one Key Points to Remember: A refundable deposit of AED2,000 (about USD is deceased. The expatriate would also for each parent that extends a minimum The sponsor needs to provide a salary certificate 545) needs to be paid which will be returned need to obtain a medical insurance policy coverage of Dh600 per year. in Arabic (in case they are employed by the once the housemaid permanently exits the government) or a labour contract (in case they country.

Key Points to Remember: Domestic workers do not have a labour card as they are not covered by the Ministry of Labour. They must be personally sponsored by an individual who is usually male and the head of the family and earns a minimum salary of AED 6,000 (USD 1,634) a month or AED 5,000 (USD 1,361) plus accommodation. Bachelors cannot sponsor a maid. The only countries from which domestic staff can be employed are Sri Lanka, Indonesia, India, Ethiopia, Bangladesh and The Philippines. As per regulations set by their respective embassies, an Indian or Filipino maid must be older than 30, but not more than 60 years of age. Minimum wages for housemaids have been set by the embassies of their respective countries. However, the monthly salaries differ for various nationalities. An Indian maid, for example, must be paid AED 1,100 (USD 300) per month, while the minimum salaries for maids from the Documents Required for Parents Visa: Philippines and Sri Lanka are atAED 1,400 (USD 381) and AED 825 (USD 225) respectively. The A typed application form that clearly entails all personal details. minimum wage limit for Indonesian maids is AED 800 (USD 217), while Bangladesh has set AED 750 (USD 204) as the salary limit for its nationals. All employers are encouraged to pay more Original passport of the sponsor. than the minimum. Passport copies of the parent/s alongwith their passport size photographs. Every housemaid is bound by a contract for one or two years – approved by the residency Proof of relationship from the respective embassy/consulate, with proof that he/she is the sole department of their respective emirate - which is renewable. Once the contract expires, the provider for their parent/s. maid is free to leave and does not have to pay any severance charge to her employer. Copy of the employment contract and/or salary certificate from their employer. Prior to applying for a residency visa, sponsors must ensure that the housemaid undergoes The expatriate would also need to provide a copy of their water and electricity bill (authenticated certain medical tests, at least 30 days before her arrival in the country. These tests will screen by the Dubai Water and Electricity Authority) and their tenancy contract as proof that they the maid for HIV/Aids, pregnancy, Hepatitis B, Syphilis, tuberculosis and leprosy. have adequate space for their family members in their place of residence. This would need to Employers are obligated to provide a one-way ticket once the contract ends and the worker is be stamped by the Land Department, certifying that the expatriate resides in a minimum two repatriated. Additionally, during the period of employment, a two-way ticket must be provided bedroom apartment. In case the tenancy contract fails to mention this, an affidavit from the to the maid once every year. landlord would need to be submitted. Employers can cancel their maid’s visa at any time. They can also report the maid in case she Once all the documents are ready, these would need to be submitted to the residency absconds, following which a ban may be placed on the individual in the event of a breach of department of the respective emirate that one is a resident of. contract or illegal activity. If a ban is placed because of a contract breach, it cannot be appealed A safety deposit (which varies from one emirate to another) would need to be provided, which by the maid. The sponsor, however, can have this nullified at no particular charge. will be refunded when the visa is cancelled or in case a parent dies. Employers who indulge in hiring maids that do not have a valid visa/passport or are illegal can Once the parents enter the UAE based on the entry visa, the sponsor must convert it to a be subject to a USD 19,061 fine, imprisonment for a month, followed by the deportation if the residency visa in no later than 60 days from the date of entry. employer is an expatriate. It is advisable to approach registered agencies to hire part-time help.

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Housing and Accommodation Freehold Property Purchase Individual taste and preference is what This option is available on almost all turns any house into a home. When moving developments in the UAE, with a mixture of to the UAE, finding an ideal place to live – freehold and a 99-year leasehold property in in a community that reflects one’s needs some cases. Expatriates with a valid residence and requirements – is a major concern for visa and even overseas investors can purchase most. Fortunately, the UAE’s housing and property in the UAE. accommodation sector ensure that there is something to suit every budget and lifestyle. factors before finalizing a property to rent. Having said that, it’s easier and more Many companies advertise rental convenient to rent an accommodation rather accommodation options, including private Key Points to Remember: than purchase a property. villas and luxury apartments, in the classified After thorough research – which can either be by liaising with authorised property agents or by Before deciding on whether to rent or buy a sections of local newspapers. Moreover, scouring on the internet - decide on a budget and secure financing before choosing a property. specialized housing agents are always on property, it is best to rule out the following hand to assist with relocation and house points first: Expatriates can only purchase property in areas that are specifically designated for them. hunting. There are no limitations for How much is the rent or installments – is it There are a wide variety of mortgage options to choose from. This includes local and international expatriates looking to purchase a property paid weekly, monthly, quarterly or yearly? lending facilities. While most overseas banks do not directly provide such facilities for purchase as part of their relocation plan to the UAE. Research the seller, the area and community, of UAE properties, arrangements can be made with favourable international interest rates, if Should an individual wish to take more time neighbours, market value and best areas to one has assets overseas. before buying an apartment or villa, a wide reside in. It is best to secure a loan as most banks require the amount to be repaid from an insurance variety of options including five-star, four- policy, in case of emergencies. star, three-star, budget hotels, furnished An individual is required to pay annual The payment terms are usually at an average deposit of between 10 and 20 per cent of the and semi-furnished hotel apartments help rent in advance either with post-dated facilitate this. cheques or cash. The number of cheques price. This would need to be paid during the contract-signing stage for all new development or installments to be paid varies from one properties. Additionally, when renting a property, landlord to another. there are various mortgage options to Once the initial payment has been made and based on the agreement between the buyer and finance a purchase. However, it is advisable A refundable security deposit will also be the seller, other stage payments would follow through to completion. to study residence options as per budget, required at the time of agreement. An investor does not need to have a local bank account to buy property in Dubai, especially travel convenience and other individual Once the terms and conditions of a since most banks extend an easy funds transfer facility from their client’s current account to the tenancy contract have been decided upon, necessary developer, landlord, or real estate agency in the UAE. it is imperative that all lease agreements It is advisable to consult a lawyer before finalizing any property deal or when buying property are registered with RERA (Real Estate from the second hand market to avoid any unforeseen circumstances or legal tussles in the Regulatory Authority) as otherwise neither future. Reputed developers, however, do not pose any such threat. party can assert their claim in case of a dispute. UAE charges a minimal development fee for maintenance and landscaping. This service charge varies from one development to another and based on facilities offered. Property agents who act as middlemen between the tenant and landlord usually Once purchased, an owner can rest assured that he or she will not be required to pay a charge a commission. government tax against the property. However, there is no Capital Gains Tax on the property either. Once a title is registered by the Dubai Lands Department, owners will be required to pay Documents Required: a 1.5 per cent registration charge based on the purchase price of their property. In case of a mortgage, the payment would be 0.25 per cent of the total value of the loan. A valid passport. Investors do not require a residence visa to purchase property in the UAE. On the contrary, an A valid residence visa. investor becomes eligible to apply for a residence visa on the purchase of a freehold property. A salary certificate – this is a testament of an However, the purchase of a property is not the sole reason for an individual to be granted a individual’s income, his or her employment residence visa – this is based on the sole discretion of the immigration authorities. and financial status.

Why UAE ? The Unlimited Opportunities 2012 Chapter 9 Relocating to the United Arab Emirates 410 411 representative offices of foreign banks. Both Islamic (Sharia’a-compliant) and regular banks are all governed by the Central Bank of the UAE. Deposits and Withdrawals Banking Processes and Initiating Accounts There are ample ATMs located across the Procedures UAE for cash withdrawals, which can also be Opening a commercial bank account for used for making utility bill payments, while Banks in the UAE offer varied choices individual purposes in the UAE requires very the same also house Cash Deposit Machines that are at par with international standards. simple procedures, but sometimes these (CDMs) for credit card payments and account There are both locally incorporated as well vary from bank-to-bank and account type. deposits. Overdrawing on the accounts is done as foreign banks, both commercial/retail and Expatriates must have a valid residency visa only with prior application and approval from investment. In most cases, the foreign banks with an expiry date of not less than 1 month the bank. require a cheque as a guarantee. Non- also offer non-resident accounts to be opened to open an account. if it has a presence in the account holder’s payment of credit card dues can also be a home country. The UAE is also home to several Issuing Cheques criminal offence if the cheque is deposited and renowned Islamic or Sharia’a-compliant returned due to insufficient funds. Accounts The layout of cheques is similar to UK or banks and institutions, including Dubai Largely, the main types ofaccounts that can American cheques and these can be easily Islamic Bank, the world’s first Islamic bank. At be opened are Current, Savings and Deposit filled with information listed in both English Bonds and Savings Certificates present, the number of commercial banks in Accounts. Current Accounts Offer a cheque and Arabic. Although cash or debit payments the UAE is close to 47 including both locally Some banks and financial institutions, both book facility, but require a minimum account are preferred for everyday transactions in incorporated and foreign ones, aside from nine regular and Islamic, offer fixed bonds and balance while Savings Accounts have no Dubai, a large number of service providers certificates as investment or saving vehicles. cheque book facility and in certain case, only require personal cheques for regular payments Documents Required: These offer attractive returns or interest and an ATM car and no minimum balance required. like tenancy payments or guarantees in case of can be encashed at any time at the same bank Passport with residency (original and copy) The Deposit Accounts vary according to the loans, mortgages and utility services. Cheques or institution. The individual has to personally carry their fixed savings/amount, tenure and interest are mostly not accepted by local retailers. It original passport with copies of the same accrued. is important to note that issuing a cheque with the residency visa stamped without the necessary funds in the account is Currencies A letter of no-objection or NOC from the a criminal offence in the UAE. If the cheque Although AED is the currency of record, in employer/sponsor bounces, the bearer can file a criminal case some banks, savings accounts can be opened against the issuer. This could result in a travel Procedure: in major foreign currencies, predominantly and/or immigration ban on the defaulter. USD and GB£. The required documents must be taken to the choice of bank and in most cases, an account will be functional within 48 working Credit Cards Salary Transfer hours, while the cheque book and ATM/ Most banks issues credit cards which carry Having the salary transferred to an account Debit Card could take up to a week. set interest rates, while in the case of Islamic is required to apply for loans, mortgages, NOC banks, a pre-listed fee is charged. Every bank utility services or tenancy contracts, as a bank has different salary and employment tenure The “Letter of No Objection” or a “No statement is usually required along with a criteria for issuing cards, while all of them Objection Certificate” (NOC) from the proof of income. employer or in the name of the company signed by the authorised signatory and stamped. The letter should stipulate salary Services and date of joining. Some banks require As with all global banks, all standard tenancy agreement to establish the account holder’s residential address. Additionally, banking services are offered by UAE banks. the employee should have completed 3 to 6 These include cheque clearance, standing months in the company to be eligible to open orders, direct debits, salary transfer and credit an account. The employee’s dependants or card repayments. Most of these transactions immediate family can open an account with per year are usually free, including withdrawing the individual’s signed permission, is the cash from any of the bank’s ATMs, although a employee is their sponsor. nominal fee is charged for withdrawals from other banks’ ATMs. Why UAE ? The Unlimited Opportunities 2012 Chapter 9 Relocating to the United Arab Emirates 412 413 residents can obtain a liquor license. However, marriage is considered illegal and unmarried the license will be applicable only in the couples indulging in adultery risk prosecution, emirate where it has been issued - a permit imprisonment and/or a fine and deportation. If issued in Abu Dhabi, for example, is not valid an unmarried woman gives birth in the UAE and in Dubai. Any alcohol consumption is illegal in is brought to the attention of the authorities, Essential Do’s and Don’ts Sharjah. The penalties for drug trafficking or she may face severe punishment - ranging from smuggling are severe. The possession and/or a refusal to issue a birth certificate to arrest As with any other country, there are certain import of even the smallest amount of drugs and imprisonment. Cohabitation (including rules and regulations that must be adhered can result in a minimum prison sentence of in hotels), cross-dressing and homosexual to in the UAE too, in order to ensure a safe, four years. behaviour are also banned in the country. secular and respectful environment for all. It is imperative to avoid using obscene Here’s a checklist of essential dos and don’ts. Languages Used language or make rude gestures in public as offenders have, in the past, received six-month Arabic is the most commonly spoken jail sentences for such acts. Some have also Dress Code language, followed by English, French, been deported. Be aware to avoid prosecution. Emirati men or Arab citizens from GCC Russian, Hindi and more. Almost all official states usually wear the traditional clothing documents, forms, laws and decrees are in of their native country. Many Muslim women Arabic. Therefore, it would be advisable to Censorship and Photography cover their hair with a scarf and wear a long, have working knowledge of the language. black robe called the abaya. of residence first before deciding to bring pets Medication into the UAE. Key Points for Dress Code for Expatriates: Some prescribed and over the counter It is essential for men and women to dress Key Points to Remember: modestly at all times. medicines that are available outside of the UAE are considered controlled substances Pets from some countries would need to All malls advertise the type of clothing that is within the emirates. It is best to procure a take a blood titter test to check for rabies. considered permissible while shopping in the prescription or prior permission from the This does not apply to pets arriving from the UAE. Please read these instructions carefully. UAE’s Ministry of Health before travelling with US, Canada, an EU Country or a country that Swimming attire can only be worn on any such medicine to the UAE. Failure to do is considered to be “free of rabies”. beaches or at swimming pools. Topless sun- this may lead to prosecution under UAE law. Photography of certain government Owners can only bring in their pets as cargo. bathing is not allowed. For more information and to view the list of buildings is not permitted. No airline allows pets to travel with its owner controlled medication, visit the Ministry of It is advisable not to photograph in the cabin of the aircraft. Health’s website: www.moh.gov.ae. people (especially women) without their It is important to procure an import paper Drugs and Alcohol permission. from the Ministry of Agriculture & Fisheries UAE adopts a zero-tolerance policy for Etiquette Do not take pictures of military sites. prior to a pet’s arrival. This is valid for 30 Avoid bringing any magazines, DVDs or days from the date of issue. drugs and alcohol - it is a punishable offence to UAE is very particular about public displays books with pornographic content into drink, or to be drunk, in public. To purchase or of affection and there have been several To obtain the import permit, the owner needs the UAE. Certain international magazines consume alcohol in the privacy of their homes, arrests for kissing in public. Sex outside of to submit an application form identifying the and newspaper sold in the UAE are pet based on its type and colour. The form censored – all objectionable material is would also identify the owner. marked in black, while intimate scenes Along with the form, the owner would also in films shown in the UAE movie theatres need to furbish copies of his or her passport are censored. and valid residency visa. Another important document to be included Pets is the pet’s full vaccination card/certificate The UAE places no restrictions on bringing clearly detailing its history of vaccinations. pets into the country. However, if an individual opts to rent an apartment, the confined space It is essential to micro-chip all dogs and cats can prove to be a hassle for both the pet and before their arrival in the UAE. The vaccination its owner. Additionally, unfavourable climatic card would need to display the micro-chipping conditions make it difficult to leave pets details. If handwritten, it would need to be outdoors. Research and decide on the choice stamped by the veterinarian. Why UAE ? The Unlimited Opportunities 2012 Chapter 9 Relocating to the United Arab Emirates 414 415 to interact with students from various List of Driving Schools nationalities and backgrounds, which in the Abu Dhabi long run ensures greater global awareness. This is possible through a wide variety of Al Aqeed Driving School, 02-642-4577 curriculums on offer which includes American, Driving and Etiquette Al Aqeed Driving School, 02-642-4577 Education British, Australian, French, German, Indian, Iranian, Japanese, Russian and of course Learning to drive in the UAE is relatively Emirates Driving Company, 02-551-1911 With an influx of nationalities streaming Arabic. easy. As with all nations, there are certain into the UAE each year, catering to multi- Dubai To ensure all schools meet parents’ rules and regulations that must be adhered cultural needs and requirements - especially to. In order to procure a UAE driving license, Al Ahli Driving School, 04-3411500 in complex fields such as education - can be expectations, the Knowledge and Human Development Authority took it upon itself an individual needs to be 18 years of age and Belhasa Driving School, 04-3243535 a mammoth task. However, the UAE does above. this with aplomb. Irrespective of whether an to grade each school based on performance, Documents Required: Dubai Driving Center, 04-3455855 expatriate student is used to an O level or A facilities and level of education by providing a level type of education or has had another detailed report on every school each year. A no-objection letter from the sponsor. Emirates Driving Institute, 04-2631100 educational background, schools in the Besides a wide variety of primary school Original passport and copies. Galadari Driving School, 04-2676166 emirates have courses to suit all palates. options, the UAE also offers the best in Copy of a valid residence visa. higher education facilities. A dedicated Sharjah One of the great things about education Eight passport size photographs. and schooling in the UAE is the opportunity complex for world-renown universities and Al Badoor Motor Driving School, 06 5650487 campuses ensures expatriates and residents An eye test certificate listing the condition do not have to look elsewhere to offer the and health. Al Deyar Driving School, 06 5656285 best in education to their wards. Also known Al Nasr Driving School, 06 5647111 as the Dubai International Academic City, this Driving Do’s and Dont’s: educational free trade zone houses some of Do follow the rules and speed limits of the the most sought after universities with over emirate you are travelling in at all times. 400 institutions operating within the city. Do not indulge in ‘road rage’ such as rude gestures or verbal abuse when driving or For more information on each school, if involved in an accident, as this can attract log on to penalties such as fines, a jail sentence, and www.khda.gov.ae/en/news/khdanews.aspx possible deportation. In case of an accident, alert the police first. It For more information, log on to is an offence to leave the scene of the accident www.diacedu.ae / www.kv.ae before the police have arrived. Do not drink and drive as this is considered a Parents and students looking to make serious criminal offense. Should an individual enquiries and lodge complaints about be caught in the act, his/her insurance is likely education and schools in the UAE can also contact the to be invalidated, which means the offender will The Ministry of Education - UAE have to pay the claims of all parties involved in an accident, if any. Offenders caught drinking Call: 800-51115 and driving also risk imprisonment.

Key Points to Remember: It is best to physically visit a nursery, school, college, or university in as a first-hand impression is worth far more than any information available on the internet, or advice provided by educational consultants. Most school websites provide a detailed overview of the curriculum and programs on offer. While this makes for ample reading material, word of mouth is sometimes also a good way to go. Most institutions do not encourage a child to switch schools during the academic year, unless approved by the Ministry of Education or in special cases. Another important factor to remember is that majority of the schools begin their academic year from September, instead of April / May.

Why UAE ? The Unlimited Opportunities 2012 Chapter 9 Relocating to the United Arab Emirates 416 417 Hospitals & Health Services in the UAE Sheikh Khalifa Medical City Tel: +971 2 819 0000 Mafraq Hospital Abu Dhabi Ramadan in the UAE Places of Worship Health Services on Offer Tel: +971 2 25011111 Al Noor Hospital All individuals are expected to extend basic UAE has some of the most beautiful Hospitals and health care providers in the Tel: +971 2 444 66 55 respect and courtesy to Muslims fasting during mosques in the region, with one in almost all UAE offer some of the most advanced and Ramadan. A clear guide is available on arrival major areas and communities. Some mosques diverse facilities - a testament of the emirates’ Rashid Hospital at all major airports. One of the great things such as the Sheikh Zayed Grand Mosque thriving health care system. Well-equipped Tel: +971 4 337 1111 about education and schooling in the UAE is and Jumeirah Mosque in Dubai have touring private and public hospitals and clinics extend Al Maktoum Hospital the opportunity. options for non-Muslims too. the best in specialized health care through in Tel: +971 4 2221211 and out-patient facilities at world-recognised Dubai Dubai Hospital institutions. Health insurance is essential, Tel: +971 4 271 4444 irrespective of whether an individual is on a tourist visa or has been sponsored for a visit. Al Wasl Hospital Most employers offer insurance coverage Tel: +971 4 2324 1111 at a premium. Insurance can also be bought Al Qasimi Hospital Sharjah through different service providers at a fee. It Tel: +971 6 538 6444 would be advisable to contact your sponsor or agency for a list of health insurance options. Khalifa Hospital Tel: +971 6 743 9333 Ajman Emergency Contacts Ajman Hospital Tel: +971 6 742 2227 Police - 999

Fire - 997 Umm Al Umm Al Quwain Hospital Quwain Tel: +971 6 765 6888 Ambulance - 998 Saqr Hospital Abu Dhabi - 02 446 1461 Ras Al Tel: +971 7 222 3666 Khaimah Churches Al Nakheel Hospital Key Points to Remember: Dubai - 04 229 2222 Tel: +971 7 222 3555 St. Joseph’s Cathedral Do not eat, drink or smoke in public view Abu Dhabi New Fujairah Hospital Fujairah during the day (including in the car). This is Tel: +971 2 446 1929 Sharjah - 06 563 1111 Tel: +971 9 224 2999 considered highly disrespectful and is also St. Mary’s Church Al Ain against the law. Failure to comply could Tel: +971 3 721 4417 result in arrest. Pregnant, nursing women and young children are exempt from fasting. St. Michael’s Church Sharjah However, it is advisable to exercise discretion Tel: +971 6 566 2424 at all times. St. Mary’s Church As per law, almost all eating and drinking Dubai establishments will not be operational during Tel: +971 4 337 0087 the day. Church of Our Lady Dress modestly. While it is advisable to avoid Fujairah of Perpetual Help skimpy clothing at all times, particular caution Tel: +971 9 223 1377 must be taken during Ramadan so as not offend religious beliefs and the local customs Temples and traditions. Loud music and dancing is considered The Shiva Mandir and Dubai disrespectful during the month. Kindly avoid. Krishna Mandir, Bur Dubai

Why UAE ? The Unlimited Opportunities 2012 Chapter 9 Relocating to the United Arab Emirates 418 419 wildlife such as the Arabian Oryx and gazelle, to name a few. for more information www.awpr.ae Lifestyle and Entertainment Al Bastakiya-Dubai It’s easy to forget the hustle and bustle As much as the UAE prides itself in being a of the modern world once you’re tucked into hub of culture and tradition, its wide variety a Sikka (narrow alley) in Al Bastakiya. One of entertainment options is also a testament of of the oldest residential areas in the city, the country’s secular nature. Many expatriates where houses were once built for the Iranian make the most of their tax free lifestyle by merchants.Where once wealthy traders and indulging in high standard international pearl divers lived, the area has been protected cuisine at world-renown restaurants. There and is now home to museums, coffee shops are numerous night clubs around the emirates and art galleries that are open to all. too. Some of the clubs attract international DJs, including talent from the Middle East and Asia and the rest of the world. Clubbing facilities in Beach Park true representation of what Bedouin living underwater zoo tour attraction. Dubai include sophisticated cocktail lounges One of Dubai’s most popular parks, Al in the UAE was like, a desert safari will www.thedubaiaquarium.com serving an eclectic mix of cuisines and drinks Mamzar houses an amphitheatre, with plenty nevertheless allow you to experience the wild and the best in live music and entertainment. of picnic spots and a well-equipped children’s world beyond the city’s tarmac and towers. Another feature is the emirate’s emphasis on playground. The park is neatly surrounded Dune-bashing, camel-riding, henna, belly- Dubai Meusium featuring the best talent of the music industry, by beaches that have sheltered areas for dancing and traditional food can all be found Located within Al Bastakiya, Al Fahidi Fort be it by way of numerous piano and jazz bars, swimming with ample security in the form of on the various tours offered from each of the is the oldest building in Dubai, having been world renowned singers or gems from the local trained lifeguards. Emirates. built in 1899 to defend the emirate against sea attacks. It was expanded on in the 1830s- talent pool. Open Hours: 8am-11pm daily, 8am to 18502, and today is considered to be one of 11.30pm on Thur and Fri.Wed only for ladies. Dreamland Aqua Park the most important historical monuments Al Ain Wildlife Park and Resort It would not be incorrect to say that this the city has. The fort has housed the Dubai park put Umm Al Quwain on the world map. Al Ain Wildlife Park and Resort is one of Atlantis - Aqua Venture Museum since 1970, showcasing the cultural Considered one of the largest water parks the best conservatories in the region where Relatively new hot spot for water sport history of the area, going back as far as 3000- in the region, Dreamland offers a variety of visitors are treated to a unique glimpse of activities that promise to leave visitors with an 4000 years ago. programs and hosts special events throughout some of the animals that comprise UAE’s experience of a lifetime. Unique selling Point – www.thedubaitourism.com the year. its Leap of Faith ride. www.dreamlanduae.com www.atlantisthepalm.com Ferrari World A theme park that focuses on the fast Camel Racing Dubai Aquarium and the furious, Ferrari World is a must visit Located in the Dubai Mall, this 10-million The Dubai World Cup may be one of the spot irrespective of whether you are a sport litre tank is one of the top draws in the richest horse races in the world, but camel enthusiast or not. UAE, mainly due to its massive size and an racing is by no means less appealing in the www.ferrariworldabudhabi.com Emirates, since the former UAE president, Shaikh Zayed, endorsed the sport and offered financial aid to citizens who cared for the camels. There are 15 racetracks located throughout the country, with races taking place on Thursdays, Fridays and Saturdays throughout the winter season.

Desert Safari While it is, admittedly, a trip that is tweaked to appeal to the tourists’ tastes rather than a

Why UAE ? The Unlimited Opportunities 2012 Chapter 9 Relocating to the United Arab Emirates 420 421

Geting Around Heritage Village - Abu Dhabi Replicating a traditional oasis village, you Land Transport won’t find anywhere better to get a real look UAE’s public transport system is one of the at what the days of yore were like for the best in the world with a widely connected Emirati people. Complete with a tent made network of buses, taxis and a Metro link in from goat hair, a falaj irrigation system and Dubai. The connects all major a campfire with customary coffee pots, you’ll areas of old and new Dubai, with construction find workshops given by traditional craftsmen underway to launch new routes. Metro users to demonstrate the skills that their forefathers are required to buy a one-time Nol card which were famed for – metalwork and pottery for needs to be recharged once all funds have the men, and weaving and spinning for the been exhausted. It is the most preferred mode women. of transport within Dubai due to its state-of- the-art facilities, easy access, cheap fares and level of comfort. Hili Archaeological Gardens The Creek - Dubai Additionally, a high-speed rail service - Located 10km outside Al Ain, historians Splitting the city in two, the Creek (also between Abu Dhabi and Dubai carrying Water Transport assert that the most untie feature about this known as Khor Dubai) was once a lifeline for passengers at speeds of up to 200kph - is to Also known as Abras, water taxis are a park are the remnants from a Bronze Age Dubai’s industry. Still a bustling thoroughfare become a reality soon after the Union Railway preferred favourite for over 15,000 who settlement (2,500 2,000BC, excavated and today, you’ll find plenty of boats riding the proposed adding a link between the two commute between Deira and Bur Dubai each restored in 1995) and a number of national waves, from dhows to more modern affairs, emirates. Once the proposal materializes it day. They are operational from 5am to 12am. treasures displayed at the museum. and there are a number of tours you can would be the only dedicated passenger line on www.rta.ae take along it, from day-time tourist rides to Union Railway’s freight-focused network. Jumeirah Beach Park romantic evening dinner rides. Or, hop on an dubaimetro.eu , a cheap taxi boat that will take you from Air Travel The preferred park for most Western shore to shore. expatriates, JBP boasts a beach front and is Brands in itself, Etihad Airways and Emirates frequented by tourists who are lured by its Airline have now become the symbol of the clean waters and round-the-clock security. Tour a Mosque UAE.To make bookings for holiday packages or for convenient travel options, contact: Location: Opp Chilli’s Restaurant on the Beach Two of the best examples you can Road, Jumeirah. experience are the Shaikh Zayed Mosque in Etihad Airways Open Hours: 8am-10:30pm daily. Thur & Fri Abu Dhabi, the eighth largest mosque in the 02 505 8000 or 800 2277 till 11pm.Saturday for children and ladies only world and home to the world’s largest hand- 02 6939711 / www.etihadairways.com woven carpet, and the Jumeirah Mosque in Saadiyat Island Dubai. Both are open to non-Muslims for Emirates Airline guided tours which will offer an invaluable A natural island, Saadiyat is currently insight into the local religion, plus a unique 04 21 44444 / www.emirates.com undergoing development on a massive opportunity to see the exquisite Islamic scale and once completed it will house the architecture both buildings demonstrate. Budget Airlines in the UAE Abu Dhabi Louvre. Visitors should dress conservatively, though. Air Arabia www.saadiyatisland.com 04 3325555 / www.airarabia.com Wild Wadi RAK Airways Sir Bani Yas Island A water park to suit all ages. Located This island has been named after the Bani between Burj Al Arab and Jumeirah Beach 07 2075000 / www.rakairways.com Yas tribe, who first inhabited Abu Dhabi. A Hotel in Dubai, Wild Wadi is the ideal place to Fly Dubai natural reserve, it also houses a five-star resort. be to have some fun in the sun. www.desertislands.anantara.com www.wildwadi.com 04 301 0800 / www.flydubai.com

Why UAE ? The Unlimited Opportunities 2012 Investing in the future

Borouge has an annual manufacturing capacity of 2 million tonnes of polyolefins in Abu Dhabi, three logistics hubs in Asia, compounding facilities in China, and sales offices throughout the Middle East and Asia Pacific. Supported by the unique BorstarR technology and a culture of innovation, Borouge continues to invest in the future and deliver value added solutions to its customers. Borouge, a joint venture between ADNOC and Borealis, is making a difference to everyday life. About Borouge

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Borouge’s innovative plastics solutions contribute towards addressing major global challenges such as climate change, food protection, water, energy, communication and healthcare. UNITED ARAB EMIRATES MINISTRY OF FOREIGN TRADE

About The Ministry of Foreign Trade Objectives The Ministry shall regulate the affairs of foreign Introducing a foreign trade policy that is trade of the United Arab Emirates and the consistent with international foreign trade representation of the State to conclude trade developments and serves the economy of the agreements with countries in the world and the UAE. preparation of programs and studies that work Maintaining UAE trade interests abroad. on the development of exports and increase their competitiveness, the ministry is also Increasing UAE trade competitiveness at responsible regulation of foreign trade, control regional and international markets. and preparation of studies and concluding Educating people about the trade regulatory agreements that preserve the interests of the environment that is consistent with the best homeland and the citizen. It also takes the international practices. study of clusters and business entities Arab Pursuing institutional excellence through and international placement to the Council achieving efficiency. of Ministers on the feasibility of dealing with them and join it together with the effects on the national economy. Responsibilities Developing trade policies required to promote commercial exchange in cooperation with the Vision concerned bodies. To become a leading Ministry working to promote Promoting the UAE at foreign markets in the commercial standing of the UAE regionally cooperation with the concerned UAE bodies. and internationally through strengthening relationships and maintaining UAE foreign trade Conducting the required communications and interests. negotiations to conclude foreign trade pacts and agreements and follow up their execution in coordination with the Foreign Ministry. Mission Representing the UAE at regional and The Ministry of Foreign Trade adopts a foreign international foreign trade organizations, trade development policy and follows up its exhibitions and conferences in cooperation execution. The policy aims at protecting the with the Foreign Ministry and other concerned UAE bilateral, regional and multilateral trade bodies. interests by adopting fair rules of trade, opening Developing relations with regional and new trade and investment horizons for national international foreign trade authorities, goods and services as well as enhancing the institutions and organizations. UAE involvement in foreign markets. Drawing up and updating draft laws and regulations concerning foreign trade and Values monitoring their execution. • Creativity Managing the foreign trade offices abroad in • Efficiency coordination with the Ministry of Foreign Affairs. Disclaimer: • Team Work The Ministry of Foreign Trade cannot be held responsible for colour matching, image resolution and content errors that may occur or be found in this book. Every possible effort has been made by the Ministry and the producer to ensure the accuracy of information and content of this book as well as the quality standards • Effective negotiation skills of images and illustrations. All photographs, illustrations, statistics and other graphic figures included in the this book have been obtained from its sources for fair use and are copyrighted to its respective owners. The Ministry is not responsible for any changes in facts that occur after the date of issue. The opinions, • Comprehensive trade culture facts, figures. This book, and all content, pictures and illustrations herein are the sole property of the UAE Ministry of Foreign Trade, and may not be reproduced, displayed on a website, distributed, sold or republished, without the prior written consent of the Ministry. • Active communication Produced by:

Consultancy and Studies Chief Executive: Mohammad Abdulla Al Hammadi, Team: Saqar Al Zaabi, Jihad Suailik, Sidhique Ameen www.borouge.com P.O. Box 22239 Dubai, UAE, Tel. + 971 4 2387 871, Mob.+971 5 0550 7070, E mail: [email protected] www.borouge.com