15+ Pros and Cons of Doing Business In UAE (Explained)

The United Arab Emirates is situated on the edge of the Arabian Peninsula and is composed of numerous sheikdoms. The country itself is at the forefront of modernity, and creativity of the 21st century.

Since oil discovery in the 1930s, the UAE has developed into one of the region’s richest nations.

In recent years tourism and a dynamic economy have made the UAE a regional center for foreign investors and an attractive nation.

Never before has the business done in the United Arab Emirates been more satisfying. Here are a few of the pros and cons of doing business in the UAE.

Benefits of doing business in the UAEThe drawbacks of doing business in the UAE
The strong and growing economyTrade limitations in a free zone
Robust InfrastructureRestricted business activities
Low Import DutiesFind a local partner

Pros of Doing Business in the United Arab Emirates

  • Approach to a Diversified Economy

From the last few years, the economy of the United Arab Emirates has seen a lot of diversification. While the oil and gas industry is still on number one in the economic development of the region.

The United Arab Emirates has also seen the substantial development of tourism, science, and technology.

Moreover, the government of Emirati has recently invested its $13.4 billion in the non-oil related industries for the growth and expansion if this industry, and a significant portion of which will be devoted to the virtual technology market.

  • A Focal Point for World Trade and Business

The UAE lies at the center of a few of the world’s most famous manufacturing and commercial regions. It has always been so traditionally and remains so much today, making it a center of world-class trade.

By establishing your company in the United Arab Emirates you will have access to the Asian, African, Southern, and Eastern European and Middle East markets.

With state-of-the-art air and maritime ports, the country has the requisite facilities to handle foreign trade, rendering business in the UAE an enticing endeavor.

The United Arab Emirates Is a Focal Point of World Trade and Business
  • Low Taxes

The government of the UAE provides attractive tax incentives for companies doing business in the region. There are presently no foreign exchange restrictions, trade barriers, and no personal or corporate taxes that can help eliminate major operational and management burdens from multinational companies.

  • Expansive Spectacle of Technical Solutions

From the last few years, the United Arab Emirates has gained a significant reputation in the field of telecommunications and IT quality. With Dubai Media Area, one of the most modern infrastructure and facilities, the country is the perfect place for the advancement of your activities.

Moreover, the companies that operate in the United Arab Emirates would benefit greatly from Communicaid’s diversity training curriculum for doing business in the UAE.

To function effectively across the world, knowledge of the local culture and the national business culture is completely necessary.

Equipping the workers with this information until they are seconded would help foreign assignments communicate with their Emirati counterparts effectively and successfully. Cross-cultural training programs offered by Communicaid, adapted to the unique features of UAE business culture, can accomplish both.

  • Business-Friendly Rules and Regulations

For so long, the government of the United Arab Emirates has been considered as the most significant aspect that helps many businesses operating in the country.

Dubai’s business-friendly policies and regulations aim to make it simple and profitable to do business in the emirate. In any company the government plays a vital role — regardless of where it is.

International companies can also invest and open their business in Dubai within a month, with the aid of professional Support services. It is necessary to work with a competent business management consultant who is familiar with the rules and regulations of Dubai to ensure effective and proper company set-up.

Does the United Arab Emirates Have Business-Friendly Rules and Regualtions

Here are only a few of the services they offer:

  • Visa and Extension applications
  •  License
  •  Establishing Non-Native Residence
  • Aid from the Ministry of Labour
  • Local Patronage
  • Free-Trade Zones

Dubai has 37 free-zones (economic trade zones) that are extremely attractive to many business groups. Unlike the mainland company that allows an Emirati national to serve as a local partner or service agent, free zones allow expatriates to maintain 100 percent control of their business with the right to repatriate capital and income.

Free-zone establishment also gives foreign business owners exemption from paying corporate tax for 15 years or more, and no import/export, withholding, or personal income tax.

Although it is not convenient for all to run a company in a free zone, this is an excellent option for many companies. Professional PRO services will provide useful insight and knowledge that will help investors make educated decisions.

Obstructions of Doing Business in the United Arab Emirates

  • Communication Style

Communication types vary around the globe, country by country, and area. For companies working outside their home country, this can be difficult.

Organizations doing business in the UAE must be mindful of some of the gaps in contact they can come across. The different definitions of ‘yes’ and ‘no’ for example may vary significantly from their own cultures.

In The United Arab Emirates, the level of formality and directness can also be difficult to adapt to.

Communication Style Is Very Different Int the United Arab Emirates
  • Islam

Although the UAE is a progressively modern state, especially in relation to its neighbors to the Gulf State, religion is still at the core of the culture and society of Emirati. Islam plays a vital role in the daily lives of people, both inside the workplace and outside.

It is important to observe Islamic customs and value the impact of the Islamic religion on business dealings when doing business in the UAE.

Islam Can Be a Barrier While Conducting Business UAE
  • Attitude to time

In the UAE, timekeeping is regarded with a much more casual mindset compared to Europe and the US. Meetings, for example, are frequently crowded, late start, or postponed at the last minute without notice.

Another important difference in the business culture in the United Arab Emirates is that the workweek is different from that of Christian countries, lasting from Saturday to Wednesday, with the Muslim Sabbath protected by the ‘weekend’.

  • Hierarchy

Hierarchy remains a very important principle which you should take into account when doing business in the UAE. Respect for the titles and role of individuals within society is important.

Many organizations have a top-down hierarchy, with one central executive making most of the decisions.

The UAE is increasingly modernizing but conservative Muslim traditions appear to be at the core of Emirati society. There must be business organizations recognizing the contrast between the new and the traditional.

Participating in a cross-cultural business management training program such as Communicaid’s Doing Business in the UAE will help you build strategies to successfully function in the UAE thereby improving the effectiveness of your company.

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