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Businesses thrive in Dubai, which would explain why it was just announced that more than 3,000 new member companies joined the Dubai Chamber of Commerce in April alone. This brings the chamber’s total membership to 300,000 companies, and makes it among the largest chambers of commerce in the world.

So what makes Dubai so attractive to businesses and why should startups consider establishing their regional headquarters in the emirate?

Pakistan can benefit from Dubai’s ‘structured’ approach to boosting startups

1. Favourable tax laws

The UAE was known for having zero corporate tax for most businesses until earlier this year, when it said it was going to implement a 9% levy on most companies. However, the exception is small businesses and those operating in free zones.

The target of the new law is bigger businesses, who will have to pay a standard statutory tax rate of 9%. There is still a 0% tax rate for taxable profits up to AED 375,000, in an attempt to support small businesses and startups.

Daniel Takieddine, CEO MENA at broker BDSwiss, had told Business Recorder earlier that the new tax rate remains very competitive regionally and globally and should not be an obstacle to the country’s efforts to develop the already thriving business environment it was able to create.

Setting up a business headquarters in Dubai: what you need to know

2. Economic free zones

There are over 30 economic free zones in Dubai offering preferential tax and customs rates and cater to specific industries

“The free zone concept was introduced by the Dubai government to generate foreign interest to set up businesses in the city. Essentially, it’s a special economic area where business owners can enjoy many ownership and taxation benefits,” H.E. Hamad Buamim, President & CEO of Dubai Chambers told Business Recorder in an interview earlier this year.

Free zones offer plenty of perks: assistance with visas, opening corporate bank accounts, advice and networking opportunities.

While mainland companies need to seek approvals from government bodies, each free zone has its own rules and external approvals are not needed.

In wooing entrepreneurs, Dubai has Pakistan startups on its radar

The Dubai Design District focuses on fashion, furniture and beauty care and has about 4,600 companies.

The Dubai Multi Commodities Centre has over 11,000 companies and is suitable for companies in the commodities and service industry. The Gold and Diamond Park is for firms that deal in precious metals and stones and has roughly 350 firms operating out of it.

3. Access to funding and new markets

Businesses looking for funding in Dubai have plenty of options at their disposal, ranging from traditional banks and venture capital firms, to business incubators, accelerators, crowd funding, angel investors and government programmes.

The Dubai government recently announced it has launched a AED370-million ($100.7m) fund to accelerate growth capital for startups with the aim to fortify the city’s position “as a global hub for financial technology, innovation and venture capital”.

4. Room for expansion

Its possible to expand your business not only within Dubai – by franchising, licensing your product, partnering up with another company or obtaining a government contract – but to other emirates like Abu Dhabi, and beyond to MENA.

Dubai is considered to be the regional hub for access to some of the most lucrative MENA markets and being based there means it is easier to scale and expand to countries like Egypt and Saudi Arabia.

Why are these markets worth tapping into? Saudi Arabia’s startups raised $195 million in funding from a total of $297 million raised in the Middle East and North Africa in April 2022, the highest amount in the region.

Meanwhile, Egypt's startups raise $491m across 147 transactions last year, and hit an all-time-high volume of foreign investors.

Salman Sattar, co-founder of startup Bagallery that has expanded into Pakistan as well also said connectivity with investors and access in Dubai is unmatched.

5. New visa rules

The UAE recently announced extensive reforms to its entry and residency schemes which make it easier for startup owners and entrepreneurs to obtain long-term visas as it looks to strengthen its position “as an ideal destination to live, work, and invest.”

Crucially, for the first time, many categories will no longer require a host or sponsor.

5-year tourist, job exploration visas: UAE offers more options, eases requirements

Its long-term UAE Golden Visa is designed for entrepreneurs wanting to relocate to Dubai’s startup ecosystem, allowing them to secure a long-term future in the city.

Mohammed Kilany, founder and CEO of Fanera, told Khaleej Times the visa “will make it possible for startups and SMEs to more easily recruit professionals from abroad, which will expand the pool of talent.”

“Second, by providing incentives for investors to relocate to the UAE, this new ruling will strengthen the country’s investment segment, increasing the potential for startups to successfully fundraise.

6. High quality of life

Dubai has a vibrant urban lifestyle with something on offer for all ages. According to website Expatra, “the social side of life is fantastic and diverse” with luxurious hotels, private beach clubs and sports clubs plus fantastic clubs and restaurants.

For those with children, Expatra says educational standards in Dubai are excellent and new schools and colleges are being constructed almost annually.

Dubai liveability: Pakistanis move from seeking employment to calling it a ‘second home’

Medical facilities are also top-class, crime is low and the emirate is very accessible, with its major international airport welcoming flights from across the world.


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