Dubai: A Global Hub

The Emi­rate evo­lu­tion con­tin­ues

EME Outlook - - Contents - Writer: Matthew Staff

Dubai’s her­itage and his­tory is one built around trade but over re­cent years the Emi­rate has di­ver­si­fied away from the ports which have helped it reach its renowned pros­per­ous sta­tus to be­come a re­gional fi­nan­cial and busi­ness hub.

This is the anal­y­sis of renowned in­ter­na­tional es­tate agency, Knight Frank whose re­cent Hub Re­port con­tin­ues to track the evo­lu­tion of the city as an in­ter­na­tion­ally sig­nif­i­cant hub.

The Re­port fo­cuses on bench­mark­ing Dubai against seven other key global cities: New York, Lon­don, Paris, Sin­ga­pore, Hong Kong, Shanghai and Syd­ney across the four key sec­tors of man­u­fac­tur­ing, lo­gis­tics, busi­ness and fi­nan­cial ser­vices, and tourism.

The in­tro­duc­tion of Free Zones - Jebel Ali Free Zone was the first of its kind in 1985 - ini­tially al­lowed tra­di­tional trade bar­ri­ers to be elim­i­nated and min­imised bureau­cratic reg­u­la­tions. Over time though, the num­ber of Free Zones in Dubai has grown to 34 and they have evolved to sym­bol­ise strate­gic hubs for co­op­er­a­tion, learn­ing and knowl­edge.

Op­er­a­tionally, com­pa­nies within a Free Zone are not re­quired to have a lo­cal Emi­rati part­ner and can there­fore con­trol 100 per­cent of their own busi­ness. This, com­bined with Dubai’s strate­gic lo­ca­tion as a junc­ture be­tween east and west, has meant Dubai has grown to es­tab­lish it­self as a re­gional fi­nan­cial and busi­ness cen­tre.

A recog­nised global fi­nan­cial cen­tre

The do­mes­tic fi­nan­cial and busi­ness ser­vices sec­tor has grown 55.6 per­cent over the past decade with only Shanghai (114.3 per­cent) out­per­form­ing Dubai.

Over this time pe­riod Dubai has also seen it­self be­come a recog­nised global fi­nan­cial cen­tre; with The Dubai In­ter­na­tional Fi­nan­cial Cen­tre re­cently be­ing ranked among the top 10 global fi­nan­cial cen­tres in The Banker’s In­ter­na­tional Fi­nan­cial Cen­tre rank­ings.

These achieve­ments are un­der­pinned by a zero tax en­vi­ron­ment/ low rate of tax for fi­nan­cial and oil com­pa­nies. Cur­rently it takes just eight days to start a busi­ness which is marginally longer than the United States (six days) and the UK (five days), although it is four times

more than Hong Kong’s fig­ure.

Fi­nally the UAE has a well-re­garded ‘ease of do­ing busi­ness’ rank­ing, which has moved up from 26th to 21st out of 190 coun­tries over the past year. Con­tin­u­ing busi­ness legislation im­prove­ments and a ma­tur­ing mar­ket mean that this score is likely to im­prove fur­ther in the fu­ture.

Matthew Dadd, Part­ner, Com­mer­cial Leas­ing & Agency, notes how these de­vel­op­ments are en­cour­ag­ing global busi­nesses to use Dubai and the UAE as a base for re­gional op­er­a­tions: ‘’As Dubai and the UAE drives changes in legislation and com­pet­i­tive­ness on a global level, we are wit­ness­ing com­pa­nies hav­ing a Mid­dle East­ern pres­ence.

“With re­forms in­clud­ing Dual Li­cens­ing be­ing in­tro­duced, this is

( al­low­ing com­pa­nies to lo­cate on­shore and off­shore busi­nesses from the same phys­i­cal lo­ca­tion, thus stream­lin­ing op­er­a­tions. This is in ad­di­tion to im­prov­ing the over­all life­style op­por­tu­ni­ties which the UAE presents to ex­pa­tri­ates.’’

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