Posted in: Business in UAE by admin on March 11, 2010
The United Arab Emirates (UAE) is a federation of seven emirates located in the Arabian Gulf: Abu Dhabi, Dubai, Sharjah, Ajman, Umm al Quwain, Ras Al-Khaimah and Fujairah. Abu Dhabi City is the federal capital. Each emirate has contributed to the nation’s progress and exciting opportunities for investors are to be found in all parts of the country.
Sharing a border with Saudi Arabia and Oman, the UAE has a land mass of 83,600 square kilometres and a total population now estimated at 4.1 million. The urban population is 75 percent of the total as four fifths of the territory is desert.
The UAE’s foreign population is around 80 percent.
According to OPEC’s 2005 report, the UAE has the world’s fifth largest proven reserves of crude oil (9 percent of total world reserves), and fourth largest reserves of natural gas (5 percent of the world total). These reserves are expected to last for more than 100 years at current production rate.
|Emerate||Area||Population (2006)||GDP as a percentage of UAE GDP (2006)|
|Abu Dhabi||67,340 km^2||1,800,000||60%|
|Ras al-Khaimah||2,478 km^2||191,753||1.9%|
|Umm al-Qaiwain||750 km^2||62,000||0.4%|
The UAE economy is booming and the opportunities to do business in the country are limitless. The UAE’s currency, the dirham, is secure and freely convertible; there are no restrictions on profit transfer or capital repatriation; import duties are low (around 5 per cent for virtually all goods) and labor costs are competitive; corporate tax and personal taxes are nil and 44 double taxation agreements and 32 bilateral investment treaties are in place. In addition, the financial risk is minimal (Moody’s credit rating Aa3). These factors, combined with a strategic, accessible location for major regional markets, an excellent reliable infrastructure and an extremely pleasant, stable and safe working environment bode well for investment.
Not surprisingly therefore, the UAE ranks high in the list of the Middle Eastern and GCC countries deemed to be the most attractive to direct foreign investments (FDI), securing 60 per cent of FDI flows to the region during 2006.
Finally, the UAE is a contracting party to the General Agreement on Tariffs and Trade (GATT) since 1994 and a member of the World Trade Organisation (WTO) since 1996. It is also a member of the Greater Arab Free-Trade Area (GAFTA) in which all Gulf Cooperation Council (GCC) states participate. The UAE is in the process of negotiating free trade agreements with the US and has embarked on negotiations, either individually or with the GCC, on several regional trade agreements. Although Arabic is the official language, English is widely used in business transactions.