The UAE and the UK have a long-standing trade partnership that is built on a strong foundation of mutual trust & investment. The trading relations between the two investment powerhouses continue to be stronger than ever as the process of business setup in the UAE is devoid of stringent regulations compared to other countries. The ease of doing business, low taxes, and sophisticated infrastructure have only contributed to accelerating the inbound flow of UK investors into the UAE. No wonder why the UAE remains to be the fourth-largest export partner of the UAE outside the UAE.
Even though the bilateral trade relations remain stronger, UK investors are still engaged in exploring fresh business opportunities for company formation in Dubai and other emirates. The UAE’s concerted efforts in reshaping the business landscape post-COVID-19 have created more profitable opportunities. Further, the breakup from the EU (Brexit) has forced the UK to enhance its investments in the UAE.
Keeping an eye on these developments, let us analyse the UAE-UK trade relations and opportunities.
A Fertile Ground for UK Companies
The UAE has always been a fertile ground for UK investors. The number of companies that have set up business in the UAE amounts to more than 5,000. This includes an overwhelming number of prominent British brands such as BP, Shell, Rolls Royce, BAE Systems, Mott McDonald, SERCO, Standard Chartered, HSBC and John Lewis / Waitrose etc. As per recent statistics, exports from the UK to the UAE is more than £10.5 billion with Britain having a trade surplus of more than £4 billion. To make the best of this fertile trading opportunity, UK investors can seek the assistance of the best business setup consultants in Dubai to incorporate their companies.
UAE is Fiscally More Resilient
The UAE’s open economy makes it more conducive for the steady inflow of foreign investments from European countries, including the UK. Even though the country is often rated as the most open Arab economy, the UAE is one of the most resilient economies in the region as well. UAE achieved resilience mainly by reducing the proportion of its gross domestic product dependent upon fossil fuels to 30%. Another substantial reform that contributed to this resilience is the introduction of the 5% Value Added Tax (VAT) in 2018. It is on the back of such reforms that the economy steadied itself amid fluctuating oil prices.
FDI Reform a boon for the UK in Post-Brexit Era
The ratification of FDI law allowing expatriate business people to have 100% ownership in their UAE companies came at the right time. It will transform the ease of business setup in Dubai and the UAE as the UK is battling a universal pandemic in addition to post-Brexit era uncertainties. Experts foresee an unprecedented explosion of foreign direct investment that may boost the prospects of businesses set up in Dubai and Abu Dhabi. It will be easier for UK investors to tap this opportunity, given the country’s strong partnership with the UAE.
Opening up of Air Travel Corridor
The pandemic had battered the tourism sector for a little while as regular flights were cancelled. But recently the UK has announced the opening of an air travel corridor with many countries. The UAE is a prominent name on the list. Reports suggest that the air travel corridor will increase the flow of British tourists in the UAE rather than the other way around. Christmas is around the corner, and more people from the UK are projected to visit the UAE, especially Dubai. Investors are optimistic about the travel corridor as they can visit the UAE without any restrictions. Also, the number of COVID cases in the UAE is minimal compared to other countries, predominantly Dubai.
A Phenomenal Time for Business Setup in the UAE
The UK investors continue to exploring fresh business opportunities for company formation in Dubai and other emirates. The UAE’s concerted efforts in reshaping the business landscape post-COVID-19 have created more profitable opportunities. Further, the breakup from the EU (Brexit) has forced the UK to enhance its investments in the UAE. The opening up of the air travel corridor and the FDI law allowing full foreign ownership is poised to change the dynamics of business setup in the UAE for the UK investors.
Amidst this favourable business climate, investors need to analyse the best opportunities available to them in the UAE. The businessmen need to choose between the mainland, offshore, and the free zone company formation in the UAE. To have clarity in the legal prerequisites, they can avail the services of reputed business setup consultants in Dubai, such as Jitendra Business Consultants. JBC has designed cost-effective business setup packages to remove the burden off the shoulders of foreign investors. With JBC’s assistance, business setup in Dubai, UAE is more viable and affordable than ever.