The United Arab Emirates, a business hub with a growing economy and business-friendly policies, is one of the most favorable countries for entrepreneurship. Reports from respected global financial institutions have supported this claim by highlighting the fast-growing economy of Dubai backed by numbers. In fact, the GDP of the UAE grew by 3.3% in the second quarter of 2024-25.
A strong reason behind this growth is the oil industry but as the global economy evolves, the UAE also attracts a lot of Foreign Direct Investment (FDI). Talking about the core force of this high-performing economy is the key initiative taken by the authorities.
There are many blogs on our website where MarkAi has done a deep dive into the various elements of the business structure of Dubai. But here in this blog, we will solely focus on the key initiatives that empower entrepreneurs and businesses in the UAE.
Over the past few decades, the diversification of the United Arab Emirates economy has been fast-tracked to reduce the reliance on petroleum income. It is in this respect that the country is currently exploring different avenues to intertwine itself with the dynamic nature of the global economy.
The government, however, is steadily making advancements in this regard by giving even more incentives meant to attract entrepreneurs and independent business people from different parts of the world.
These include:
Permitting firms to complete 100 percent foreign ownership.
Allowing longer visas to entrepreneurs.
Attracting UAE IT companies.
Financing and supporting SMEs.
Offering a suitable lifestyle and working environment.
Let's do a detailed analysis to observe how businesses are being facilitated by the UAE government.
- Permitting 100% Foreign Ownership to Firms
In May 2019, the UAE government permitted foreign entrepreneurs to own 100% shares of locally incorporated companies. Before this change, the Companies that were formerly considered as onshore setups, needed to be more than 51 percent owned locally. Earlier, total foreign ownership was allowed only in one of the growing number of free zones in the UAE.
This change brought about many opportunities for entrepreneurs running businesses in the UAE or those who were looking for an ideal launchpad for their startup. In turn, this turned out to be a good step to keep a high-level inflow of Foreign Direct Investments.
- Allowing Longer Visas to Entrepreneurs
One of the major reasons that attract entrepreneurs in the UAE is the rule that allows them a 5-year visa to get set up in the country. This step was taken in November 2018 and permits entrepreneurs to live longer in the country.
This resulted in a new resident permit system for five- and ten-year residencies, intended for eminent non-UAE candidates and professionals living, working, and studying in Dubai without a national sponsor. The visa may be renewed, depending on the progression of circumstances of the candidate.
The required investment for the above-mentioned Visas is- AED 5 million and AED 10 million for five- and ten-year-long visas respectively.
- Financing and Supporting SMEs & Micro-enterprises
Dubai is one of the most supportive economies for Small and medium-sized enterprises (SMEs). The taxation regime or fund initiatives comprehensively support SMEs & Micro-enterprises, as they readily provide all sorts of administrative and governmental support to the entrepreneurs.
- Mohammed Bin Rashid Innovation Fund
The Mohammad Bin Rashid Innovation Fund was initiated to help the startup ecosystem of the UAE and assist in making the country the most innovative nation worldwide. The Guarantee Scheme and the Innovation Accelerator are the fund's two primary initiatives.
The Innovation Accelerator does non-financial synergies for high-potential innovators to catalyze their impact on sectors and the UAE economy, the Guarantee Scheme provides dirt-cheap debt financing to innovators. The MBRIF was established with a whopping investment of USD 544,590,000 (AED 2 billion).
- The Muwafaq Package
The Muwafaq Package is more than just a financial perk, it is a tool to help businesses grow with a vision. This package is initiated by UAE's Federal Tax Authority which is crafted to elevate the growth of SMEs.
Since its introduction in March 2023, subscriptions to the package have continuously grown to date, showing that it effectively supports the SME sector. Its benefits also range from tax education seminars to training programs.
- Khalifa Fund
The Khalifa Fund for Small and Medium Enterprises is an Abu Dhabi government initiative that bolsters the SME sector and helps the UAE’s goal to create a diversified economy. It encourages an entrepreneurial culture by supporting UAE citizens in developing or starting up a business.
Established in Abu Dhabi in 2007, it further opened branches in the Western region and Al Ain. In 2011, operations were further expanded to reach the Northern Emirates including Ras Al Khaimah, Ajman, and Fujairah.
Most of the time entrepreneurs are unable to find the right direction for their businesses which can turbocharge their growth story. If you are planning to start a business in the United Arab Emirates, you should have a better understanding of the help offered by the UAE Business ecosystem.
Markai Corporate Services thoroughly assists entrepreneurs and guides them to all the beneficial initiatives initiated by the UAE government to empower startups. Reach out to us know to fulfill your business dreams today!
