Why Dubai Attracts Investors?

Why Dubai Attracts Investors?PolicybazaarAverage Rating / 5 ( reviews)
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As per the World Investment Report, 2019 published by the United Nations Conference on Trade and Development (UNCTAD), outward FDI from West Asia reached a remarkable high of USD 49 billion in the year 2018 and UAE was the second among the nations responsible for the same. UAE also played a significant role in raising the FDI inflow to Asia by 4%. All these statistics bring UAE in limelight across the globe and make it one of the most preferred destinations for investment. Other factors that attract foreign investors to the UAE are the country's economic stability, tax-free environment, low energy costs, and the government's openness towards a diversified economy. Among the most developed cities in the UAE is Dubai which currently hosts a large number of expats and is one of the popular destinations for foreign investors.

If you are still wondering why Dubai is popular among foreign investors, read on to know more:

Good investment opportunities in Dubai

The most established industries in Dubai still continue to gas, oil, and financial sectors. The banking sector too has relaxed rules for the international investors looking forward to setting up a company in Dubai. The real estate sector in Dubai is one of the most preferred investment options for both nationals as well as foreign investors due to the easy regulatory environment.

Attractive tourism industry

As the number of tourists in Dubai increases, every year so does the number of businesses in the sector.  Tourism in Dubai is a part of the government's strategy to maintain the flow of foreign investment into the emirates. In the year 2013, Dubai Tourism Strategy 2020 was launched with the sole objective to attract 20 million visitors in a year and make Dubai the first choice for international leisure travel as well as business travel. In the year 2018, this strategy was extended to set new goals to attract 21-23 million visitors in 2022 and around 23-25 million visitors by the year 2025.  People from across the globe visit Dubai for shopping and luxury experiences.

Relaxed taxation system

One of the greatest strengths of Dubai, as compared to other cities of the world, is its relaxed taxation rules. Even though value added tax (VAT) has been incorporated recently; Dubai doesn’t impose any other tax which makes it a favorable place for the investors.  No tax is imposed on individuals and companies operating in the city. The deportation of profits from Dubai to other places is free from tax most of the time. The free zones in Dubai provide no corporate taxes and also there are no taxes in Dubai. Also, there are no taxes for employees in Dubai, which serves as one of the most important tax burdens in other countries.

So many free zones

Dubai has the greatest number of free zones in the world. Free zones refer to special economic areas where foreign business owners get the benefit of keeping 100% business ownership and enjoy tax exemptions. There are free zones devoted to specific activities for instance, Dubai knowledge village is a free zone dedicated to innovative research and development. Once a company is registered in a Dubai Free Zone, it gets all the advantages among which one of the most beneficial is the integrated solution for registration of business and procuring the important VISAs for business owners as well as the employees. These free zones offer some of the greatest investment opportunities in Dubai for foreign investors.

Summing up the reasons why Dubai is an attractive investors' destination

  • The economic and political stability offered by the country
  • Easy registration for the companies
  • Plenty of industries to invest for the foreign investors
  • Luxurious life and high standard of living.
  • Dubai is a central trading hub in the Middle Eastern region and in the gulf cooperation council.
  • Dubai has one of the best infrastructures in the world.

Dubai is well-known as the regional and global center for business and the Expo 2020 is supposed to provide good investment opportunities in Dubai for national as well as international investors. Some of the sectors that will see a lot of investments are construction, rental, transport, and retail. The logistics and tourism sector is also expected to expand in the next few years as per the report: Dubai 2015 as issued by Morgan Stanley Capital International.

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