Rising inquiries about new visa options offered by the government to set up a business in the UAE indicates that the emirates will attract more high net worth individuals and millionaires this year.
The UAE looks set to attract more foreign investment in 2023 on the back of a host of investor-friendly measures and reforms unveiled by the government to enhance the ease-of-doing business environment in its drive to encourage global investors to relocate their businesses into the country.
The UAE has been ranked first in the Arab world and 19th globally for its ability to attract foreign direct investment (FDI) inflows by the World Investment Report 2022 issued by the United Nations Conference on Trade and Development (Unctad). The UAE also emerged 17th globally in terms of FDI outflows that totaled $22.5 billion in 2021, reflecting a 19 per cent growth compared to the year 2020.
According to a projection by experts, the UAE will attract a major share of $66 billion in potential FDI inflows into the Middle East, North Africa, and Pakistan (Menap) in 2023 as global investors consider the emirate an ideal destination for investment. In 2022, according to the Institute of International Finance, the UAE had attracted an estimated $22 billion in FDI inflows due to its business and visa reforms while the Menap region was expected to receive $56 billion in FDI inflows.
In 2022, the UAE attracted foreign investments in various sectors. The oil and gas sector accounted for 59 per cent of the total FDI contributions, followed by 10 per cent in IT and communications as the country is implementing a number of steps to encourage investment in the industrial sector and increase its contribution to Dh300 billion from Dh133 billion within 10 years.
Rising inquiries about new visa options offered by the government to set up a business in the UAE indicates that the emirates will attract more high net worth individuals and millionaires this year, according to Business Link, a UAE-based business consultancy.
Investment pundits are bullish that the UAE is well positioned to attract more investment into its booming real estate, e-commerce, logistics and transportation, hospitality, and tourism sectors
They believe that business-friendly policies, a stable economy, favourable tax policies, and strategic location as a gateway to the Middle East and Africa market are some of the key factors that attract global investors to the UAE. On top of that the proactive government has rolled out a spate of new policies and regulations to make it even easier for foreign companies to set up and operate in the second largest Arab economy.
Business Link, which also has operations in Saudi Arabia, said it has received many inquiries and clarification about the residency reforms including golden visa, silver visa, investor visa and freelance visa as foreign investors are keen to be part of UAE’s success story by relocating their business to the emirates.
“The UAE’s business-friendly policies and forward-thinking approach have made it a hub for foreign investment, and we are confident that 2023 will see an even greater influx of international companies looking to tap into the opportunities that the country has to offer,” said Hatem ElSafty, founder and CEO of Business Link.
Analysts at Business Link said the UAE would take things to the next level with a series of new policies to make the country even more attractive to foreign investors. New regulations and visa reforms have already been introduced to facilitate foreign companies to set up their base in the UAE. These include simplifying the process for obtaining licences and permits and reducing the time required to complete various bureaucratic procedures.
Special economic zones
Another new policy that is set to be introduced in 2023 is the establishment of special economic zones. These zones will be designed to attract specific types of foreign investment, such as technology, manufacturing, and financial services, the business consultancy said.
As per the data provided by the UAE Ministry of Economy, the number of new business setups in the country has registered a steady uptrend despite the challenges posed by the Covid-19 pandemic. The government has also implemented various initiatives to support the growth of the country’s small and medium-sized enterprises (SMEs).
The government’s ongoing efforts to promote and support entrepreneurship and innovation and the country’s favourable business environment will likely attract more investment in real estate, e-commerce, logistics and transportation, hospitality and tourism sectors.
“The focus on technology and sustainability would be more prominent in driving new business growth in coming years,” analysts said.
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