UAE: Switzerland’s Top Trade Ally in the Middle East
For European investors, establishing a strong economic presence in the Middle East and North Africa (MENA) region is critical in terms of expanding their business. European investors, especially the Swiss businessmen, initiate the process of business setup in Dubai as the emirate is considered as a gateway to the MENA markets.
This pursuit of economic expansion has led to some positive developments in the trade relations between Switzerland and the UAE. As of now, the UAE is Switzerland’s top partner in the MENA region. Here we are tracking the strength of the bilateral relations and the scope of business opportunities the UAE can offer for the Swiss investors.
Switzerland’s Biggest Partner in the MENA Region
Company formation in UAE is critical for the Swiss investors as there are immense business opportunities available due to a strong trade relationship between the two countries. Official statistics confirm that the Swiss investments in the UAE amount to approximately US$16.6 billion. The annual bilateral trade between the UAE and Switzerland is estimated to be worth US$21 billion. Swiss foreign minister Ignazio Cassis confirmed during his recent UAE visit that the bilateral trade jumped 24.5% in 2019 to nearly USD 21 billion.
A Major Export Hub for Swiss Companies
It is estimated that more than 200 Swiss companies have set up businesses in the UAE. The companies have been incorporated in both free zones as well as in the mainland. The mainland and free zones company formation in the UAE has proven to be highly advantageous for the Swiss entrepreneurs. Many of the Swiss companies use the UAE as a sophisticated hub to export their products to other countries in the Middle East and beyond. In 2018, the Swiss companies invested approximately USD 16.6 billion in the UAE and employed 11,000 people.
Economic Diversification & Business Opportunities
The UAE’s ambitious plans of diversifying from an oil economy to a knowledge-based economy have yielded positive results in the form of enhanced foreign direct investments (FDI). This provides numerous business opportunities for Swiss investors who wish to set up small and medium enterprises (SMEs) and startups in the UAE. Switzerland is known for producing specialised technical solutions in varied areas such as sustainable farming, water stewardship, and healthcare. The UAE’s open economy, modern infrastructure, ease of doing business, lenient tax regime, and less-stringent regulations make the country a fertile ground for such businesses.
Key Swiss Industries in the UAE
The Swiss investors are mainly inclined to form companies in key industries including pharmaceutical products, food, banking, machines, watches and luxury products, perfumes, logistics and construction. Even though the companies have been performing very well in the UAE, specific mainland regulations such as the local sponsorship (51% ownership for UAE national) were a great turn off for the entrepreneurs. However, the UAE has allowed 100% ownership for foreign investors in specific sectors such as manufacturing, agriculture and services sectors. The FDI Law, in this regard, has opened the door for more Swiss investments and makes the process of business setup in UAE more flexible.
Hopes for Expo 2020
At present, the key joint initiative being undertaken by the two countries is the Expo 2020, slated to take place in October 2021. Switzerland is among the first countries to announce its participation in the Expo. Switzerland’s participation in the Expo will be based on the three significant themes: mobility, opportunity, sustainability. The Expo 2020 has been postponed to 2021 due to the uncertainty created by the COVID-19 pandemic. However, the UAE has shown unparalleled resilience to the pandemic and took up the challenge to organise the event at a later date. The UAE’s resolve to conduct the Expo with renewed enthusiasm has been met with admiration from all the participants, including Switzerland.
Access to Higher Living Standards
The UAE is known for providing a safer and affordable living standard for the residents. Expatriate investors find Dubai and Abu Dhabi as the most safer cities compared to other cities around the world. By initiating business setup in Dubai or Abu Dhabi, the investors and their dependents are exposed to one of the most sophisticated environments to live in. Dubai’s Golden Visa, retirement visa and investor visa schemes make life easier for Swiss investors. Furthermore, there are more than 3,000 Swiss people living in the UAE as residents. And this is the largest Swiss community in the entire Arab world.
How can Business Setup Consultants in Dubai Help?
The UAE and Switzerland are one of the strongest financial centres in the world, and the opportunities arising out of mutual cooperation are plenty. Setting up a business in Dubai or any other emirates in the UAE provides the Swiss investors access to the lucrative MENA market. Since the two countries have a strong bilateral relationship, it is easier for the Swiss entrepreneurs to break out into the UAE.
Perhaps the only stumbling block while commencing the process of business setup in the UAE would be foreign investors’ lack of awareness about the company structures, licensing regulations, labour & immigration laws etc. However, investors can easily navigate the process of company formation with the help of reputed business setup consultants in Dubai, such as Jitendra Business Consultants (JBC). JBC’s company formation specialists in Dubai provide legal expertise regarding the legal structures, visa rules, free zone & mainland licensing etc. With JBC’s assistance, company formation in the UAE becomes a simple process.