Dubai finalising project to issue business licences without residency

Dubai’s Department of Economic Development issued 9,489 new business licences during January-April 2019, up 35 per cent compared to the same period in 2018.

The growth has come even as the DED has adopted new strategies to strengthen Dubai’s position as a global business and investment destination, said Sami Al Qamzi, DED’s director general.

The entity is currently finalising a project to establish the region’s first-of-its-kind virtual commercial city where licences will be granted without requiring residency in Dubai and in accordance with international legal standards, he added.

The business confidence index in Dubai also climbed to 117.8 points in the first quarter of 2019 compared to 116.4 points during the same period of 2018, according to a DED survey.

Companies participating in the survey said they anticipated higher profits and selling prices in the second quarter of 2019, largely due to seasonal demand.

The manufacturing sector was the most optimistic on volumes, profits and employment.

The survey also found that larger companies have stronger expectations for Q2 2019 compared to small and medium enterprises, a statement said.

The implementation of the 5 per cent value added tax (VAT) in 2018 and companies subsequently registering in the tax net has resulted in a new cost for small and medium-sized enterprises.

“However, the cost has come down over the following year and no additional implications are foreseen on business costs or consumer spending in 2019, which is further good news for growth,” the statement added.

Meanwhile total FDI inflow into Dubai also increased significantly to reach Dhs22.2bn at the end of the first quarter of 2019, compared to Dhs7.3bn during the same period of 2018, according to data from the Dubai Investment and Development Agency (Dubai FDI) in DED.

A framework for a Foreign Direct Investment committee is being created and DED is developing a guide to implement the new investment law, which will increase foreign ownership to 100 per cent in specific sectors and fields to attract inward FDI, the statement said.

Dubai also expects to attract more FDI as it prepares to host Expo 2020.

Data from the Dubai Statistics Center indicated that the general inflation rate in Dubai declined for the first quarter of 2019 to -3.72 per cent compared to a 2.27 per cent increase during the same period of 2018.

“Though falling prices of residential units has had a negative impact on real estate revenues, this, along with a series of initiatives adopted by the government of Dubai during mid-2018 has helped boost Dubai’s competitiveness and consumer spending on other goods and services,” DED said.

Dubai is estimated to grow 2.1 per cent in 2019 and 3.8 per cent in 2020 driven by the Expo 2020.