Factors for Russian Trade Expansion in UAE
With its fast-growing, open and diverse economy, the United Arab Emirates is an extremely attractive market for Traders. Russia is among the top sources for tourism in the emirates of Dubai and Fujairah. The introduction of visas on arrivals for Russian tourists last year, visa-free travel for Emiratis to Russia from August 2018, and new fight routes between both countries also augment cooperation in tourism.
Russia and the UAE are also significant stakeholders in global oil markets. The strengths of the UAE include its easy access to oil resources, low energy costs, a willingness to diversify the economy and a high purchasing power. The absence of direct business taxation (excluding banks, oil companies and telecommunications operators) and direct income taxation, of exchange controls and of any limitations on the repatriation of capital, as well as the existence of a strong and profitable banking sector, plus a large pool of expatriate labor are the country’s undeniable assets. There is a large number of free trade zones on the territory of the United Arab Emirates, which are formed in order to attract business – foreign investors and entrepreneurs. These free trade zones became one of the key factors of the development of the international business in the UAE and great incentive for the moving of the various large and medium sized international companies into the country.
Company registration in such free trade zone provides foreign businessmen with the possibility of complete ownership and company management. There are significant tax and customs benefits, and there are no restrictions on the volume and nature of the movements of the investment funds and their repatriation for companies domiciled on the territory of the free trade zones.
The authorities of the United Arab Emirates also provide the opportunity for the registration of the offshore companies, which can carry business only outside the UAE, but, at the same time can acquire immovable property in ownership within the country, participate in investment projects and serve as owners of other companies in UAE and abroad.
There are no restrictions at the legislative level on the currency exchange, profit and its withdrawal in the form of dividends and capital circulation. The authorities aim to optimize all the processes and to simplify the opportunities for carrying on business to the maximum extend, what results in the constant work at all the levels and the improvement of the country governmental system and regulations.
The United Arab Emirates is located in the heart of the crossroads of the trade routes of East and West, Europe and Asia. It helps to organize effectively an international trade flow with the minimal costs. There are modern sea and air transport companies, ports and airports in the UAE, which are connected with all the leading international transport hubs, and which provide the possibility of delivering goods from and into any part of the world.
Besides, the location of the country allows flying quickly to the UAE from a large number of the countries, and in the case of living in the UAE it is easy to fly to any country in Europe, Asia or Africa.
The year to year increasing domestic consumer demand on the import of goods, which are necessary for the local requirements, as well as a significant increase in the volumes of export and re-export, also plays an important role for taking decisions about establishing business in Dubai.
This factor and indicators of the constant dynamic development of all the sectors of the economy are the direct and most visible proof of the success of the terms which are offered for business by the UAE.
Registration of the offshore companies is also applicable on the territory of some administrative units of the United Arab Emirates. For such companies there are restrictions in terms of carrying on business within the country. However, they are allowed to act as the holders of the local companies and to purchase real estate within the country, and also to carry on almost any business outside the UAE.
These companies are also characterized favorably by the price of registration and renewal and by the absence of requirement on financial the reporting.
Summing up all what was mentioned above we can say that in the UAE there are opportunities and prospects for any kind of Trade business activity, besides, the UAE is the perfect platform for creating international business in different countries. Where Russia is looking to take complete advantage of these factors in expanding its reach in the UAE regardless of its type and size.
This blog is written by Ms. Heena Arora, Partner Relation Executive at Flyingcolour Business Setup, VAT and Accounting Services, Dubai. If you have any question regarding establishing business in Dubai or anywhere across the UAE then please contact us at +971 4 4542366 or email us at info[at]flyingcolour[dot]com.
