The UAE has become a global magnet for talent and innovation, as it continues to build on its aspirations to be a model environment for investment and entrepreneurship. Backed by its strategic location and strong financial reserves, the UAE has been able to create a modern, dynamic and diverse economy since the start of the century.
The country has consistently and strategically banked on its strengths to transform as one of the most attractive business and trade hubs across the globe and defining its economic success that goes well beyond the hydrocarbons sector. It has worked its way up to create an ecosystem that not only attracts and empowers global start-ups and entrepreneurs but also thrives as a haven for global investors and MNCs.
Successful Covid strategy
Despite the rapid economic transformation over the past decade, the onset of the Covid-19 pandemic coupled with the slowdown in oil prices brought the economy to a sudden halt. This compelled the central bank and the government to introduce stimulus measures and accommodative policies aimed at restoring investor confidence while ensuring business continuity and sustainability.
The UAE rolled out several financial packages and optimized spending to support the overall economy. Consistent with their vision to increase the contribution of SMEs to the economy and support priority sectors, Covid-19 recovery measures were aimed at job creation, retaining ex-pats, and boost overall demand.
One of the primary ways in which the UAE aims to achieve this is by targeting knowledge-sharing between innovative economies focused on growth and cooperation. The priority here is to develop strategic sectors, underpinned by next-generation technologies and attracting highly skilled global talent. While Expo 2020 is likely to play a huge role in this regard, the country has also undertaken several initiatives to realize this goal. For instance, the recently launched ‘Projects of the 50’ is a series of economic initiatives aimed at making the UAE a global player across different industries and boosting the nation’s overall competitiveness. The initiative focuses on attracting FDI to the tune of Dh550 billion over the coming decade, investing in technology, and creating new visas to attract and retain residents and skilled workers. Among the projects envisioned, the UAE and the Emirates Development Bank will invest Dh5 billion in industrial technology and technology-heavy sectors.
Easing visa regulations
UAE’s expatriate population (90 percent of its total population), the cornerstone to the country’s economic growth, was hit hard by the Covid-19 pandemic that led to thousands of ex-pats losing their jobs. The rigid visa regulations only added to the burden, leading to an exodus of workers as they returned to their homeland. This aggravated the economic pressure, making it imperative for the authorities to attract and retain foreign talent in addition to focusing on easing visa regulations to ensure long-term stay.
In late 2020, UAE launched the ‘Remote Worker Visa’, which allows individuals with overseas employment to live in the UAE for one year, as long as they meet a certain earnings threshold. The recently launched 50 economic initiatives also target at bringing in new residents with schemes like ‘Green Visa’, which is meant to expand self-residency status for skilled individuals and investors, and the ‘Freelancers Visa’, which will enable the self-employed to sponsor themselves. These freshly introduced visa categories are in addition to the already introduced 10-year ‘Golden Visa’, which is granted to the highly-skilled, select residents and investors.
Attracting skilled talent
The UAE remains objectively focused on attracting skilled talent that will aid its growth towards establishing a digital economy, which forms a major pillar and a key enabler of the nation’s strategy for building a digital future driven by advances in science, knowledge, innovation, and technology. For this, among other initiatives, the UAE authorities have launched the ‘National Program for Coders’ this year in collaboration with global tech giants to train and attract 100,000 coders. The program will also work towards establishing 1,000 digital companies within five years and increase investment in start-ups from Dh1.5 billion to Dh4 billion. In a broader sense, the program seeks to provide opportunities for fostering cooperation between government and private sector entities in the UAE and abroad to implement promising ideas and turn them into comprehensive projects.
Expo 2020 Dubai benefits
The commencement of the much-awaited six-month-long Expo 2020 Dubai is set to bid a gamut of opportunities to Dubai, and the UAE at large, offering a massive opportunity to showcase what they have achieved so far and how they plan to implement world-leading plans in the future. Considered as one of the largest global events post-pandemic, the UAE is likely to reap its benefits for years to come. Apart from bringing in millions of visitors from 191 countries over the tenure of the event, the Expo will cement the UAE as a global player in a number of fields, demonstrating to the world the many innovations it has pioneered, while also attracting more business and investment in the country.
Tourism, real estate, construction, leisure, and hospitality are likely to witness a direct positive impact in the form of investments, while the influx of people and the global spotlight will bode well for small business owners and entrepreneurs, especially at a time when the economy is still recovering from the pandemic.
The construction and real estate sectors recorded an improvement in growth numbers in the first half of 2020, possibly benefitting from the expansion in Dubai’s hotel capacity that is required to accommodate visitors for the Expo. Residential real estate sales in Dubai also improved during the period, perhaps aided by the buoyancy in the market. In terms of job opportunities, MEED anticipates 277,000 new jobs in the making of Expo 2020, of which, 40 percent are in the tourism, travel, and leisure sector. The construction sector accounts for the rest of the share.
Overall, the Expo is going to accelerate growth in all areas of the economy, whether directly or indirectly. The $12 billion invested by UAE towards the event may also seem small when compared to the potential revenue it is likely to earn, which is forecasted to be twice that of the original investment. The UAE already has in place plans to capitalize on the several government-led projects that were undertaken in the run-up to the Expo – District 2020, the Expo site, will retain more than 80 percent of its infrastructure and become a major hot spot for economic growth with affordable housing and a center for exhibitions and tourism, while the expanded infrastructure will serve business communities and societies for years to come.
Over the coming years, the UAE is expected to firmly establish itself as a knowledge-based economy, and be among the vanguard of nations in designing the future, embracing talent, entrepreneurs, academics, start-ups, and future investments globally. The country’s various strategic initiatives are a vital step in realizing this growth as its commitment towards technology in economic and social progress aid the rise of a hub for the development of creative and innovative solutions. As the Dubai Expo 2020 creates new pathways to prosperity and brings with it an enormous opportunity for the world to come together, it is just the beginning of a new era of economic growth for the UAE.