Expo 2020 - The Impact on Business in the UAE
Expo 2020 - The Impact on Business in the UAE
The World Expo has historically paved the way for strong economic growth within its host country, but for the UAE, Expo 2020 holds even greater significance as Dubai becomes the first city to host such a large-scale international event in the MENA region. Now with preparations gaining full momentum, the UAE’s industries are gearing up to benefit from the six-month mega event, with a number of sectors expected to enjoy substantial growth. Construction, transportation, tourism, hospitality, retail, and leisure sectors have obvious potential to benefit from increased spending and infrastructure, whilst the expo’s theme ‘Connecting Minds, Creating the Future’ lends itself to opportunities within technology and innovation.
Construction & Infrastructure Grows due to Expo 2020
In the 2017 budget, the Dubai government announced an increase of 27% in annual infrastructure spend ahead of Expo 2020. By the end of 2017, Dubai Expo 2020 are expected to have awarded over 1,200 construction contracts, worth in excess of AED12 billion. With the additional spend in infrastructure, it is estimated that of the potential 300,000 jobs created by Expo 2020, 30% of these will be within the construction sector alone.
As the major infrastructure developments and real estate projects accelerate towards completion, there is therefore a renewed confidence in the already improving construction industry. This is a much-needed stimulus in a market that relies so heavily upon confidence and optimism in order to create momentum for renewed development and a stronger economic cycle. If you are considering setting up a construction or engineering company in the UAE, read our latest blog to understand the regulations for setting up an engineering business in the UAE .
Tourism & Hospitality Forecasted to Increase
It only takes a quick review of the forecasted impacts of the Dubai Expo 2020 to understand why the event has been donned ‘an economic catalyst’ for the UAE, even when considering tourism alone. Dubai is expecting around 25 million visitors over the course of the Expo 2020, with around 70% being international tourists. Naturally this will provide a significant boost to the city’s hospitality sector, but the impact is also expected to be felt in neighbouring cities, particularly in Abu Dhabi as they are likely to absorb part of this demand. This all comes hand in hand with the government’s investment drive to grow the UAE’s tourism industry; there are currently around 99 hotels under construction in the UAE, and this is expected to increase as we approach 2020. If you are interested in setting up a restaurant in the UAE, view this business set-up information.
Foreign Investment Frameworks
Expo 2020 can only stand to further support Dubai’s reputation as a growing global business hub, and therefore seems likely to enhance its attractiveness as a base for Middle Eastern company formation.
Dubai is already a coveted market for foreign investors, and as infrastructure and construction spearhead economic growth, the UAE as a whole is likely to attract more foreign investment because of Expo 2020. Expo 2020 is providing more impetus for initiatives that provide security, stability, and strict regulatory frameworks for capital and investment markets.
Strengthening the Dubai “Brand”
Dubai Expo 2020 is bound to attract millions of visitors over its 6-month period. The emirate’s strategic location alone (within four hours of a third of the world’s population) offers this particular Expo added potential for a much wider impact than ever before. The real opportunity however is to strengthen the Dubai “brand” beyond tourism, and show case not only the emirate, but the UAE as region with a diverse portfolio of economic sectors.
A major question surrounding the Expo is whether the benefits of hosting the event will continue after 2020. The driving force behind the ‘long-lasting legacy’ is that over 80% of the Dubai Expo 2020 site will be reused, and there will be a focus on infrastructure and cutting-edge technology within four high priority industries; real estate, travel and tourism, education, and transport and logistics. The conference and exhibition centre will also become a major event venue for Dubai, plus there will be vast residential communities and retail outlets.
Though there is some time before the true impact of Expo 2020 will be clear, for now “business as usual” is certainly no longer applicable. The international event in Dubai will undoubtedly create significant changes - both opportunities and challenges - in most industries and market sectors across the UAE. The Expo 2020 will provide significant opportunities for business and economic growth in the UAE, in the build up to and beyond the event.
There has arguably never been a more prominent time to establish a business in the UAE, but it is still vital to seek professional guidance from a reputable company. PRO Partner Group have assisted in the formation of over 300 companies in the Middle East, and provide invaluable guidance and support in the process of establishing a company in the UAE.
Jane Ashford is Managing Director at PRO Partner Group. Jane has extensive experience of establishing companies within the Middle East and has been recognised for her remarkable skills building relationships and providing excellent client services. Jane is focussed on bringing more businesses to the region to enable them to take advantage of this growing economy.
EXPO 2020: www.expo2020dubai.ae