United Arab Emirates
United Arab Emirates
This is a comprehensive analysis of the United Arab Emirates in which the company hopes to expand its international operations. The analysis gives an in-depth discussion of the country's macro environment by describing its level of development, important industries, infrastructure, its history of inward foreign investments and significant industries available within its borders. Also discussed in the report are the country's economic ties with other nations, its political situation and the legislation that might affect inward foreign investments including government subsidies, tariffs, intellectual property protection and informal trade barriers.
The company intends to set up foreign operations in a foreign country, and this can only be done after an unequivocal analysis of the prospective foreign country. In order to make invaluable recommendations, this analysis also incorporates various economic conditions experienced in the United Arab Emirates including currency stability and economic growth statistics. Also included in this analysis for the purposes of this study are the cultural issues that might hinder social stability and perhaps workforce skills. It is noteworthy that the risks and benefits that might be associated with doing business in this country will also form an integral part of this study.
The UAE is majorly an Arab-Islamic nation situated in the GCC section of the Middle East. It is noteworthy that the UAE comprises of seven emirates 3. These include Abu Dhabi, Dubai, Sharjah, Ajman, Ras Al Khaimah, Fujairah and Umm Al Quwain 1. Despite being one of the youngest Middle Eastern nations, the United Arab Emirates has exhibited a steady economic growth largely because of the exportation of crude oil and related products 6.
United Arab Emirates macro environment
One ought to recognize that the economy of the United Arab Emirates is primarily run by the export of oil. United Arab Emirates and its environs are known for their abundant oil reserves that have seen the region exhibit an overwhelming development of economy3. However, the economy of this region also depends on tourism, subsistence agriculture and nomadic animal husbandry. The increased production of oil and related products has escalated the establishment of political, social and formal economic institutions but also infrastructure 1. It is worth noting that the widespread development of agriculture has also been instigated by tourism in the region that has hit peaks in the last two decades 2.
Various multination companies have invested in the United Arab Emirates, and this is an indication of a favorable business environment in the region 7. For instance, the Marriot Hotel, which is an international brand of numerous five-star chain hotels all over the globe, has set up its branches in major cities within the region 6. Other multinational corporations like FedEx and Pepsi amongst many others also have their operations within the borders of United Arab Emirates. It is imperative to note that the UAE was ranked 23rd in the Ease of Doing Business Report done in 2014 by the World Bank 3.
A 2013 Global Corruption Perceptions Index done by Transparency International on 177 nations placed the United Arab Emirates at 26th position; same score and position as Austria. These statistics indicate that this country enjoys a rather liberal economic environment that is almost free from barriers like corruption. Additionally, United Arab Emirates was ranked 23rd in a Bribe Payers Index study done in 2011 on 28 countries 1. The BPI research measures the possibility that corporations from these countries would pay bribes abroad 10.
United Arab Emirates’ political situation
The political situation always plays a significant role when conducting a feasibility study on the suitability of a nation for