2018 was a mixed year for many businesses. Some industries did it tough whilst others such as the tech and IT industries went from strength to strength.
What does 2019 have in store for us? If you want to know what lies ahead then take a look Creation’s forecasts below.
Many economic analysts have announced that the outlook for UAE’s economy is highly positive in spite of global headwinds. UAE’s gross domestic product (GDP) is expected to grow 3.7 percent this year, which is higher than the 2.9 percent forecast for 2018 and the 0.8 percent growth achieved in 2017, according to the latest economic outlook figures from the International Monetary Fund (IMF).
Juma Mohammad Al Kait, Assistant Under-Secretary for Foreign Trade Affairs at the Ministry of Economy, revealed “Geopolitical developments are unlikely to moderate the economic growth of the UAE, a trend in line with IMF projections of strong growth in the country in 2019. The positive outlook for the country’s economy has been affirmed by the advanced ranking across several global competitiveness indices”.
UAE has jumped 10 places in the World Bank’s Ease of Doing Business ranking to 11th position globally in 2019, up from 21st position in 2018 and remains the leader in the Arab world for the sixth repeated year. This is an attractive pull factor for those looking to setup a business in Dubai. The UAE is fast closing in to become one among the top 10 in the Ease of Doing Business ranking of 190 countries by the World Bank making the country even more appealing for foreign direct investors looking to expand or start a business in Dubai. Furthermore, the UAE is the most competitive economy in the Middle East & North Africa region, according to the IMD World Competitiveness Center. Overall, we predict the UAE economy is on track for steady growth.
Year 2017 was great for cryptocurrency investment. 2018 was a misfortune for cryptocurrency in terms of market price declines however, it was the year of major progress such as:
Bitcoin will be increasingly used as a store of value. Bitcoin costs nothing to store or transport. As much as it did after prior bear markets, Bitcoin price will rise again and head for new all-time highs. We anticipate a select group of crypto companies will compete to develop a more secure and more sustainable approach to supporting cryptocurrencies. We predict the avalanche of Crypto, Information Technology (IT) and software entrepreneurs and companies looking to start and setup a company in Dubai we saw in 2018 will grow even stronger in 2019.
Innovation is at the heart of World Expo and the UAE. Dubai has ambitious plans to be a pioneer for smart city technology. Expo 2020 Dubai has partnered with Siemens to meet its sustainability targets and its aim to create a plan for future smart cities. The smart technologies will support Dubai’s targets for energy efficiency, comfort, safety and security. This project is one of the world’s largest to implement the Siemens Navigator system.
“Expo 2020 Dubai is building the most digitalized, connected Expo in the Event’s 167-year history, and we will support this with data-driven infrastructure for sustainability, safety and security,” said Markus Strohmeier, Senior Executive Vice President of the Building Technologies Division, Siemens Middle East.
Creation foresee an increase in the types of tenders being awarded in 2019 for Expo 2020, injecting new financial and human capital into the UAE in the coming months. There are still many potential opportunities for businesses to win tenders with the ability to expand and start a company in Dubai. Check out the procurement section for Expo 2020.
United Arab Emirate dirham is pegged to the US dollar. Therefore, with continued pressure on the US Dollar, this will make the United Arab Emirates even more attractive to tourists. The inflow of the tourist dollar will be welcome news to those in the hotel and hospitality sectors for 2019.
Dubai registered 4.7 million overnight tourists in the first quarter of 2018, the Emirates look to be on track to achieve a target to attract 20 million visitors by 2020, source Department of Tourism and Commerce Marketing (Dubai Tourism).
Countries that have been or are currently being effected by war in North Africa are in the midst of reconstruction. We have seen an increased interest in the number of businesses looking to set up a company or branch in Dubai, UAE and the wider-GCC. Furthermore, these companies are making plans to setup their regional head offices in Dubai and operate from the UAE. We anticipate an increase in the companies looking to assist with reconstruction efforts in countries effected by war in North Africa. Already Creation are seeing a surge in interest in the consulting, construction, security and life support sectors.
We foresee significant M&A activity driven by both aspirations for growth and desperation for survival. Global funds will continue to only look to invest and acquire mature regional companies which have scaled in large geographical locations such as: UAE and Saudi Arabia. Furthermore, strategic investors will not stay away from investing irrespective of the political climate. We predict there will be larger household brand names looking to expand and form a company in Dubai or regionally and possibly acquire local companies. We anticipate that there could be a potential merger regionally with Careem-Uber on the horizon. On the other hand e-commerce rivals Noon and Souq will remain to battle it out and compete aggressively, resulting in improved customer service.
Small to medium enterprises (SME) are the backbone of the UAE economy. SMEs account for 42% of UAE’s workforce and contribute around 40% to the total value add generated in Dubai’s economy. Again, innovation and entrepreneurial encouragement is at the heart of Dubai and the UAE. We predict a continued growth of startups in the region. With the encouragement of government and private sector support we are seeing the emergence of several incubator programs. Watch this space as Creation are in the process of partnering with a Dubai Economy backed incubator that will assist new startups to the marketplace, more details on this topic are to be revealed soon.
Final thoughts from our Managing Director – Scott Cairns
Creation ensures clients receive a seamless, cost effective and proficient entry to the GCC market. We provide clients with the foundations and best practices empowering them to build and control a successful business.
We continuously strive to exceed client’s expectations whilst making certain they are protected from undue risk at all times. Creation Business Consultants is the preferred and truly trusted business partners for the GCC.