Advantages and conditions of investment in Dubai for Saudis

Is investment in Dubai available for Saudis?

As we mentioned in a previous article, investment in Dubai is available for Saudis. Dubai offers several advantages for Saudi investors, such as geographical proximity, shared customs and traditions, tourism appeal, and encouraging and facilitating investment laws, in addition to a strong and modern infrastructure. One of the most prominent advantages of investing in Dubai for Saudis and others is what Financial Times "FDI Markets" data revealed: Dubai ranked first globally in several sub-sectors of foreign direct investment. The emirate was ranked first worldwide in the number of creative industry projects, and also topped the number of foreign investment projects in sectors such as business services, financial services, transport and storage, industrial equipment, sales, marketing, and support.

Dubai has maintained its outstanding global performance in attracting foreign direct investment projects after successfully attracting 492 projects during the first six months of 2022, the highest ever for a six-month period, with an 80.2% growth compared to the same period in 2021, according to the latest data from the Dubai Department of Economy and Tourism. All this highlights the great opportunities Dubai offers to investors in general, and Saudis in particular.

Investment Law in Dubai

The legal regulations governing foreign investment in Dubai are based on laws specific to the emirate itself, issued by the Government of Dubai, in addition to other general laws issued by the federal government of the United Arab Emirates. The most important points related to the Investment Law in Dubai can be summarized as follows:

• Any foreign investor is allowed full ownership in the Emirate of Dubai, according to Federal Decree Law No. 26 of 2020 amending some provisions of Federal Law No. 2 of 2015 regarding commercial companies.
• Full ownership (100%) for foreign investors in Dubai includes more than 1,000 commercial and industrial activities, except for economic activities related to the country's strategic sectors, which include 7 different sectors.

• Before a foreign investor starts any commercial activity in the Emirate of Dubai, they must obtain a commercial license that requires multiple procedures to be completed step by step until the legal license is received, allowing the investor to start their investment activity without any issues.

Investment Conditions in Dubai for Saudis

Investment conditions in Dubai for foreign investors for Saudis include the following:

• Issuing a commercial license that matches the type of investment activity, obtaining initial approval, a unified number, reserving the trade name, and having establishment and lease contracts approved by the official authorities.

• Choosing the appropriate type of investment whether inside free zones or within the local market, while adhering to the conditions of each type of company, such as partnership, joint-stock, or limited liability companies.

• Compliance with investment laws in the UAE including government fees, mandatory insurance, financial transparency, and legal regulations relating to employees and management.

• Determining the required capital according to the type of investment activity, as capital values vary according to the regulations governing foreign investment in Dubai.

Advantages of Investing in Dubai for Saudis

Among the incentives for Saudis to invest in Dubai, as mentioned at the beginning of the article, is that the emirate ranked first globally among cities most attractive for new foreign direct investment projects during the first six months of 2022, according to "FDI Markets", which is the most comprehensive database on new foreign investments worldwide.

New projects accounted for 56% of the total foreign direct investment projects attracted by Dubai during the mentioned period, according to the "Dubai Investment Monitor" report issued by the Dubai Investment Development Agency, one of the institutions of the Dubai Department of Economy and Tourism.

The value of capital inflows for foreign direct investment projects in Dubai reached 13.72 billion dirhams (3.73 billion US dollars) during the first half of 2022, achieving a growth of 14.6% compared to the same period in 2021.

The emirate also maintained its regional leadership and rose to third place globally in the ranking of job creation from foreign direct investment, after creating 15,164 jobs during the first half of 2022, a growth of 33.5% compared to the same period in 2021, according to Financial Times "FDI Markets" data. Dubai also maintained its leadership in employment related to foreign direct investment among the countries of the Middle East and North Africa region.

Confirming renewed investor confidence, Dubai ranked fourth globally in the ranking of reinvestment projects by number of projects, tenth globally in terms of capital inflows, and eighth in terms of related job creation. All this once again proves Dubai's strong investment reputation, which is a key advantage encouraging Saudi investors to invest in Dubai, as they have deep-rooted and strong fraternal ties with the emirate.

Read also: Best investment sectors in Dubai.

Volume of Saudi Investments in Dubai

The volume of Saudi investments in the UAE until August 2019 exceeded 35 billion dirhams (about 9.5 billion dollars), with the number of Saudi projects in the UAE reaching 206 projects.

As for the number of Saudi companies operating in the UAE, it is about 23,000 Saudi companies and 66 commercial agencies. Regarding the evaluation of the volume of investment in Dubai for Saudis among what was mentioned, it is undoubtedly large, as Saudi-Emirati relations are based on shared social and political foundations, proven by the direct understandings that have characterized the relationship between the two brotherly countries since the early years of the union, and the establishment of the United Arab Emirates.

Best Types of Investment in Dubai for Saudis

When talking about the increasing trend of Saudis investing in Dubai, and the best types of investment in Dubai for Saudis, it is important to mention the role of flourishing Saudi tourism to Dubai, which may have contributed to Saudi tourists getting closely acquainted with Dubai's promising investment market, motivating some to invest in real estate in Dubai, while others were attracted to other types of investments. One study showed that the number of Saudi tourists visiting Dubai is higher than any other destination!

 Dubai, which enjoys increasing popularity among travelers worldwide, attracts Saudis in particular, as shown by official statistics indicating that Saudis, in particular, enjoy special short trips to Dubai, with about 1.8 million Saudis visiting Dubai in the last months of 2014.

Real Estate Investment in Dubai for Saudis

The volume of investments by Saudi citizens in Dubai properties increased during the period from 2002 until the end of 2018, exceeding 89 billion dirhams, according to analyses of published economic data.

It is noteworthy that in 2020, Saudi investors ranked first among Arab investors, second in the Gulf, and fourth globally among the top investors in Dubai real estate.

Saudi investments were concentrated in residential apartments in several areas, most notably Dubai Marina, Downtown Dubai, JLT, and Dubai Sports City. As for villas, Saudi investments were concentrated in Dubai Land, Jumeirah, Arabian Ranches Springs, Palm Jumeirah, Al Furjan, and Jumeirah Island.

It is worth noting that the majority of Saudi investments in Dubai real estate were focused on residential apartments, as most Saudis invest in buying apartments, while the share of those preferring to invest in villas reached 20%.

Imtilak Global Services for Saudi Investors

Investors, in order to start a safe and successful investment, are keen to turn to trusted and experienced companies in the investment market.

In this regard, Imtilak Global in Dubai offers its diverse services to Saudis wishing to own and undertake real estate investment in Dubai through all its stages, starting from real estate consultations, helping to find the right property, providing everything needed to complete the property ownership process, and ending with various after-sales services. For more information, you can contact us via our official channels.

Edited by: Imtilak Global Real Estate©

Questions and Answers about Investment in Dubai for Saudis