Selling in the United Arab Emirates (UAE) offers Italian companies an interesting perspective to expand their business in one of the most dynamic and growing areas globally.
In recent years, the rapid restart of economic activities post-lockdown has stimulated domestic demand, strengthening the UAE's role as strategic distribution hub. Thanks to the speed of recovery compared to other countries with more prolonged restrictions, the UAE has consolidated itself as a crucial hub for the Middle East, East Africa and South Asia markets. This is made possible by state-of-the-art infrastructure and the presence of 53 Free Trade Zones, which offer significant tax and customs benefits for foreign companies.
The UAE's economic diversification strategy aims to reduce dependence on the oil sector by developing an innovative and competitive business ecosystem. Initiatives such as “Operation 300 Bn” and “Projects of the 50” aim to strengthen the industrial sector, attract international talent and support start-ups, fostering sustainable growth. Foreign investors also benefit from favorable regulations, while export opportunities extend to advanced sectors such as sustainable energy, artificial intelligence and Industry 4.0, often supported by direct investments in local projects.
Italian exports to the UAE continue to show a growing trend. In the first eight months of 2024, Italy exported goods for 5.115 million euros, compared to 4,174 million euros in the same period of 2023, marking a increase of 22.5%. This result demonstrates the strong demand for Italian products and the consolidation of trade relations between the two countries, encouraging opportunities for companies that want to sell in the Emirates.
The exports to the United Arab Emirates They are characterized by strong diversification, with strategic sectors such as luxury, machinery and fashion driving exports.
Looking ahead, greater penetration into niche markets and consolidation in established sectors could lead to further growth opportunities.
There mechanics and Italian industrial technologies constitute approximately 40% of Italian exports to the United Arab Emirates (UAE), mainly concentrated in the oil & gas, water treatment and renewable energy sectors. The UAE Government's commitment to developing a solid local industrial fabric offers new market opportunities, both in traditional manufacturing sectors and in those related to Industry 4.0, such as greentech, artificial intelligence, robotics and blockchain. These areas are helping to modernize the UAE labor market, reducing employment in low-tech sectors and stimulating demand for innovative machinery.
The UAE, which imports 87% of its food needs, considers the food safety a strategic priority. The National Food Security Strategy 2051 and initiatives such as the AgTech Accelerator Program and the Food Valley Platform aim to promote innovative and sustainable agricultural technologies, even in difficult environments. The local food industry, with over 560 companies, is the third largest in the country, producing 6 million tons of food per year. The UAE food market is dominated by large supermarket chains and e-commerce platforms, while consumption reflects the growing interest in natural, organic and “free from” products, favoring the export of quality Italian products.
There Jewelry is a pillar of the Emirati economy, representing 30% of non-oil exports. With the launch of the “UAE Good Delivery Standard,” the Government aims to strengthen transparency in the gold and gemstone supply chain, consolidating Dubai’s role as a global hub for jewelry manufacturing and trading. While older generations are buying gold as an investment, young people are attracted by design and brands, opening up market space for high-end jewelry, including Italian ones.
The UAE pharmaceutical sector is booming, driven by population growth and reduced dependence on drug imports. With an import value of $6.57 billion in 2021, the market benefits from Free Trade Zone such as Dubai Healthcare City and Dubai Science Park. The medical industry is supported by the increase in private healthcare spending and the spread of medical tourism, where Dubai excels globally. Future prospects include telemedicine and teleradiology, tools that are growing rapidly thanks to the aging population and the demand for personalized care.
From 1 June 2021, with the entry into force of the Federal Decree Law 26/2020 , a significant amendment has been introduced to the federal legislation regulating private companies in the United Arab Emirates (Federal Law 2/2015, “Law on Commercial Companies”), which allows foreign individuals and legal entities to fully own the capital of companies incorporated in the country, which operate outside of strategic sectors such as telecommunications, finance, currency printing.
In order to also encourage the attraction and retention of qualified talent from abroad, a reform of the visa system was launched in September 2021, which includes the introduction of the Green Visa, designed for high-level professionals, investors, entrepreneurs and students, with the possibility of self-sponsoring without the intermediation of a local employer. With this in mind, the Freelancers Visa, aimed at self-employed workers in innovative fields such as artificial intelligence, blockchain and fintech, and business travel permits have been extended from three to six months, accompanied by significant changes to the Golden Visa, reserved for investors and high-profile figures.
The UAE, while retaining legislative control over key sectors such as defense, foreign affairs, education and health, grants individual Emirates the power to legislate in taxation and other public sectors. The tax system is advantageous for those who want sell in the Emirates, as there is no personal income tax and companies are not required to file corporate tax returns, except for entities involved in natural resource extraction or banking activities. In addition, there is no corporate income tax for most businesses, and some free trade zones offer long-term tax exemptions. Since 2018, VAT has been introduced at 5%, but some categories of goods and services are exempt or apply a rate of 0%, such as exports and health and education services. For companies that want sell in the Emirates, it is essential to understand VAT rules and register when sales exceed a certain threshold. VAT obligations are quite clear, but businesses must be prepared to comply with the regulations to avoid penalties and to be able to benefit from any VAT credits.
For more information on ways and opportunities to expand in the UAE, the team at Octagona, leader in internationalization strategies for Italian companies, is at your disposal.
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