Economy Bleak economic forecast leads to UK companies setting up in UAE By Melissa Hancock October 3, 2022 Unsplash British businesses are turning to the UAE as prospects look more positive than in their home country There has been a 23 percent year-on-year rise in UK companies setting up in the UAE. The increase comes as Britain contends with a stark economic outlook: the most recent forecast from the British Chambers of Commerce (BCC) predicts that there will be a recession before the end of this year, with inflation spiking to 14 percent. This sharp downturn will be driven by a combination of factors according to the BCC, including a dive in consumer demand, a weakening currency, a rise in costs and slowing growth in global trade. UK-GCC trade in numbers: relationship set for new era Against this backdrop British investors are increasingly looking to the UAE to incorporate their business given the emirates’ stability, low taxes and booming economy. Emirates NBD last week raised its economic growth forecast for the UAE to seven percent for 2022, due to a higher estimate for the energy industry’s output and the “robust growth” of its non-oil sector. The latest revision from Dubai’s biggest lender compares with an earlier 5.7 percent estimate and would mark its highest annual growth since 2011, when the economy grew by 6.9 percent. Industry professionals also noted that British investors are attracted to the UAE’s business-friendly environment and its pro-business policies. “The UAE government has been making several progressive and strategic changes in this past year,” said Helen Barrett, partner at CBD Corporate Services, which is based in Dubai. “This includes the introduction of long term visa categories, full foreign ownership, changes to the legislation and openness to foreign investment. “As a result, investors are moving their business to the UAE in an effort to recession-proof their business expansion.” Tom Smith, managing director of digital services agency Complete Online and a CBD client, credits his UAE expansion on the state of the British economy as well as the opportunities in his respective sector in Dubai. “We chose to expand to the UAE after seeing a gap in the market for a British, full-service marketing agency that offers the complete package,” Smith said. “After already partnering with other agencies over in Dubai to deliver projects, we thought it was the right time to get everything set up properly over here. “Given the current economy in the UK, it has only become more apparent that we need to diversify the markets in which we are working in. “I have also joined as a member of the British Business Group as a soft landing and for trusted contacts.” CBD also noted an increase in interest in the financial zone of Abu Dhabi Global Market (ADGM). “We’re seeing a number of ADGM incorporations that are focused on ringfencing assets, protecting wealth and legacy continuation,” Barrett said.