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Business Loves Dubai

DMCC – the world’s flagship Free Zone, business hub and Government of Dubai Authority on commodities trade and enterprise – announced record-breaking performance in 2020, despite the COVID-19 pandemic.

Economic and commercial activities in the UAE continued their positive run in the first half of February 2021, reflecting the growing confidence of local and foreign investors in the national economy.

Recent statistics issued by the National Economic Register showed that over 4,300 new licences for economic and commercial activities around the country were issued in the first 15 days of February.

In light of the sector’s continuous growth, the total number of licences issued in the country amounted to over 745,000, in light of the ongoing activities of the production and services sectors.

In his statement to the Emirates News Agency (WAM), Hamad Al Awadhi, Member of the Abu Dhabi Chamber of Commerce and Industry and Chairman of the Commerce Committee, said that the UAE has recently adopted several initiatives that aim to maintain its economic achievements, to counter the effects of the coronavirus (COVID-19) pandemic.

These initiatives include a series of incentives and facilitation for all sectors, which increased the attractiveness of the UAE’s business environment, encouraging investors to further invest in the country, Al Awadhi added.

He also stressed that the country’s considerable efforts to offer all citizens and residents the coronavirus vaccine had a positive impact in reinforcing investors’ confidence in the national business environment over recent months.

Figures from the UAE Purchasing Managers’ Index (PMI) showed an increase in the activities of private non-oil sector companies in the last couple of months, underscoring the continued demand and export activities in the country.

Some 2,025 new companies joined the DMCC in 2020, the highest number of registrations in five years. Retention rate remained at an all-time high. This was primarily due to the Business Support Package launched in March 2020 that saw interest from companies in 149 countries. More than 8,000 member companies availed over 13,000 offers and incentives throughout the year.

In recognition of its continued efforts to enhance its ecosystem, the DMCC claimed Global Free Zone of the Year by the Financial Times’ fDi Magazine for a record sixth consecutive year in October 2020.

For its efforts in supporting business and residents in the JLT-community in terms of COVID-19 relief efforts, the DMCC is shortlisted for “Best Communications During COVID-19” and “Best Integrated Campaign” by PRCA, the world’s largest professional PR body, in its MENA regional awards.

Ahmed Bin Sulayem, Executive Chairman and Chief Executive Officer, DMCC, said, “A year like no other, 2020 was shaped by market uncertainty, geopolitical tension and a global pandemic. Despite the difficult context, the UAE’s visionary leadership and prompt and decisive actions meant that our economy remained resilient. As for the DMCC, we continued to attract, facilitate and promote global trade flows to and through Dubai. We surpassed 18,000 member companies, broke company registration records while launching new initiatives and progressing on time with flagship projects. Building on this momentum, we will maximise the progress made to reach new heights in 2021.”

Attracting foreign direct investment to Dubai China – 2020 saw a 20 percent year-on-year increase in Chinese companies joining the DMCC. A China Service Centre opened its doors in Almas Tower with Mandarin onboarding support while a representative office in Shenzhen was inaugurated all to promote the ease of doing business through the business hub.

Israel – Following a Memorandum of Understanding with the Israel Diamond Exchange, the DMCC inaugurated its representative office in Ramat Gan, Tel Aviv, Israel in 2020. The new office is supporting Israeli businesses, from all industries and sectors, to set up an office in DMCC.

Engagement – The DMCC hosted 19 virtual Made for Trade Live roadshow webinars to engage with key international markets across including China, Israel, Russia, Switzerland, Germany, Angola, South America, Spain, Turkey, Ukraine and the United Kingdom. Overall, the DMCC gathered 11,000 attendees virtually in 2020.

Record-breaking year for commodity trade With the gold and diamond industry representing 15 percent of all the exports out of the UAE, second only to oil and petroleum products, the DMCC’s role in facilitating trade and connecting markets marched forward at pace in 2020.

Diamonds – In 2020, a total of AED91.8 billion (US$24.99 billion) worth of rough diamonds were traded through the Dubai Diamond Exchange (DDE), the world’s largest diamond tender facility. The DDE hosted 19 rough and polished diamond tenders and its first emerald tender. At the year-end, the UAE’s largest ever rough diamond tender took place on the DDE floor, with 379,912 carats of rough diamonds sold, valued at AED321.29 million ($87.47 million).

Gold – Throughout 2020, DMCC supported the UAE Ministry of Economy in developing the new UAE Good Delivery Standard to enhance the country’s position as a leading hub in the global gold and precious metal trading landscape.

Coffee – The DMCC Coffee Centre processed and handled seven million kilogrammes of coffee and facilitated coffee shipments – from 25 countries across Africa, Asia and Latin America – worth over AED250 million ($68 million) throughout the year.

Tea – The DMCC Tea Centre value-added and transacted 40,000 metric tonnes of tea. In June, both Centres hosted His Highness Sheikh Mohammed bin Rashid Al Maktoum, Vice President, Prime Minister and Ruler of Dubai.

The DMCC’s ecosystems for trade across sectors also recorded a strong performance: Exchange – Dubai Gold and Commodities Exchange (DGCX), the largest and most diversified derivatives exchange in the Middle East and a subsidiary of the DMCC, traded 12.73 million contracts valued at AED1,177.73 billion ($320.69 billion). In addition to celebrating its fifteenth anniversary, The DGCX received the prestigious “Exchange of the Year” award at the Futures and Options World Global Investor MENA 2020 event for a third consecutive year.

Transactions – The DMCC Trade Flow platform recorded transactions valued at AED744 billion ($202 billion), an increase of 121 per cent year-on-year. The transaction value of Islamic products rose by 128 per cent year-on-year. The platform onboarded 28 new members, including 12 leading financial institutions.

Agri – In August 2020, DMCC launched the Agriota e-Marketplace, a technology-driven agri-commodity trading and sourcing platform that uses blockchain to help bridge the gap between millions of rural farmers in India and the UAE’s food industry. More than 92,000 farmers have registered on the platform to date.

A digital-first strategy Digital – The DMCC further enhanced its set-up process, offering a simplified and fully digitalised onboarding experience. This resulted in a 50 per cent drop in walk-ins and physical visits, with existing and new members preferring to conduct their transactions online. Focused digital outreach across key markets saw 95 per cent of new companies in the Free Zone start their journey with the DMCC digitally.

In its pursuit of digital-first, the DMCC claimed the International Business Leadership Award in the category Strategy, Change and Transformation. The award was given for digital improvements across the company onboarding journey, cutting down the average application-to-licence time to 10 days from 40, reducing documentation by 60 percent and improving customer-member satisfaction by nine percent.

A thought leader on trade In October 2020, the DMCC launched the third edition of its flagship thought leadership report “The Future of Trade”. The award-winning report examines the impact of geopolitics, technology, COVID-19 and global economic trends on the future of trade. In addition to deep research, the report provides tangible recommendations to government and business on trade and policy to grow trade in the decade ahead. To date, the 2020 report has generated over 13.1 million impressions and over 250,000 downloads.

A smart community Performance – Overall, the Free Zone maintained high occupancy levels across its lease asset portfolio, signed substantial lease extensions with key tenants, and executed deals and commercial agreements with several well-known F&B brands coming to JLT soon.

Uptown Tower – Construction of the Uptown Tower, in the much-anticipated Uptown Dubai District, surpassed the 40 per cent mark following the completion of design works. Several smart district initiatives, such as smart parking sensors, smart street lighting, building management systems and energy management upgrades were also successfully implemented.

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S. Jack Heffernan Ph.D. Economist at Knightsbridge holds a Ph.D. in Economics and brings with him over 25 years of trading experience in Asia and hands on experience in Venture Capital, he has been involved in several start ups that have seen market capitalization over $500m and 1 that reach a peak market cap of $15b. He has managed and overseen start ups in Crypto, Mining, Shipping, Technology and Financial Services.