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Geographic Location
The United Arab Emirates extends along the coast of the gulf, from the base of Qatar peninsula to a short way beyond Ras AL Khaimah and across the Mussandum peninsula to the Gulf of Oman.
The federation comprises the seven emirates of Abu Dhabi (the capital), Dubai (the thriving commercial capital), Sharjah, Umm Al Quwain, Ajman, Ras Al Khaimah and Fujairah. In all the UAE covers an area of about 83.6 thousand square Kms.
Climate in the United Arab Emirates
UAE lies within a subtropical zone with very hot summers, high humidity, mild and pleasant winters. Rainfall is erratic generally, lasting for a few days and rarely exceeding 5 to 10 inches a year.
Population
In 2005, the population of the UAE was estimated to have reached 4.32 million Immigrant employees who form a large portion of the population predominantly from the Indian Subcontinent, Iran, Europe and other Arab countries. Expatriates are attracted to UAE by the opportunities offered by the rapid development of the country.
Culture
Arab Islamic culture dominates the lifestyle of UAE. However, it is tolerant of the different creeds and beliefs of its large expatriate community. Arab heritage and folklore finds expression in poetry, dances and songs. The traditional all-pervasive hospitality gives a great deal of charm to life in UAE. Cultural activities of other nations are very much popular in this country.
Language
The official language is Arabic, but English is the common language, Urdu and Persian are also widely spoken. Arabic and English are usually used in business and commerce.
Political System
The United Arab Emirates is a Federal Sovereign State which consists of 7 Emirates mentioned above. The Federation was established on the 2nd December 1971 of six Emirates, and then the Emirate of Ras Al Khaimah joined the Federation on the 10th of February 1972. According to the constitution, The Supreme Council of the Federation is the highest political authority in the country. It consists of all the Rulers of seven Emirates. The President and the Vice President of the State are elected by the Supreme Council and from its members. The President appoints the Prime Minister with the consent of the members of the Supreme Council. The members of the Federal Government are appointed by a decree from the President upon recommendation from the Prime Minister. The Federal National Council (FNC), which consists of representatives of each Emirate, is the Legislative Council (Parliament). It exercises the authority to discuss the sanction all Federal Laws and then refer them to the Supreme Council for enactment.
The Economic Policy
The economic policy of UAE is based on safeguarding and respecting the individual freedom in ownership of the means of production, practicing any type of business activities and providing all facilities.
There are no restrictions on imports and exports except some minor customs and administrative duties. The government plays a supervisory role in issuing legislation, which organize the functioning of the various economic sectors while causing no hindrance to the business activities.
Nature of Business Activities
The UAE economy has witnessed rapid economic developments. Even before 1957, the economy of the Emirates constituting the Federation, under their self-ruling system, was dependent on the available natural and human resources. Economic resources varied in each Emirate in accordance to the area, population and the abundance of the resources of each of them.
They were almost wholly dependent on certain activities such as pearl fishing and trading, fishing, trade, agriculture, grazing and some handicraft industries. Each Emirate differed from the other by its relative dependence on special economic resources. In 1957, another stage of economic development started. It was the beginning of the era of oil producing and exporting in Abu Dhabi, Dubai in 1969, and then in Sharjah. This stage had witnessed the increasing importance of the oil sector since the huge amount of revenues it provided in comparison with other sources of the national income. This rendered the traditional economic activities to become less important, particularly the sector of pearl fishing and trading. Since then oil and its related industries have become the backbone of the UAE Economy.
Trading Regulations of UAE
International manufacturers and exporters may conduct business with UAE by concluding transactions directly with importers and traders who are already established in the market. This type of arrangement may be suitable for low-volume trade. However, for an ongoing business relationship, overseas companies may well want to consider a more permanent form of representation.
. Commercial Agencies
A foreign company wishing to supply goods and services from abroad, but without establishing a physical presence in UAE, may find it advantageous to appoint a commercial agent. The main provision of the Federal Commercial Agency Law No 18 of 1981, as amended by Law No 14 of 1988, is that an agent must be a UAE national or a company 100 per cent owned by UAE nationals. A commercial agent may not carry out activities in the UAE unless its name is entered in the Commercial Agency Registry maintained at the Ministry of Economy and Commerce.
. Distributor:
It is possible for an overseas trader to appoint a local Distributor to distribute the products in UAE market. Unlike a Commercial Agent, the Distributor can be any locally registered company including companies with foreign ownership.
Other Regulations
Import duties are largely standardized at five per cent (expect for tobacco products (100%) and intoxicating liquors 50%) but there are many exemptions, including food, building materials, medical products and any item destined for the Free Trade Zones.
Trade practices in UAE are in line with normal international standards. As a sophisticated market, full technical specifications should be provided with CIF UAE prices and Middle East references. UAE is a member of WTO. Only importers who have appropriate trade license can undertake imports into UAE. |
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