Mar 24 2008

Doing Business in the Middle East

MCI Dubai director Ajay Bhojwani presented at the recent ASAE & Center International Conference held earlier this month in Washington DC. His presentation was so popular I have asked Ajay to share some of his thoughts along with a copy of his slides on his experiences in Dubai of the UAE.

I have been living in Dubai since 1981, and have spent my entire childhood here. It has been wonderful and feels like home now. With over 75% of the population being expats, it is not difficult to find people from one’s own nationality.

Dubai’s social scene is a melting pot of cultures with east and west sitting happily side by side. A city, which is tax free; filled with beaches, shopping malls and crime free. The quality of life is amazing without any restrictions in working or social life – as long as one can understand how to act during the period of Ramadan (holy month).

Working in a multicultural environment, Dubai has a diverse work force with a number of corporations who are located here as regional hubs. So the work environment tends to provide enormous opportunities to learn and adapt to various cultures. The city is as busy and buzzing as New York, USA or Mumbai, India.

As part of the work force, one needs to be careful and flexible as one will need to change their approach and business formats when dealing with different cultures, even if it is within the same company. For example:

  • Men should not offer handshakes to ladies, unless offered a hand by them.
  • One needs to be patient when dealing on a local level and a lot of times contracts are established and work is done by handshakes and verbal confirmation without having anything in writing.
  • Work hours depend on industries and can be long at times.
  • Friday is a weekend, however being a work day in other parts of the world depending on the industry one needs to be available for work queries.

You don’t have to organize or plan your shopping or groceries. Everything is open to late night or early mornings even and hence one can just decide and walk out of home to shop, eat or have fun.

The government is very pro active when it comes to promoting non-profit organizations. Most of the national associations are backed by the government and they have very strong connections with them which helps influence decisions on a policy level as well.

Dubai has established an economic free zone called the Humanitarian City to support the non profit sector.

The local language spoken is Arabic, however the business language tends to remain English.

Among the Emirati food, Biryani(rice with meat); hariss(cooked lamb with meat) are the most preferred. A lot of the Arabic dishes from Saudi Arabia, Lebanon and Iran are also preferred.

The local people are very friendly and open to other cultures. In fact, one can see a lot of Arabs in cinemas on weekends watching English or Hindi (Indian) movies. The Arabs generally tend to socialize till late especially weekends. They are quite commonly seen smoking sheesha’s (hubbly bubbly) and sipping sulemani’s (black tea). It is not very easy for an expatriate to easily mix and get along with the nationals, however once the ice is broken then all is quite simple and easy to network, have fun and work together.

The destination seems to be very attractive to event attendees. In the past two years, all the events have attracted larger number of attendees than the previous year’s events held in other destinations. The destination has a lot to offer and attendees can experience multiple cultures at one point.

Getting a visa is simple and it is very easily accessible whether you are traveling from Asia, Europe or USA.

The destination offers direct flights to most of the key countries across the globe. Hospitality and hotels cannot be matched, a wide variety of luxury as well as economical accommodations are available.

One of the key challenges to look out for is that most of the local registrations happen at the last minute. Approvals and government involved do require some time and that needs to be factored in when planning an event.

When traveling in Dubai, are there any safety precautions people should take? No safety precautions as such. The country is very easily accessible and getting a visa is also not a problem. However, when it comes to rules, they are very hard and no exceptions tolerated.

What are the legal and tax issues for Associations wanting to open an office in the Middle East?

  • Incorporation / Registration – To register associations in Dubai, it needs to be done with the Department of Economic Development and the Chamber of Commerce. There is a local / government representation is required for all associations.
  • Legislation – Due to definition problems, associations have to register with the Chambers of Commerce and they need to have a minimum number of citizens in them
  • VAT/Taxes – There are no direct taxes applicable
  • Bank Account – Need to be registered with the Economic Department in order to open a bank account
  • Recruitment – No laws or protection for employees as such. Hiring/ Firing is not difficult

What are the absolute Do’s and Don’ts when doing business in Dubai?

  • Be Patient
  • Do not discuss politics and religion with business people
  • Men should not offer a handshakes to ladies, unless offered by them
  • Friday and Saturday are government weekends, however people are very open to discuss business during weekends
  • Security is of paramount importance and one should take care not to break any rules and is fully aware about the legislation
  • When in a meeting with Arab never discuss business first off. Always build rapport – 10 to 15 mins minimum.
  • Be flexible as lot of times written contracts don’t apply
  • When holding meetings in the region, participation from the government agency to get government buy in is important
  • It is not recommended to discuss financials right at the start.
  • One needs to be prepared to operate last minute as a lot of times client queries and requirements come in last minute

You can contact Ajay Bhojwani directly at [email protected].

About the author

Peter Turner

As MCI's Senior Advisor, Global Development Strategy, I help associations build and execute global growth strategies. Over the past 30 years I have served three associations (ASAE, MPI and IEEE Computer Society) as a leader of business, product and partnership development.

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