Brexit business impact: why rich Londoners are moving to the UAE?
Since the Brexit has been announced after the referendum held on 23rd of June 2016, the UK national currency has been experiencing lack of stability and demonstrated considerable decrease. Over the last eight months, GBP has been falling dramatically to USD from its peak at 1,43% in April to 1,27% in the middle of November 2018.
London, which used to have a reputation of political and economic heaven for wealthy people from all over the world during the last 30 years, is experiencing precipitous migration of millionaires. According to the last Global Wealth Migration Review, rich Londoners are moving to other countries because of the Brexit impact. In 2017 the UK took 4th place at the rank of world HNWI (High-net-worth-individuals) net outflow.
Countries ranked by HNWI net outflows
|NET OUTFLOW OF HNWI IN 2017
Notes: Figures rounded to nearest 1000.
Source: New World Wealth, 2017
What are the Current Challenges for the UK Business?
- Low-demand of the EU market
- Strong competition
- Over-taxation (some taxes, such as inheritance tax are reaching 40% in the UK and are known to be among the highest in the world)
- Brexit impact
Among the usual challenges of any European business, the Brexit impact is clearly standing out. Evidently regardless whether there will be “deal” or “no-deal”, it is going to impose dramatic limitations on the UK export of goods and services to the EU (at least, until bilateral agreement between the UK and individual EU countries will be made), considering the fact that the EU is the largest export market for the UK. Only export to the main 3 EU trading partners Germany, Netherlands and France accounts for 80,4 bln USD which is 35,3% bigger than export to the USA (52 bln USD).
Altogether these factors don’t contribute to shaping positive business environment in the UK and serve as compelling reasons of moving operations to the countries with more favourable conditions.
The UAE undoubtedly can be listed among the most desirable destinations for British entrepreneurs. According to statistics, presented at the last Global Wealth Migration Review, Dubai took the second place in the rank of cities with the largest HNWI inflow in 2017 (the first one went to Auckland).
What Can Dubai Offer to UK Citizens?
- AED is pegged to the USD
- Lower-cost workforce
- Liberal Immigration Law
- Political stability and safety
- Good Infrastructure
- 0% corporate tax
- Strategic location for trading with the Middle East, Asia, Africa
- Green light for the UK passport holders
Why Moving Business from the UK to the UAE can be a Solution?
- Governmental support: “The UK has identified £30 billion worth of new opportunities annually for British businesses across sectors in the GCC region by 2021”.
- Powerful business tools tailor-made for British citizens.
- Growing demand of the UAE and Middle East market especially for high-tech, luxury goods, renewable energy solutions, smart technologies, pharmaceuticals and IT – segments where the UK is among the best in the world.
- Active and ambitious presence of the UK in the UAE. More than 120 000 UK citizens live, work and set up business in the UAE. The UK is the largest foreign direct investor in the UAE, with 6 000 British companies operating in the UAE
- Formidable reputation of the UK business in the UAE. According to the UK Department for International trade, the UAE is “the UK’s largest export market in the Middle East and the 13th biggest globally”.
Some of you may say, that bald statistics tells nothing about underlying trends of the Brexit impact and business opportunities and we agree 100 % because the only thing matters – are real-life examples.
Stories of UK Businesses in UAE
One of our clients used to work in the finance sector in the UK and decided to move to the UAE to enjoy better weather and tax optimization options. In a short time, he realized, what a great business potential local market can offer. Currently, this successful businessman owns several businesses in the UAE and is providing top-notch B2B services in different fields. Not only he is satisfied with his professional life, but also, he is wealthy enough to afford his kids to study at Ripton in the UK.
Another client came to us being already an outstanding businessman, with many factories owned all over the world, but his biggest buyers were in KSA, so in order to meet the requirements of GCC clients, he relocated to Dubai and not just his business, but himself with family and his dog. A permanent presence in Dubai allowed him to grow even faster, as he understood, that there is no business that can be done in the Middle East without a handshake. Currently, he is getting ahead and is engaged in the export and import of building materials and enjoys living in one of the most beautiful neighborhoods in Dubai.
We know many more stories of success when people not only benefited financially, but they also have changed their lifestyle and become healthier, happier and more active in Dubai. Thus, Brexit is not the end – it may become a great business opportunity to grow your business, depends on how you percept it.
In case you wish to get a kind expert advice on relocation of your business to UAE, be free to reach our Business Setup expert directly on WhatsApp: +971 55 1479 576.
Share your questions with us: [email protected] and our professional team will ensure that your business is set up for the ultimate success, every time.