Silicon Oasis of the Middle East

Publications Written by Assem Muratova

DUBAI IS SILICON OASIS OF THE MIDDLE EAST

The world is undergoing the 4th Industrial Revolution, and in the first half of the third millennia, states are gradually shifting their priorities in tune with the current times. Information Technologies has not just become part of human life, but in addition, it became an essential tool to progress the states from the third world to the top.

In fact, a number of governments are trying to organize an entrepreneurial environment, which is identified by commercial innovation and IT inventions. To facilitate the development of such a business environment, local laws and the conditions created therefrom play an important role.

Dubai, which is the financial and business hub of the Middle East, works actively in establishing a favorable environment for IT start-ups and tech entities. It would be safe to say that Dubai is the leading city amongst other cities of emerging states in regards to the creation of an advantageous business environment and the attraction of investors and entrepreneurs.

The Dubai government has initiated and established several free zones specialized in IT as well as initiatives and platforms to foster its start-ups.

The following free zones are the foundation of Dubai’s “Silicon Valley,” and there are 49 free zones, which allow setting up companies in the IT space, but here we would like to mention the most dedicated ones:

Dubai Silicon Oasis;
Dubai Internet City;
Dubai Outsource City;
The National Industries Complex.

The main peculiarity of these free zones is 100% ownership of the company; 100% foreign ownership; 100% repatriation of capital; Zero income tax; Zero corporate tax.

Apart from that, each free zone has its own programs and funds to support IT startups. Tecom Investment Group, which owns and supervises Dubai Internet City and Dubai Outsource City free zones, has its own In5 incubator.

The incubator is a unique meeting platform for start-ups and investors with preferential terms. In5 suggests reasonable costs for license, visa, and easy launch of business. Currently, out of 120 active startup projects, more than a half have 50% growth. Currently, there is a business looking up in the areas of setting up companies with activities related to artificial intelligence, e-commerce, data management, and cybersecurity.

Dubai Silicon Oasis has launched its own division to support startup projects, which is Dubai Technology Entrepreneur Centre (DTEC) in 2015. Currently, DTEC is admitted as the largest startup center with its own entrepreneurial ecosystem. Since its launch in 2015, DTEC has become home to more than 800 entrepreneurial startup companies.

Dubai is not only a favorable place to launch a startup company, but also a place where you can get investment for further development. In 2017, UAE concreted its status as a regional hub of IT startups. The industry attracted 500 MLN USD of investment, which is 76% of the total investment amount received by the companies in the MENA region. The UAE has one-third of all investors in the MENA region. UAE along with Saudi Arabia, Lebanon, and Egypt invested 70% out of the whole amount of regional investment in digital and IT startups in the region.

This year, UAE registered 298 new startups. The most eminent ones are CAREEM private taxi service and StarzPlay movies resource. Especially, CAREEM attracted USD 350 MLN and SOUQ.COM received USD 275 MLN of investment. We can name Dubai as the Silicon Oasis of the Middle East by right. As apart from the creation of favorable conditions and supporting startup projects, UAE government, especially Dubai, initiated scores of innovative projects.

The serious proof of UAE’s approach to new technology is proved by the fact that it is the first time in the world a state has established the Ministry of State for Artificial Intelligence of the UAE. By 2021, UAE is planning to become the world capital of blockchain technology. Dubai’s Startup Hub project backed by local government is working actively to promote and to support startup projects in Dubai.