How to Do Business in the United Arab Emirates (UAE)
In February of this year, President Bush faced a storm of criticism over a decision to let a subsidiary of United Arab Emirates (UAE) government-controlled maritime management firm Dubai Ports World run ports in several U.S. cities. Whether or not you felt that the criticism was well-founded, you likely wondered what prompted the Bush Administration to choose this particular company to run our ports, and were maybe even just a little curious as to who or what constitutes the United Arab Emirates.
The United Arab Emirates is a constitutional federation of seven emirates; Abu Dhabi, Dubai, Sharjah, Ajman, Umm al-Qaiwain, Ras al-Khaimah and Fujairah. The capital and the largest city of the federation, Abu Dhabi, is located in the emirate of the same name.
These certainly are not names most of us are familiar with, in spite of the steady stream of information on the Middle East we’ve received from the news since September 11 or even earlier. Most of us more or less could state a factoid or two about Afghanistan, Iraq, Iran, Kuwait, Saudi Arabia, Israel/Palestine, Lebanon and Syria. But, for most of us again, the UAE mostly conjures up some vague notion of things Arabic and Middle Eastern at best.
The UAE, especially its capital Dubai, is about as close to a free-trade utopia as a political body can get. There are no foreign exchange controls, quotas or trade barriers. Import duties are extremely low, and many products are exempt. Despite a relatively small population, Dubai’s total imports exceed $14 billion. The reason is that Dubai is the major re-export centre for the region.
Originally a small fishing settlement, Dubai was taken over in the 1830s by a tribe led by the Maktoum family, which still rules the emirate today. So began a trading empire based on gold, silver, pearls and spices. A fusion of Arab, Persian and Indian flair established Dubai’s business acumen.
A foreign company wishing to supply goods and services from abroad, but without establishing a physical presence in Dubai, 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% owned by UAE nationals.
The main business district in Dubai is around the World Trade Centre, on Sheikh Zayed Road. The Emirates Towers, as the tallest buildings in the Middle East, are one of the business hubs of the city. The focus looks set to shift in part to the new Dubai International Convention Centre (DICC), completed in time for the IMF and World Bank Conference in May 2003. Other major planned infrastructure developments include a revamped Port Rashid container port, the completion of a massive marina in Jumeirah and a new bridge over Dubai Creek.
Multinational companies and international organisations based in Dubai include Sony, Heinz, AT&T, Shell, IBM and General Motors. Etisalat is the only provider of Internet services within Dubai, exercising heavy control, with all sites accessed and monitored through the company’s proxy server. The Dubai Chamber of Commerce (tel: (04) 228 0000; website: www.dcci.org) is often helpful for foreign businesspeople.
Although Dubai is almost completely free of trade restrictions, many of the Arabic rules of etiquette still apply here.
It is a major faux pas to break certain conventions when How to Do Business in Dubai. Smart conservative clothing is expected, despite the often soaring heat. Meetings could start late, since this is not frowned upon in Dubai and it should not be commented on. The Arabic handshake involves touching the heart with the palm of the right hand after each shake, although visitors should note that when greeting Arab women they should not offer their hand unless the woman extends hers first.
The terms ‘Sayed’ (Mr) or ‘Sayeda’ (Mrs), followed by the first name, should be used in greeting, to ensure politeness. It is also very important for visitors never to sit in such a way that their feet are pointing directly at someone else. Causing someone else to lose face, whether a client or colleague, is considered extremely offensive and any criticism or corrections should be kept for private discussions afterwards.
Meetings tend to start with plenty of preliminary chatting before moving onto the serious work, so it is essential for visitors not to rush in. Business meetings in Dubai are often seemingly casual affairs, in cafйs or restaurants, although it is easy to be caught off guard, as the pace tends to quicken rapidly and deals are struck in a fraction of the time it can take in Western Europe.
Friday is considered a day of prayer and rest, so meetings should not be scheduled for this day. Calls to Arab people should also be avoided on this day. Similarly, local people will not answer the telephone during siestas, which are usually taken between 1400 and 1700. Business hours are Saturday to Wednesday 0800-1300 and 1600-1900. Businesses run by Western staff might open Sunday to Thursday 0800-1700. Business socialising in Dubai can be quite formal. Lunch meetings are more common than evening meetings and visitors should note that sometimes business meals will be served at venues that do not serve alcohol. Asking for it may cause embarrassment and even insult.
With tensions high in the Middle East, visitors are strongly advised not to bring up political matters and, if prompted, to veer on the side of caution, not assuming any common beliefs or opinions.
Further customs and conventions
A number of expressions punctuate conversation in the UAE and the most common is the term Insh’allah (‘if God wills’), which underlines a strong belief that the course of events cannot be controlled by the individual.
The term Bukra Insh’allah (‘tomorrow, God willing’) conveys the sense that ‘We will do things as soon as possible but God will determine when that may be’.
Customs that are common throughout the Islamic world are well known. Some of these are not unique to the Arab environment, but are standard behaviours in a range of international situations.
The Arab meeting — what to expect
Arab meeting settings in the UAE vary but it is best to be prepared. In many instances, you may be meeting with an expatriate executive and the meeting will follow standard international practice.
Some of the characteristics of Arab meetings in the UAE are:
Have you visited Dubai or another part of the UAE? Do you have personal anecdotes to share about the Emirates, or contrasting examples to the above general rules?
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