With The Global Business Forum Africa 2021, Dubai Chamber Continues With Its Mission To Bolster Ties Between The UAE And The African Continent
Businesses from Africa are increasingly looking at Dubai as a gateway for them to expand into markets across the GCC, Asia, and Europe.
For years, the UAE, and Dubai in particular, has served as a hub that global businesses have used to launch and run their operations in the African continent. At the same time, Dubai has, over the last couple of years, continued to lead the GCC region in the volume of foreign investment that flows into Africa- Dubai Chamber of Commerce and Industry’s Director of International Offices Omar Khan points out the Emirate’s non-oil trade with Africa was up 11.8% in 2020, compared to 2019. Dubai’s focus on the African continent has also been evident through the Global Business Forum Africa event series staged by Dubai Chamber over the years, with its sixth edition set to run this year from October 14–16, 2021.
Now, however, a new trend is being seen as businesses from Africa increasingly look at Dubai as a gateway for them to expand into markets across the GCC, Asia, and Europe. “Dubai remains a major hub for African companies that want to do business with our part of the world, and expand their footprint abroad,” Khan explains. “African companies that are keen on entering the UAE market can capitalize on the competitive advantages that the country offers, such as its strategic geographic location, world-class infrastructure, excellent logistics facilities, 100% foreign ownership, long-term residency, attractive free zones, and a business-friendly environment.”
Omar Khan, Director of International Offices, Dubai Chamber
Source: Dubai Chamber
Ngozi Nzekwue, co-owner and Managing Director of Hatfield Solution Ltd, a London-based commodity solution provider with operations in Uganda, confirms that the sheer number of benefits that the UAE offers to foreign businesses is what led her to set up a branch of her business in Dubai. For her enterprise’s expansion into the Emirate, she engaged a UAE-based PRO (Public Relations Officer) company to help ease the licensing process, and that allowed her to concentrate on business development from day one. “A good knowledge of the local laws will help one to harness the intricate requirements comprising formation and registration procedures,” Nzekwue says. “Without this knowledge at hand, obtaining the wrong license could be a costly mistake with financial implications that could significantly set you and your team back.”
Ngozi Nzekwue, co-owner and Managing Director of Hatfield Solution Ltd
Source: Hatfield Solution Ltd
And this sentiment underlines her advice for any of her fellow African entrepreneurs that want to set up a business in the Emirates. “When it comes to the UAE, be clear on your objectives, state them with the passion with which you conceived them, and then shape the collaborative strategy with clarifying questions that are welcomed in this part of the world,” she explains. According to Nzekwue, the UAE offers a market for any high-quality product, and that’s why businesses would be wise to tap into it. “Plus, a product catering for locals can be upsized for wider distribution, and therefore, is ripe for ground-level purchase,” she continues. “Another tip is learning key salutations and customs in Arabic, and having the appropriate respect for prayer times. These gestures show the respect that goes a long way in any foreign land, and they are valued as rapport-building aspects, thereby enabling a business to thrive between the involved parties.”
Another example of an African entrepreneur who has made inroads into the UAE market is Bernard Kingsley Annoh, the founder and Group CEO of The Berlin Group International, a Ghana-based umbrella company for Berlin Cosmetics, which is perhaps best known for its Black Secrets brand of products. When talking about kicking off his business in the UAE, Annoh notes the straightforward and quick set up process that, he says, gave him the confidence that the UAE was well prepared to receive foreign entrepreneurs. “I would advise entrepreneurs looking to seize opportunities in the UAE market after the COVID-19 pandemic to start researching online, but to know that since most of the registration fees and rates have been reduced for new companies, this is the ideal time for African companies to get into this market,” Annoh says. “It might be a good idea also to come together and form one entity with different products or services in order to save cost.” Integrity and truthfulness are what he calls the key values that govern doing business in the UAE. “There have been no short- cuts or undercover in my dealings, and I have only experienced transparency and the win-win mindset,” he declares.
Bernard Kingsley Annoh, the founder and Group CEO of The Berlin Group International
Source: The Berlin Group International
According to Annoh, doing business in the UAE has been made especially easy thanks to the support of the country’s government, which, he says, “operates more like the private sector.” This means that entrepreneurs wanting to set up shop in the country don’t have to worry about governmental red tape, and can concern themselves with aspects that can ensure the success of their businesses instead. “The UAE takes standards seriously, and therefore, African businesses should pay particular attention to product and service standards in the country,” Annon notes. “The UAE is also home to many brands from many countries, from the US to New Zealand, and each market category has so many competing companies, and therefore, you must be well prepared to compete in order to win some of the market share.” As for the advantages Dubai presents for any business operating in the Emirates, Annoh first points toward its top-notch logistics infrastructure, saying, “In addition to Emirates Airline and its cargo, the Emirate’s sea ports are one of the best in the region.” Another detail he highlights is the talent pool that’s available in Dubai. “One of my major considerations before coming to the UAE had to do with finding the personnel to work with, and interestingly, personnel are never in short supply in the UAE,” he notes. “Professionals from all over the world are available to join in your company!”
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But even as Dubai rolls out the red carpet for businesses from Africa, Dubai Chamber’s Khan notes that companies in the UAE would be wise to look at opportunities in the African continent that they can capitalize on as well. “Africa is a market of strategic importance to Dubai Chamber, and a major focus of our international expansion strategy,” Khan says, noting that the Chamber already has its representative offices in Ethiopia, Ghana, Mozambique, and Kenya, all of which play an active role in identifying opportunities in those markets that offer the most potential for the business community in Dubai. “At the same time, they focus their efforts on attracting African companies to set up in the Emirate,” Khan adds. “The ever-expanding trade links between Africa and Dubai are a positive sign that our efforts are bearing fruit. We look forward to exploring invest- ment opportunities in new sectors and areas that UAE companies can benefit from.”
Khan points toward a recent Dubai Chamber survey that found that 61% of global traders and investors believed that agriculture represented the most lucrative area for investment in the sub-Saharan region of Africa, followed by telecommunications (45%). The abundance of natural resources was the factor identified as having the most positive impact on investment opportunities, ahead of economic growth, demographics, domestic markets, a large low-cost labor force, and the political and social environment.
When it comes to advice for Dubai-based entrepreneurs who are keen on entering the African market, Annoh says that they need to be prepared for the red tape and cultural differences when doing business in the continent. “Firstly, businesses coming to Africa should bear in mind that the issues of bureaucracy and corruption might affect their capital, if not managed well, “ he says. “Government support is not available, and one must pay attention to taxes, which tend to be very high, as African governments often consider them as their main revenue tools. Secondly, in most African countries things are not done as quickly as you would do the same in the UAE, so because of the informal nature of the market, you may be frustrated in the beginning. There are no properly structured and standardized ways of doing things, therefore, one must study and understand the makeup of the Africa system in order to do business here.” Annoh also talks about logistical challenges within the continent, since “it can be quite problematic to move goods from country to country in Africa.” But despite such challenges, he remains insistent on the fact that the African continent is ripe for improvement and innovation, which is easily evident through its high consumption of foreign goods- a good point to know for all UAE businesses thinking of exporting their products into Africa. Annoh also says that knowing the key differences between the working styles of African and their Arabian counterparts can also come in handy when doing business in the conti- nent. “While GCC/UAE-based entrepreneurs are concerned about growing beyond the borders of UAE, those in Africa only think about growing and succeeding in their individual countries,” he notes. “Secondly, partnerships and cooperation seem to be common in the Gulf region, whereas African entrepre- neurs mostly run one-person companies. Another difference is that GCC/UAE business owners tend to pay attention to details and are more orderly than African entrepreneurs. Lastly, they invest large capital when getting started, as against Africans doing small businesses when getting started.”
For her part, Nzekwue agrees with the notion that socioeco- nomic disparities have a huge impact on the approach African entrepreneurs have towards business. “There is more urgency to close in executing business deals in Africa, which will show in the contracts and stepped-up timeframes when compared to those in the GCC/UAE,” she says. “GCC/UAE entre- preneur entities need to understand that the African farming markets produce raw materials, and need funds to set up processor/production plants to add the value that will bring viability to investment considerations. GCC/UAE and Africa need to meet in the middle with the amount of collateral required in proportion to the level of finance required.”
As such, when it comes to advice for Dubai-based entrepreneurs who are keen on entering the African market, Nzekwue says that international businesses should always keep in mind that Africa is a vast continent of 54 coun- tries, each of them having their own sets of laws, regulations, procedures, and social customs. “Engaging with the African Continental Free Trade Area (AfCFTA) will ease the successful completion of multi-jurisdic- tional business transactions,” she says, while noting that AfCFTA, although aimed at eliminating 90% of tariffs and creating a single market with free movement of goods and services across Africa, hasn’t been ratified by all countries on the continent. As such, Nzekwue says it falls on the entrepreneurs themselves to properly educate themselves about the particular African country/market that they want to do business in. “Be aware that Africa does lack infrastructure, which heavily impedes the fluidity of importing and exporting,” she says. “Security is also a major factor; therefore, find the right local partner to navigate issues and provide appropriate accompaniment.” At the end of the day, however, Nzekwue highlights the fact that the African market indeed is developing, with its fast-growing, innovative, and entrepreneurial population seeking financial resources and development expertise to take their businesses to the next level.
As such, if there are any UAE-based companies out there hoping to capitalize on these opportunities, Nzekwue advises them to consider forming joint ventures with African companies, and to also ensure their presence in the local market. “Have liquidity ready to push to the front of the line,” she concludes. “Demonstrate your cultural knowledge and consideration, and of course, keep contact with the nearest Dubai Chamber of Commerce and Industry branch.”
Global Business Forum Africa 2021: Transformation Through Trade
October 13-14, 2021
The Global Business Forum Africa 2021, held under the patronage of H.H. Sheikh Mohammed bin Rashid Al Maktoum, Vice President and Prime Minister of the UAE and Ruler of Dubai, will be organized on the sidelines of Expo 2020 Dubai to shed light on the global economic recovery following the coronavirus pandemic, with a particular focus on Africa’s economic development post the COVID-19 crisis. “As the Official Business Integration Partner for Expo 2020, Dubai Chamber is organizing a wide range of high-profile events during the mega event that will provide local and international companies access to networking and collaboration opportunities,” said H.E. Hamad Buamim, President and CEO of Dubai Chamber. “Among these is the sixth Global Business Forum Africa, which serves a catalyst for expanding trade links and economic cooperation between Africa and Dubai.”
With participants from 173 countries and 24 international organizations, the Forum will present Dubai’s competitive advantages as a gateway for African companies that can be leveraged to expand their global footprint. The event will encompass the following three tracks: GBF Insight, a curated program of high-level keynotes and plenary sessions; GBF Connect, a business matching and networking service; and The Expert Hub, a special platform reserved for African representatives to present investment opportunities in their respective countries to the audience directly. Key topics to be discussed include the outlook for the African economies, the expected impact of the African Continental Free Trade Area, the evolution of global trade, the adoption of advanced technologies, and the role of innovation in strengthening capital markets, as well as promising investment opportunities emerging in a post-COVID-19 world.
Tamara Pupic is the Managing Editor of Entrepreneur Middle East.