Black Affairs, Africa and Development
Tips for African companies looking to do business in Dubai
Dubai in the United Arab Emirates (UAE) has been positioning itself over the years as a strategic place to set up business to access global markets.
Richard Harris, president of the South African Business Council (SABCO) in the UAE, told How we made it in Africa that South African companies and brands looking to become international players should consider setting up their headquarters in Dubai.
“If you think about it, South African companies can come and set up a branch here and access not only North Africa, but indirectly into Europe and the Asian [markets],” said Harris. “So if you look at it logistically and take Dubai as the centre of the world, and look at where you can go to on a six hour flight, it makes sense to have an operation here as opposed to flying from South Africa up the way the whole time. So there is business sense in opening an operation here.”
According to His Excellency Hamad Buamim, director general of the Dubai Chamber of Commerce and Industry, a number of companies have successfully used Dubai as a hub to access African markets. For example, Nestle, Louis Dreyfus, one of the world’s largest commodity traders, and MiDCOM Group, the largest Nokia distributor in Africa and the Middle East region, all based their Africa office in Dubai.
“At the same time, African entrepreneurs seeking expansion into European and American markets can use Dubai as a base,” Buamim said earlier this year. “Dubai is a gateway to Africa as the Emirate’s close proximity and business-friendly climate is an ideal hub for the continent… We envisage developing our existing trade relationship by encouraging more African companies to use Dubai as a base to trade with Europe, Asia, the Middle East and North America.”
This month, the Department of Tourism and Commerce Marketing of the Government of Dubai hosted an event in Cape Town to promote Dubai as an attractive place for Southern African companies to set up business. Alongside the advantage of Dubai’s geographic position and access to world markets, a number of other benefits were highlighted for African businesses.
According to Wendie White, director of Dubai Tourism in Southern Africa, Dubai’s political and economic stability can provide companies and business owners with a sense of security.
“The [Middle East] region has been through some tough times lately but the UAE is very stable,” she emphasised. “Politically it is very stable, there are no issues there, and also the economy is free. It has been kept open and free to attract investors into the region.”
White added that Dubai’s world class infrastructure means it is easy to conduct business, and the global city, with a large expat population, offers a high quality of life for foreigners who have moved there with their families. “From first class hospitals, schools, shopping centres, hotels, conference centres and manufacturing areas, it really is world class.”
Dubai is also one of the top export centres of the world and has a rapidly developing manufacturing sector. The city is known for its free zones which can offer a number of economic incentives for businesses such as 100% business ownership, tax free environments and no trade barriers.
Agriculture also provides a number of opportunities for African businesses in Dubai. According to 2011 statistics, South Africa was the 13th largest supplier of Dubai’s food imports.
However, in order to ensure a good business relationship between African and Emirati businesspeople, White suggested seven tips to keep in mind.
1. Educate yourself on Islamic culture
“It’s important to remember that the UAE is an Islamic country. They are very liberal compared to other countries in the area but they are still Islamic so it is a good idea to have a little bit of an understanding about the Islamic culture,” suggested White.
Business attire is typically formal, such as a suit and tie for men. While the UAE does host a high population of Western expats, it is respectful for women to dress conservatively, not showing much bare skin and not wearing short skirts and low cut tops.
2. Drinking alcohol is not a custom
Alcohol is not part of Islamic culture and it is therefore not custom to serve alcoholic beverages at business functions with local businesspeople. Alcohol is served at many international hotels but is not available everywhere.
“We always say get used to drinking coffee and tea. It’s very common when you have a business meeting that you are served Arabic coffee or a very nice tea and it’s very polite to accept it,” White said.
3. Take time to build a business relationship
“The Emirati people in particular work very well with you once they know you,” explained White. “It’s very much about getting to know you and very much about building a relationship before you start trying to do business.”
She added that it’s a good idea to take the time to visit and meet with Emirati businesspeople face-to-face to gain trust, prove sincerity and build up a relationship before asking them to sign contracts.
4. Make regular visits
White said Emirati people like to keep in regular contact with the people they work with and it is polite to keep them updated on business news and give them feedback following a meeting. She added that business updates should make use of tangible evidence or testimonials in an effort to strengthen a relationship based on trust.
5. Prioritise phoning to writing
“It’s always good to follow up with an email but people appreciate it if you speak to them on the telephone,” continued White. “If you can’t meet with them in person, speak to them on the telephone and don’t always communicate only in writing.”
6. Work on Sundays
As an Islamic country, Sunday is the first day of the week in the UAE. “So you have to be prepared to work and go to meetings on Sunday,” said White. “And then remember that Friday is the holy day, the day of prayer, the day that they don’t work.”
Foreign businesspeople should also be considerate of the fasting month of Ramadan.
7. Accept last minute invitations
“Those of us who have worked with people in the region know that it is not uncommon for us, in the same week, to be asked to go to Dubai for a business meeting. It is something that is acceptable in the region,” explained White. “So if you are asked to see them at short notice, please don’t see that as being rude. It is just something that happens… the advice is to try and make it because they will appreciate that.”