The Dubai government is introducing a spate of initiatives designed to future-proof family businesses and bolsters their competitiveness and growth capabilities in a rapidly evolving global environment, as the emirate seeks to unlock a new phase of high-powered growth for its economy.
Over the last year, Dubai introduced new legislative and support measures aimed at helping them navigate the challenges and opportunities brought by a global economy in transition.
The new initiatives come amid the sector generating over 40 percent of the emirate’s GDP.
Family businesses are the mainstay of the UAE’s economy, as a staggering 90 percent of private companies in the country are family-owned, according to a report from the UAE Ministry of Economy.
They are also major employers, with more than 70 percent of the private sector workforce earning their livelihoods from them.
Family businesses have also been at the forefront of Dubai’s economic diversification, with a significant presence in a diverse range of vital sectors including real estate and construction, retail and wholesale trade, hospitality and tourism, manufacturing, financial services, healthcare, education and technology.
A global family business hub
Dubai’s strategic geographical location and growing status as one of the world’s most hyper-connected cities make it an ideal global base for family businesses seeking to tap high-growth markets, the report said.
The emirate’s high levels of safety, world-class healthcare and education, and unbeatable leisure and lifestyle offerings make it an attractive location for family-owned enterprises, it added.
The swift expansion of financial wealth in the UAE, which is projected to surge at a compound annual rate of 6.7 percent to reach $1 trillion in 2026, up from $700 billion in 2021, will spur significant growth in the family business sector.
However, to achieve new levels of growth and thrive for generations to come, the sector needs to address several issues brought by an evolving economy including digitisation, cultural issues, governance and succession planning.
A series of initiatives launched recently by Dubai seeks to empower family businesses to lay the groundwork for sustained prosperity.
Raising family business capabilities
Earlier this year, Dubai Chambers announced the launch of the Dubai Centre for Family Businesses to educate family-owned firms on leadership transition, succession planning and growth.
Forming part of a comprehensive plan approved by Sheikh Mohammed bin Rashid Al Maktoum, Vice President and Prime Minister of the UAE and Ruler of Dubai, at the Dubai Council’s fifth meeting, the new centre aims to support the growth of family firms through diverse initiatives that include a centre for settling family business-related disputes.
Earlier this month, the centre introduced a new set of governance guidelines designed to assist family-owned companies in establishing effective governance frameworks that can facilitate a smooth succession process and ensure the continuity of family businesses.
Abdulaziz Abdulla Al Ghurair, Chairman of Dubai Chambers, said the impact of sector will be further enhanced through legislation designed to develop a favourable business ecosystem, together with specialised training aimed at helping family businesses to overcome challenges, elevate governance standards, and ensure a smooth transition of leadership between generations.
He added, “We at Dubai Chambers are committed to supporting the success of family businesses by representing their interests, enhancing their competitiveness, and advancing the capabilities of the next generation of leaders.”
In March this year, Dubai International Financial Centre (DIFC), the leading global financial hub in the Middle East, Africa and South Asia (MEASA) region, launched the DIFC Family Wealth Centre, the first in the world to create such a unique offering.
The DIFC Family Wealth Centre brings together global family-owned businesses and ultra-high net-worth individuals (UHNWIs) to help preserve and grow the sector.
By providing a range of support services, the centre is set to not only accelerate the growth of local family businesses but also attract family businesses and UHNWIs from across the world.
At a time when an estimated AED3.67 trillion in assets will be transferred to the next generation in the Middle East over the next decade, the initiative is set to play an instrumental role in delivering Dubai’s commitment to supporting family businesses.
Essa Kazim, Governor of DIFC, said by harnessing DIFC’s wealth of experience and expertise, family businesses in Dubai can take their growth and succession planning to the next level.
“We understand the critical role family businesses play in the global economy, and the DIFC Family Wealth Centre’s end-to-end service offering is designed to empower them to thrive, innovate, and preserve their legacies for generations to come,” he said.
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