Dubai free zones may cut fees to become more competitive
Sheikh Maktoum bin Mohammed bin Rashid Al Maktoum flanked by Sheikh Ahmed bin Saeed Al Maktoum and Dr Mohammed Alzarooni at World Free Zones Organisation's 4th Annual International Conference & Exhibition event on Monday in Dubai. - Wam
Dubai - There are various fees and charges applied by different free zones across the emirates.
Two major and well-established free zones in Dubai are considering reducing fees and other costs in order to become more competitive and attract more foreign companies in to the free zone, a senior official said on Monday.
Dubai Airport Free Zone Authority (Dafza) and Dubai Silicon Oasis Authority (DSOA) are conducting studies to reduce fees and it is expected that the report will be completed in the current quarter, said Dr Mohammed Alzarooni, vice-chairman and CEO of DSOA and director-general of Dafza.
"It is difficult to say how much we will reduce the fee because an internal team is working on the study,"Alzarooni told Khaleej Times during an interview on the sidelines of 4th Annual International Conference and Exhibition, organised by World Free Zones Organisation.
There are various fees and charges applied by different free zones across the emirates, depending on the licence applied by the individual or companies.
Alzarooni noted that these instructions to reduce cost have come from the high authorities, hence, other free zones and government will also follow these instructions.
"When government asks for something (taking any measures), be sure that it has studied carefully about what positive effects this will have on businesses and reduction in fee is one of the main initiatives. There are other things we are working on how to simplify the procedures for investors, making everything online, removing any bureaucratic hurdles and improving the system more," he said, adding that cost cutting measures will benefit the whole economy of Dubai.
Earlier, Sheikh Maktoum bin Mohammed bin Rashid Al Maktoum, Deputy Ruler of Dubai, opened the 4th Annual International Conference and Exhibition.
Alzarooni, who is also the chairperson of World Free Zones Organisation, noted that the positive impact of the free zones to the country's GDP is much more than the mainland areas.
"Free zones induce more business with better connectivity and infrastructure. They also provide more efficient operations and opportunities for investors and accelerate economic growth," he said.
Citing an example, he said Dubai Airport Free Zone recorded 33 per cent growth in the first-quarter of 2018 than the same period last year.
"I asked other colleagues in Dubai free zones, and they also said that they were doing very well."
Currently, more than 50 per cent of Dubai's exports are from the free zones and these free zones house more than 33,000 companies, employing around 280,000 people.
"The free zones' contribution to Dubai's GDP is not less than 23 per cent but still our economy has capacity to establish more free zones. I think, services sector is poised to grow as free zones will focus on technology-driven services sector more in the future."
Highlighting the challenges faced by free zones, he said they are mainly internal related to bureaucracy, simplifying procedure, infrastructure, services and regulations.