Global expansion: Overcoming the challenges of entering new markets

Key takeaways from the British Chamber of Commerce Dubai event

Sitting in London on an overcast day in late winter, it’s hard not to feel envious of colleagues at the other end of video calls in Dubai, whose offices overlook the beach. For some people, the Middle Eastern weather is enough reason to make a move.

Sunshine notwithstanding, Dubai has become one of the most talked about destinations for corporate expansion for several good reasons, including a host of benefits for growing businesses.

Most well-known are the city’s favourable tax incentives, which can ease the financial burden of incorporation and help attract top talent to the region. As a result, the city is a hub for diversity and innovation, with the population hailing from all corners of the globe. About 85% of its residents are expatriates, with significant communities from India, Pakistan, Bangladesh and the Philippines contributing to Dubai’s vibrant multicultural atmosphere.

The local government also continues to invest in corporate and social development. For example, while many countries compete to lead in AI innovation, Dubai is steadily building its reputation as a global hub for artificial intelligence. In June 2024, HH Sheikh Hamdan approved the appointment of 22 Chief AI Officers across Dubai Government departments.

Still, international expansion is a big decision. So, how do businesses decide when – or even whether – to make the leap, and how should they prepare?

As part of our continued commitment to working with globally expanding businesses, we recently became a member of the British Chamber of Commerce Dubai (BCCD). Last month, we attended their business briefing in London to gain insights into the main challenges and opportunities of expanding into the region.

Establishing your network

For scaling companies and SMEs, new markets can be daunting because they come with a whole host of regulatory and cultural unknowns. Katy Holmes, CEO of the British Chamber of Commerce Dubai, believes building your network is key.

“Networking, through in-person connectivity, is essential in establishing your business and your stakeholder relationships in the GCC,” she said. “Businesses looking to successfully expand in this dynamic region should ensure that joining a Chamber or business group is a priority in their go-to-market strategy.”

According to Holmes, the Chamber network can inform its members about regulatory changes and market updates in a timely manner, providing a credible resource with immediate access to a knowledgeable ecosystem.

This advice – particularly pertinent in the digital age – is a great reminder that strategic relationships and partners are still vital.

Building a sustainable tax strategy

For many individuals, tax incentives are the primary driving force behind a move to Dubai. A particularly attractive proposition that Dubai’s free zones

offer is allowing 100% foreign ownership. This incentive often dissuades globally mobile companies from expanding into other regions that don’t offer similar business terms.

A recurring theme on the panel was treading carefully in this area. Lorenzo Tosonotti, Partner at Well Tax, encouraged businesses to think beyond tax benefits and build a sustainable tax strategy.

“The United Arab Emirates (UAE) has historically been a tax-efficient jurisdiction, particularly for businesses and individuals relocating from high-tax environments such as the UK,” he said. “While there are clear tax benefits, like no personal income tax and a 9% corporate tax on profits over AED 375,000, businesses must still be mindful of their UK tax obligations.”

The UK and UAE have a Double Taxation Treaty (DTT) to reduce the risk of double taxation. Regardless, entrepreneurs need to consider corporate tax residency and permanent establishment risks when setting up a presence in the region.

“Market accessibility, regulatory ease, and long-term scalability should be key considerations for any company looking to expand internationally,” said Robert James Osborne, Client Engagement Manager at IFZA. “Leaders should assess operational readiness to ensure they have the resources and infrastructure to scale effectively.”

Osborne also stressed the importance of partnering with local experts and organisations that understand the nuances of global business. By doing so, they can gain valuable insight to help them navigate challenges – particularly in dynamic markets.

Partnering for growth

A strategic gateway to high-growth markets across the Middle East, Africa, and Asia, Dubai offers investor-friendly policies, a strong regulatory framework and a dynamic free zone ecosystem. However, businesses need more than the initial bump created by tax benefits to succeed in the region. Solid financial plans, market adaptability and a solid grasp of global expansion strategy are essential for long-term success.

Companies new to the UAE often benefit from working with industry experts who can help them get established in the region. IFZA, for example, provide tailored licensing solutions, a streamlined business setup process and a strong network of partners to help businesses settle into the Dubai landscape.

At Interpolitan Money, we support companies looking to expand internationally by making multi-currency accounts and cross-border payments more accessible. We’ve helped countless businesses navigate foreign markets, including organisations with non-standard ownership structures.

More than a service provider, we offer expert advice about complex financial and compliance matters, delivering tailored alternative banking solutions that support the global flow of payments, investment and corporate growth. So, if you're planning to go global, we’d love to learn more about your business and discover how we can help you succeed.

Ready to spread your wings? Learn more about multi-currency business accounts or explore partnership opportunities today.