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July 30, 2019
Dubai and Abu Dhabi's outlook in terms of personal well-being, long-term investment, GDP growth, innovation, transparency and ease of doing business has improved substantially over the last one year, thanks to the host of reforms and measures taken at the federal and emirate level.
AT Kearney's Global Cities Index 2019 has raised the outlook of Dubai by 10 positions to 32nd while Abu Dhabi's ranking leapt even higher by 30 positions to 20th, one of the best improvements in outlook ratings among 130 global cities.
Dubai's outlook is better than the capitals and developed cities of Asia, Europe and the US including Seattle, Atlanta, Beijing, Los Angeles, Seoul, Rome and Hong Kong, among others. The UAE capital, meanwhile, is rated even higher, beating the likes of New York, Washington DC, Frankfurt, Houston, Montreal, Brussels and Taipei, among others.
Analysts attribute the improvement in rating to the initiatives announced by the two emirates such as reduction in public services fee, 100 per cent foreign ownership, long-term visas, free tourist visas for tourists under the age of 18, introduction of e-services by the public sector and a stimulus package to create jobs, among others, over the past year, which improved their attractiveness, quality of life and governance and ease of doing business.
Last month, the UAE jumped from fifth to seventh place in the IMD World Annual Competitiveness Report, with strong performances in the government (second) and business (first) efficiency factors. One of the main determinants in IMD's report was a substantial improvement in business legislation.
On a year-on-year basis, Dubai's rating in the Global Cities Index improved one position to 27th while Abu Dhabi slipped one rank to 69th.
Naresh Manchanda, partner at Mayur Batra Group, said reforms are a key direction that any city needs to follow continuously to stay relevant and both Abu Dhabi and Dubai continue to evolve based on continuous feedback from the market, as well as regional and global developments.
"The FDI law, tax laws, new long-term visa, annual theme of tolerance at the country level, government summit or technology advancements - these are some of the key measures that will place the UAE at the next level of growth where country is bound to lead the entire region in times to come," Manchanda said.
Krishnan Ramachandran, CEO of Barjeel Geojit Financial Services, noted that the significant improvement in the rankings recorded by Abu Dhabi and Dubai in the Global Cities Outlook reconfirms the fact that both the cites are committed and poised for an overall growth in the future as they have been taking proactive steps and measures in this respect, especially in areas such as healthcare, education, capital flows, promoting startups and innovation, and creating a conducive atmosphere to do business.
"The UAE is well-positioned to attract top-notch human capital and investments, especially with the recent changes to the residency laws and other business-friendly initiatives, such as 100 per cent foreign ownership across 13 sectors. These initiatives are bound to take both Abu Dhabi and Dubai to a much improved rankings in the next one to two years," said Ramachandran.
"Dubai has been acknowledged as the top notch city in the world in infrastructure is a clear validation of the vision and efforts of the rulers to establish the emirate as the most preferred city for investments and long-term stability."
However, the two emirates boast the best outlook among the Arab world. Regionally, Muscat also saw massive jump in its outlook as it rose 41 positions to 58th in the AT Kearney report. Jeddah and Riyadh improved three and six positions to 84th and 85th, respectively. Doha slipped four positions to 66th while Kuwait City fell nine positions to 67th.
Mike Hales, partner at AT Kearney, said the Middle Eastern cities are gaining ground as openness in the region is propelling cities towards greater prominence on the global stage.
Globally, London dethroned San Francisco from first place. New York saw a massive decline in its outlook, falling from second to 24th. The top 10 cities with best outlook are London, Singapore, San Francisco, Amsterdam, Paris, Tokyo, Boston, Munich, Dublin and Stockholm.