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Kuwait

Executive Summary

The Government of Kuwait launched an ambitious development plan in 2018 known as ‘Vision 2035’ which aims to transform country into an international trade hub and diversify its oil-centric economy. The goal is to increase private sector participation in Kuwait’s economy by creating a more investor-friendly environment as well as to invest in the nation’s economic infrastructure via the construction of new airports, ports, roads, industrial areas, residential developments, hospitals, a railroad, and a metro rail.  The Northern Gateway initiative, which encompasses the Five Islands or New Kuwait projects, envisions public and private sector investment in the establishment of an international economic zone that could exceed USD 400 billion over several decades. With one of the world’s largest sovereign funds with more than USD 670 billion in assets as of March 2021, minimal taxes, and low-cost labor, Kuwait provides a great opportunity for investment. However, bureaucratic red tape and the frequent changing of the government has stalled the progress of many initiatives.

Several public-private partnerships are in the pipeline in the power, water management, and renewable energy sectors. Two billion-dollar hospitals were completed in the last two years. These institutions need foreign investment to operate and train hospital staff, as well as to deliver world-class equipment and IT infrastructure.

With a view to attracting foreign investment, the government passed a foreign direct investment law in 2013 that permits up to 100 percent foreign ownership of a business if approved by the Kuwait Direct Investment Promotion Authority (KDIPA).  All other foreign businesses must abide by existing law that mandates that Kuwaitis, or other GCC nationals, own at least 51 percent of any enterprise. In approving applications from foreign investors seeking 100 percent ownership, KDIPA prioritizes local job creation, the provision of training and education to Kuwaiti citizens, technology transfer, diversification of national income sources, contribution to exports, support for small- and medium-sized enterprises, and the utilization of Kuwaiti products and services.  KDIPA has sponsored 37 foreign firms, including six U.S. companies. KDIPA also provides certain investment incentives like tax benefits, customs duties relief, and permission to recruit foreign employees.

Kuwait has also made great strides in protecting intellectual property. Kuwait’s 2019 Copyright Law addressed serious concerns about Kuwait’s intellectual property protection regime. The Office of the U.S. Trade Representative (USTR) moved Kuwait from the Priority Watch List to the Watch List in its 2020 Special 301 Report because of the new copyright legislation and an increase in intellectual property enforcement actions. The Special 301 Report identifies countries that are trading partners, but which do not adequately or effectively protect and enforce intellectual property rights (IPR). Kuwait has continued to increase enforcement actions in 2021.

Kuwait is a country of 1.4 million citizens and 3.3 million expatriates.  It possesses six percent of the world’s proven oil reserves and is a major oil exporter.  The economy is heavily dependent upon oil production and related industries, which are almost wholly owned and operated by the government. The energy sector accounts for more than half of GDP and close to 90 percent of government revenue. The fall in oil prices after OPEC+ failed to agree on production targets in 2019 and the reduction in global demand for oil upon the onset of the COVID-19 pandemic in 2020 greatly exacerbated Kuwait’s fiscal deficit. However, the rapid increases in the price of oil since spring 2021 has allowed Kuwait to significantly reduce its deficit from KD 5.4 billion (USD 17.7 billion) in March 2021 to KD 406.4 million (USD 1.3 billion ) as of January 2022. However, reduced stress on the country’s finances has dampened support for economic and business reforms that Kuwait needs to become the investment hub envisioned in New Kuwait Vision 2035. Kuwait’s ability to implement these changes will determine whether the current financial windfall will result in an economically sustainable future.

As it develops the private sector to reduce the country’s dependence on oil, the government faces two central challenges. It must improve the business climate to enable the private sector and must prepare its citizens to work in the private sector. Political tension between the government and the elected National Assembly, a slow and overly complicated bureaucracy, inconsistent legal practices, and restrictive economic policies contribute to a challenging business environment for outside investors.

More than 85 percent of all Kuwaitis with jobs work in the public sector, where they receive generous salaries and benefits. This makes public sector jobs largely preferable to careers in the private sector. Convincing young Kuwaitis that their future is in the private sector will require changing social attitudes and raising the level of local education so that Kuwaiti businesses can compete internationally in sectors other than fossil fuels.

Table 1: Key Metrics and Rankings
Measure Year Index/Rank Website Address
TI Corruption Perceptions Index 2021 73 of 180 http://www.transparency.org/research/cpi/overview 
Global Innovation Index 2021 72 of 132 https://www.globalinnovationindex.org/analysis-indicator 
U.S. FDI in partner country ($M USD, historical stock positions) 2020 USD 540 million https://apps.bea.gov/international/factsheet/ 
World Bank GNI per capita 2019 USD amount 36,290 https://data.worldbank.org/indicator/NY.GNP.PCAP.CD 

3. Legal Regime

4. Industrial Policies

5. Protection of Property Rights

6. Financial Sector

7. State-Owned Enterprises

The energy sector is dominated by state-owned enterprises (SOEs), as law precludes private participation in most sector activities.  Outside the energy sector, Kuwait has few fully SOEs. One notable exception is Kuwait Airways.  No published list of SOEs exists. The government owns shares in various Kuwaiti companies through the Fund for Future Generations managed by the KIA or the Social Security Fund managed by Kuwait’s Public Institution for Social Security.  SOEs are permitted to control their own budgets.

8. Responsible Business Conduct

Kuwaitis have a general awareness of expectations for responsible business conduct, including environmental, social, and governance issues.  One aspect of responsible business conduct in Kuwait is contributions to local charities and causes.  Kuwaiti labor law is generally adequate in its protection of workers, although actual implementation of the law varies. Labor rights violations are generally more common in the domestic worker sphere than in the business community, although violations are common in low wage sectors with high expatriate populations. Economic stress following the onset of the COVID-19 pandemic in early 2020 led to an increase in illegally forced “resignations” or illegal salary cuts as businesses sought to relieve themselves of financial obligations. The Kuwait Environmental Public Authority has been active in enforcing compliance and addressing environmental violations, since the passage of the Environmental Protection Law of 2014.

9. Corruption

In recent years, Kuwaiti authorities have increased their focus on combatting corruption and several investigations and trials involving current or former government officials accused of malfeasance are active.

Transparency International’s 2021 Corruption Perceptions Index ranked Kuwait 73 out of 180 countries, an improvement from 78 in 2020.  Kuwait ranked behind all other GCC countries except for Bahrain.  According to Transparency International, Kuwait’s numeric score is 43 out of 100.

The often-lengthy procurement process in Kuwait occasionally results in accusations of attempted bribery or the offering of other inducements by bidders.  In 1996, the government passed Law No. 25, which required all companies securing contracts with the government valued at KD 100,000 (USD 330,000) or more to report all payments made to Kuwaiti agents or advisors while securing the contract.  The law similarly requires entities and individuals to report any payments they received as compensation for securing government contracts.

Kuwait signed the UN Convention Against Corruption in 2003 and ratified it in 2007.  In 2016, the National Assembly passed legislation to establish the Anti-Corruption Authority, also known as Nazaha (integrity).  The legislation was passed to comply with the United Nations Convention Against Corruption. Nazaha has sent several cases to the Public Prosecution Office for failure to comply with financial disclosure requirements.

10. Political and Security Environment

The U.S. Embassy occasionally receives threat information indicating possible targeting of official and private U.S. citizens for terrorist attacks.  Soft targets are vulnerable to terrorist attack, although many have improved their perimeters and internal security. There have been no terror incidents in Kuwait since 2016.  There have been no attacks targeting businesses or infrastructure. Since late 2013, Kuwait has seen no large-scale, politically motivated demonstrations, although it experienced some small-scale protests against COVID-19 restrictions over the winter of 2020-2021. U.S. citizens are encouraged to enroll in the U.S. Department of State’s Smart Traveler Enrollment Program (STEP) for up-to-date information from the Embassy.  The Department of State shares credible threat information through its Consular Information Program, including Travel Advisories, Alerts, and Country Information for Kuwait, available at  https://travel.state.gov/content/travel.html or the Embassy’s website:  https://kw.usembassy.gov/.

11. Labor Policies and Practices

Kuwait has a diverse labor force.  According to the Central Statistical Bureau (CSB), as of September 30, 2021, approximately 1,479,454 million expatriate workers account for 77.7 percent of Kuwait’s workforce. According to the Kuwaiti government’s statistics, the number of foreign workers in the private sector fell by over 280,000 over the course of the COVID-19 pandemic.

Many expatriate workers are low-paid laborers from other Middle Eastern countries, South Asia, and the Philippines working in Kuwait under a legally established “sponsorship” system.  Under the kafala system, a migrant worker’s immigration status is legally bound to an individual employer or sponsor for their contract period. The migrant worker cannot enter the country or transfer employment for any reason without first obtaining explicit written permission from their sponsor. This situates the migrant worker as almost entirely dependent upon their sponsor for their livelihood and residency. Abuse of the sponsorship, or “kafala” system is widespread. Sponsors sometimes confiscate workers’ passports despite legislation declaring this practice illegal. Workers who fled abusive employers had difficulty retrieving their passports, and authorities deported them in almost all cases. The law does not explicitly prohibit private sector workers from paying recruitment fees. For domestic workers, employers are required to pay recruitment agency fees, which cannot be deducted from the worker’s remuneration.

White-collar workers from around the world occupy highly-skilled positions in Kuwait, while many middle management positions are occupied by Egyptian, Lebanese, and South Asian nationals.

Kuwaiti nationals occupy most of the top management positions in the private and public sectors.  Generally, unemployment among Kuwaitis is quite low, but new labor entrants are reluctant to enter the private sector. According to the Public Authority for Manpower, approximately 73,000 Kuwaiti citizens worked in the private sector as of September 2021.

The International Monetary Fund has stressed that limiting public sector employment growth should be part of broader public sector reforms and accompanied by efforts to boost private sector job and entrepreneurship opportunities for Kuwaiti youth.

Since 1991, the government has adopted inconsistent policies intended to limit growth of the resident expatriate population. This population has continued to increase steadily however.  Lower-paid, unskilled workers often suffer unfavorable working conditions. The government has an electronic labor tracking system to allow companies only enough work permits to be issued for pre-verified positions.  The tracking system is designed to protect workers, following years of visa fraud whereby Kuwaiti sponsors created ghost positions and sold the visas for personal profit. Workers brought to Kuwait under such fraudulent schemes found themselves unemployed, forced to seek illegal work, vulnerable to exploitative work conditions, and eventual arrest and deportation.  Unskilled foreign workers are restricted from transferring from one sponsor to another within the private sector for a minimum of two years, but college graduates may transfer after one year. However, the quota system has impacted ability of domestic and foreign firms, delaying their ability to bring in new expatriate workers.

Kuwaiti workers have the right to organize and bargain collectively, but Kuwaiti law restricts the right of freedom of association to only one union per occupational trade.  The law permits only one federation, the Kuwait Trade Union Federation, which comprises 15 of the 47 licensed unions. Foreign workers are permitted by law to join unions only as non-voting members after five years of work in a specific sector.  Private sector workers have the right to strike; however, negotiation and arbitration are compulsory in the case of disputes. Public sector workers do not have the legal right to strike, though groups of public sector workers threatened to strike on occasion during the past few years.  Kuwaiti labor law prohibits anti-union discrimination.

Kuwaiti labor laws establish work conditions in the public and private sectors, except for the oil sector. Kuwaiti law prohibits forced labor. Workers in industrial and dangerous jobs must be at least 18 years old; youth under the age of 18 can work part-time in some non-industrial positions.  A multi-tiered labor market ensures higher wages for Kuwaiti employees. The minimum monthly salary for the private sector is approximately 75 dinars (USD 250) whereas the approximate lowest monthly salary for Kuwaitis in the public sector is 600 dinars (USD 2,000). Domestic workers earn a minimum monthly salary of approximately 60 dinars (USD 200). Kuwaitis, whether employed in the private or public sector, receive substantial government payments and benefits on top of their base salaries. The amended labor law of 2010 did not change the previous workweek maximum from 48 hours but extended annual leave to 30 days after six months of employment. Labor laws are not consistently enforced and disputes over the payment of salaries and contract switching are common, especially among unskilled workers.  A specific set of laws and regulations cover domestic (household) workers.

The International Labor Organization’s (ILO) Committee of Experts has longstanding criticisms concerning discrepancies between the Kuwaiti Labor Code and ILO Conventions 1, 30, and 87 regarding work hours and freedom of association.  The ILO has criticized the prohibition on more than one trade union for a given field; the requirement that a new union have at least 100 workers, of whom 15 must be citizens; the regulation that workers must reside in Kuwait for five years before joining a trade union; the denial of foreign workers’ right to vote and serve in trade union leadership positions for; the prohibition against trade unions engaging in political or religious activity; and the reversion of trade union assets to the Public Authority for Manpower in the event of dissolution. While Kuwaiti public sector union leaders and workers faced no government repercussions for their roles in union or strike activities, companies directly threatened migrant workers calling for strikes with termination and deportation.

Law No. 91 of 2013 for Combating Trafficking in Persons and Smuggling of Migrants defines human trafficking in Kuwait and the penalties for trafficking in persons. Forced labor conditions for migrant workers included nonpayment of wages, long working hours, deprivation of food, threats, physical and sexual abuse, and restrictions on movement, such as withholding passports or confinement to the workplace. During recent years, the Government of Kuwait has taken several measures to address human trafficking and to improve protections for workers.  In September 2020, the Public Authority for Manpower, the Supreme Council for Planning and Development, the United Nations Development Program and the International Organization for Migration launched the Tamkeen initiative to implement the International Recruitment Integrity System to promote ethical recruitment of migrant workers. As of November 2021, the Public Authority for Manpower completed the first phase of the Tamkeen initiative, which included training for its own staff and recruitment agencies. In October 2021. the Anti-Trafficking Department of the Ministry of Interior established a 24/7 hotline in Arabic and English to receive reports of human trafficking, but there are reports it did not operate at all times.

Since 2007, labor laws have banned women from working between 10:00 p.m. and 7:00 a.m., except for sectors approved by the Public Authority for Manpower such as nursing.  The law also banned women from working in jobs that are judged to be hazardous, rough, and damaging to health, as well as in positions that the government deems “immoral or abuse women’s femininity,” or in businesses that exclusively serve men. The Supreme Council for Planning and Development reported that women make up 56 percent of the labor market in the public sector and 11 percent in the private sector.

The Director General of the Public Authority for Manpower issued an administrative decision in March 2022 annulling a previous 2021 decision that banned the renewal of work and residency permits for expatriates who reached the age of 60 and held only a high school certificate.

Kuwait’s Public Authority for Manpower assists all residents of Kuwait with private sector employment and labor disputes.  The Public Authority for Manpower’s labor and occupational safety inspectors routinely monitored private firms for labor law compliance. Noncompliant employers faced fines or a forced suspension of their company operations. Offices assist residents according to the location of the employer and are open Sunday through Thursday, 8:00 a.m. – 1:00 p.m. Some expatriate residents have reported that the offices were unable to provide any assistance. It is recommended that residents seeking assistance be accompanied by an Arabic speaker. Following is information on Public Authority for Manpower offices:

Capital Business Administration:
Sharq,
Mohammad al-Haqan Street
Tel: +965 2246-6830 and 2246-6831

Hawalli Business Administration:
Hawalli
Tunis Street, opposite Ahli Bank of Kuwait
Tel: +965 266-0229 and 2266-0228

Al-Farwaniya Business Administration:
Dajeej
Adjacent to General Department of Criminal Evidence
Tel: +965 2431-9555

Al-Jahra Business Administration:
Saad al-Abdullah (Amgarah)
Street 1, Block 10
Tel +965 9494-5446

Al-Ahmadi Business Administration:
Al Ahmadi
Next to Kuwait Oil Company
Block 1, Street 20
Tel: +965 2398-2059

Mubarak Al-Kabeer Business Administration:
Mubarak Al-Kabeer
Co-op #4, beside National Bank of Kuwait and Kuwait Finance House
Tel: +965 2543-8595

The Public Authority for Manpower offers Arabic and English responses via their Twitter handle: @manpower_KWT, or Instagram account: pr.manpower.  The Authority attempts to answer inquiries within one business day.

13. Foreign Direct Investment and Foreign Portfolio Investment Statistics

According to the 2020 World Investment Report published by the United Nations Conference on Trade and Development, Kuwait attracted a foreign direct investment inflow of USD 104 million in 2019, while divesting USD 2.5 billion of overseas investment.

According to the U.S. Department of Commerce Bureau of Economic Analysis, 2019 U.S. direct investment in Kuwait was USD 398 million, down from USD 499 million in 2018.  Kuwait’s FDI stock position in the United States totaled USD 1.26 billion in 2019. Kuwaiti direct investment in the United States is largely in real estate, stocks, and logistics.

Table 2: Key Macroeconomic Data, U.S. FDI in Host Country/Economy
Host Country Statistical Source* USG or International Statistical Source USG or International Source of Data:
BEA; IMF; Eurostat; UNCTAD, Other
Economic Data Year Amount
Host Country Gross Domestic Product (GDP) ($M USD) 2019 $136.197 billion http://www.worldbank.org/en/country 
Foreign Direct Investment Host Country Statistical Source* USG or International Statistical Source USG or International Source of Data:
BEA; IMF; Eurostat; UNCTAD, Other
U.S. FDI in partner country ($M USD, stock positions) N/A N/A 2019 $398 million BEA data available at
https://apps.bea.gov/international/factsheet/ 
Host country’s FDI in the United States ($M USD, stock positions) N/A N/A 2018 $1,256 BEA data available at
https://www.bea.gov/international/direct-investment-and-multinational-enterprises-comprehensive-data 
Total inbound stock of FDI as % host GDP 2019 $398 million 2019-2020 -5.1% UNCTAD data available at https://unctad.org/topic/investment/world-investment-report 

*Host country source: https://www.cbk.gov.kw/en/statistics-and-publication/publications/quarterly-statistical-bulletin 

Table 3: Sources and Destination of FDI
Direct Investment from/in Counterpart Economy Data
From Top Five Sources/To Top Five Destinations (US Dollars, Millions)
Inward Direct Investment Outward Direct Investment
Total Inward Amount 100% Total Outward Amount 100%
Qatar 3,288 X% Cayman Islands 4,451 X%
Saudi Arabia 908 X% Bahrain 3.728 X%
United Arab Emirates 848 X% Saudi Arabia 3,401 X%
Bahrain 746 X% Iraq 3,126 X%
Oman 440 X% Turkey 2,932 X%
“0” reflects amounts rounded to +/- USD 500,000.

14. Contact for More Information

Economic Section
U.S. Embassy Kuwait
P.O. Box 77
Safat 13001
Kuwait
+965 2259 1001
KuwaitDirectLine@state.gov

United Arab Emirates

Executive Summary

The Government of the United Arab Emirates (UAE) is urgently pursuing economic diversification and regulatory reforms to promote private sector development; reduce dependence on hydrocarbon revenues; and build a knowledge economy buttressed by advanced technology and clean energy.

The UAE serves as a major trade and investment hub for the Middle East and North Africa, as well as increasingly for South Asia, Central Asia, and Sub-Saharan Africa. Multinational companies cite the UAE’s political and economic stability, excellent infrastructure, developed capital markets, and a perceived absence of systemic corruption as factors contributing to the UAE’s attractiveness to foreign investors. The UAE seeks to attract foreign direct investment (FDI) by i) not charging taxes or making restrictions on the repatriation of capital; ii) allowing relatively free movement into the country of labor and low barriers to entry (effective tariffs are five percent for most goods); and iii) offering FDI incentives.

The UAE in 2021 launched broad economic and social reforms to strengthen pandemic recovery, respond to growing regional economic competition, and commemorate its 50-year founding anniversary with a series of reforms.

The UAE and the country’s seven constituent emirates have passed numerous initiatives, laws, and regulations to attract more foreign investment. Recent measures include visa reforms to attract and retain expatriate professionals, a drive to create new international economic partnerships, major investments in critical industries, and policies to encourage Emirati entrepreneurship and labor force participation. These economic development projects offer both challenges and opportunities for foreign investors in the coming years. In 2022, UAE changed its work week for government bodies from Sunday to Thursday to Monday to Thursday with a half day on Friday in order to more closely align with world markets.

Additionally, the UAE approved a comprehensive reform of the national legal system, which, among other aims, developed the legal frameworks around data privacy, investment, regulation and legal protection of industrial property, copyrights, trademarks, and residency. The first-ever federal data protection law regulates how personal data are processed across the UAE, with separate laws on government, financial, and healthcare data to follow. The new Commercial Companies law removes restrictions to facilitate further mergers and acquisition activity. The federal trademark law further expands the scope of legal protection for companies’ trademarks, products, innovations, and trade names by protecting non-traditional patterns of trademarks. These legal reforms are broadly considered to be positive by U.S. companies, but investors will need to carefully consider how these broad changes affect their operations.

The Ministry of Finance announced in January 2022 that the UAE will introduce a federal corporate tax on business profits starting in 2023 as part of its membership in the OECD Inclusive Framework on Base Erosion and Profit Shifting. Companies await further guidance on how the new tax policy will be implemented, but it is expected to have a broad and significant impact on companies operating both inside in the UAE and “offshore” in the country’s many economic free zones.

The UAE announced in October 2021 that it would pursue net zero greenhouse gas emissions by 2050, to include an investment of $163 billion in renewable energy.

Table 1: Key Metrics and Rankings
Measure Year Index/Rank Website Address
TI Corruption Perceptions Index 2021 24 of 180 http://www.transparency.org/research/cpi/overview
Global Innovation Index 2021 33 out of 132 https://www.globalinnovationindex.org/analysis-indicator
U.S. FDI in partner country ($M USD, historical stock positions) 2020 $19.5 https://apps.bea.gov/international/factsheet/
World Bank GNI per capita 2020 $39,410 http://data.worldbank.org/indicator/NY.GNP.PCAP.CD

1. Openness To, and Restrictions Upon, Foreign Investment

3. Legal Regime

4. Industrial Policies

5. Protection of Property Rights

6. Financial Sector

7. State-Owned Enterprises

State-owned enterprises (SOEs) are a key component of the UAE economic model. There is no published list of SOEs or GREs at the national or individual emirate level. The influential Abu Dhabi National Oil Company (ADNOC) is strategically important and provides a major source of revenue for the government. Emirates Airlines and Etisalat, the largest local telecommunications firm, are also internationally recognized brands. In some cases, these firms compete against other state-owned firms (Emirates and Etihad airlines, for example, or telecommunications company Etisalat against du). While they are not granted full autonomy, these firms leverage ties between entities they control to foster national economic development. In Dubai, SOEs have been used as drivers of diversification in sectors including construction, hospitality, transport, banking, logistics, and telecommunications. Sectoral regulations in some cases address governance structures and practices of state-owned companies. The UAE is not party to the WTO Government Procurement Agreement.

8. Responsible Business Conduct

There is a general expectation that businesses in the UAE adhere to responsible business conduct standards, and the UAE’s Governance Rules and Corporate Discipline Standards (Ministerial Resolution No 518 of 2009) encourage companies to apply social policy towards supporting local communities. In January 2021, the corporate social responsibility (CSR) UAE Fund announced that it would launch an index as an annual performance measurement tool for CSR & Sustainability practices in the UAE. Many companies maintain CSR offices and participate in CSR initiatives, including mentorship and employment training; philanthropic donations to UAE-licensed humanitarian and charity organizations; and initiatives to promote environmental sustainability. The UAE government actively supports and encourages such efforts through official government partnerships, as well as through private foundations.

In December 2021, the Dubai Executive Council approved a CSR policy to raise the role of companies and private establishments in social and economic development, and to align their projects and contributions with the priorities set by the government.

The UAE has not subscribed to the OECD Guidelines for Multinational Enterprises and has not actively encouraged foreign or local enterprises to follow the specific United Nations Guiding Principles on Business and Human Rights. The UAE government has not committed to adhere to the OECD Due Diligence Guidance for Responsible Supply Chains of Minerals from Conflict-Afflicted and High-Risk Areas, nor does it participate in the Extractive Industries Transparency Initiative. The Dubai Multi-Commodities Center (DMCC), however, passed the DMCC Rules for Risk-Based Due Diligence in the Gold and Precious Metals Supply Chain.

 

9. Corruption

The UAE has strict laws, regulations, and enforcement against corruption and has pursued several high-profile cases. The UAE federal penal code and the federal human resources law criminalize embezzlement and the acceptance of bribes by public and private sector workers. There is no evidence that corruption of public officials is a systemic problem. In August 2021, the president of the UAE issued a federal decree holding ministers and senior officials accountable for wrongdoing. Under the decree, the Public Prosecution can receive and accordingly investigate complaints against senior official and take necessary actions, including banning travel and freezing family financial accounts.

The Companies Law requires board directors to avoid conflicts of interest. In practice, however, given the multiple roles occupied by relatively few senior Emirati government and business officials, conflicts of interest exist. Business success in the UAE also still depends much on personal relationships. The monitoring organizations GAN Integrity and Transparency International describe the corruption environment in the UAE as low-risk and rate the UAE highly on anti-corruption efforts both regionally and globally. Some observers note, however, that the involvement of members of the ruling families and prominent merchant families in certain businesses can create economic disparities in the playing field, and most foreign companies outside the UAE’s free zones rely on an Emirati national partner, often with strong connections, who retains majority ownership. The UAE has ratified the United Nations Convention against Corruption.

There are no civil society organizations or NGOs investigating corruption within the UAE.

Resources to Report Corruption

Contact at government agency or agencies are responsible for combating corruption:

Dr. Harib Al Amimi
President
State Audit Institution
20th Floor, Tower C2, Aseel Building, Bainuna (34th) Street, Al Bateen, Abu Dhabi, UAE
+971 2 635 9999
info@saiuae.gov.ae , reportfraud@saiuae.gov.ae

10. Political and Security Environment

Violent crimes and crimes against property are rare.  U.S. citizens should take the same security precautions in the UAE that one would practice in the United States or any large city abroad.  In March 2022, the United States published a travel advisory for UAE noting pandemic concerns and the potential for missile or drone strikes.  The latest information can be found at https://travel.state.gov/.  Visitors should enroll in the Smart Traveler Enrollment Program (STEP) to receive security messages.

11. Labor Policies and Practices

Despite a pandemic-induced economic slowdown in 2020, unemployment among UAE citizens remains low. Although there were significant departures of foreign workers during the pandemic, expatriates represent over 88.5 percent of the country’s 9.6 million residents, accounting for more than 95 percent of private sector workers. As a result, there would be large labor shortages in all sectors of the economy if not for expatriate workers. Most expatriate workers derive their legal residency status from their employment.

14. Contact for More Information

Samuel Juh
Economic Officer
First Street, Umm Hurair -1
Dubai UAE
Juhshk@state.gov

Investment Climate Statements
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