UAE SMEs are the most export-focused in the world
UAE's small and medium enterprises rank top in Zurich's export study
Small and medium enterprises (SMEs) in the United Arab Emirates are the most export-focused in the world, according to the results of a new study conducted by Zurich.
“Challenges, Risks and Opportunities for Small and Medium Enterprises” surveyed more than 3,250 SMEs across 12 countries, 250 of which were situated in UAE. The study reveals that a quarter of UAE SMEs expanded their export operations over the past year, and that a similar proportion view expansion into overseas markets as their biggest opportunity during the next 12 months.
The percentage of UAE SMEs that expanded their overseas operations during the last 12 months was double that of the 13% average reported amongst other surveyed countries. The 26% figure becomes even more impressive when compared to established exporting nations such as Switzerland (15%), Germany (8%) and Brazil (8%).
In addition to targeting overseas growth, 30% of SMEs in UAE reported increased efforts to target new domestic customers during the past year, compared to a global average of only 23%.
UAE’s SMEs are also the most optimistic in the world in terms of future exports. When asked what they view as the biggest commercial opportunity over the next 12 months, 28% of UAE SMEs cited expansion into international markets. Again, this figure is double the global average of 14% and significantly higher than Switzerland (10%), Germany (10%) and Brazil (9%).
The Zurich study reinforces the notion of UAE as a low-risk jurisdiction, with high competition (42%) perceived as the most significant threat. Potential risks such as cybercrime (6%), natural catastrophes (4%), fire (3%) and malicious damage (0%) did not seem to concern UAE businesses.
“Zurich’s findings illustrate a sense of real ambition and confidence among SMEs in the UAE to grow their businesses overseas, at a time when other global small businesses are far more cautious about international expansion,” said Brian J Reilly, chief executive officer of Zurich’s General Insurance business in the Middle East. “This represents good news for the economy as SMEs are a vital economic growth engine for the UAE.
“The findings in our SME research highlight the strength of the UAE as a key global trading hub, which benefits from a low business risk perception that encourages small businesses to invest in expanding their operations and seek international growth opportunities,” he concluded.