A fast-track visa system, seed capital and business support services are among recommendations in an Abu Dhabi Government report to help kick-start enterprise in the emirate.
Officials are seeking to remove barriers to entrepreneurship and lower costs in a bid to encourage more start-ups.
"Creating the ideal conditions for entrepreneurs has been a challenge for the region, as reflected by business start-up rates, which in Abu Dhabi are less than half of what they are in Singapore," wrote the authors of the Abu Dhabi Competitiveness Report.
"Business start-ups and micro-enterprises can act as remedies to help allay unemployment concerns for youths and nationals in the region, which is why effective policies and initiatives for business start-ups could have reverberations throughout the economy."
The findings of the report come as Abu Dhabi redoubles efforts to move the economy away from a reliance on government funding and oil receipts to a more sustainable model based on private sector enterprise. Entrepreneurship has been earmarked as a central plank in the emirate's Economic Vision 2030. In an effort to entice start-ups, the government in March set up the Abu Dhabi Business Centre, slashing red tape and cutting the time it takes to start a business to a matter of days. Officials hope the centre will help to lift the emirate in global competitiveness indexes such as the World Bank's Doing Business survey. But the report suggests more should be done to encourage the types of businesses being started. "General retail and trade shops, which are low growth, low skilled and low technology activities are still the most prevalent choices among start-ups in Abu Dhabi," the authors wrote.
"While new firms benefit the economy by increasing employment and business activity, the priority should be encouraging entrepreneurs in key knowledge and skilled sectors." Supporting start-ups around clusters contributing to the general knowledge, technology and innovative output should be the key emphasis of government efforts, it recommends.
The report finds the challenges of a lack of enterprise are particularly pressing in the Western Region. In Al Gharbia, micro and small businesses account for 80 per cent of Emirati-owned SMEs, the majority of which are male-owned and retail businesses.
Improving competitiveness in the region will require substantial investment in bringing in skills, technology and financing, the authors wrote. The report also backs the Government's focus on building cluster models. It has already taken strides to link different strands of industries together.
For example, the Khalifa Industrial Zone Abu Dhabi is seeking to attract downstream aluminium companies in areas such as rolling mills, extrusions, castings and forgings anchored around the Emirates Aluminium plant, which will be the world's largest single site aluminium smelter.
