Space is the UAE economy’s most promising new sector and can enable growth in other fields, senior officials said at an Expo 2020 Dubai forum.
Hamad Buamim, president of Dubai Chamber of Commerce, said companies are already learning how to benefit commercially from the recent plans for exploration and missions.
“There could be no better place or time for space, which is evolving, growing and set to become UAE’s most promising sector and key pillar of growth for itself and others,” he said.
He was speaking at the Space Business Forum, taking place at the Expo 2020 Dubai for Space Week on Tuesday.
The next phase is entering the right market in the right sector and at the right time - becoming a global player
Sarah Al Amiri,
Minister of State for Advanced Technology
“Space is very interesting for business because it is seen as the next frontier for business innovation.
"We believe there are many opportunities that lie in commercialising these activities. The question is how businesses can get involved and this is what we hope to achieve through events like this one.”
The latest figures show that the global space sector is valued at more than $423 billion and that may triple to $1.4 trillion by 2030.
In 2019, the UAE announced it had spent more than Dh22 billion on space projects, but no updated figure has been provided since then.
Private companies from around the world are getting increasingly involved in space, with businesses developing spacecraft and systems for missions beyond Earth.
Billionaires such as Elon Musk, Jeff Bezos and Sir Richard Branson have launched space tourism businesses, while more start-ups and medium companies are offering services to government space agencies.
The UAE’s new space strategy involves establishing a private space sector that creates impact on the economy.
Sarah Al Amiri, the UAE Minister of State for Advanced Technology and chairperson of the UAE Space Agency, said at the forum that the “sole purpose” over the next five years is to transform the UAE space industry into a global player.
The country already has several achievements to its name, including sending an Emirati astronaut to the space station in 2019, placing a spacecraft around Mars, developing locally built satellites and an upcoming lunar mission.
For its new asteroid belt and Venus exploration, the space agency will heavily involve private companies in hopes that it would boost the economy and lay the foundation for a sustainable private space industry.
“In our upcoming mission that we announced recently, exploration of the asteroid belt, we will work together with our private sector to provide that valuable know-how, experience and expertise, so that they can enter into the space race,” Ms Al Amiri said.
“A lot of the arguments are that space exploration creates valuable from a societal perspective and it creates an indirect economic value.
"How do you go about creating a direct space economy value and establishing a sector that didn't exist in a country before?
"Experience capability and capacity are the first ingredients for this, the next ingredient after utilising our planetary exploration missions, is to elevate the capabilities within the sector and design the right processes and test beds for experience and expertise.
“The next phase is entering the right market in the right sector and at the right time, becoming a global player.”
Ms Al Amiri highlighted two key areas in the UAE space sector, Earth-observation satellites and communication satellites.
She said private companies could get involved in Earth observation satellites to create an impact on other sectors from a societal perspective, such as addressing issues of climate change, enabling logistical systems, facilitate urban planning and better farming practices.
On Monday, the Mohammed bin Rashid Space Centre launched the 'Space Ventures' programme, a launch pad for startups in the space sector to work with the centre on long-term projects.
It would help companies gain access to technology and support and receive help in communicating with regulatory agencies around the world.
The areas of partnership opportunities include communications, data storage, Internet of Things, satellite manufacture and launch, robotics, space hardware and software.
Startups that partner with Space Ventures would need to be based in the UAE.
Adnan Al Rais, programme manager of Mars 2117, said that partnering with and supporting startups would help create an impact in the space sector.
"Space Ventures will help in establishing a strong and sustainable space ecosystem that will contribute to achieving the goals of the Mars 2117 programme, which aims to establish human settlements on Mars by 2117, as well as other space programmes in the UAE," he said.
"With niche focus areas in the space field, the Space Ventures initiative provides both Mbrsc as well as private players to collaborate and capitalise on each other’s strengths and expertise.”
What drives subscription retailing?
Once the domain of newspaper home deliveries, subscription model retailing has combined with e-commerce to permeate myriad products and services.
The concept has grown tremendously around the world and is forecast to thrive further, according to UnivDatos Market Insights’ report on recent and predicted trends in the sector.
The global subscription e-commerce market was valued at $13.2 billion (Dh48.5bn) in 2018. It is forecast to touch $478.2bn in 2025, and include the entertainment, fitness, food, cosmetics, baby care and fashion sectors.
The report says subscription-based services currently constitute “a small trend within e-commerce”. The US hosts almost 70 per cent of recurring plan firms, including leaders Dollar Shave Club, Hello Fresh and Netflix. Walmart and Sephora are among longer established retailers entering the space.
UnivDatos cites younger and affluent urbanites as prime subscription targets, with women currently the largest share of end-users.
That’s expected to remain unchanged until 2025, when women will represent a $246.6bn market share, owing to increasing numbers of start-ups targeting women.
Personal care and beauty occupy the largest chunk of the worldwide subscription e-commerce market, with changing lifestyles, work schedules, customisation and convenience among the chief future drivers.
Mercer, the investment consulting arm of US services company Marsh & McLennan, expects its wealth division to at least double its assets under management (AUM) in the Middle East as wealth in the region continues to grow despite economic headwinds, a company official said.
Mercer Wealth, which globally has $160 billion in AUM, plans to boost its AUM in the region to $2-$3bn in the next 2-3 years from the present $1bn, said Yasir AbuShaban, a Dubai-based principal with Mercer Wealth.
“Within the next two to three years, we are looking at reaching $2 to $3 billion as a conservative estimate and we do see an opportunity to do so,” said Mr AbuShaban.
Mercer does not directly make investments, but allocates clients’ money they have discretion to, to professional asset managers. They also provide advice to clients.
“We have buying power. We can negotiate on their (client’s) behalf with asset managers to provide them lower fees than they otherwise would have to get on their own,” he added.
Mercer Wealth’s clients include sovereign wealth funds, family offices, and insurance companies among others.
From its office in Dubai, Mercer also looks after Africa, India and Turkey, where they also see opportunity for growth.
Wealth creation in Middle East and Africa (MEA) grew 8.5 per cent to $8.1 trillion last year from $7.5tn in 2015, higher than last year’s global average of 6 per cent and the second-highest growth in a region after Asia-Pacific which grew 9.9 per cent, according to consultancy Boston Consulting Group (BCG). In the region, where wealth grew just 1.9 per cent in 2015 compared with 2014, a pickup in oil prices has helped in wealth generation.
BCG is forecasting MEA wealth will rise to $12tn by 2021, growing at an annual average of 8 per cent.
Drivers of wealth generation in the region will be split evenly between new wealth creation and growth of performance of existing assets, according to BCG.
Another general trend in the region is clients’ looking for a comprehensive approach to investing, according to Mr AbuShaban.
“Institutional investors or some of the families are seeing a slowdown in the available capital they have to invest and in that sense they are looking at optimizing the way they manage their portfolios and making sure they are not investing haphazardly and different parts of their investment are working together,” said Mr AbuShaban.
Some clients also have a higher appetite for risk, given the low interest-rate environment that does not provide enough yield for some institutional investors. These clients are keen to invest in illiquid assets, such as private equity and infrastructure.
“What we have seen is a desire for higher returns in what has been a low-return environment specifically in various fixed income or bonds,” he said.
“In this environment, we have seen a de facto increase in the risk that clients are taking in things like illiquid investments, private equity investments, infrastructure and private debt, those kind of investments were higher illiquidity results in incrementally higher returns.”
The Abu Dhabi Investment Authority, one of the largest sovereign wealth funds, said in its 2016 report that has gradually increased its exposure in direct private equity and private credit transactions, mainly in Asian markets and especially in China and India. The authority’s private equity department focused on structured equities owing to “their defensive characteristics.”
Killing of Qassem Suleimani
Our legal columnist
Name: Yousef Al Bahar
Advocate at Al Bahar & Associate Advocates and Legal Consultants, established in 1994
Education: Mr Al Bahar was born in 1979 and graduated in 2008 from the Judicial Institute. He took after his father, who was one of the first Emirati lawyers
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Ten tax points to be aware of in 2026
1. Domestic VAT refund amendments: request your refund within five years
If a business does not apply for the refund on time, they lose their credit.
2. E-invoicing in the UAE
Businesses should continue preparing for the implementation of e-invoicing in the UAE, with 2026 a preparation and transition period ahead of phased mandatory adoption.
3. More tax audits
Tax authorities are increasingly using data already available across multiple filings to identify audit risks.
4. More beneficial VAT and excise tax penalty regime
Tax disputes are expected to become more frequent and more structured, with clearer administrative objection and appeal processes. The UAE has adopted a new penalty regime for VAT and excise disputes, which now mirrors the penalty regime for corporate tax.
5. Greater emphasis on statutory audit
There is a greater need for the accuracy of financial statements. The International Financial Reporting Standards standards need to be strictly adhered to and, as a result, the quality of the audits will need to increase.
6. Further transfer pricing enforcement
Transfer pricing enforcement, which refers to the practice of establishing prices for internal transactions between related entities, is expected to broaden in scope. The UAE will shortly open the possibility to negotiate advance pricing agreements, or essentially rulings for transfer pricing purposes.
7. Limited time periods for audits
Recent amendments also introduce a default five-year limitation period for tax audits and assessments, subject to specific statutory exceptions. While the standard audit and assessment period is five years, this may be extended to up to 15 years in cases involving fraud or tax evasion.
8. Pillar 2 implementation
Many multinational groups will begin to feel the practical effect of the Domestic Minimum Top-Up Tax (DMTT), the UAE's implementation of the OECD’s global minimum tax under Pillar 2. While the rules apply for financial years starting on or after January 1, 2025, it is 2026 that marks the transition to an operational phase.
9. Reduced compliance obligations for imported goods and services
Businesses that apply the reverse-charge mechanism for VAT purposes in the UAE may benefit from reduced compliance obligations.
10. Substance and CbC reporting focus
Tax authorities are expected to continue strengthening the enforcement of economic substance and Country-by-Country (CbC) reporting frameworks. In the UAE, these regimes are increasingly being used as risk-assessment tools, providing tax authorities with a comprehensive view of multinational groups’ global footprints and enabling them to assess whether profits are aligned with real economic activity.
Contributed by Thomas Vanhee and Hend Rashwan, Aurifer
UAE v Zimbabwe A, 50 over series
Fixtures
Thursday, Nov 9 - 9.30am, ICC Academy, Dubai
Saturday, Nov 11 – 9.30am, ICC Academy, Dubai
Monday, Nov 13 – 2pm, Dubai International Stadium
Thursday, Nov 16 – 2pm, ICC Academy, Dubai
Saturday, Nov 18 – 9.30am, ICC Academy, Dubai
Women’s World T20, Asia Qualifier
UAE results
Beat China by 16 runs
Lost to Thailand by 10 wickets
Beat Nepal by five runs
Beat Hong Kong by eight wickets
Beat Malaysia by 34 runs
Standings (P, W, l, NR, points)
1. Thailand 5 4 0 1 9
2. UAE 5 4 1 0 8
3. Nepal 5 2 1 2 6
4. Hong Kong 5 2 2 1 5
5. Malaysia 5 1 4 0 2
6. China 5 0 5 0 0
Final
Thailand v UAE, Monday, 7am
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