United Arab Emirates - Country Commercial Guide
Information and Telecommunications

This is a best prospect industry sector for this country. Includes a market overview and trade data.

Last published date: 2020-09-12


The UAE, the foremost nation for international trade and business in the MENA region, is a competitive market for the Information Communication Technology (ICT) industry. In a bid to reduce dependence on oil revenue and grow the private sector, the Abu Dhabi Economic Vision 2030 and the UAE Vision 2021 government initiatives set out to build a competitive knowledge economy and establish an open, efficient, effective, and globally integrated business environment. Integral to this is the UAE’s investment in the ICT sector, and it is of no surprise that the UAE led the ICT Global Competitiveness Index in 2019. With consumer demand for ICT products totaling $4 billion in 2016, it is evident that the nation is a strong market for final goods. Moreover, the UAE has undertaken measures to grow in the product development, manufacturing and software programming sectors, with the UAE topping the Middle East and Africa IT Risk/Reward Index in Q2 of 2019. In 2020, the pre-COVID projection was for the ICT market to grow by 7.4% to reach a value of $6.8 billion. The UAE is a re-export hub for consumer ICT goods, with more than half of all shipments to the UAE in many sub-sectors (e.g. PC monitors, smartphones) being ultimately re-exported to other markets. This has left the local IT industry relatively underdeveloped, allowing foreign companies to seize market share.

The UAE government has established a number of free trade zones (FTZs) such as Dubai Internet City (in 1999), Dubai Media City (in 2000) and Dubai Silicon Oasis (in 2005) that specialize in the ICT industry and act as industry clusters for high technology and innovation. Within these zones, firms are allowed 100% import and export tax exemptions, 100% repatriation of capital and profits, and corporate tax exemptions for 50 years, on a renewable basis. These minimal trade barriers have made the UAE, and Dubai specifically, the preferred location for businesses serving the entire Middle East and North Africa and this is also driving demand for IT software and services from the private sector.

Some of the ICT trade free zones in the UAE include:

  • TwoFour54 (Abu Dhabi)
  • Dubai Studio City (Dubai)
  • Dubai Production City (Dubai)
  • International Media Production Zone (Dubai)
  • Dubai Outsource City (Dubai)
  • Sharjah Media City Free Zone (Sharjah)
  • Ajman Media Free Zone (Ajman)
  • Creative City (Fujairah)

Investment is also driving the demand for ICT products and services, in sectors such as healthcare, aviation, retail, and hospitality, and those sectors linked to the UAE’s economic diversification plans such as manufacturing and real estate. UAE ICT market challenges include the relatively high cost of internet access and bandwidth and its exposure to cybersecurity risks. In a bid to attract foreign companies and develop human capital resources, the UAE government has established the UAE ICT Fund, which educates hundreds of Emirati students overseas in the ICT field. Moreover, the UAE’s SmartPass system has created a digital framework for the operations of all government services and ministries, and the UAE 2031 AI Strategy plans for Artificial Intelligence (AI) technology to be incorporated into these services. These vast government projects will require the expertise and services of foreign firms, and many American companies may have a comparative advantage with advanced technologies and innovations.

Leading sub-sectors

Cloud Computing

The cloud computing industry in the UAE has grown significantly and is forecast to create over 32,000 jobs in the UAE by 2022. The UAE is the region’s most significant player, with a forecast of $411 million in yearly expenditures on public cloud services by 2022. Microsoft has announced cloud data centers in Abu Dhabi and Dubai, and Alibaba cloud opened its first data center in Dubai in 2016.

The UAE government is working to bring in cloud and digital transformation technologies. The Government Information Authority (GIA) is developing cloud technology to be used by federal government entities in the UAE, and the services it offers include electronic hosting, file management and database systems, intranet portals, email and meeting management systems. The SmartPass service currently allows citizens to conduct their affairs with four federal government departments, and there are plans to connect other government agencies soon. With the exponential investments by the UAE government in cloud computing, and the UAE’s competitive business laws, as well as strong technological infrastructure, the sector is forecasted to continue expanding in the years ahead. A public cloud, due to its nature as an off-site internet-based service provider to multiple clients, provides some very specific advantages to companies. Several business models require companies to operate with demand constantly fluctuating. Public cloud hosting in the UAE has addressed these variations in resource and expertise efficiently and through highly specialized solutions. Despite these significant expansions, there is still sizeable room for development that will require the expertise and know-how of American firms to be achieved. Up to 51% of organizations in the Gulf Cooperation Council (GCC) named cloud computing as a priority, and two in three Gulf enterprises plan on investing at least 5% of annual revenues into the digitization of operations. As local enterprises adopt Software-as-a-Service, Infrastructure-as-a-Service and Platform-as-a-Service (SaaS/IaaS/PaaS) to cut costs and increase flexibility, and as the government moves to store all its data in the cloud and offer more services online, there is undoubtedly a vast amount of potential for American firms to invest into this sub-sector throughout the UAE.


The UAE’s geopolitical position and importance to the world economy in the energy, oil & gas, and aviation industry make the UAE vulnerable as a target of cyber attacks, triggering rapid growth in the cybersecurity market. The Emiratis report the highest number of malware incidents among consumers in the GCC. To protect the UAE’s critical data information infrastructure and improve national cybersecurity, the government introduced the UAE Information Assurance Standards (UAE IAS) which are a set of guidelines for government entities in critical sectors. Compliance with these standards is mandatory for all government organizations and businesses that are identified as critical infrastructure in the UAE. Several local players have been developing cybersecurity capabilities to capitalize on rising demand, while international IT security firms are expanding their presence in the country. With leading technology experts stating that the number one priority for UAE firms remains cybersecurity, the market is expected to continue expanding.

The Dubai government launched the Dubai Cyber Security Strategy, which involves five main domains: becoming a cyber-smart nation (through public awareness), innovation through research, user cybersecurity (confidentiality and privacy), cyber resilience (maintaining the non-stop availability of IT systems) and national and international collaboration in the realm of the cyberspace. Initiatives such as Expo 2020 and Vision 2021 (which seeks to make the UAE the most advanced nation globally) are driving demand for cybersecurity, which will provide many opportunities for American companies.

Internet of Things (IoT)

Internet of Things (IoT) opportunities also include smart services, the industrial internet, and machine-to-machine communications. There are applications in the public sector for smart cities and telehealth, and enterprise applications include smart metering, asset tracking, and production optimization. The UAE has emerged as a leading global location for the deployment of IoT solutions to enhance public infrastructure, especially Dubai as it aims to become a leading ‘smart city’. There is a foundation of cooperation across multiple sectors including ICT, power, transportation, infrastructure, healthcare, and government. Due to the high level of government interest in developing IoT in the UAE, spending on IoT is estimated to exceed $37 billion by 2020, with a Compounded Annual Growth Rate (CAGR) of 31%. Telecom leader Etisalat announced that, in cooperation with Emirati authorities, it is planning a mass IoT introduction into the UAE market. In April 2018, the UAE Government launched the Emirates Blockchain Strategy 2021. The strategy aims to capitalize on blockchain technology to transform 50% of government transactions onto blockchain platforms by 2021. The UAE’s desire to serve as a key tech player and offer the best of services to its residents drives many ambitious goals, which presents many opportunities to  American companies.  

Artificial Intelligence

Artificial Intelligence (AI) is a priority in the UAE. AI is forecast to contribute almost 14% of the national GDP by 2030 ($96 billion), and the annual growth in the AI contribution to the UAE economy is forecast to grow by 33.5% between 2018 and 2030. As part of the government’s UAE Centennial 2071 plans, the UAE AI Strategy 2031 was launched to improve efficiency in the transport, health, space, renewable energy, water, technology, education, environment, and traffic sectors. In order to achieve this, the UAE appointed Omar bin Sultan Al Olama as the Minister of State for Artificial Intelligence – the first position of its kind – and the UAE witnessed spending on Artificial Intelligence of $8.98 billion in 2017. The nation has already begun integrating AI with the education and healthcare sectors. The UAE government has collaborated with Alef Education to include digital education platforms in several schools in Abu Dhabi and Al Ain, and the Dubai Health Authority has outlined a strategy that uses AI and robotics to automate surgeries and other procedures. In the aviation industry, Emirates is developing an AI-powered assistant for customers, and the UAE’s aviation authority has signed an agreement to explore the use of AI in air traffic management, while airport officials are developing plans to use robots which detect wanted criminals and suspicious activity. The UAE Cabinet has formed the UAE AI Council, which is tasked with overseeing the AI integration into government services and training of government employees to operate with AI. Since the UAE has a minimal role in the production of AI technology, there is huge potential for U.S. companies to both implement this technology and conduct the training for employees. AI is a key part of the ambitious plans of the UAE government to diversify their economy and become a knowledge economy, and significant budget allocations and expenditures to achieve Vision 2021 and other national strategies. The race between Gulf states to have the newest and most sophisticated technology, particularly in the field of AI, provides a large, untapped market in which U.S. firms have huge comparative advantages.

Smart Cities

In a bid to transition away from dependence on oil, the UAE has made huge investments into projects for smart cities, with goals to build smart cities from scratch and improve infrastructure in existing cities. Since October 2013, the Dubai authorities have undertaken a mission to transform Dubai into a smart city, with innovations centered on 6 key areas: transport, communications, infrastructure, electricity, economic services, and urban planning. These are to be achieved through 100 initiatives, and more than 1,000 government services are predicted to go smart in the city. Examples of the initiatives include the provision of public Wi-Fi, electric car charging stations, live traffic monitoring, and an eWallet for the Roads and Transport Authority, highlighting how there are tech-related opportunities for American firms in all sectors of the Emirati economy. Moreover, Abu Dhabi’s Department of Planning and Municipalities launched a pilot phase of the Zayed Smart City Project in 2018, which aims to achieve the same goals as the Dubai initiative. The most ambitious smart-city plan of the UAE is the creation of Masdar City, an $18 billion planned city led by a subsidiary of the Mubadala Development Company. Designed to run entirely on solar power, it will have many smart features, including light sensors instead of switches, and a Personal Rapid Transit system running on Podcars. With Abu Dhabi topping the smart city rankings in the Middle East, and Dubai ranking second, UAE authorities will want to maintain the reputation of the UAE as a leading smart country, and continuous public sector investments in large-scale infrastructure projects revolving around ‘smart’ building will continue growing, providing opportunities for American companies.


UAE is the first country in the Arab region and fourth globally to launch its 5G network. Both Du and Etisalat, the nation’s leading telecom companies, launched limited 5G networks at the beginning of June 2019, along with the 5G-enabled ZTE Axon 10 Pro smartphone to both post-paid and pre-paid customers. In Q3 2019, Etisalat successfully conducted the first end-to-end 5G stand-alone call in the MENA region, becoming the first operator to achieve the milestone. The current 5G coverage in the country has reached 80% of the UAE’s main cities, such as Dubai and Abu Dhabi, with Expo 2020 venues serving as test sites for the network. By the end of 2023, it is estimated that 16 million 5G smartphones will be operational in the region. With the UAE being at the forefront of technological advance and given the strong GDP per capita, demand for 5G services is predicted to be strong over the next five years. The Telecommunications Regulatory Authority (TRA) of the UAE has established a Steering Committee for the oversight of the 5G launch, and Qualcomm, Ericsson, and Huawei have been named as potential partners in the rollout of the 5G network across the country. The rollout of 5G and expansion of the telecom network and infrastructure in the UAE will offer many business opportunities for American companies.  


The UAE continues to grow rapidly in the technology space. Private and public sector players are seeking to modernize by adopting state-of-the-art solutions and catch the broader global wave of innovation, data utilization, digital transformation, and technological advancement. The UAE’s desire diversify and build a knowledge economy is creating new opportunities, and the government has set aside large parts of the budget in order to achieve the ambitious Vision 2021, Abu Dhabi Vision 2031, and UAE AI vision 2031 plans. Technology players continue to see the huge potential to grow their business in the UAE.   

According to Business Monitor International (BMI), the software and services segments have seen significant investment in areas such as cloud computing, smart services, and cybersecurity. IT spending in the UAE is forecast to increase at 6.5% over 2020-2023 to reach a total of $8.2 billion. Software and services demand will drive IT spending growth over the medium term, especially demand from large industries for solutions around cloud computing, data analytics, cybersecurity, and the Internet of Things. The hardware segment will also see healthy growth as the market tilts towards high-end power users and workstation purchases from the enterprise and commercial sector.

Chart showing opportunities in Software and Services in UAE
Opportunities in Software and Services in UAE





2020 (forecast)*

Computer hardware sales




Software sales




Services sales





*All figures are in billions of U.S. Dollars

There is also growth expected in the demand for business management software. Key verticals include process manufacturing, followed by the finance sector, where regulatory compliance and new services, including Islamic banking, will help to create opportunities. The increasing regional and global orientation of the UAE economy is a major driver for locally based small and medium sized enterprises to enhance the efficiency of their operations. The UAE’s ambitious goals, and the lack of domestic firms, presents many opportunities for American companies.