The United Arab Emirates has secured its position as the premier global destination for starting and growing a business, ranking first in the Global Entrepreneurship Monitor (GEM) 2025/2026 report. This marks the fifth consecutive year that the UAE has topped the index, outperforming several major world economies and established innovation hubs. The achievement highlights the success of the nation’s strategic legislative reforms, world-class infrastructure, and a pro-business environment that continues to attract global talent and investment. According to the report, the UAE’s consistent leadership in this space is a direct result of its ability to adapt and innovate in an increasingly competitive global market.
Key Development
The UAE’s top ranking is based on a comprehensive evaluation of 13 specific indicators known as the Entrepreneurial Framework Conditions (EFCs). For the 2025/2026 cycle, the UAE achieved an unprecedented composite score, leading the world in categories such as “Ease of Access to Finance,” “Government Policy: Support and Relevance,” and “Physical Infrastructure.” The GEM report particularly praised the UAE’s focus on integrating entrepreneurship into the national education system, ensuring that the next generation of residents is equipped with a digital-first mindset.
The Ministry of Economy noted that this milestone coincides with a record-breaking year for business license issuances across the emirates. In 2025, the UAE saw a 14 per cent increase in the number of new SMEs registered compared to the previous year. This growth is reportedly driven by the expansion of “Golden Visa” categories for entrepreneurs and the implementation of 100 per cent foreign ownership laws in nearly all sectors, which have significantly lowered the barriers to entry for international founders.
Why It Matters
Securing the top spot for half a decade reinforces the UAE’s reputation as a “Safe Haven” for capital and innovation. For the local and regional economy, this ranking carries significant weight:
- Foreign Direct Investment (FDI): The ranking acts as a global seal of approval, encouraging international venture capital firms to establish regional headquarters in Dubai and Abu Dhabi.
- Talent Retention: The UAE’s status as a top hub helps retain high-skilled expatriate talent, who increasingly view the emirate as a long-term home for their families and businesses.
- Economic Diversification: The surge in entrepreneurship accelerates the nation’s shift away from oil dependency, with SMEs now contributing over 63 per cent of the UAE’s non-oil GDP.
- Global Competitiveness: Maintaining the number one position ensures the UAE remains ahead of regional competitors who are also vying for a share of the global startup market.
Bigger Picture
The UAE’s dominance in entrepreneurship is a central pillar of the “We the UAE 2031” vision. The government’s goal is to increase the number of SMEs in the country to one million by 2030. This isn’t just about quantity; it’s about quality and industry relevance. By fostering ecosystems like Hub71 in Abu Dhabi and the Dubai Future District, the UAE is specifically targeting “Deep Tech” sectors including AI, blockchain, and space technology.
The focus is also shifting toward “Impact Entrepreneurship.” New policies are being designed to support startups that solve global challenges such as climate change and food security. This alignment with global trends ensures that UAE-based companies are not just profitable but also attractive to ESG-focused (Environmental, Social, and Governance) global investors. The country is effectively building a bridge between East and West, serving as a global laboratory for the future of the private sector.
What Happens Next
Building on this momentum, the Ministry of Economy is expected to launch the “Entrepreneurship 2.0” initiative later this year. This program will reportedly focus on scaling local startups into “Global Unicorns” (companies valued at over £770 million or $1 billion). A new digital platform is also set to launch in July 2026, aimed at streamlining the entire business setup process into a single, three-minute mobile experience.
As regional competition intensifies, the UAE is set to introduce further incentives for home-grown businesses, including enhanced access to government procurement contracts for Emirati-led startups. With the upcoming Eurasian Economic Union Summit and other global trade forums on the horizon, the UAE is positioned to leverage its top-tier ranking to secure even more cross-border trade and innovation agreements.
FAQs
What is the Global Entrepreneurship Monitor (GEM)?
GEM is the world’s most comprehensive study of entrepreneurship, providing a yearly assessment of the entrepreneurial environment across dozens of countries.
How long has the UAE held the top spot?
The UAE has been ranked as the world’s number one entrepreneurship hub for five consecutive years, starting from 2021.
What are the main factors behind the UAE’s top ranking?
Key factors include government support policies, world-class physical infrastructure, ease of access to finance, and a flexible legal framework for foreign ownership.
Does the ranking only apply to Emirati citizens?
No, the ranking assesses the overall environment for all entrepreneurs, including expatriates and international investors who choose to start businesses in the UAE.
What is the goal for the UAE’s SME sector by 2030?
The UAE aims to increase the total number of SMEs to one million and significantly boost their contribution to the national non-oil GDP.
