Russian businessmen settle in Dubai

Russian businessmen settle in Dubai

Affected by the sanctions against Russia for the invasion of Ukraine, more and more Russian businessmen, lawyers and artists settle in Dubaiwhere they are welcomed by the wealthy Gulf emirate, always on the lookout for well-to-do expats.

In IFZA, one of the many free zones created to attract foreign investment, “the number of Russian entrepreneurs and start-ups has increased tenfold compared to last year,” said its executive director, Jochen Knecht.

“It started with technology companies, software companies. Now there are all kinds of companies, art galleries, resellers, parts suppliers,” he lists.

The companies “come with employees, rent offices, warehouses,” adds this expatriate to Dubaione of the seven emirates that make up the United Arab Emirates.

Suffocated by the economic sanctions imposed on Moscow, the heads of companies are seduced by the business and finance center of Dubaiwith advantageous taxation, but also because of the declared neutrality of the country in the face of the Ukrainian conflict, explains Knecht.

“Russian investors are welcome,” he insisted, in a country of nine million inhabitants -90% foreigners-, mostly low-skilled workers from Asia. Dubai It also seeks to attract investments in full recovery after covid-19.

Luxury tourist destination and often accused of being a tax haven, Dubai it has always been frequented by a wealthy Russian clientele, interested above all in real estate.

Among them are tycoons now sanctioned by Westerners, such as the former owner of the Chelsea club, Roman Abramovitch, who visited houses in Dubai in March, according to the Bloomberg agency.

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There are also “many Russian celebrities, singers and actors who already owned Dubai and today they want to live there,” said Valeria Zolotco, from the real estate agency AX Capital.

“We see more and more SMEs, emerging companies that are looking to relocate in order to guarantee the continuity of their businesses,” says Georges Hojeige, president of Virtugroup, which advises companies on setting up in Dubai.

The financial and trade sanctions against Russia pose great challenges to Russian companies, whether in terms of suppliers, customers, labor or logistics.

“We have to create a (new) infrastructure, we have the means, but it will also take time,” the president of the Russian Central Bank, Elvira Nabiullina, acknowledged in April. “The difficulties appear in all sectors,” she stressed.

“A normal person”

Daria Nevskaya, associated with the Russian law firm FTL Advisers, noted that many of her clients “have difficulties working abroad.”

She herself has decided to leave Moscow to open an office in Dubai. “I am a specialist in international law, and I think that soon there will be no more international projects in Russia,” she laments.

But for many Russian citizens the move is an obstacle course, with credit cards that don’t work abroad, uncompromising banks, and Moscow-imposed restrictions on currency outflows.

Nevskaya says that for a month she has been trying to recover a sum of 5,000 euros ($5,350) transferred from Moscow to Dubaiwhich are blocked by the correspondent bank based in Europe.

“It does not seem fair to me, I am not a sanctioned person but my money is frozen, I do not have access to my money in Russia,” explains the lawyer. Because of the restrictions, Nevskaya says, she was only able to take “$10,000” with her when she left.

International sanctions particularly affect members of the affluent middle class, who, unlike the oligarchs, rarely have foreign passports or foreign accounts, Nevskaya explains.

Dubai it offers “business opportunities,” she continues, saying she sees an “international city” without anti-Russian sentiment. “I don’t feel like a criminal here. They treat me like a normal person,” she concluded.

AFP is a major global information agency that offers fast, verified and comprehensive coverage.

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