Baking Abu Dhabi"s best cupcake is just the first hurdle

Selling a superior cupcake is clearly a serious business, requiring not just culinary skill but also entrepreneurial spirit. Both of these are evident in Lebanese-born Faiza Taha, the titular parent of Mama’s Cupcakes in Abu Dhabi, which has been identified by The National’s panel of experts as the capital’s best.

Mrs Taha taken the endorsement of her baking prowess from her children and their friends and turned it into a business. But like many other entrepreneurs before her, she discovered that creating a better product was just the first of many hurdles she had to surmount to open a businesses in the UAE.

There is a compelling need for the UAE economy to have a wide range of private enterprises to match the robust health of the public sector, which is mostly based around either government services or extractive industries. The latest World Bank survey puts the UAE in 23rd place when it comes to the ease of setting up a business. This is well behind major economies like the US and the UK and also small knowledge-economy countries like Singapore and Hong Kong to which the UAE likes to compare itself. The UAE was in 100th place when it came to enforcing contracts and resolving insolvency.

Barriers to setting up a business in the UAE include the need to pay fees in advance, the requirement for foreign owners to have a local partner with 51 per cent equity, and the need to register annually with a range of government departments. Would-be entrepreneurs must also understand local laws and regulations relating to such issues as holidays and Ramadan working hours, and realise that there can be a long time-lag between recruiting staff from overseas and their arrival in the UAE.

Some of the impediments to attracting entrepreneurs have been addressed by Noura Al Kaabi, the chief executive of twofour54 and a member of the Federal National Council. She told the Arabnet Digital Summit 2014 in Dubai that a new kind of visa will be introduced for entrepreneurs hoping to set up in the UAE.

Previously foreign nationals had to have a definite offer of employment to get a residency visa, a stipulation that had the effect of restricting the arrival of entrepreneurs. The new visa will allow a business to be set up without even the need for a physical office. Ms Al Kaabi also identified impediments to entrepreneurs in the­ ­areas of funding, educational infrastructure, government bureau­cracy and inefficiencies, and cultural differences.

To get the diverse and robust private sector that the UAE seeks, the authorities will have to remove many of these barriers to setting up businesses so success will be more about baking a better cupcake (the importance of which is explored below) and less about battling bureaucracy.

Baking Abu Dhabi"s best cupcake is just the first hurdle