UAE Family Businesses Expand Rapidly
(MENAFN) Family-run enterprises in the United Arab Emirates (UAE) are experiencing accelerated growth, bolstered by government-driven reforms and a modern legal infrastructure designed to secure their longevity and strengthen their role in the national economy.
Data from the UAE Ministry of Economy and Tourism reveals a significant rise in the number of registered family businesses, growing from approximately 15,000 in 2022 to more than 17,000 by mid-2025—a surge of over 13% within just two years.
Currently, family businesses account for about 40% of the UAE’s non-oil gross domestic product (GDP) and make up nearly 90% of private sector firms, underscoring their importance in driving employment and economic diversification.
In a strategic move to ensure the sustainability of these entities, the UAE introduced several legislative updates over the past two years, most notably the Family Business Law, which took effect in early 2023. This law establishes a comprehensive legal structure to facilitate intergenerational ownership transfers, improve governance practices, and support the transition of family firms into private joint-stock companies—without sacrificing their familial identity.
Noura Al Ahmed, CEO of a family-owned food company, told media that the main hurdle for family enterprises is “smooth succession planning.” She pointed out that some regional firms have faced setbacks due to the lack of structured approaches to administrative and financial inheritance.
“Balancing family relations with institutional business requirements is a constant challenge,” Al Ahmed said. “But it can be overcome through training and governance. The current regulatory environment in the UAE is very encouraging, especially with the new laws and government support for corporate transformation.”
Economist Hazem Al Nuaimi noted that UAE family businesses have “evolved significantly thanks to state policy, and are now more prepared for regional and international expansion.”
“The flexibility of family enterprises, combined with the UAE’s stable business environment, positions them as key drivers of economic growth in the coming years,” said Nuaimi.
Nearly 47% of UAE family businesses have already begun transferring leadership to second and third generations, according to estimates—indicating a shift toward more formalized, institutional practices.
Abdullah Al Muhairi, general manager of a Dubai-based family firm, said, “We successfully restructured our company last year by leveraging the new regulations, and we’re now preparing to expand into new sectors.”
Al Nuaimi added that empowering family-run firms is essential to realizing the goals of UAE Vision 2031, especially in terms of private sector growth and economic diversification. “If these businesses continue to institutionalize, they will become a cornerstone of competitiveness and a magnet for high-quality investment,” he said.
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