Happy Sunday everyone!

Here’s your top business news roundup for today:

• GEMS Education plans a $300 million expansion, betting on Dubai’s population boom and increasing demand for premium schooling.

• The UAE remains a global investment magnet, attracting $30.7 billion in FDI in 2023, driven by business-friendly policies and emerging sectors.

• Microsoft urges the U.S. to ease AI export rules for Gulf allies, warning that restrictions could push countries toward Chinese alternatives.

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GEMS Education Plans $300M Expansion Amid Dubai’s Population Boom

📰 What is it about?

• Dubai-based GEMS Education will invest $300 million over the next two to three years to drive organic growth.

• The private school operator aims to increase student enrollment by 30,000 to 35,000 by 2028.

• The expansion is fueled by Dubai’s rising population, particularly high-net-worth individuals relocating from the UK and Western Europe.

💡 Why it matters?

• Dubai’s Growing Appeal: Favorable tax policies, ease of doing business, and lifestyle benefits are attracting wealthy expatriates.

• Education Demand Surge: Higher demand for premium international schools is shaping Dubai’s private education sector.

• Investment Confidence: GEMS’ growth aligns with private equity interest, following a major Brookfield-led investment in 2023.

🔜 What’s next?

• GEMS will open a new school in August, with tuition fees potentially reaching $56,000 annually.

• The company may consider acquisitions to further expand its presence.

• Dubai’s education market is set to grow as more affluent families relocate, increasing demand for high-end schooling.

Markets

UAE Strengthens Position as a Global Investment Hub, with $30.7 billion FDI Inflows

📰 What is it about?

• The UAE has cemented itself as one of the world’s top destinations for foreign direct investment (FDI), with record-breaking capital inflows in 2023.

• In 2024, the country issued 200,000 new economic licenses, boosting its 1.1 million active businesses across various industries.

• The Ministry of Investment reported that foundational FDI inflows reached $16 billion in 2023, reinforcing the UAE’s reputation as a prime destination for global investors.

💡 Why it matters?

• Economic Growth: Increased FDI inflows drive job creation, innovation, and long-term economic expansion.

• Business-Friendly Policies: The UAE has introduced over 30 new laws in the past four years to strengthen investor confidence, covering sectors such as e-commerce, consumer protection, and intellectual property.

• Diversified Investments: While business services, software, and IT lead the way, sectors like financial services, industrial equipment, transportation, and renewable energy are also thriving.

🔜 What’s next?

• The UAE’s focus on emerging industries such as electric vehicles, cloud computing, and renewable energy will attract new waves of investment.

• Government-led initiatives and a competitive legislative framework will continue to support business expansion and FDI growth.

• With FDI inflows increasing by 35% to reach AED 112.6 billion ($30.7 billion) in 2023, the UAE is set to further solidify its status as the top investment destination in the Arab world.

Microsoft Pushes for AI Export Rule Changes to Gulf Allies

What is happening?

• Microsoft has urged the U.S. government to ease restrictions on AI chip exports to key allies, including the UAE and Saudi Arabia.

• The AI Diffusion Rule, introduced in Biden’s final days in office, controls access to advanced AI technology, particularly high-performance computing chips and AI models.

• Microsoft President Brad Smith argues that the rule hinders U.S. tech companies from expanding AI data centers in friendly nations like the UAE, Saudi Arabia, India, and Singapore.

Why it matters:

• Geopolitical Risks: The restrictions were originally designed to curb China’s AI development, but Smith warns that they could push allies toward Chinese alternatives, just as happened with 5G technology.

• Economic Growth: AI infrastructure is critical for economic expansion in Tier 2 countries, which now fear being left behind.

• Microsoft’s Investments: The company plans to spend $80 billion on AI infrastructure globally this year, with more than half in the U.S., but future investments depend on global market access.

What’s next?

• Microsoft is pushing for policy changes to allow AI exports while still protecting national security.

• Trump administration officials are reportedly considering tougher restrictions but also simplifying export rules to reduce unintended consequences.

• The debate over AI export controls will shape global AI leadership, with China poised to benefit if allies turn away from U.S. technology.

🔍In other news…

• UAE ramps up China charm offensive to deepen investment, tech ties.

• Space42 reports $629mln in revenues during 2024.

• Amid truce concerns, US plans emergency $3 billion Israel arms deals.

The Latest from the Smashi Business Studio

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