On November 5, the Ethiopian military declared war with separatists in the Tigray region of Ethiopia. The world now faces the prospect of another country descending into conflict.
The implications of full-blown war in Ethiopia would be of huge significance. It would have the potential to displace 9 million people, according to reports. This would be a figure even greater than the number of people displaced in Syria’s ongoing civil war.
The chief victims, of course, would be Ethiopians, who last suffered the tragedy of war 20 years ago. But risks also extend to the wider Horn of Africa, a region with huge potential that could be rocked by instability.
The "great man theory" of history, coined by the Scottish philosopher Thomas Carlyle, argues that individuals have the ability to alter the course of major events. This, many hope, is true for Ethiopia's Prime Minister, Abiy Ahmed. Even with his impressive political career – he has won the Nobel Peace Prize and the UAE Order of Zayed, and is credited with impressive economic and environmental achievements in his country – his task ahead will require the leadership and compassion of a great statesman.
Tribal and ethnic divisions have long existed in Ethiopia. For many years, politics in the country was dominated by former prime minister Meles Zenawi. Mr Meles was from the semi-autonomous Tigray region, homeland of the Tigrayan ethnic group, who comprise six per cent of Ethiopia’s population of 110 million.
After Mr Abiy – who is a member of the Oromo, one of the largest ethnic groups in the country – rose to power, Tigrayan leaders claimed he was launching a campaign to reduce their influence in the country.
Tensions in Tigray boiled over when, ostensibly due to the pandemic, Mr Abiy postponed national elections. This prompted the TPLF, the ruling party in Tigray, to hold its own elections, which the national government deemed illegal.
Since then, fighting has broken out, putting at risk the end of the country's fragile peace. Illustrating the seriousness of the situation, The National reported last Saturday that Mr Abiy had told civilians in Tigray to stay indoors to avoid "collateral damage" from government airstrikes.
The UN and many in the international community have called for de-escalation. But with news yesterday of Ethiopian forces seizing a Tigrayan airport and reports of refugees fleeing to neighbouring Sudan, many worry the situation is worsening.
There are also concerns that ethnic factions in the Ethiopian military could splinter, endangering internal security. A potential conflict threatens to reverse recent economic achievements and reforms. Last year, investment in Ethiopia reached 38 per cent of GDP.
Ethiopia bears the unique distinction in Africa of having retained its independence throughout the colonial era. It also possesses an ancient heritage tied to each of the three great Abrahamic faiths. Despite its challenges, there has been a historic coherence and continuity to Ethiopian identity that provides a model for strength in diversity.
The prospect of war must not jeopardise the wellbeing of one of Africa’s great nations and turn a success story into a tragedy. Mr Abiy, with the support of the international community, must guide his country through this difficult episode. The future of Ethiopia and its people rests on it.
Three trading apps to try
Sharad Nair recommends three investment apps for UAE residents:
- For beginners or people who want to start investing with limited capital, Mr Nair suggests eToro. “The low fees and low minimum balance requirements make the platform more accessible,” he says. “The user interface is straightforward to understand and operate, while its social element may help ease beginners into the idea of investing money by looking to a virtual community.”
- If you’re an experienced investor, and have $10,000 or more to invest, consider Saxo Bank. “Saxo Bank offers a more comprehensive trading platform with advanced features and insight for more experienced users. It offers a more personalised approach to opening and operating an account on their platform,” he says.
- Finally, StashAway could work for those who want a hands-off approach to their investing. “It removes one of the biggest challenges for novice traders: picking the securities in their portfolio,” Mr Nair says. “A goal-based approach or view towards investing can help motivate residents who may usually shy away from investment platforms.”
Ten tax points to be aware of in 2026
1. Domestic VAT refund amendments: request your refund within five years
If a business does not apply for the refund on time, they lose their credit.
2. E-invoicing in the UAE
Businesses should continue preparing for the implementation of e-invoicing in the UAE, with 2026 a preparation and transition period ahead of phased mandatory adoption.
3. More tax audits
Tax authorities are increasingly using data already available across multiple filings to identify audit risks.
4. More beneficial VAT and excise tax penalty regime
Tax disputes are expected to become more frequent and more structured, with clearer administrative objection and appeal processes. The UAE has adopted a new penalty regime for VAT and excise disputes, which now mirrors the penalty regime for corporate tax.
5. Greater emphasis on statutory audit
There is a greater need for the accuracy of financial statements. The International Financial Reporting Standards standards need to be strictly adhered to and, as a result, the quality of the audits will need to increase.
6. Further transfer pricing enforcement
Transfer pricing enforcement, which refers to the practice of establishing prices for internal transactions between related entities, is expected to broaden in scope. The UAE will shortly open the possibility to negotiate advance pricing agreements, or essentially rulings for transfer pricing purposes.
7. Limited time periods for audits
Recent amendments also introduce a default five-year limitation period for tax audits and assessments, subject to specific statutory exceptions. While the standard audit and assessment period is five years, this may be extended to up to 15 years in cases involving fraud or tax evasion.
8. Pillar 2 implementation
Many multinational groups will begin to feel the practical effect of the Domestic Minimum Top-Up Tax (DMTT), the UAE's implementation of the OECD’s global minimum tax under Pillar 2. While the rules apply for financial years starting on or after January 1, 2025, it is 2026 that marks the transition to an operational phase.
9. Reduced compliance obligations for imported goods and services
Businesses that apply the reverse-charge mechanism for VAT purposes in the UAE may benefit from reduced compliance obligations.
10. Substance and CbC reporting focus
Tax authorities are expected to continue strengthening the enforcement of economic substance and Country-by-Country (CbC) reporting frameworks. In the UAE, these regimes are increasingly being used as risk-assessment tools, providing tax authorities with a comprehensive view of multinational groups’ global footprints and enabling them to assess whether profits are aligned with real economic activity.
Contributed by Thomas Vanhee and Hend Rashwan, Aurifer
The National's picks
4.35pm: Tilal Al Khalediah
5.10pm: Continous
5.45pm: Raging Torrent
6.20pm: West Acre
7pm: Flood Zone
7.40pm: Straight No Chaser
8.15pm: Romantic Warrior
8.50pm: Calandogan
9.30pm: Forever Young
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What the law says
Micro-retirement is not a recognised concept or employment status under Federal Decree Law No. 33 of 2021 on the Regulation of Labour Relations (as amended) (UAE Labour Law). As such, it reflects a voluntary work-life balance practice, rather than a recognised legal employment category, according to Dilini Loku, senior associate for law firm Gateley Middle East.
“Some companies may offer formal sabbatical policies or career break programmes; however, beyond such arrangements, there is no automatic right or statutory entitlement to extended breaks,” she explains.
“Any leave taken beyond statutory entitlements, such as annual leave, is typically regarded as unpaid leave in accordance with Article 33 of the UAE Labour Law. While employees may legally take unpaid leave, such requests are subject to the employer’s discretion and require approval.”
If an employee resigns to pursue micro-retirement, the employment contract is terminated, and the employer is under no legal obligation to rehire the employee in the future unless specific contractual agreements are in place (such as return-to-work arrangements), which are generally uncommon, Ms Loku adds.
Living in...
This article is part of a guide on where to live in the UAE. Our reporters will profile some of the country’s most desirable districts, provide an estimate of rental prices and introduce you to some of the residents who call each area home.
