NEW POLICIES BEGINS RISING OF NEW UAE – MONEY MAESTRO
New Policies begins rising of new UAE
UAE as a country is always been full of prospects and zeal. A country which is rich in culture and heritage. It was always an investor’s paradise. From the time of closed economy it had attracted the investors. The economy of UAE is the second largest in Middle East. Till the beginning of 21st century UAE was a closed economy their economy was fully dependent on oil and natural gas. With the beginning of 21th century they have realized that they cannot solely depend on petroleum and natural gas for their economy. Hence, the process of diversification started and now UAE emerged as a success in diversifying its economy.
Rising of UAE
Dubai model of economic development has encouraged the rest of UAE to consider diversification and foreign investment. With the emergence of new companies policy UAE is going to be the next hot with investment. Mr. Saeed Al Hebsi, Ministry of Foreign Affairs explain “We can expect the UAE’s status as a first-rate expatriate destination to be further cemented by our promotion of long-term cross-cultural appreciation, exchange, and understanding.” The changes will “have a far-reaching impact on the flow and quality of foreign and domestic investments, as well as overall economic growth of the country”, said Sami Al Qamzi, director general of Dubai Economy.
What is new in the policy?
The new policy abolish the requirement to have a UAE shareholder holding at least 51 percent of share capital of the company. Now the foreign nationals/companies can potentially own up to 100 percent of an onshore company’s issued share capital; The new policy repeals the earlier condition of allowing foreign investors to own up to 100% of and onshore company only in certain fields subject to certain condition. Further, the requirement to appoint a UAE national agent in case of a foreign parent company for its onshore branch is removed. The new policy also grants the local authorities certain powers to set conditions and requirements for onshore companies that are either wholly owned or majority owned by foreign investors. Hamad Buamim, president and CEO of Dubai Chamber of Commerce and Industry, described the new changes to the UAE Companies Law as an important development that comes at the right time given that the UAE is doubling down its efforts to improve ease of doing business and enhance economic competitiveness.
Beginning of Economic liberation
The economic liberation started in 2015 with encouraging Foreign Direct Investment (FDI) in UAE. At that time it was having co-ownership with the Emirati citizen.
The first major move to attract FDI was made in 2018, when the UAE Council of Ministers granted foreigners the right to own 100 percent of their onshore companies only in certain industries/sectors and subject to certain terms and conditions. Foreign investors and professionals with expertise in certain fields were also made eligible for a 10-year residence permit.
The norms in UAE required foreigners to share ownership of their company with an Emirati citizen. But the idea of relinquishing half a company’s ownership to a local sponsor often refrain investors from setting up businesses in mainland UAE.
The first step towards diversification started with Dubai the city of gold. As Dubai has already overcome the past significant economic challenges in 2009-2010. Dubai has always shown bold initiative with its diversifying policies then rest of the UAE remains comparatively conservative..