UAE announces 50 economic boost projects, companies wait for details

Dubai, United Arab Emirates- The United Arab Emirates has launched a series of programs to stimulate and diversify its economy, seeking to attract approximately US$150 billion in new foreign investment over the next ten years.

UAE officials stated that 50 new projects and initiatives will be announced in the coming weeks to coincide with the country’s 50th anniversary, including new visas to attract residents and skilled workers.

“The driving force for the UAE for the next 50 years is to become a global player in different industries,” Sarah Al Amiri, the UAE’s first senior minister of state for science, told CNBC’s Dan Murphy on Sunday. “This region is the target we have been aiming for for the past five years; now we are working hard to ensure that many of our industries are globally competitive.”

The country aims to increase investment in advanced industrial sectors and technical education. Newly introduced changes include visa programs such as green visas, which aim to expand the self-occupancy status of skilled individuals and investors, and freelance visas, which will enable self-employed individuals to provide guarantees for themselves. The country has introduced a 10-year golden visa, which is selectively granted to highly skilled and selected residents and investors.

Visas are the core pillar of the UAE economy, as nearly 90% of its 10 million population are foreigners. Traditionally, without a job, foreign residents lose their visas; this is why nearly 10% of the country’s population left in the first year of the coronavirus pandemic.

The oil-rich desert emirate has been working hard to bring in new capital and residents to help its economy rebound from the blow to it caused by the pandemic, which has caused its economy to shrink by 6.1% in 2020. At the end of last year it introduced a remote worker visa that allows individuals to live in the UAE for one year, even if they work overseas, as long as they reach a certain income threshold.

However, like many major announcements in the UAE, the news details of these 50 initiatives are scarce, and there are no specific details about when each of these plans will start and what they will bring.

Employment law experts who spoke with CNBC described these programs as an “important and positive” step for businesses in the region.

Kiersten Lucas, a partner of Stephenson Harwood in Dubai, told CNBC: “Historically, mainly due to visa and work permit restrictions, it is difficult for companies to develop more flexible and atypical work arrangements outside of the traditional employment model.”

But the company is waiting for more details. The company’s partner, Laura Anderson, said: “Businesses and individuals will be anxiously waiting for the authorities to further clarify how the new visa works in practice.”

She added that many employers want to know to what extent these changes “give them more flexibility in signing contracts directly with individuals on a more traditional consulting basis”, without being subject to the current legal obligations surrounding the company’s employee relationship with the UAE. constraint. .

Chris Payne, chief economist of the UAE-based Peninsula Real Estate Company, described the move as a strategic move, although details are currently lacking.

“This is a recognition of the UAE that foreigners will stay here for a long time, they will stay here, when you go through the economic cycle, when you go through a downturn, the unemployed will leave the country,” Payne Monday Tell CNBC’s “capital link”. “This will immediately affect other companies, and its impact on the real estate market is very obvious, which is why this problem is being addressed bit by bit.”

“Usually you get the real details after the fact,” he said of Sunday’s announcement. “But the details will come out… If we talk about visa changes, even if we wait for the details, they are all very positive.”

This move also comes at a time when competition with neighboring Saudi Arabia to become the region’s trade and business center is becoming increasingly fierce.UAE — Especially dubai — It has long been regarded as the commercial center of the region, with modern transportation and logistics infrastructure, located at the crossroads of east and west, and convenient transportation.

Last year, Saudi Arabia initiated liberalized economic reforms to attract more human capital and investment. In February, it announced that its government would cease doing business with any international companies whose regional headquarters are not in the kingdom by 2024. This move is widely regarded as a direct blow to Dubai’s commercial dominance in the region.

“In many cases, competition is clearly a good thing, and the UAE is responding to this by entering the next phase,” Payne said. “This has always been the vision of the UAE — It is not only the hub of the Gulf Cooperation Council, but also the hub of South Asia, connecting East Africa and East Asia beyond South Asia. Therefore, if you look at some of these trade and investment announcements, you will find that we have competition within the Gulf Cooperation Council, but in fact our vision goes beyond the Gulf Cooperation Council. “

“So it is definitely a response to what is happening in Saudi Arabia, but it is a positive response; it says’we can meet the challenge’.”