Transfers made up 27% of the country's current account, though new laws including 100% foreign ownership and longer-term visa are aiming to keep retain expat earnings
Remittances by expats in the UAE, mostly Indian workers, rose over 17% in the first quarter of this year.
They remitted AED43.5 billion in the first three months of 2018 compared to AED37.1bn last year, reported Wam news agency based on figures by the Central Bank of the UAE.
Around 70% of transactions, totalling over AED30bn, were done via money exchanges, marking a rise of more than 10% compared to the same period last year, when 29% of remittances were done through banks.
Indian workers alone transferred AED16bn, 36% of total transaction value, followed by Pakistanis at 8.8%, Filipinos at 6.9%, Omanis at 5%, Egyptians at 4.9%, Americans at 4%, British at 3.4% and Bangladeshi expats at 3%.
Remittances made up 27% of the UAE’s current account, the data showed.
It comes a week after the UAE issued laws that allow 100% foreign ownership of companies and 10 year visas for certain investors, professionals and students, in order to attract foreign investment and retain skilled expat workers – and their savings, thus reducing remittances.
Prominent Emirati lawyer Dr Habib Al Mulla told Arabian Business this week that the country needs to open more channels of investment for expats in areas ranging from property to consumer law, in order to encourage them to keep their savings in the UAE.
“We always talk about the fact that the expat community is transferring billions of dirhams to their home countries. Of course [they are], because they don’t have a channel of investing it here. It’s only a few years that we allow them to invest in the capital market… We should give them channels to invest their money here so that everyone will be benefitting,” he said.
He urged changes to laws including the consumer protection law, particularly in areas of credit card charges and data and privacy.
“It’s time to come up with a more modern, more up to date consumer law,” he said, suggesting the UAE looks to the European Union (EU) for inspiration.
“We don’t have to reinvent the wheel. We can look to the [EU]. They have one of the best consumer laws in the world. We don’t have to copy them all, but we can look at the best principles they implemented,” he said.
He said such changes will have improve the country’s investment opportunities when compared to global powers.
“If we want to be seen as one of the capital markets of the world, there are things we need to implement. Consumer protection is one; data, privacy laws… We need to have the full package implemented so that we can say yes, we are competing with world class cities like London, New York and Singapore,” he said.
On his Twitter account, he questioned the legality of credit card charges.
“Are the high, complex and complicated charges that banks impose on credit card operations, especially in the case of a purchase in a currency other than dirham, legal? Where are the regulations? Where is consumer protection?” he tweeted.