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Thu 19 Mar 2020 02:14 PM

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Abu Dhabi stimulus package to 'mitigate panic', says LuLu Financial boss

Adeeb Ahamed, managing director, Lulu Financial Group, says aid package will 'shore up businesses for both SMEs and bigger players

Abu Dhabi stimulus package to 'mitigate panic', says LuLu Financial boss

Adeeb Ahamed, managing director, Lulu Financial Group.

The boss of LuLu Financial Group, part of the UAE-based hypermarket-to-hospitality LuLu Group, has hailed stimulus efforts announced by Abu Dhabi to limit the impact of the coronavirus.

Adeeb Ahamed, managing director, Lulu Financial Group, which operates LuLu Exchange for remittances and transfer of money, LuLu Forex for buying and selling of foreign currencies and LuLu Money, its mobile app platform, said the aid package would mitigate "panic" in the emirate.

He added that the announcement would "ultimately result in shoring up businesses, for both SMEs and bigger players".

Directed by Abu Dhabi Crown Prince Mohamed bin Zayed, Abu Dhabi Executive Council revealed a total of 16 new initiatives on Monday.

Ahamed said: "The announcement of subsidies, new public funds, especially the Dh1bn to establish a market maker fund, and other easy lending measures will enhance liquidity in the system and maintain the consumer’s purchasing power.

"The tourism and hospitality industry, which is among the biggest employers in Abu Dhabi, is another sector that has been hit hard by the ongoing crisis. Hotels and tourist destinations are wearing a deserted look, raising doubt on the rate of return on investments made. The proposed rebates on rentals and suspension of municipality fees will go a long way in mitigating panic, as operators look to re-forecast their annual budget.

"The need of the hour is to emerge from this crisis with resilience and it’s good to see the government play an active role in supporting residents and businesses, to keep the economy rolling."

The fast-tracked Ghadan 21 initiatives will be implemented immediately and will enable Abu Dhabi to "adapt swiftly to both current and future challenges", according to a statement from Abu Dhabi Executive Council on Twitter on Monday.

They follow the UAE central bank's announcement last week to roll out a AED100 billion package to support its banks as it seeks to mitigate the economic impact of the coronavirus.

The initiatives include no annual registration fees for commercial vehicles, no toll gate tariffs for all vehicles and no real estate registration fees for the remainder of 2020.

Abu Dhabi Executive Council has also announced that it will offer AED5 billion of subsidies for water and electricity for citizens and commercial and industrial activities plus subsidies for electricity connection fees for SMEs.

An AED3 billion for SME credit guarantee programme has also been set up while performance guarantees for projects up to AED50 million have been waived for start-ups for this year.

Abu Dhabi also said a new committee has been established to review lending options to support local companies.

Other initiatives include an up to 20 percent rebate on rentals for the restaurant, tourism and entertainment sectors while tourism and municipality fees for tourism and entertainment sectors have been suspended this year.

A AED1 billion market maker fund to enhance liquidity and sustain balance between supply and demand for stocks on Abu Dhabi Securities Market has also been set up.

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