A new report from BMI Research suggests that the implementation of 10-year visas are a signal that the government won't pursue Emiratisation at the expense of competitiveness
The UAE’s move to ease restrictions on foreign investment will lead to an uptick in investment inflows, while the introduction of 10-year residency permits will help reduce labour market risks, according to a new report from BMI Research.
According to BMI, the changes are a “net positive” for the country’s business environment, which in turn will help the UAE maintain its position as a regional outperformer at a time when competition for foreign investment is heating up across the GCC.
“We believe that the new regulations will make it easier for investors to enter the country, as it no longer requires finding a reliable local partner, while the introduction of 10-year residency permits for investors and selected professionals will provide additional visibility and stability,” the report said.
The report notes that the move will help the UAE remain a “step ahead” in terms of competitiveness, as ongoing economic diversification programmes are heavily reliant on foreign expertise and investment.
“By remaining ahead of its GCC peers from a business environment perspective, the UAE is therefore well positioned to benefit from the uptick in investment associated with rising oil prices, especially in high-value added sectors,” the report noted. “This will enable the UAE to maintain its regional lead.”
From a labour market perspective, BMI said it believes the decision to allow 10-year residency permits signals that ‘Emiratisation’ is not a core priority for the government, and that it will not be pursued at the expense of competitiveness in the labour market.
“Several GCC states have implemented, or are in the process of preparing, regulations restricting the participation of foreigners in their local job market,” the report notes.
“This does not mean that the government will not continue to encourage the participation of nationals in the workforce but it will likely do so largely through positive incentives, rather than punitive measures,” it added.
The report concluded that the move will also help to significantly lower labour market risks by reducing the likelihood of local businesses experiencing labour shortages and related cost increases.