Economy minister says UAE in advanced stage of drafting new law to boost foreign ownership in some sectors
The UAE is at an advanced stage of drafting a foreign investment law that would allow 100 percent foreign ownership of businesses in some sectors, the economy minister said on Monday.
Sultan bin Saeed Al Mansouri, speaking at an international investment conference in Dubai, did not specify the sectors or say when the law might be passed. The process of drafting and enacting major laws in the UAE often takes years.
But the initiative may mark a more aggressive push by the Arab world's second biggest economy to attract investment. At present, foreigners generally cannot own more than 49 percent of any UAE firm unless it is incorporated in a special "free zone".
A new companies law, anticipated to take effect within months, was originally expected to relax this restriction, but that reform was dropped because of strong opposition from some Emiratis who feared they could lose out to foreigners.
Mansouri said on Monday, however, that the UAE was determined to diversify its economy beyond oil and saw foreign investment as a key way to do this.
"Economies face pressures from changes in the international environment, including the drop of the oil price," he said.
While Mansouri did not say how the new foreign investment law would work, it may require fully foreign-owned firms to transfer technology in sectors that are strategically important for the UAE. Officials have previously said they are keen to attract technology for industries such as aerospace.
New foreign direct investment (FDI) in the UAE rose 25 percent to $13 billion in 2014, Mansouri said, adding that the government aimed to raise FDI to 5 percent of gross domestic product in coming years. GDP was AED1.540 trillion ($420 billion) last year, he said.For all the latest banking and finance news from the UAE and Gulf countries, follow us on Twitter and Linkedin, like us on Facebook and subscribe to our YouTube page, which is updated daily.
If the new law took place for real, it would really attract new investments to the area and would add a great value to UAE as well.
Whatever they plan so far, does not really matter... as long as the bankruptcy law has not been implemented, as long as there is no international Bank Law in place, as long as you can be put into prison for no valid reason and as long as the main speculators pushing the rent/housing prices beyond its real value, good investors and companies will always hesitate to invest into the UAE. Global standard is near, but not as near as it has to be to attract investors and give them trust that they themselves and their money is ending up in a safe country with proper Laws.
Hats off agian. Step in the right direction. Now this to be done for the small shops and you will see economy even grow faster. Will also stimulate the Emirati not only to hold up his hand to the foreign investors and the small business operators but increase proper entrepreneurship again. I have a lot of respect for the vision of his leaders.
This is such old news - they say this every 3 or 4 years so as to placate the World Trade Organisation, the FTA, US etc etc but will never actually do it.
It's not in the Emirati ruling families interest to suddenly allow LandRover or Coca Cola to suddenly have 100% ownership and let that money spinner come to an end, plus the quid pro quo is that everyone would have to pay tax which you can imagine being a really fair system and will really attract foreign workers.
Do a Google search on "foreign ownership restriction UAE" in 2010, 2007 and 2003 - they have been in "advanced stages" for years.