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Wed 25 Jan 2012 03:29 PM

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UAE government pays off $544m debt of citizens

More than 6,830 Emiratis to benefit from move to pay off all loans valued at under AED1m

UAE government pays off $544m debt of citizens
UAE President Sheikh Khalifa bin Zayed Al Nahyan

The government of the UAE will settle AED2bn ($544.5m) of
debt owed by nationals
, the state news agency WAM said on Wednesday.

Sheikh Khalifa bin Zayed al-Nahayan, president of the UAE,
ordered the settlement of non-performing loans of citizens whose debt does not
exceed AED1m, the agency reported.

Debt will be paid by the government and borrowers will be
released under the condition that 25 percent of their salaries will be deducted
until the debt is paid back.

The move applies to both people who are detained for
defaulting on debt or have agreed to settle their debt through scheduled
payments.

A total of 6,830 citizens of the Gulf state will benefit
from the decision.

Most UAE fiscal spending occurs at the level of individual emirates, mainly oil-wealthy Abu Dhabi, with the federal budget accounting for only 11 percent of the total.

The government has already announced plans to invest $1.6bn over three years to improve living conditions in less developed northern emirates and a 70 percent rise in military pensions among other measures.

Arabian Business: why we're going behind a paywall

Evgeny 8 years ago

Why wasn't i born a UAE citizen?))))

umar 8 years ago

They really care for there nationals,a good example for other gcc countries.Allah Subhanetallah will give them more n more(including wealth,health,iman and good heart)
They had very good n kind father,person,teacher.(Shaikh Zayed)Allah Subhane tallah give him place in janat ul firdous.
The other GCC Gov,t should also try to do there best for there peoples in there capibility.
And also request to UAE gov,t please think for the expatriates too,
Who also gave there best in uae building frpm last so many decades.

jay 8 years ago

The key here is that it doesnt teach people to manage thier finances it is the same as the huge salary hikes recently given. It encourages and causes inflation as people now spend again in the hope it will be paid off again in the future
Kuwait and other GCC countries do this and the people rely on the state more and more thus preventing the Emeratization in private enterprises
While great for the citizens its bad overall for the country and 550 million should be invested in job creation or paying down the huge debts the country has.

great to look after citizens but how about everyone else 8 years ago

Really nice they care about the nationals, but a real shame expats are treated badly with regard to stalled property projects. My money is tied up in 2 properties that were due to be completed in 2009, we are now in 2012 and the land department told me they can offer no help despite breach of contract and to hire my own lawyer....my question is with what money am I supposed to do that? and who is there to help me now I am financially trapped due to Dubai developers??? While I think it is great the emiratis are so well looked after I think it is a huge let down to the image of the UAE to treat those of us from abroad, who invested in this country for the long term future with intent of pumping money back into the economy, badly.

Syed Shiraz Ali 8 years ago

May ALLAH Bless UAE Wise Leadership with choicest blessings, this is an excellent example for all muslim leaders/rulers how to cater their fellow countrymen
My personal wish is as same as Evgeny's
Long Live UAE & the Leadership

kenneth 8 years ago

Nice in the short term. However, in the long term this will set locals back. They are not taught the value of money and are not taught the value of hard work.

Prad 8 years ago

The saying "Give a man a fish, he'll eat for today. Teach a man to fish, he'll eat for life"....comes to mind.

Ahmad 8 years ago

Unfortunately most expat investors have only themselves to blame. In an effort to make money, they forgot to read their contracts or do due diligence on the chances of their projects being built. If you bought off plan and lost money you have only yourselves to blame, surely every investor should have done a bit of homework before investing? the ones that did made a lot of money and are happy home owners, the ones that did not are now complaining

Siwash 8 years ago

Please note that it is not a forgiveness on the debt incurred by nationals, but rather a rescheduling of payments. The President's Office will pay the current non-performing debt and get the money back from the national as a deduction of 25% of their monthly salary (interest-free I assume).

This will help the nationals get back on their feet and becoming productive. It is also with a commitment to not take on any more personal loans until this debt is paid off.

This fund can be set up so that the money recovered monthly can be used to pay off other nationals who fall into debt.

Baloo 8 years ago

@ Ahmad.

A rather unfair & insensitive viewpoint, in my opinion. Many investors have turned to their Contracts to redress the many breaches of contract by developers.

Many have been unable to reach a remedy, quite simply because the Contracts are worthless as the terms & conditions therein are not applied by the law of the land.