The UAE has completed the drafting of a long-awaited law that could allow foreign investors to have 100 per cent ownership in some projects and is awaiting final approval before it is enforced this year, the country’s minister of economy said in remarks published on Sunday.
Sultan bin Saeed al Mansouri also told the Arabic daily 'Al Khaleej' the UAE had overcome more than “95 per cent” of the effects of the 2008 global fiscal distress and is set to become stronger than before the crisis.
Asked about the UAE’s investments in some Arab countries hit by the current political turmoil, the minister said the government had received assurances for protection from those countries in line with signed accords.
“We have finished drafting the new investment law but there is one item that needs to be agreed on…the rift is that who will sign foreign investment agreements—the ministry of economy or the ministry of finance?....we have referred this issue to legal parties which are now studying it,” he said.
“We are awaiting a response from those parties so the law will be presented to the competent authorities for endorsement….I would like to point out that we have no problem as to who will sign investment agreements, be it the ministry of economy or the finance, but we believe in the need for coordination and distribution of powers in this respect for both parties.”
Mansouri said it would be up to the federal cabinet to set the percentage allowed by foreign investors in projects in the UAE, the second largest Arab economy and foreign capital destination after Saudi Arabia. But he added the percentage would vary, depending on the type of investment and size of the project.
“In some cases, the ownership could reach 100 per cent while in other cases it could be much lower,” he said.
Asked about the UAE investments in Arab countries hit by unrest, Mansouri said he hoped those countries would tackle their problems and restore stability to preserve the Emirati assets there. “But we have already received assurances from those countries to protect our investments there in line with agreements signed between us,” he said.
He said the UAE, despite the crisis impact on its economy and default problems, had remained an attractive destination for foreign direct investment (FDI).“We are now have serious talks with many investors from the Arab World, Europe and other areas seeking to invest in tourism, industry and other sectors in the UAE…these investors are looking for lucrative and safe markets for their investments and are trying to enter the UAE for this purpose,” he said.
Mansouri acknowledged that the UAE had been strongly affected by the global crisis given its openness to the world economy.
He said the process of evaluating the impact on the UAE’s economy and investment was not easy on the grounds the country is more integrated into the world economy than other Arab nations.
He said that 2009 was a year of damage assessment rather than taking decisions in order to determine the exact effects of the crisis on the country and work out plans to tackle these repercussions.
“In 2010, we began devising solutions to the problem, including the Dubai World debt problem…I would like to point out that the government handled many problems during that year wisely and slowly…we then moved into 2011, which was a year of setting off as the UAE reasserted itself on the global economic map by tackling most of challenges arising from the crisis,” he said.
“I can now say that the UAE has overcome 95 per cent of the crisis repercussions on its economy and is on the verge of fully recovering so it will rejoin the global economic race and emerge stronger, more immune and more experienced than it was before the crisis.”