This week's announcement of amendments to the laws governing residency and ownership of companies is a brave step. The long-term objectives of the changes have been clearly spelt out by Sheikh Mohammed bin Rashid, the Vice President and Prime Minister and Ruler of Dubai.
The best way of attracting global investment and exceptional talents to the UAE, he said, is through an "open environment, tolerant values, infrastructure and flexible legislation”.
These new moves should be seen as a firm and decisive step on the path to achieve that. They are a beginning, not an end.
One surprise is the breadth of the changes, in particular with regards to the creation of a 10-year residency visa for qualified professionals and their families. That will have an enormous impact, both in terms of the stability it offers for those concerned but also in terms of the decisions they make about how to invest for their futures.
I hope that, in future, this facility will be extended to those beyond the currently designated categories of doctors, engineers and specialists working in medicine, science, research and technical fields.
Those in the fields of the arts, such as sculptors, musicians, painters, historians, writers and others, also have an essential part to play, if, in Sheikh Mohammed’s words, the UAE is to “remain a global incubator for exceptional talents”.
I hope also that the issue of the ability of expatriates to stay here after retirement will be addressed at a future date. Indeed, those benefiting from 10-year visas who invest in local property will eventually require some assurance that they are not obliged to sell up and depart once they retire.
Expatriates who have been in the workforce for years, perhaps decades, have experience of our economy and way of life that newcomers will take years to obtain. Even in retirement, such people can still contribute in many ways to development, even if they do not plough their savings into property or new businesses.
Those are among topics that can be tackled in the future – for it would be reasonable to expect that this is only one more step on the continuing process of change as the country evolves. The complexity and diversity of the issues being addressed will require that.
One key aspect of Sunday's announcement is the implicit recognition that those categories of expatriates now able to obtain 10-year residence visas are no longer viewed simply as "temporary" workers. That will fundamentally change their own views of their status here.
Many are likely to decide to invest here at least some of the savings they would have previously allocated to investment in their countries of origin. At a time when the property market is, at best, sluggish, that’s certainly something to be welcomed.
The decision that students will also be able to secure five-year visas, with 10 years for those deemed "exceptional", is also an excellent step. For years the UAE has suffered from a brain drain, not of its own citizens but of those who have been spent their childhood and have completed their education here, whether born in the UAE or not. Those unable to find jobs here, particularly young men, who after the age of maturity, can no longer be sponsored by their parents, leave to take up employment elsewhere. This new rule will encourage them to stay so that this country can benefit from the expertise and talent that it has nurtured.
As for the decision to allow 100 per cent foreign ownership of companies, that could prove beneficial in a variety of ways. The initial focus of discussion has been on the attracting of more foreign direct investment, into manufacturing, for example. There’s potential benefit too for the stock markets in Abu Dhabi and Dubai, where existing limits on the percentage of foreign ownership have discouraged foreign buyers. Listing of companies here, rather than on overseas stock markets, may become more attractive.
It would be naive, though, to assume that everything that arises from the changes will be beneficial to all concerned.
Current regulations on company ownership, for example, have helped to ensure that Emirati citizens can share in the wealth being created in the local economy. Once 100 per cent foreign ownership is allowed, what impact will that have on those who depend on their sponsorship of companies?
Many foreign firms might wish to break their agreements with existing Emirati partners. Moreover, can we expect new regulations to ensure that at least some of the profit was retained in the country rather than it all being remitted?
The residential property market is likely to experience a boost from the introduction of 10-year residence visas but there will be side-effects in terms of impact on the demographic structure of the country. The last national census, several years ago, suggested that 11.5 per cent of the country's inhabitants were UAE citizens. If that percentage declines further – and it might already have done so – how can the UAE's own heritage and culture be preserved?
Moreover, changes to residency rules might prompt increased long-term migration to the UAE of people of working age, not just from within the region but from further afield. That, in turn, raises issues related to the supply of housing and of school and university places for dependent children. To what extent should the continued development of the country's infrastructure cater to the needs of expatriates?
All these issues and more, all part of the complexity of the UAE’s unique social and economic structure, will have been taken into account by the government in the discussions leading up to the announcement. The changes represent a brave and welcome step that should be applauded.
Peter Hellyer is a consultant in the UAE's history and culture
The specs: 2018 Maxus T60
Price, base / as tested: Dh48,000
Engine: 2.4-litre four-cylinder
Power: 136hp @ 1,600rpm
Torque: 360Nm @ 1,600 rpm
Transmission: Five-speed manual
Fuel consumption, combined: 9.1L / 100km
Fixtures
%3Cp%3E%3Cstrong%3EWednesday%2C%20April%203%3C%2Fstrong%3E%3C%2Fp%3E%0A%3Cp%3EArsenal%20v%20Luton%20Town%2C%2010.30pm%20(UAE)%3C%2Fp%3E%0A%3Cp%3EManchester%20City%20v%20Aston%20Villa%2C%2011.15pm%20(UAE)%3C%2Fp%3E%0A%3Cp%3E%3Cstrong%3EThursday%2C%20April%204%3C%2Fstrong%3E%3C%2Fp%3E%0A%3Cp%3ELiverpool%20v%20Sheffield%20United%2C%2010.30pm%20(UAE)%3C%2Fp%3E%0A
Killing of Qassem Suleimani
Mercer, the investment consulting arm of US services company Marsh & McLennan, expects its wealth division to at least double its assets under management (AUM) in the Middle East as wealth in the region continues to grow despite economic headwinds, a company official said.
Mercer Wealth, which globally has $160 billion in AUM, plans to boost its AUM in the region to $2-$3bn in the next 2-3 years from the present $1bn, said Yasir AbuShaban, a Dubai-based principal with Mercer Wealth.
“Within the next two to three years, we are looking at reaching $2 to $3 billion as a conservative estimate and we do see an opportunity to do so,” said Mr AbuShaban.
Mercer does not directly make investments, but allocates clients’ money they have discretion to, to professional asset managers. They also provide advice to clients.
“We have buying power. We can negotiate on their (client’s) behalf with asset managers to provide them lower fees than they otherwise would have to get on their own,” he added.
Mercer Wealth’s clients include sovereign wealth funds, family offices, and insurance companies among others.
From its office in Dubai, Mercer also looks after Africa, India and Turkey, where they also see opportunity for growth.
Wealth creation in Middle East and Africa (MEA) grew 8.5 per cent to $8.1 trillion last year from $7.5tn in 2015, higher than last year’s global average of 6 per cent and the second-highest growth in a region after Asia-Pacific which grew 9.9 per cent, according to consultancy Boston Consulting Group (BCG). In the region, where wealth grew just 1.9 per cent in 2015 compared with 2014, a pickup in oil prices has helped in wealth generation.
BCG is forecasting MEA wealth will rise to $12tn by 2021, growing at an annual average of 8 per cent.
Drivers of wealth generation in the region will be split evenly between new wealth creation and growth of performance of existing assets, according to BCG.
Another general trend in the region is clients’ looking for a comprehensive approach to investing, according to Mr AbuShaban.
“Institutional investors or some of the families are seeing a slowdown in the available capital they have to invest and in that sense they are looking at optimizing the way they manage their portfolios and making sure they are not investing haphazardly and different parts of their investment are working together,” said Mr AbuShaban.
Some clients also have a higher appetite for risk, given the low interest-rate environment that does not provide enough yield for some institutional investors. These clients are keen to invest in illiquid assets, such as private equity and infrastructure.
“What we have seen is a desire for higher returns in what has been a low-return environment specifically in various fixed income or bonds,” he said.
“In this environment, we have seen a de facto increase in the risk that clients are taking in things like illiquid investments, private equity investments, infrastructure and private debt, those kind of investments were higher illiquidity results in incrementally higher returns.”
The Abu Dhabi Investment Authority, one of the largest sovereign wealth funds, said in its 2016 report that has gradually increased its exposure in direct private equity and private credit transactions, mainly in Asian markets and especially in China and India. The authority’s private equity department focused on structured equities owing to “their defensive characteristics.”
The National's picks
4.35pm: Tilal Al Khalediah
5.10pm: Continous
5.45pm: Raging Torrent
6.20pm: West Acre
7pm: Flood Zone
7.40pm: Straight No Chaser
8.15pm: Romantic Warrior
8.50pm: Calandogan
9.30pm: Forever Young
Where to donate in the UAE
The Emirates Charity Portal
You can donate to several registered charities through a “donation catalogue”. The use of the donation is quite specific, such as buying a fan for a poor family in Niger for Dh130.
The General Authority of Islamic Affairs & Endowments
The site has an e-donation service accepting debit card, credit card or e-Dirham, an electronic payment tool developed by the Ministry of Finance and First Abu Dhabi Bank.
Al Noor Special Needs Centre
You can donate online or order Smiles n’ Stuff products handcrafted by Al Noor students. The centre publishes a wish list of extras needed, starting at Dh500.
Beit Al Khair Society
Beit Al Khair Society has the motto “From – and to – the UAE,” with donations going towards the neediest in the country. Its website has a list of physical donation sites, but people can also contribute money by SMS, bank transfer and through the hotline 800-22554.
Dar Al Ber Society
Dar Al Ber Society, which has charity projects in 39 countries, accept cash payments, money transfers or SMS donations. Its donation hotline is 800-79.
Dubai Cares
Dubai Cares provides several options for individuals and companies to donate, including online, through banks, at retail outlets, via phone and by purchasing Dubai Cares branded merchandise. It is currently running a campaign called Bookings 2030, which allows people to help change the future of six underprivileged children and young people.
Emirates Airline Foundation
Those who travel on Emirates have undoubtedly seen the little donation envelopes in the seat pockets. But the foundation also accepts donations online and in the form of Skywards Miles. Donated miles are used to sponsor travel for doctors, surgeons, engineers and other professionals volunteering on humanitarian missions around the world.
Emirates Red Crescent
On the Emirates Red Crescent website you can choose between 35 different purposes for your donation, such as providing food for fasters, supporting debtors and contributing to a refugee women fund. It also has a list of bank accounts for each donation type.
Gulf for Good
Gulf for Good raises funds for partner charity projects through challenges, like climbing Kilimanjaro and cycling through Thailand. This year’s projects are in partnership with Street Child Nepal, Larchfield Kids, the Foundation for African Empowerment and SOS Children's Villages. Since 2001, the organisation has raised more than $3.5 million (Dh12.8m) in support of over 50 children’s charities.
Noor Dubai Foundation
Sheikh Mohammed bin Rashid Al Maktoum launched the Noor Dubai Foundation a decade ago with the aim of eliminating all forms of preventable blindness globally. You can donate Dh50 to support mobile eye camps by texting the word “Noor” to 4565 (Etisalat) or 4849 (du).
Quick%20facts
%3Cul%3E%0A%3Cli%3EStorstockholms%20Lokaltrafik%20(SL)%20offers%20free%20guided%20tours%20of%20art%20in%20the%20metro%20and%20at%20the%20stations%3C%2Fli%3E%0A%3Cli%3EThe%20tours%20are%20free%20of%20charge%3B%20all%20you%20need%20is%20a%20valid%20SL%20ticket%2C%20for%20which%20a%20single%20journey%20(valid%20for%2075%20minutes)%20costs%2039%20Swedish%20krone%20(%243.75)%3C%2Fli%3E%0A%3Cli%3ETravel%20cards%20for%20unlimited%20journeys%20are%20priced%20at%20165%20Swedish%20krone%20for%2024%20hours%3C%2Fli%3E%0A%3Cli%3EAvoid%20rush%20hour%20%E2%80%93%20between%209.30%20am%20and%204.30%20pm%20%E2%80%93%20to%20explore%20the%20artwork%20at%20leisure%3C%2Fli%3E%0A%3C%2Ful%3E%0A
The specs
Engine: 2.0-litre 4-cylinder turbo
Power: 240hp at 5,500rpm
Torque: 390Nm at 3,000rpm
Transmission: eight-speed auto
Price: from Dh122,745
On sale: now
Company%20Profile
%3Cp%3E%3Cstrong%3ECompany%20name%3A%3C%2Fstrong%3E%20Hoopla%3Cbr%3E%3Cstrong%3EDate%20started%3A%20%3C%2Fstrong%3EMarch%202023%3Cbr%3E%3Cstrong%3EFounder%3A%3C%2Fstrong%3E%20Jacqueline%20Perrottet%3Cbr%3E%3Cstrong%3EBased%3A%3C%2Fstrong%3E%20Dubai%3Cbr%3E%3Cstrong%3ENumber%20of%20staff%3A%3C%2Fstrong%3E%2010%3Cbr%3E%3Cstrong%3EInvestment%20stage%3A%20%3C%2Fstrong%3EPre-seed%3Cbr%3E%3Cstrong%3EInvestment%20required%3A%3C%2Fstrong%3E%20%24500%2C000%3C%2Fp%3E%0A
