The Department of Economic Development of Abu Dhabi is working to implement 7 out of 10 strategic initiatives as part of a strategy aimed at stimulating business in the emirate.
The strategy is created for 3 years and 50 billion dirhams are allocated for its implementation. It aims to support entrepreneurs, small and medium-sized enterprises and the private sector, to promotion their growth, attracting more foreign direct investment and creating jobs.
The experts were instructed within 90 days to develop a detailed plan for the implementation of the given strategy. The Department’s initiatives include allowing foreigners to set up car rental companies in conjunction with Emirates partners. Also the entrepreneurs will have opportunity to work from home when they receive the first license, and companies will be able to work both in and outside the free zones after issuing licenses.
The UAE is now working on a series of reforms aimed at stimulating economic growth, creating jobs, diversifying the economy and reducing its dependence on the oil sector. Innovations include the abolition of corporate fines in Dubai and Abu Dhabi, as well as allowing foreigners to own 100% of the company’s shares in certain sectors from the end of this year. There are initiatives aimed at simplifying the process of obtaining commercial licenses. Among them is the online portal Tamm, which was launched earlier this year and which allows investors from anywhere in the world to instantly obtain commercial licenses for managing any of 91% of all economic activities.
Those activities that were previously available only to UAE citizens will become available also to foreign citizens. This group of activities includes car rental companies. Now, to create such companies, UAE citizens can act as partners of citizens of other states. In addition, licenses will be issued that will allow resident companies operating in certain industries to simultaneously open branches outside the free zone. This will attract more direct foreign investment in Abu Dhabi. It is expected that this initiative will be implemented this year.
The stimulating measures in the framework of the Tajer Abu Dhabi program, previously directed only to the citizens of the Emirates, will soon be intended to support all entrepreneurs in the UAE, and will allow new companies to get commercial licenses for a period of 2 years without an office or physical presence. When obtaining the first license, entrepreneurs will be allowed to work from home. The Department is trying to create comfortable and attractive conditions for start-ups in early stages of development, entrepreneurs and companies with a home office in Abu Dhabi. At the same time, Tajer Abu Dhabi’s initiative is considered as a foundation for achieving this goal.
Other initiatives will be aimed at supporting the development of private business, as well as public-private partnerships, small and medium-sized enterprises. Among them is the creation of a platform for registering applications related to the debts of state enterprises, which will ensure faster payment.
In addition, the Department is working on legal and regulatory issues.
It is also planned to establish the Department for Public-Private Partnerships, the responsibilities of which will include an analysis of the possibilities for developing public-private partnerships in accordance with government instructions.
According to a study conducted by the Chamber of Commerce and Industry of Dubai, 65% of entrepreneurs answered that the main difficulty in creating companies for them is interaction with the banking sector, and the lack of financing is on the second place. As the Department’s management notes, they want to help more than 350,000 small and medium-sized enterprises in the UAE (more than 94% of the total number of companies operating in the country) in overcoming the obstacles to their growth. Such circumstances include lack of financing and limited market opportunities. Small and medium enterprises account for more than 60% of GDP, and the UAE seeks to increase their share to 70% by 2021.
Although it is not yet known whether this support will include financial assistance. The committee will analyze the amounts of payments that were not received by private enterprises. The information collected will remain confidential, nevertheless, it will allow the committee to understand the reasons for not making payments, and to make a number of changes in the payment process in the public sector to ensure payment to private providers in the future.