UAE Visa Reforms to Boost Economy & Attract Foreign Direct Investment
The UAE government has been proactive in promoting the country as a global business hub. Several major initiatives have been taken by UAE in order to enhance ease of doing business, boost investment confidence and stimulate business growth. In addition to the 10-years visa plan and 100 per cent ownership for foreign companies, new visa reforms to radically reduce the cost of employee visa have been implemented allowing private sector companies to recover an estimated Dh 14 billion ($3.8 billion). The initiatives allow them to improve cash flow and further invest in their business.
In a recent move, the UAE cabinet chaired by H.H. Sheikh Mohammed, Vice President and Prime Minister of UAE and the Ruler of Dubai, approved new strategic reforms to enhance UAE’s economic competitiveness by facilitating the private sector (new visa rules & insurance schemes) in the country. The new visa rules also aimed at making UAE and Dubai leading tourism destination among the transit tourists. The cabinet approved eight new strategies to enhance the competitiveness of the country.
UAE Government – Economic Competitiveness Initiatives 2018
- A new system to replace the bank guarantees required for private sector employee visa
- Releasing the current employee bank guarantees to the private sectors (Est. Dh 14 billion ($3.8 billion))
- Implementing new insurance policy
- Temporary visas for jobseekers for 6 months without the visa fees
- Entry free visa for transit tourists (48 hours) to boost tourism
- Two years visa scheme for outstanding and talented students
- Visa adjustment for individuals eliminating the need to exit and re-enter UAE
- Voluntary departure facilities for individuals that overstayed without imposing ban
Visa Reforms to Improve Cash Flow & Boost Economy
In a major move, the UAE government will replace the current employee bank-guarantee paid by the private sector employers (Dh 3,000 ($817)) to a comprehensive employee insurance scheme at Dh 60 ($16) on annual basis (covering work injuries and end of service benefits etc.). Through the initiative, businesses will recover an estimated Dh 14 billion ($3.8 billion), which will reduce the burden on private sector employers to manage capital requirements hence enabling them to improve cash flow and further invest in their business.
Visa Reforms to Boost Tourism & Support Job Seekers
One of the significant improvements in visa rules is the decision to exempt transit passengers from all entry fees for the first 48 hours. Additionally, a transit visa can be extended for up to 96 hours for a fee of Dh 50. The new changes are likely to boost tourism activities in the country with as many as 70 per cent of the total passengers passing through UAE airport are transit passengers. The passenger traffic at Dubai Airport reached 7.6 million in April 2018 with traffic from Eastern European, CIS and African countries showing growth while India, Saudi Arabia and UK being the top performers.
A new six-month visa will be introduced for job seekers who overstayed their visa, but wish to work in UAE. Facilities to voluntarily leave the country for people (without ban) who are overstaying will also be introduced. Likewise, several major reforms have been proposed in UAE, which includes number of visa facilitation for visitors, residents, families and individuals overstaying in UAE.
New Visa Rule to Foster Investment Environment in UAE
As one of the most diversified and developed economy in the region, UAE will continue to hold prominent placement amongst international investors. UAE’s incredible positioning amongst global investors also results from its political stability, higher transparency, nearly non-existent crime rates and a very cosmopolitan society, where nationals from over 200 countries reside in the country.
UAE will continue to remain an attractive investment destination because of its diversified and innovation driven economy. In 2017-18 Global Competitiveness Report published by World Economic Forum, UAE topped the Arab World and ranked 17th globally in the global competitiveness ranking. By the year 2025, UAE is expected to attract more than Dh257 billion ($70 billion) investments.
The new visa and insurance reforms along with the 10-years visa plan and 100 per cent ownership for foreign companies, is likely to make UAE more competitive and flexible, re-instate confidence of the private sector and stimulate business growth in the country. It will also attract more jobs and foreign direct investment in the country.
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