New Visas and Ownership
As the UAE reforms laws on foreign ownership and visas by implementing new initiatives, the country is hoping to open its doors to a new era of business. Late last month, during a cabinet meeting chaired by His Highness Sheikh Mohammad bin Rashid Al Maktoum, Vice-President and Prime Minister of the UAE and Ruler of Dubai, they made an announcement introducing new visa initiatives intended to reinforce the UAE’s position as a top destination for global talent and international investors.
The new law is intended to make it easier for foreign investors to open up new businesses outside of free zones while still maintaining 100 percent ownership under the now available 10-year residency visas granted for investors and specialists in fields such as academics, engineering, and technology.
Along with new visas for foreign investors, there are also 5-year visas available for foreign students who wish to study in the UAE.
This new visa initiative is being seen as important in that it opens up doors for and provides opportunities towards attracting the right level of skills to the country, especially in start-up communities and scientific research.
The Scope of the Visa Initiative
- When will the measures come into effect?
Sheikh Mohammad directed the Ministry of Economy to implement the new visa initiatives and follow up on its developments, in coordination with all relevant stakeholders. In addition, he has asked for a detailed report to be submitted in the third quarter of 2018, so as to ensure effective implementation.
- Why did the UAE decide on these new measures?
The new visa law and initiative works towards promoting the current government leadership’s priorities in attracting international investments as well as a more diverse talent pool which, they hope, will build a rock-solid foundation for a stronger economy. Overall, the new policies and their long-term implications are intended to distinguish the UAE’s economic competitiveness in a globally competitive atmosphere.
- How will the visa initiatives help the UAE?
According to Sheikh Mohammad, the UAE “will remain a global incubator for exceptional talents and a permanent destination for international investors. Our open environment, tolerant values, infrastructure, and flexible legislation are the best plan to attract global investment and exceptional talents to the UAE”.
According to the government, not only will the new law transform the quality of the workforce, but it will also ensure economic and social stability.
Effects of the Visa Initiative to the UAE Economy
The passing of this new visa initiative has been greeted with optimism. In fact, some say that it is truly a ‘game changer’ and has the potential to add to the continuity of the UAE economy. More specifically, it is seen as working towards attracting more foreign direct investment and boosting the innovation and talent pool within the country.
1. Attracting of Foreign Direct Investment
According to PNC Menon, the Sobha Group chairman, the cabinet’s decision to allow for full business ownership by foreign investors and the granting of long-term visas will prove to be a revolutionary move that will significantly add to a much larger inflow of capital.
Experts believe the greatest value of the rule changes is that more and more investors will be tapping into UAE industries. The move to include and welcome foreign investors sends the message that the UAE is open to working with international investors and wants to create a conducive hub for business growth. It is seen to boost the country’s profile as a preferred investment destination.
Thanks to the new laws, the new environment will attract more foreign direct investment which will positively impact the local business environment, and ultimately, enhance the country’s economic competitiveness.
While the necessary qualifications and experience specifications have not been clarified, the new initiative will most likely help in the acquisition of new investors, better resources, and will assist in the talent recruitment process.
Since this new law gives individuals the power to own their ideas, it paves the way to acquire more than an investor’s capital. Protecting and nurturing those ideas should lead to a boost in innovation within the country.
Start-ups and global businesses alike will also be drawn to the UAE because of its proactive stance towards developing an investor’s capital and ideas. The UAE federal government wants to be proactive in assisting businesses to stay and grow locally, regionally and internationally. With this law, the UAE is no longer going to be just a regional hub. Instead, it will now have the potential to be an active participant in the global economy by nurturing ideas and innovation, and by respecting people’s desire to control their own fate.
3. Increased Talent Pool
The changes in rules on student visas are also seen as very helpful in that it shows the government is willing to be proactive while working towards the advantage of its residents, regardless of their nationality. The visa initiative will help attract students by creating a conducive environment for them to find jobs after graduation.
The longevity of residency and the mere fact that the new laws allow individuals to own their ideas will get students committed to the UAE which will consequently increase attraction and retention in the country’s talent pool which would, in turn, be good for its economic development.
All in all, the new visa initiative creates a sense of inclusivity between the UAE and foreign investors and students. It makes the UAE a conducive environment to work and grow that is very appealing to outsiders.
What’s better is that it benefits both investors and the UAE. Thanks to the law, investors will be able to tap into the UAE market and the UAE will get to reap the benefits of a stable and growing economy. The move into this era is being seen as a ‘win-win’ situation for nurturing growth.