• Home
• /
• Local business

New Company Law to 
Go for Cabinet Nod

“It (the proposed law) is moving at a great speed through the various internal committees. We are left with only 100 articles (to be reviewed) out of a total 383 articles being processed. Hopefully, within a month we will finalise everything, and the draft law will be placed before the Cabinet for final ratification,” the minister told reporters on the sidelines of the “Abu Dhabi 
Outlook Summit.”

With substantial construction activities already underway in Abu Dhabi, investments through public-private partnership in infrastructure development, real estate and manufacturing sector are expected to reach $1 trillion in the medium term, the minister said. “Today Abu Dhabi is a hub for capital flow to and from the region. The emirate has projects worth over $100 billion currently underway. These are clear indications that Abu Dhabi defies the impact of global financial crisis and continues to thrive,” Al Mansouri said.

The present company law in the UAE allows foreigners 100 per cent company ownership only in the free zones. For companies outside the free zones, the current law stipulates a 51 per cent partnership for nationals with the investor eligible for only 49 per cent stake.

The long-awaited new law, which is in line with the framework suggested by the World Trade Organisation, or WTO, is expected to further boost the flow of foreign investments 
into the UAE.

“The UAE places no restrictions on the repatriation of capital, and we have sufficient liquidity to support sizeable global investments in addition to upholding highest standards in transparency,” the minister said.

The minister said the UAE economy was showing definite signs of recovery from a slowdown caused by the global recession. “Yes, definitely, I’m 100 per cent certain that the UAE economy is on the path of recovery from the slowdown. Every sector that we have looked at reinforces the view that the UAE economy has been able to demonstrate resilience in the wake of the global economic slowdown. Aviation sector in the UAE, for instance, has achieved ten per cent growth so far this year. Hotel and services sector are also doing well,” the minister said in reply to a question.

On the overall economic growth of the UAE, the Minister said, “My expectation is that the UAE’s gross domestic product, or GDP, at fixed rates is likely to grow at 1.3 per cent in 2009.”

Al Mansouri, however, declined to make a forecast on the country’s economic outlook in 2010. “It will depend on several factors like oil prices, imports, exports and performance of the global economy. Our economy is well integrated to the global economy.”

The minister said the UAE would be able to manage inflation at around 2.5 per cent to three per cent this year, down from his own earlier assessment that it could be around 3.5 per cent to four per cent this year. Currently, inflation hover around 2.6 per cent to 2.9 per cent. Last year, the UAE had a very high level of inflation of 12.3 per cent. “Next year we will be able to control inflation, unlike over the last few years,” he said.

· ramavarman@khaleejtimes.ae