UAE's legal reforms to boost its status as expat, investment destination
Move can incentivise 'greater business participation'
Dubai - View to the skyscrapers of the district Marina. Image used for illustrative purpose.
By Cleofe Maceda , ZAWYA
The new legal reforms announced by the UAE will strengthen the country’s position as an attractive destination for investors and expatriates, analysts have said.
The amendments announced by the UAE government on Saturday include matters relating to divorce, succession, cohabitation of unmarried couples and alcohol consumption. The changes follow a historic peace accord signed between the UAE and Israel to normalise relations.
“2020 has been a transformative year for UAE that recently signed [the peace deal with Israel]. The new societal laws that enhance personal freedom could help attract foreign talent and further incentivise western businesses to set their destination in UAE, resulting in great investment flows into the country,” said Raghu Mandagolathur, executive vice president of Kuwait Financial Centre (Markaz).
He noted that the financial fallout of COVID-19, coupled with lower oil prices, has “created havoc” to the economy in the UAE, which is largely driven by trade, travel and tourism.
Enhance social life
With the latest overhaul, Raghu said, the UAE would be able to stimulate the local economy and revive tourism arrivals after a COVID-19-induced slump.
“The recent overhaul of personal laws in UAE is a step in the right direction that aims to enhance the social life in the emirate. The changes are progressive in nature and are reflective of the evolving society in UAE, wherein there are eight expats for every Emirati,” Raghu told Zawya.
“Once the economy recovers and the business environment improves, the changing legal environment could accelerate people’s arrival,” he added.
He said the changes will not just increase tourist activity, it will also incentivise greater business participation, as the country prepares to host the World Expo next year.
“It could further enhance UAE’s stature as a vibrant, dynamic and progressive society,” he added.
Annelle Sheline, a Middle East research fellow at the Quincy Institute for Responsible Statecraft, said the changes effectively strengthen the UAE’s attractiveness to non-Muslims, particularly those with high disposable incomes.
“The UAE expands personal freedoms, reinforcing its appeal to wealthy non-Muslims as a place to vacation and live,” Sheline said on Twitter.
“This can happen without too much popular resistance because the population of citizens, especially in the main cities of Dubai and Abu Dhabi, is so small,” she added.
The UAE is home to 9.6 million people from more than 200 nationalities as of 2018, with Emiratis constituting roughly 20 percent of the total population.
The country has consistently been ranked as one of the top destinations for the wealthy, attracting an estimated 25,000 high-net-worth individuals (HNWIs) over the past two decades from countries like India and the neighbouring states in the Middle East and Africa, according to New World Wealth.
Analysts have recently predicted that the expatriate population could decline this year due to the anticipated hundreds of thousands of job losses across industries.
(Reporting by Cleofe Maceda; editing by Seban Scaria)
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