UAE private sector hails proposed fund plans for expats

The government move to enhance the gratuity scheme of expats and introduce a retirement scheme for the country's foreign workforce has been welcomed by the corporate sector.

The planned scheme that aims to improve private sector saving and offer long-term financial security for expatriates will turn the UAE into a preferred global destination, said many employers.

"This is no doubt an amazing news," said Yusuffali MA, chairman and managing director of Lulu Group.

"Majority of expatriates working here have always considered UAE their second home, thanks to the excellent standards of living, harmonious culture and the tolerant society prevailing in this great country. And I am sure any initiative toward a retirement fund would further boost the UAE's image as one of the best countries to live and work in."

Yusuffali said the move would work as a catalyst to attract and retain global talents. "Great news for all sectors, I must say," he added.

Promoth Manghat, CEO of UAE Exchange, described the development as a 'progressive' move that will bolster the UAE's position as a preferred place to live in.

"The discussions initiated by the Federal Authority for Government Human Resources towards setting up investment funds to manage retirement and end-of-service benefits are a commendable one. It clearly expands opportunities for savings for the expatriate community and will spur a renewed focus on financial planning. The wider socio-economic impact of the programme, especially in terms of its ability to facilitate financial security for the lower economic strata, will be significant."

Manghat said the move would further enhance the UAE's standing as a "preferred destination for talent and for the expatriate workforce in the region".

Prasanth Manghat, CEO and executive director of NMC Health, said such investment funds are a global phenomenon, and the UAE has been at the forefront of fostering a conducive and fair ecosystem for investors, employers and employees alike.

"Majority of UAE residents depend on their end-of-service gratuity payment to fund their retirement, and the new system stands to help fund the retirement gap between the gratuity payment and an employee's retirement costs."