Abu Dhabi: The Cabinet is finalising the industry law that will allow 100 per cent foreign ownership in industries.
The Cabinet is also considering raising the foreign ownership ceiling from the current 49 per cent, a top official said.
Sultan Bin Saeed Al Mansouri, Minister of Economy, said the move is aimed at boosting foreign investment.
"The law to allow 100 per cent foreign investment is ready, but still under study and should be finalised within the next two months. We are especially looking into certain sectors such as hi-tech and hi-value," the minister told Gulf News during an inspection visit to the Abu Dhabi Co-operative Society to ensure prices are reduced on essential goods.
He did not, however, give any indication of the possible limit of foreigners' stakes in private companies. "Anything is possible," he said.
Even though the minister said sudden change can alter the agenda at the last moment, many foreign companies and investors are interested in moving to the UAE, which he said will help contribute to the UAE's gross domestic product (GDP).
"This is one of the Abu Dhabi government's visions, to encourage foreign investment, but most importantly we need to create the right environment and make sure everything is well planned and studied first," he said.
He said the government would like to increase the contribution of non-oil sectors which make up 64 per cent of the UAE's GDP, some of which include small- and medium-sized businesses and various industrial sectors.
Reda Musallam, a business analyst, said that introducing a 100 per cent foreign investment independent of an Emirati partner is a very important step for the UAE economy, and the beginning of a new era.
"Liquidity will increase for sure, which will help increase the UAE's GDP. This decision will benefit all the economic sectors in the country and will also promote business affairs with the outside world without obstacles," the expert told Gulf News.
The decision, he added, was not easy, because it involved the approval of all the concerned parties in the seven emirates.
"I hope this decision is applied by the end of the year, since it will benefit all of us," Musallam said.
The annual inflation rate in the UAE in 2009 will be around 3.5 to 4 per cent, down from 12.3 per cent last year, Al Mansouri said.
"[A figure of] 3.5 to 4 per cent - that is what we are expecting this year," Al Mansouri told reporters yesterday.
The minister said, this will not increase further.
This is very exciting. I am based in London and have been looking to open an office in the UAE for years. However, the thought of me having to give a large stake of my business away to a complete stranger has always put me off. But this will definitely invite a "corporate boom" just like it did a residential boom in the property market. Without a shadow of a doubt, this will lead to the UAE's prosperity.
Posted: September 14, 2009, 15:47