Abu Dhabi details measures to shore up economy amid global coronavirus impact
17 Mar 2020
Abu Dhabi detailed a plan to stimulate economic growth through strategic investments and 16 initiatives to support the private sector, as the global economy faces challenges from the coronavirus outbreak.
It will ease investment laws and regulations, proceed with approved capital expenditure and development projects and review lending options for local businesses, Sheikh Mohamed bin Zayed, Crown Prince of Abu Dhabi, said on Monday.
"We are confident in the resilience of our national economy and its ability to navigate market fluctuations," Sheikh Mohamed, also Deputy Supreme Commander of the UAE Armed Forces, wrote on Twitter.
The latest measures follow the UAE Central Bank's introduction of a Dh100 billion stimulus package on Saturday and Dubai announcing a Dh1.5bn plan last week to offset the economic effects of Covid-19.
The UAE on Sunday reported 12 new cases, taking its total to 98.
The outbreak is the biggest challenge to the global economy since the 2008 financial crisis.
It has disrupted global supply chains, tourism, aviation, and wiped at least $17 trillion from stock markets worldwide, as plunging oil prices added to the pressure.
Sheikh Mohamed issued directives to continue with all approved capital expenditure and development projects in the UAE capital and to "take further measures to preserve Abu Dhabi’s economic gains, prioritising start-ups and SMEs".
The emirate will form a committee led by the Department of Finance, with members from the Department of Economic Development and local banks, to review lending options.
The capital will continue developing and easing investment laws and regulations, making them "more flexible to maintain our economic development", Sheikh Mohamed said.
Abu Dhabi on Monday also launched initiatives to help the emirate "adapt swiftly to both current and future challenges", the government media office said on Twitter.
The 16 initiatives are focused on supporting small and medium enterprises, cutting business fees and reducing living costs.
The emirate will allocate Dh3bn to the SME credit guarantee scheme managed by Abu Dhabi Investment Office to stimulate financing by local banks.
This will “enhance SMEs' ability to navigate the current market environment", the media office said.
The government will also assign Dh1bn to establish a fund to “enhance liquidity and sustain balance between supply and demand for stocks", it said.
Another Dh5bn will be channelled towards subsidising water and electricity for citizens, and commercial and industrial activities.
Authorities in Dubai and Abu Dhabi are introducing remote working schemes, focusing on groups of workers viewed as being particularly at risk of infection, among other preventive measures.
Abu Dhabi also suspended or reduced fees to ease the cost of doing business for the tourism, property and industrial sectors.
It offered a 20 per cent rebate on rental values for restaurants and the tourism and entertainment sectors.
Tourism and municipality fees for tourism and entertainment sectors this year were suspended.
Abu Dhabi earlier announced it closed all cinemas, beaches, parks and nightclubs, as well as major attractions such as the Louvre and Ferrari World to contain the spread of the virus.
The UAE, a regional tourism and transit centre, said it would also “temporarily suspend” issuing most visas into the country.
Dubai authorities said those with diplomatic passports and people eligible for visa-on-arrival would be exempt.
The Central Bank said it would continue to monitor the situation and was prepared to take further steps if necessary, while affirming commitment to maintain the dirham peg to the US dollar.
The state directives are to:
Allocate Dh5bn to subsidise water and electricity for citizens, and commercial and industrial activities.
Subsidise electricity connection fees for start-ups until the end of 2020.
Exempt all commercial and industrial activities from Tawtheeq fees for 2020.
Allocate Dh3bn to the SME credit guarantee scheme managed by the Abu Dhabi Investment Office to "stimulate financing by local banks and enhance SME’s ability to navigate the current market environment".
Provide Dh1bn to establish a market maker fund, to enhance liquidity and sustain balance between supply and demand for stocks.
Settle all approved government payables and invoices within 15 working days.
Suspend bid bonds and exempt start-ups from performance guarantees for projects up to Dh50 million.
Reduce industrial land leasing fees by 25 per cent on new contracts.
Suspend real estate registration fees for 2020.
Waive current commercial and industrial penalties.
Exempt commercial vehicles from annual registration fees to the end of 2020.
Exempt all vehicles from traffic tariffs and road tolls to the end of 2020.
Suspend tourism and municipality fees for tourism and entertainment sectors for this year.
Offer up to 20% rebate on rental values for the restaurants and tourism and entertainment sectors.
Establish a new committee led by the Department of Finance, with members from the Department of Economic Development and local banks to review lending options to support local companies.
Source: The National