UAE Federal and local governments introduce new economic stimulus packages
The spread of the coronavirus has already created massive disruption around the world, as well as huge uncertainty going forward. In response to the COVID 19 outbreak, the Federal and local governments of the United Arab Emirates (UAE) have announced a number of new economic stimulus packages to assist businesses and individuals, which include:
Central Bank of the UAE (CBUAE) – AED100 billion comprehensive Economic Support Scheme for retail and corporate customers affected by COVID-19, including AED50 billion from Central Bank funds and AED50 billion of funds freed up from banks’ capital buffers. (https://www.centralbank.ae/en/node/2097)
UAE Federal Government – AED16 billion economic stimulus package that includes a number of renewable six-month suspension of work permit fees and reduction of labour and other charges, which are designed to cut the cost of doing business, support small businesses and accelerate major infrastructure projects. Banks have also come together to offer a comprehensive relief package to ease the financial pressure on customers in the current economic environment.
Emirate of Dubai – AED1.5 billion economic stimulus package for the next three months to support companies and the business sector in Dubai. This includes 15 initiatives focused on the commercial, retail, trade, tourism and energy sectors. (Source Khaleej Times)
- Commercial & Business Sector:
- Suspension of 2.5% market fees.
- Recovery of 20% custom fees on imported products sold locally.
- Cancellation of AED50,000 bank guarantee or cash requirement to undertake customs clearance activity.
- 90% reduction on fees imposed on submitting customs documents.
- Cancellation of requirement to provide a banking instrument when submitting customs-related grievances.
- Cancellation of 25% down payment for requesting instalment-based payment of government fees for licensing and renewing licences.
- Commercial licences can be renewed without mandatory renewal of lease contracts.
- Exemption from permits for new sales and offers.
- Water and electricity bills will be cut by 10% for all Dubai customers, including residential, commercial and industrial. Also a 50% reduction on deposits required for connections.
- Five major Dubai banks have rolled out major relief measures for both individual and corporate customers.
- Tourism Sector:
- 50% reduction on municipality fees imposed on sales at hotels from 7% to 3.5%;
- Exempting companies from fees charged for postponement and cancellation of tourism and sports events scheduled for year 2020.
Emirate of Abu Dhabi – Economic stimulus package including the continuation of all approved capital expenditure and development projects in Abu Dhabi and various other initiatives including AED5 billion in water and electricity subsidies, AE3 billion to an SME Credit Guarantee Scheme, AED1 billion to financial markets, exempting all commercial and industrial activities from property registration (Tawtheeq) fees, exemptions for property registration fees, and many other initiatives.(https://www.khaleejtimes.com/coronavirus-outbreak/covid-19-fees-reduced-cancelled-in-uae-under-new-stimulus-package)