With the impact of Covid-19 on a global scale, the UAE government has responded quickly with a raft of measures to help keep the economy stable.


Both Dubai and Abu Dhabi were proactive in their counter measures to the COVID-19 pandemic and, across March 2020, rolled out 15 short-term economic stimulus packages to help ease the pandemic’s adverse effects on the business community.

Aimed at simplifying procedures and reducing the cost of doing business in the UAE, the initiatives are due to complete a 3 month run before being reviewed in full.

Dubai

Significant highlights include:

  1. Ability to renew Dubai Economy licenses without the mandatory renewal of lease contracts
  2. Suspension of 2.5% market fees levied on Dubai Economy licences
  3. Suspension of payment of AED 50,000 bank guarantee or cash requirement in order to undertake customs clearance activities
  4. Refund of bank guarantees or cash requirement to be paid by existing custom clearance companies
  5. A 90% reduction of fees imposed on submission of customs documents

Abu Dhabi

Significant highlights include:

  1. Allocation of AED 3 billion to the SME credit guarantee scheme managed by the Abu Dhabi Investment Office to stimulate financing by local banks and enable SMEs to navigate the current market environment
  2. Allocation of AED 1 billion to establish a market maker fund, to enhance liquidity and sustain balance between supply and demand for stocks
  3. Exemption to all commercial and industrial activities from Tawtheeq fees until the end of this year
  4. Suspension of tourism and municipality fees for the tourism and entertainment sectors until the end of this year
  5. Allocation of AED 5 billion in water and electricity subsidies

With the short-term response already being well underway, the UAE government is already planning its longer-term approach. The most recent update as of 12 May 2020 is that the second phase of economic stimulus will encourage investment in sectors with high potential, such as the digital economy, the renewables industry and companies promoting food security.

CBD remains at the forefront of the latest Government intel in order to better serve and support its clients through the current economic crisis.

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