Abu Dhabi fast-tracks Ghadan 21, UAE cuts rates
ABU DHABI 17 March 2020: Abu Dhabi Executive Council yesterday waived all traffic tariffs at toll gates in Abu Dhabi for all vehicles.
It is part of a dynamic economic stimulus package that fast-tracks the implementation of key Ghadan 21 economic initiatives to support economic activity, reduce the costs of living, and facilitate business in the emirate.
The measures include an allocation of Dh5 billion for water and electricity subsidies for citizens and the commercial and industrial sectors, intended to reduce the cost of living and support businesses, as well as subsidising electricity connection fees for startups until the end of the year.
For SMEs, an additional Dh3 billion has been allocated to the SME Credit Guarantee Scheme managed by Abu Dhabi Investment Office to stimulate the ability of SMEs to navigate the current market environment. As for the financial markets, the Executive Council has allocated Dh1 billion to establish a market maker fund, to enhance liquidity and sustain balance between supply and demand for stocks.
Other initiatives announced include exemption of all commercial and industrial activities from Tawtheeq fees, as well as exempting individual and commercial real estate registration fees for this year, suspension of bid bonds, and exempting startups of performance guarantees for projects up to Dh50 million.
20% Rebate
There will be no annual vehicle registration fees for commercial vehicles. In addition, up to 20% rebate will be offered on rental value for the restaurant, tourism and entertainment sectors, and tourism and municipality fees for the tourism and entertainment sectors will be suspended for this year.
The initiatives additionally include settling all approved government payables and invoices within 15 working days, waiving all current commercial and industrial penalties, and reducing industrial land leasing fees by 25 percent for new contracts.
The newly launched stimulus package in Abu Dhabi and those launched recently by the UAE Central Bank and local governments provide a solid foundation to accelerate and advance the economy, as well as protect the UAE’s economic stability, said His Highness Sheikh Mohamed bin Zayed Al Nahyan, Crown Prince of Abu Dhabi, Deputy Supreme Commander of the UAE Armed Forces, and Chairman of the Abu Dhabi Executive Council.
Sheikh Mohamed gave directives to continue with all approved capital expenditure and development projects in the Emirate, as well as further measures to preserve Abu Dhabi’s economic gains, prioritising startups and SMEs, said Wam.
New Committee
Sheikh Mohamed also gave additional directives to formulate plans to stimulate strategic investment sectors, and to form a new committee headed by the Department of Finance, with members from the Department of Economic Development and local banks to review lending options to support local companies.
The new committee is tasked with reviewing lending options to support local companies. All measures and initiatives will take effect immediately.
Sheikh Mohamed affirmed that the authorities will continue developing investment laws and regulations and ensuring their flexibility to maintain Abu Dhabi’s progressive economic development. Sheikh Mohamed expressed his confidence in the resilience of the national economy and its ability to navigate market fluctuations.
Loans, mortgages likely to be cheaper by 0.75%
The Central Bank of the UAE (CBUAE) announced on Monday that it will cut interest rates, beginning 16th March, following US Federal Reserve cuts to contain the economic repercussions of coronavirus, Covid-19.
CBUAE, effective 16th March, has decided as follows:
- Cut the interest rate applicable to the 1-week Certificates of Deposit by 75 basis points, in line with the Federal Funds Target Rate – Upper Bound.
- Maintain the Repo Rate, applicable to borrowing short-term liquidity from CBUAE against CDs at 50 basis points above the 1-week CD rate.
- Reduce rates applicable to the Interim Margin Lending Facility, IMFL, and the Collateralised Murabaha Facility, CMF, by 50 basis points, to 50 basis points above the Repo Rate against CDs.
Certificates of Deposit, which CBUAE issues to banks operating in the country, are the monetary policy instrument through which changes in interest rates are transmitted to the UAE banking system.
GCC central banks, monetary agencies discuss coronavirus
The governors of central banks and monetary organisations of Gulf Cooperation Council (GCC) member countries yesterday held a meeting with Abdullatif bin Rashid Al Zayani, Secretary-General of the GCC, through video conferencing to discuss the economic effects of coronavirus, upon an invitation from Mubarak Rashed Al Mansoori, Governor of the Central Bank of the UAE.
The meeting was held in light of the role of these monetary institutions in maintaining financial stability, supporting the economies of their countries, protecting consumers and companies, and supporting the private sector during the current exceptional conditions.
During the meeting, participants were presented with the steps and measures taken by GCC member countries through their monetary organisations and central banks to reinforce trust in their economies, improve their business environments, support the private sector, and mitigate the financial and economic effects of coronavirus through funding support programmes for small and medium-sized enterprises, SME, instalment delay programmes, loan financing programmes and guarantee support programmes.
READ MORE AT CORONAVIRUS
ALSO READ:
