Ministry of Economy and UAE economic department heads propose new initiatives to further strengthen the economy

These proposals follow a series of meetings organised by the Ministry of Economy with local department heads. Several committees were formed to monitor the performance of markets all over the UAE, which recommended several solutions and suggestions.

The meeting called for the setting up of a Common Emergency Committee to deal with the global economic crisis, and provide recommendations to the Cabinet. The participants discussed the suggested initiatives provided by the Minister of Economy and various government departments and the different Chambers of Commerce & Industry in the UAE to tackle the unprecedented challenges.

Mr Al Mansouri told the participants that the strong economic integration of the Federal and local governments has helped minimize the impact of the current global financial crisis on the UAE's various economic sectors.

"The joint efforts with the local entities help in reducing the impact of the global crisis on the UAE markets, we are committed to addressing the economic challenges and in formulating appropriate solutions. The Ministry has set up a special team to study the suggestions by our committees, which will send its report to the Cabinet for approval and implementation."

said Mr Al Mansouri.

The participants said the global financial crisis demands urgent involvement of the UAE Central Bank in outlining effective monetary policies. They discussed the need for new mechanisms to facilitate bank deposits that will encourage business growth, and proposed the reduction of interest rates, and initiating varied lending rates for different economic sectors. The participants said that though the UAE is committed to a free market policy, the government must intervene, where needed.

The meeting recommended the formation of a supreme committee involving the Ministry of Economy, various economic departments, municipalities and the public- and private sectors. This committee is also mandated to look into the status of functioning of the real estate sector and tackle potential issues. Each Emirate was urged to adopt effective strategies and policies to meet the challenges faced by the real estate sector and also amend banking policies related to interest rates and lending norms.

The participants called for the need to provide loans for strategic projects, regulate leasing prices, reduce fees of entry visas and sponsorship transfer, and provide commercial warehouses at lower costs. They said the industrial sector must be provided with easier access to credit for their sustained growth.

They suggested releasing the cash of private sector companies held as bank guarantees by the Ministry of Labour, and to cancel the A, B, C classifications followed by the Ministry for construction companies and putting all of them as A class in 2009 and 2010.

The economic department heads said it was extremely important to enhance the competitiveness of the economy globally. They said the local and federal governments and the private sector must join hands to identify new opportunities and face the challenges. They called on the need to have stronger transparency norms and urged businesses to provide accurate information to the investors to help them make informed decisions.

The functioning of the media was also discussed, and the participants said that the media must highlight the positive aspects of the economy too, and not delves only on negative stories.

Mr Al Mansouri said the Ministry of Economy will send the recommendations by the various department heads to the Cabinet for approval, after which they will be implemented in co-ordination with the local departments.

Participants in the meeting included: His Excellency Mohammed Ahmed Bin Abdul Aziz Al Shihhi, Director General at the Ministry of Economy; H.E Hamid Bin Butti, Executive Director of the Commercial Affairs Sector at the Ministry; H.E. Sami Al Qumzi, Director General of the Department of Economic Development in Dubai; H.E Ali Bin Salem Al Mahmoud, Director General of the Sharjah Economic Department; H.E Mohammed Bin Majed, Director General of the Fujairah Industry and Economy Department; H.E. Isa Mosbeh Director General of the Economic Department of Um Al Quain; H.E Dr Hasan Hamdan Al Alkim, Director General of the Department of Economic Development in Ras Al Khaima; H.E Rashed Al Zaabi, Director of Economic Planning, Department of Planning and Economy in Abu Dhabi; and H.E Aayesh Jawdat Al Barghouthi, Director of Financial affairs and Administration in the Economy Department of Ajman.