UAE to amend companies' law to allow family businesses go public: Sheikha Lubna

Speaking at the opening session of the global investors' conference held in Ras Al Khaimah, she said, 'I am working on changing the companies' law in order to allow family business to go public by removing the forbidding conditions that the initial public offering
(IPO) should be at least 55 % of the total shares', she said.

'Family businesses would not go public if they are going to lose control, nor the public would want successful families to abandon their new corporate responsibilities. Once most of our leading companies become public corporations, they will be better run, better regulated and by far more accountable and transparent', she added.

She said that the Government was intent on a vast privatization campaign. 'Our view of privatization is not a mere divesture of public shares. No, it is a new revitalization and empowerment process aimed at the activation of the private sector role. Government alone cannot shoulder the proliferating infrastructure, utility and public services requirements'.

'The days when governments were investing, building, managing, supervising and subsidizing are gradually coming to an end. The government will create conducive environment, prepare the legal frame work and legislations, supervise and act as an arbiter. Privatization should be our vehicle towards more efficiency and effectiveness', she added.

Dr. Muhammad Khalfan bin Kharbash, UAE Minister of State for Finance, said that UAE had attracted $9bn in foreign direct investment last year. He pointed out that IMF estimates of FDI inflow to UAE stood at $10.3bn for 2005.

He said that the policy directions adopted by RAK for achieving its economic goals were on the right direction. 'The developmental strategy laid out by the emirate's leadership firmly rests on the fundamental principles of diversification and efficient private-public partnership'. He pointed out that the number of industrial units established in RAK in 2004 has increased by more than 100 units, attracting a capital of over Dhs 3 billion.

Sultan Nasser Al Suwaidi, Governor of Central Bank, in his presentation, said that efforts should be made to bring in more transparency in the financial sector. 'The implementation of international accounting standards, financial reporting standards and corporate governance standards are the need of the hour', he said.

Suwaidi pointed out that banks and financial institutions in the country would lend more if there is more transparency in the financial sector and if the legal issues are made less ambiguous.

Dr. Marcos G. Ghattas, Program Manager, World Bank's Technical Cooperation Programme, said that the objective of the conference was to present the summary of the study conducted by the World Bank on the investment environment in Ras Al Khaimah before the global investment community. 'The sectors presented in the conference- infrastructure, manufacturing, tourism and life- style property development- represent the immediate thrust of the Emirate's private investment strategy. But there are good opportunities for growth in other areas as well- from pharmaceuticals to agri business and finance', he pointed out.