International companies would be allowed to hold 100 per cent ownership of businesses they establish in the UAE under proposed changes to legislation aimed at boosting foreign investment.

Currently, foreigners must have a UAE national as a sponsor and are limited to a maximum 49 per cent ownership of businesses in the Emirates, except in free zones scattered about the country.

The new industry law would open the door for hi-tech firms offering large capital investments to set up operations here as the Government seeks to expand its industrial base and create new jobs.

Sectors such as transportation, healthcare, education, and financial services will become more important components of the emirate’s GDP, DIFC governor tells Dubai Chamber event

The composition of Dubai’s economy will undergo a structural shift over the next few years toward sustainable long-term sectors such as transportation, healthcare, education, tourism and financial services, HE Dr Omar Bin Sulaiman, Governor of the Dubai International Financial Centre (DIFC), told members of the Dubai Chamber of Commerce & Industry on Thursday.

“This shift in the relative importance of various sectors of the economy is, in fact, a central component of the Dubai Strategic Plan 2015, but it’s happening more quickly than envisioned by the plan, largely due to the impact of the global crisis,” said Bin Sulaiman during the Dubai Chamber’s quarterly Business Breakfast, its second of 2009.

Dubai World Central (DWC) - the 140-square-kilometre aviation and logistics city in Jebel Ali - will open for business in June 2010, the government has reconfirmed.

"Our vision for Dubai is to be an unparalleled global commercial, trade and transportation hub with a unique integrated multi-modal logistics platform in DWC which will change all known air, land and sea transportation parameters," Shaikh Ahmad Bin Saeed Al Maktoum, chairman of Dubai Aviation City Corporation (DACC), who is also president of Dubai Civil Aviation Authority and chairman and chief executive of Emirates Airline and Group, said in a statement.

"Construction on all related infrastructure works is continuing with all our stakeholders recognising the fact that Dubai World Central is a committed Dubai government project; and once the global economic recession tides out its cycle, work towards its final master plan will resume at its original pace."

The Dubai government dismissed Nasser Al Shaikh as director general of the city-state's finance department, removing a key player from the recently assembled team shaping the emirate's response to the economic crisis.

The government gave no reason for the dismissal and representatives for the government weren't available to comment. Mr. Al Shaikh didn't answer calls seeking comment.

A statement Monday from the official Emirates News Agency said that by royal decree, Mr. Al Shaikh was succeeded by Abdul Rahman Saleh Al Saleh. Mr. Al Shaikh will assume a minor role, as assistant director in the office of foreign affairs in Dubai.

Dubai government is pushing for reforms to company law to allow 100 percent foreign ownership of businesses across the UAE to boost foreign investment and help weather the global financial crisis, a senior government official said in comments published on Monday.

Currently 100 percent foreign ownership is only allowed in designated areas, known as free zones. Outside these areas all companies must be at least 51 percent owned by a UAE national.

Abu Dhabi Municipality is planning to set up the Six Continents Fun City in the capital at a total cost of more than Dh550 million,

Engineer Abdul Aziz Al Jiraishi, Director of Parks Department at the municipality, told Khaleej Times that the mega project will span over an area of more than 350,000 square metres, and the municipality will select a suitable location for construction of the facility. The project will take one year to complete.

“The Fun City will house a pavilion designed in the shape of the UAE map, VIPs’ building,  city management offices as well as six indoor halls containing trade stores, food court and constructional and cultural landmarks denoting to the nature of every continent in the world.”

THE first glamorous residents have already made a home for themselves at “The World”, an archipelago of 300 artificial islands (pictured above) created off the coast of Dubai by Nakheel, one of the emirate’s big three developers. Pilot fish and parrot fish have colonised the man-made reef surrounding the islands. The reef, built from 34m tonnes of rock, forms a protective ring around the islands—a breakwater that stops the Gulf’s currents from slowly washing The World away.

To its many critics, Dubai’s economy is as artificial as Nakheel’s islands. The emirate borrowed capital and labour to make speculative bets on real estate, of which The World is only one outlandish example. Now policymakers are scrambling to build an economic breakwater that might protect the emirate’s prosperity from adverse tides: plunging property prices, ebbing trade and tourism, and the unaccustomed difficulty of refinancing its ambitions.

Dubai has launched a wide- ranging restructuring of its government-controlled companies. Those owned by the emirate's ruler will also be reorganised.

The restructuring is aimed at consolidating the sprawling empires that were instrumental in fuelling Dubai's debt-driven growth, and reducing costs at a time when the city-state's revenues from trade, tourism and finance, have been reduced.

Last month, Dubai turned to the United Arab Emirates for a $10bn (€7.5bn, £6.9bn) loan.

The consolidation will leave fewer government partners for the foreign investors that had been banking on Dubai as their regional launchpad for investment in the gulf.

Faced with a sudden economic slowdown, Dubai is trying to combat the fraud cases that surged during the past years of rapid economic growth in a bid to boost its status as a regional business hub.

But the clean-up drive has stirred controversy as several former executives of major firms, suspected of embezzling sums which total hundreds of millions of dollars, have been held for months without charge.

The economic boom of the past several years appears to be the main culprit.

"It was a boom market. Everybody gets greedy and you have corruption," economist Eckart Woertz of Dubai-based Gulf Research Centre told AFP. "You have the opportunity to cash in some bribes, and you do it."

The World Water Day event, due to be held on 27 March, 2009 at the public park in Abu Dhabi has been postponed to 10 April, 2009, due to bad weather forecast.

Dubai and adjoining emirates were lashed by heavy rain late Wednesday and Thursday morning.

The meteorology centre also reported heavy rain in Masafi and some areas of Sharjah.

The Abu Dhabi event is organised to commemorate World Water Day 2009 and to bring awareness to the increasing importance of conserving water.

Ebtisam Al Bedwawi has been named Dubai's first female judge.

"When I was sworn in before His Highness Shaikh Mohammad Bin Rashid Al Maktoum, Vice President and Prime Minister of the UAE and Ruler of Dubai, I felt very proud, especially since it has proved how much our wise leaders trust women and support their empowerment. I thank President His Highness Shaikh Khalifa Bin Zayed Al Nahyan and Shaikh Mohammad who have always empowered women."

"I feel honoured to be the first woman to be appointed as a judge in Dubai courts." Born in 1982, Ebtisam holds a masters degree in special law, which she earned at the Dubai Police Academy.

Funds from the Dubai government’s $10bn bond will target Dubai World, Dubai Holding and domestic firms in the emirate's sovereign wealth fund's portfolio, the emirate's finance department head said on Tuesday.

A five-man fiscal committee, headed by Emirates airline chairman Sheikh Ahmed bin Saaed Al Maktoum, was established a month ago to assess the companies' requirements and decide how the funds would be used, Nasser Al Shaikh said in an interview on Tuesday.

"We will not wait to support the companies, there are urgent requirements that need to be dealt with quickly," he said.

The economies of the six Gulf Cooperation Council (GCC) countries will reach an aggregate $2 trillion (Dh7.3 trillion) by 2020, according to a new report by the Economist Intelligence Unit (EIU).

Another point the report raises is that monetary union between five of the GCC members will most likely not meet the scheduled deadline of 2010, and only be in place by 2020. Oman has opted out of the monetary union, insisting on pursuing an independent monetary and economic policy.

The EIU's long-term forecasts predict that by 2020 a quarter of the world's oil supplies as well as an increasing proportion of petrochemicals, metals and plastics will be supplied by the GCC region, and investors and regional sovereign wealth funds will increasingly focus on the emerging economies of Asia and Africa.

More than 50,000 homes will be built for Emiratis over the next 20 years, the Abu Dhabi Urban Planning Council (UPC) said yesterday.

Tens of thousands of Emiratis have applied for government housing and the waiting list is up to five years long, so the announcement was warmly welcomed and heralds much needed relief to a housing crisis that has resulted in spectacular rent increases and forced many people to commute from cheaper areas, such as Buraimi in Oman, on the border with Al Ain.

About 30,000 houses will be constructed in Abu Dhabi and 20,000 in Al Ain at an initial cost of AED 25 billion (US$6.8 billion) in the first three years.

Companies are still flocking to Dubai despite difficult times, thanks to the emirate's advanced infrastructure and its status as a major financial centre, a board member of Dubai Financial Services Authority said yesterday.

"The Gulf economy is clearly strong and I am optimistic about it in the long term. Every economy at the moment is suffering major pressures. Dubai and the UAE no different from that. But I do think fundamentals here are good. Dubai is a major international business centre; infrastructure here is very strong. Companies are coming here even in difficult times," said Lord David Currie, DFSA Board Member.

The UAE and other Gulf oil producers suffered from a combined asset loss of nearly $350 billion (Dh1.2 trillion) as a result of the global financial distress but their financial position remains strong enough to respond to faltering revenues and other repercussions, a major Saudi bank said yesterday.

After nearly seven years of an economic and fiscal boom, the six Gulf Co-operation Council (GCC) countries now face a difficult period as oil prices tumble, their crude output dives by more than two million barrels per day and global credits become scarce, the Saudi American Bank (Samba) said in a study.

Given their heavy reliance on oil exports, the decline will likely turn years of fiscal surpluses into deficits in some members, while their economies will either plunge into a recession or sharply slow down this year, it said.

But the seven-year boom is not a bygone era as its positive impact will stretch into 2009 and beyond.

Inflation in the UAE is expected to ease to two-three per cent this year and 2010 would be a year of recovery for the Gulf, Asia and Africa regions while economies like the US, UK and Eurozone are likely to take much longer to recover, Standard Chartered bank said yesterday.

Deflation could be a possible risk but not necessarily a threat to the UAE's economy. While some banks are already lending, the estimated Dh110 billion liquidity gap needs to be filled for the banking sector to re-start lending, Standard Chartered said in an economic briefing in Dubai.

The region, with its strong fundamentals, would be quick to recover and at the same time should aim at a "good quality, sustainable" growth instead of a high growth. Unlike last year, which saw growth in credit zoom to almost 50 per cent for the UAE in June, a growth of 10-15 per cent is desirable in the present situation, the bank said.

Ras Al Khaimah Investment Authority (Rakia) has mandated Standard and Poor's for a credit rating in an effort to attract more investment into the emirate, a top government official said.

"We are going in for a credit rating and have appointed S&P for the purpose. The rating should not be viewed as our plans to tap the fund market, but is to show the world how safe Ras Al Khaimah is for investment. We expect to get the rating in the next three to four months," said Dr Khater Massad, Chief Executive Officer of Rakia.

Ruling out plans for overseas expansion for Rakia, he said: "It was a directive from emirate's top leadership to invest and develop the emirate. And we are now concentrating on development of RAK."

In late January, S&P assigned RAK its long-term foreign and local currency sovereign credit rating of 'A', while Fitch assigned its 'A' foreign and local currency sovereign credit rating to the emirate. Both the rating agencies maintained a stable outlook.

"Ras Al Khaimah's rating is supported by its relatively diverse economy, rapid economic development and high per capita income and the government's prudent fiscal policy and strong balance sheet," Richard Fox, Head of Middle East and Africa Sovereign Ratings at Fitch, had said.

According to Dr Massad, the investment authority has no plans to launch a sukuk, or Islamic bonds issue this year.

In December 2007, Rakia listed a $325 million (Dh1.19 billion) sukuk on the DIFX and the London Stock Exchange. The money was raised to fund its Al Marjan island project.

Dr Massad, who is also the advisor to Sheikh Saud bin Saqr Al Qasimi, Deputy Ruler and Crown Prince of Ras Al Khaimah, refused to comment on whether RAK was planning a sovereign bond issue.

In mid February, Dubai launched a $20bn bond programme as part of its long-term financing strategy. The first tranche, valued at $10bn, has been fully subscribed by the UAE Central Bank.

According to Fitch ratings agency, public sector debt at end-2006 was just seven per cent of gross domestic product (GDP), well below the 'A' median, with no external debt and limited foreign currency debt in Ras Al Khaimah.

However, debt rose to 20 per cent of GDP in 2007, largely due to a $325m sukuk issued by Rakia. Besides, RAK's liberal business model, supported by state-provided infrastructure, has attracted major foreign investment since 2003 in two free zones, which are home to about 4,000 companies.

A surge in its oil export income and other revenues boosted the UAE's fiscal surplus by a staggering 55 per cent in 2008 but the balance is expected to decline sharply this year, according to Western estimates.

From around Dh196 billion in 2007, the surplus in the country's consolidated finances jumped to a record Dh304bn in 2008, an increase of around 55.1 per cent, as per the figures by the Institute of International Finance (IIF). The surge was a result of a 41 per cent leap in the UAE's total revenues, which hit an all time high of Dh487bn last year compared to around Dh345bn in 2007, the Washington-based Institute said in a study.

The surplus increased despite a 22 per cent in expenditure to nearly Dh182bn in 2008 from around Dh149bn in 2007, the figures showed.

A surge in its oil export income and other revenues boosted the UAE's fiscal surplus by a staggering 55 per cent in 2008 but the balance is expected to decline sharply this year, according to Western estimates.

From around Dh196 billion in 2007, the surplus in the country's consolidated finances jumped to a record Dh304bn in 2008, an increase of around 55.1 per cent, as per the figures by the Institute of International Finance (IIF). The surge was a result of a 41 per cent leap in the UAE's total revenues, which hit an all time high of Dh487bn last year compared to around Dh345bn in 2007, the Washington-based Institute said in a study.

The surplus increased despite a 22 per cent in expenditure to nearly Dh182bn in 2008 from around Dh149bn in 2007, the figures showed.

Published reports have claimed that a group of property investors has presented Dubai’s Real Estate Regulatory Authority (RERA) with a petition urging the watchdog to clamp down on "fly-by-night developers" who were unable to deliver projects amid tightening liquidity and project financing, even though they've taken down payments from investors.  The petition allegedly came from the Dubai Property Investors Group, made up of more than 300 local and international investors, lawyers and real estate developers.

Official figures indicate that cancellations of residency visas in January 2008 rose 86% over January of 2007.  Dubai’s Ministry of Interior Naturalization & Residency (DNRD) released data showing that 54,684 residency visas were cancelled during the month of January, compared with 29,418 in January 2008.  This translates to approximately 1,764 per day, higher than the 1,500 cancellations reported in the media during the past three weeks.