Abu Dhabi offers fine waiver for business licences not renewed before Covid

Emirate’s economy is expected to grow stronger this year amid diversification initiatives, official says

Abu Dhabi’s economy grew 3.1 per cent annually last year. Khushnum Bhandari / The National
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Abu Dhabi is waiving fines for businesses that failed to renew their commercial licences before the onset of the coronavirus pandemic, as it seeks to support businesses and attract more investments into the emirate.

The Abu Dhabi Department of Economic Development is cancelling fines, which begin at Dh200 per month and are capped at Dh4,000, for the non-renewal of licences, its undersecretary told The National on Tuesday.

The decision was taken after getting feedback from business owners in Abu Dhabi who requested to waive the fines, Rashed Al Blooshi said.

“The reasons why those owners could not renew is due to partnerships. Most of those licences are partnerships between two people, the counterpart or the partner could be out of the country for one reason or another and could not update the database. So we have left one partner who could not deal with the situation of renewing the licence,” he said.

“We have consulted the stakeholders and we have looked at the situation from the financial point of view, from the legal point of view, from the fairness point of view and as a result we came up with an initiative, which is waiving the Dh4,000 fine and resetting those licences.”

Licences can only be cancelled if requested by the company owners.

The measure will help companies “who were stuck with the old licence to activate and renew it, and this would help to make the environment for attracting the investments here in Abu Dhabi healthier”, Mr Al Blooshi said.

The move will encourage small and medium enterprises to expand and play a stronger role in Abu Dhabi’s gross domestic product growth, he said.

Unified economic licence

Last week, Abu Dhabi also launched a system to unify procedures for registering economic licences across the emirate and its free zones to improve the ease of doing business.

Added joined with the Abu Dhabi Free Zones Council, which includes Khalifa Economic Zones Abu Dhabi, Abu Dhabi Airports Free Zone, Masdar City Free Zone and Creative Media Authority, to roll out the initiative.

The new initiatives come as Abu Dhabi’s economy continues to grow amid its economic diversification plans.

Abu Dhabi’s economy grew 3.1 per cent annually last year, hitting its highest level in a decade, as a sharp expansion of the non-oil sector drove momentum.

The emirate's gross national product for the 12 months to the end of December reached Dh1.14 trillion, its best performance in terms of value in 10 years, while its non-oil economy expanded 9.1 per cent, driven by growth in construction, finance and insurance and transportation activities.

Mr Al Blooshi expects Abu Dhabi’s economy to continue the economic momentum this year amid new government initiatives and measures to attract new investment.

“If you look at the situation around us, if you look at the agreements that we are continually signing up, if you look Cepas [Comprehensive economic partnership agreements] for example, and if you look at the industrial sector, that we want to double the size of the industrial sector by 2031, that would definitely encourage the growth of the GDP,” Mr Al Blooshi, said.

In 2022, the emirate launched an industrial strategy to grow the contribution of the sector to the economy by investing Dh10 billion across six programmes to more than double the emirate’s manufacturing to Dh172 billion by 2031.

Industrial sector growth is “strong” in Abu Dhabi and its contribution to the emirate’s GDP reached Dh101 billion last year, he added.

“A lot of actions are taking place” around the development of the sector, Mr Al Blooshi said.

That includes a land incentive programme for manufacturers, where rents could be offered for as low as Dh5 per square metre for priority sectors including logistics, food, energy, heavy industry, health care, bio-pharmaceuticals and others.

Tech push

Mr Al Blooshi expects more investments in artificial intelligence amid initiatives to support the sector, Mr Al Blooshi said.

“AI requires strong communication, cloud and collection of the data and strong machines. If you look at those three elements, you'll see clearly that when it comes to the infrastructure of Abu Dhabi today, it is number one in terms of linking the fiber optic, which makes communication extremely efficient and fast,” he said.

Microsoft invested $1.5 billion in Abu Dhabi-based artificial intelligence and cloud company G42.

Companies are investing in Abu Dhabi because of the offerings and technology ecosystem including the presence of Hub71, clean energy company Masdar and Abu Dhabi Global Market, among others, he said.

Updated: June 11, 2024, 3:23 PM