Etihad Credit Insurance (ECI) reaffirmed its commitment to support exporters in the country as economies gradually reopen in the wake of the Covid-19 pandemic.
The agency said in a statement on Wednesday that it would support companies even as private insurers become more risk averse "due to an environment that is characterised by weak demand, vulnerable supply chain, tight credit, and a weakened capacity to pay".
ECI, set up in 2018, provides guarantees and insurance solutions to mitigate the political and commercial risks of exporting by offering financing or refinancing for export transactions on behalf of the UAE government.
Global trade has been heavily affected by the restrictions put in place to stop the spread of Covid-19. In April, the World Trade Organisation forecast that global trade would fall between 13 per cent and 32 per cent in 2020, with all regions facing double-digit declines.
ECI said it recently helped a UAE manufacturer recover payments from a leading US firm that had filed for bankruptcy.
“Fortunately, the business transactions were already insured by ECI, otherwise collecting payments would have been extremely difficult due to the complexity of the bankruptcy procedures and the intricacies of the local laws and regulations in a foreign jurisdiction.”
It also supported a UAE-based SME to expand to more markets through a trade credit insurance policy.
“ECI plays a significant role in restoring confidence in the market by protecting companies from commercial and political risks, and increase their access to finance, new suppliers and frontier markets,” Massimo Falcioni, chief executive of the company said.
“As UAE economic sectors restart and borders reopen, more focus will be put on cash flow by both the buyers and sellers. Buyers will prefer to deal with sellers who can provide more liberal payment terms. Sellers, on the other hand, will also focus on their balance sheets and protect their main assets — their cash receivables.”
Last month, Etihad Credit Insurance and Abu Dhabi Exports Office (Adex) partnered to offer a full range of financial products to help UAE companies to boost exports and ease financing challenges amid Covid-19.
Adex has set aside Dh550m to help firms restart exporting, and both the entities will offer a full range of credit facilities including direct financing, guarantees and export credit insurance to businesses as part of the new partnership.
The UAE has taken various steps to help local companies as they adjust to a global economy that is gradually readying for business following a period of lockdown.
Abu Dhabi last month rolled out a digital platform to boost exports from the emirate to 60 target markets worldwide in an effort to expand its foreign trade.
The new digital platform, Abu Dhabi Export Gateway, will “offer an integrated approach” to export at least 100 local products from 10 different sectors, the Abu Dhabi Department of Economic Development said.
Company profile
Name: Back to Games and Boardgame Space
Started: Back to Games (2015); Boardgame Space (Mark Azzam became co-founder in 2017)
Founder: Back to Games (Mr Azzam); Boardgame Space (Mr Azzam and Feras Al Bastaki)
Based: Dubai and Abu Dhabi
Industry: Back to Games (retail); Boardgame Space (wholesale and distribution)
Funding: Back to Games: self-funded by Mr Azzam with Dh1.3 million; Mr Azzam invested Dh250,000 in Boardgame Space
Growth: Back to Games: from 300 products in 2015 to 7,000 in 2019; Boardgame Space: from 34 games in 2017 to 3,500 in 2019
UAE - India ties
The UAE is India’s third-largest trade partner after the US and China
Annual bilateral trade between India and the UAE has crossed US$ 60 billion
The UAE is the fourth-largest exporter of crude oil for India
Indians comprise the largest community with 3.3 million residents in the UAE
Indian Prime Minister Narendra Modi first visited the UAE in August 2015
His visit on August 23-24 will be the third in four years
Sheikh Mohamed bin Zayed, Crown Prince of Abu Dhabi and Deputy Supreme Commander of the Armed Forces, visited India in February 2016
Sheikh Mohamed was the chief guest at India’s Republic Day celebrations in January 2017
Modi will visit Bahrain on August 24-25
Ten tax points to be aware of in 2026
1. Domestic VAT refund amendments: request your refund within five years
If a business does not apply for the refund on time, they lose their credit.
2. E-invoicing in the UAE
Businesses should continue preparing for the implementation of e-invoicing in the UAE, with 2026 a preparation and transition period ahead of phased mandatory adoption.
3. More tax audits
Tax authorities are increasingly using data already available across multiple filings to identify audit risks.
4. More beneficial VAT and excise tax penalty regime
Tax disputes are expected to become more frequent and more structured, with clearer administrative objection and appeal processes. The UAE has adopted a new penalty regime for VAT and excise disputes, which now mirrors the penalty regime for corporate tax.
5. Greater emphasis on statutory audit
There is a greater need for the accuracy of financial statements. The International Financial Reporting Standards standards need to be strictly adhered to and, as a result, the quality of the audits will need to increase.
6. Further transfer pricing enforcement
Transfer pricing enforcement, which refers to the practice of establishing prices for internal transactions between related entities, is expected to broaden in scope. The UAE will shortly open the possibility to negotiate advance pricing agreements, or essentially rulings for transfer pricing purposes.
7. Limited time periods for audits
Recent amendments also introduce a default five-year limitation period for tax audits and assessments, subject to specific statutory exceptions. While the standard audit and assessment period is five years, this may be extended to up to 15 years in cases involving fraud or tax evasion.
8. Pillar 2 implementation
Many multinational groups will begin to feel the practical effect of the Domestic Minimum Top-Up Tax (DMTT), the UAE's implementation of the OECD’s global minimum tax under Pillar 2. While the rules apply for financial years starting on or after January 1, 2025, it is 2026 that marks the transition to an operational phase.
9. Reduced compliance obligations for imported goods and services
Businesses that apply the reverse-charge mechanism for VAT purposes in the UAE may benefit from reduced compliance obligations.
10. Substance and CbC reporting focus
Tax authorities are expected to continue strengthening the enforcement of economic substance and Country-by-Country (CbC) reporting frameworks. In the UAE, these regimes are increasingly being used as risk-assessment tools, providing tax authorities with a comprehensive view of multinational groups’ global footprints and enabling them to assess whether profits are aligned with real economic activity.
Contributed by Thomas Vanhee and Hend Rashwan, Aurifer
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