ABU DHABI // Almost half of the country’s expatriate workforce will be made up of skilled workers by 2021 under new regulations announced at a meeting of the Federal National Council on Tuesday.
Ministers were also told about new rules making it compulsory for overseas workers to present a good-conduct certificate from their home countries before they can work in the Emirates.
Saqr Ghobash, Minister of Human Resources and Emiratisation, told the council the ministry was working to boost the number of highly skilled workers, such as those who hold a diploma or above, to 40 per cent of the workforce.
The ministry is also working on ways to increase production by the UAE’s non-oil sectors by 5 per cent a year.
“This is not possible if the workers’ skills are not elevated,” Mr Ghobash said. “This is a challenge that shows to what extent the government is keen on shifting towards a competitive, knowledge-driven economy.”
The minister gave the example of the construction industry where the Smart Building System, which was launched last October, is regulating the number of limited-skill workers in the sector with the aim of reducing their number by 30 per cent.
“Municipalities from all over the country have been involved in this,” he said.
Training centres around the UAE and abroad, in particular in countries such as India and Pakistan, will ensure the majority of the expat workforce are skilled and hold qualifications.
The Ministry of Human Resources and Emiratisation is conducting a study along with the Finance Ministry looking into raising employment fees paid by companies to hire limited-skill workers, Mr Ghobash said.
“This will cause a turning point in attracting a skilled workforce.
“As a result of everything I mentioned, the percentage of high-skilled workers has increased from 400,000 to 600,000 in the past five years, and by 20 per cent for labourers.”
The UAE is ranked third in the world when it comes to attracting skilled workers, and is third globally when it comes to retaining them, the minister said.
Rola Almoheid, an HR consultant, said if companies restructure and screen their employees the right way, they will recruit staff who are highly skilled for the job.
Because many operations have become automated, companies did not need as many staff as they used to, she said. “One highly skilled worker could compensate for three average employees.”
However, what often happens is companies invest heavily in consultants to look at the restructuring process and then, as a result, cannot afford to hire highly qualified staff.
“They get rid of high salaries and keep those with low salaries and end up expanding the problem upon themselves.”
Mr Ghobash also told the FNC that a report into making good-conduct certificates a precondition for expats who wished to work in the Emirates would be available in a few weeks.
The certificates, issued by the expat’s country of origin, must be accredited by the UAE embassy in that country.
A joint committee of the Interior, Foreign and Human Resources Ministries, formed during the cabinet meeting in October last year, will put together the report.
“This pre-condition has been approved and the role of the committee is to set the terms and conditions and assign responsibilities.”
FNC member Hamad Al Rohoumi, from Dubai, said good conduct certificates were crucial to maintain security in a country that is home to millions of foreign workers.
Those with a criminal record are likely to end up facing charges again here and go on to burden the country’s jails, he said, adding that the system should be linked with all GCC countries, especially when it comes to domestic workers.
Mrs Almoheid said such a pre-requisite makes sense for most of the workforce, but in the case of labourers it could prove to be quite inconvenient.
“Labourers are brought in large numbers, and usually they come from villages which means they will have to pay the cost of moving to the city to issue such a certificate.”
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Skewed figures
In the village of Mevagissey in southwest England the housing stock has doubled in the last century while the number of residents is half the historic high. The village's Neighbourhood Development Plan states that 26% of homes are holiday retreats. Prices are high, averaging around £300,000, £50,000 more than the Cornish average of £250,000. The local average wage is £15,458.
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heading
Iran has sent five planeloads of food to Qatar, which is suffering shortages amid a regional blockade.
A number of nations, including Iran's major rival Saudi Arabia, last week cut ties with Qatar, accusing it of funding terrorism, charges it denies.
The land border with Saudi Arabia, through which 40% of Qatar's food comes, has been closed.
Meanwhile, mediators Kuwait said that Qatar was ready to listen to the "qualms" of its neighbours.
Mohammed bin Zayed Majlis
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ICC Women's T20 World Cup Asia Qualifier 2025, Thailand
UAE fixtures
May 9, v Malaysia
May 10, v Qatar
May 13, v Malaysia
May 15, v Qatar
May 18 and 19, semi-finals
May 20, final
Mercer, the investment consulting arm of US services company Marsh & McLennan, expects its wealth division to at least double its assets under management (AUM) in the Middle East as wealth in the region continues to grow despite economic headwinds, a company official said.
Mercer Wealth, which globally has $160 billion in AUM, plans to boost its AUM in the region to $2-$3bn in the next 2-3 years from the present $1bn, said Yasir AbuShaban, a Dubai-based principal with Mercer Wealth.
“Within the next two to three years, we are looking at reaching $2 to $3 billion as a conservative estimate and we do see an opportunity to do so,” said Mr AbuShaban.
Mercer does not directly make investments, but allocates clients’ money they have discretion to, to professional asset managers. They also provide advice to clients.
“We have buying power. We can negotiate on their (client’s) behalf with asset managers to provide them lower fees than they otherwise would have to get on their own,” he added.
Mercer Wealth’s clients include sovereign wealth funds, family offices, and insurance companies among others.
From its office in Dubai, Mercer also looks after Africa, India and Turkey, where they also see opportunity for growth.
Wealth creation in Middle East and Africa (MEA) grew 8.5 per cent to $8.1 trillion last year from $7.5tn in 2015, higher than last year’s global average of 6 per cent and the second-highest growth in a region after Asia-Pacific which grew 9.9 per cent, according to consultancy Boston Consulting Group (BCG). In the region, where wealth grew just 1.9 per cent in 2015 compared with 2014, a pickup in oil prices has helped in wealth generation.
BCG is forecasting MEA wealth will rise to $12tn by 2021, growing at an annual average of 8 per cent.
Drivers of wealth generation in the region will be split evenly between new wealth creation and growth of performance of existing assets, according to BCG.
Another general trend in the region is clients’ looking for a comprehensive approach to investing, according to Mr AbuShaban.
“Institutional investors or some of the families are seeing a slowdown in the available capital they have to invest and in that sense they are looking at optimizing the way they manage their portfolios and making sure they are not investing haphazardly and different parts of their investment are working together,” said Mr AbuShaban.
Some clients also have a higher appetite for risk, given the low interest-rate environment that does not provide enough yield for some institutional investors. These clients are keen to invest in illiquid assets, such as private equity and infrastructure.
“What we have seen is a desire for higher returns in what has been a low-return environment specifically in various fixed income or bonds,” he said.
“In this environment, we have seen a de facto increase in the risk that clients are taking in things like illiquid investments, private equity investments, infrastructure and private debt, those kind of investments were higher illiquidity results in incrementally higher returns.”
The Abu Dhabi Investment Authority, one of the largest sovereign wealth funds, said in its 2016 report that has gradually increased its exposure in direct private equity and private credit transactions, mainly in Asian markets and especially in China and India. The authority’s private equity department focused on structured equities owing to “their defensive characteristics.”
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What is Financial Fair Play?
Introduced in 2011 by Uefa, European football’s governing body, it demands that clubs live within their means. Chiefly, spend within their income and not make substantial losses.
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The second phase of its implementation limits losses to €30 million (Dh136m) over three seasons. Extra expenditure is permitted for investment in sustainable areas (youth academies, stadium development, etc). Money provided by owners is not viewed as income. Revenue from “related parties” to those owners is assessed by Uefa's “financial control body” to be sure it is a fair value, or in line with market prices.
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