The Foreign Direct Investment Transparency Index in the Emirate of Abu Dhabi recorded 76.1 points in 2018 on the 100-point index scale, compared to 71.1 points in 2017, which largely reflects a higher level of transparency in direct foreign investment policies and investors awareness of the transparency of the policies adopted by the UAE federal government and the sound policies of the wise government of Abu Dhabi, which represents a major incentive for attracting FDI to the Emirate of Abu Dhabi in particular.
This came in the results of Abu Dhabi Foreign Direct Investment Policies Transparency Index issued by the Department of Economic Development - Abu Dhabi (ADDED) in coordination with the Statistics Center – Abu Dhabi (SCAD) in 2018, which reflects the views of respondents on several key issues, including the efficiency of Abu Dhabi government policies for attracting and encouraging FDI in the Emirate of Abu Dhabi and the role of the federal and local governments in Abu Dhabi in administering and implementing the policies and incentives which affect foreign investors, the distribution of economic responsibilities among the various levels of the government and the capacity of Abu Dhabi government entities for managing and directing policies and incentives related to investment
The Abu Dhabi government is keen on is keen stimulating foreign capitals to invest in the local economy in the Emirate through improving the quality of provided services, developing the performance of the institutional, legal and procedural structures, enabling the private sector to contribute effectively in various economic activities and providing investors with clear data and information about the investment environment in the Emirate, contributing to attracting foreign investment in accordance with Abu Dhabi Economic Vision 2030.
The results of FDI Transparency Index in 2018 reflects investors awareness of the transparency and clarity of the policies adopted by the UAE federal government and the sound policies of the wise government of Abu Dhabi, which represents a major incentive for attracting FDI to the Emirate of Abu Dhabi.
According to the index results, respondents' answers regarding the efficiency of government policies in the Emirate of Abu Dhabi to attract and encourage FDI in 2018 indicated that approximately (97%) of respondents were aware of the effectiveness and efficiency of government policies aimed at attracting and encouraging FDI in the Emirate of Abu Dhabi.
As for the roles at various administrative levels in UAE and the Emirate of Abu Dhabi, concerning the administration and implementation of policies and incentives, which affect foreign investors in the Emirate of Abu Dhabi, the index results reflected the high clarity of those roles, at both the federal level and the level of the Government of Abu Dhabi. About (97%) of respondents indicated the clarity of such roles in the Federal Government, while (96%) consider that such roles were clear in Abu Dhabi government, strongly confirming the positive performance of federal and local government authorities and their effectiveness in the role they play.
Some (97.4%) of respondents in the examined sample stressed the clarity of the process of distributing economic responsibilities at the various levels of government for the administration and implementation of policies and incentives, which affect their businesses.
Regarding the respondents' assessment of the capacity of government entities in Abu Dhabi at different levels, in terms of administering and monitoring direct foreign investment policies and incentives, the results reflected the effectiveness and capacity of the federal government. About (96.1%) of respondents indicated that the capacity of UAE government bodies was effective or sufficient to administer and direct DFI policies and incentives. About (96.8%) of respondents said that the capacity of Abu Dhabi government authorities was effective. This indicates investors awareness that government bodies do recognize the opportunities and challenges facing foreign investors and are capable of directing policies in a way that attracts DFI using a number of tools at their disposal.
As for the ease of accessing various information relating to investment, results came to show that accessing information concerning work permits ranked first in terms of ease, while information related to licensing procedures came second in terms of easy access. On the other hand, the information related to exemptions from fees or taxes came in the last place.
As for the respondents' evaluation of the financial costs of licensing and registration fees for foreign investors, about (45%) of respondents in the sample did not consider this matter as a problem or obstacle to their investments. Views and opinions about the size of the problem varied, as (18%) thought it is a simple problem, while (25%) believed that it is a medium problem. About (12%) of respondents consider it was a big problem.
As for evaluating how difficult it is to access information on the changes in government policies and regulations concerning foreign investors in the Emirate of Abu Dhabi, about (58.4%) of respondents in the surveyed sample reported that it was not a problem or an obstacle to their investments, while the rest (41.6%) thought that it was a problem and an obstacle to their investments in the Emirate of Abu Dhabi. In this respect, views varied as (19%) saw this as a simple problem, while (19.2%) believed that it is a medium problem, (3.4%) said it was a big problem.
As for evaluating how difficult it is to access information on the changes in Federal government policies and regulations concerning foreign investors, about (61.2%) of respondents in the surveyed sample reported that it was not a problem or an obstacle to their investments, while the rest (38.8%) thought that it was a problem and an obstacle to their investments. In this respect, views varied as (17%) saw this as a simple problem, while (18.3%) believed that it is a medium problem, (3.4%) said it was a big problem.
In answer to the question about the sources of information concerning important business laws and regulations issued by the Government of Abu Dhabi on foreign investment, respondents indicated that investors have mainly depended on the databases of government entities, either through their direct contact with these entities or through the free databases of these entities. These two sources of information were the most often used by (91.2%) and (82.3%) respectively. On the other hand, the least used sources of information were the foreign consultancies. Only (29.3%) of investors depended on these consultancies.
The results generally indicate that investors and businessmen depend significantly on local databases compared to foreign databases overseas, as the ease to access them and the trust in them are all considered a key pillar to attract investment to any country. Accordingly, the respondents' answers reflect the extensive efforts exerted by the government of the Emirate of Abu Dhabi to provide reliable information and databases.
As for the views of respondents on the adequacy of efforts put by Abu Dhabi government to consult investors before the enactment of laws and regulations related to foreign investments, about (89%) of respondents saw these efforts as sufficient. About (87%) of respondents saw sufficient communication channels between the government bodies of Abu Dhabi and all relevant parties, including foreign investors. Respondents' feedback was greatly positive concerning the clarity of government procedures concerning exceptions in the notification and consultation carried out by government bodies.
Concerning the ADDED role, surveyed foreign investors recognized the effectiveness of ADDED role and performance in creating a favourable investment climate to encourage and attract FDI by streamlining procedures and developing services. The majority of respondents (55%) thought that there are no challenges in the registration and licensing procedures, in comparison to 45% of respondents, who see they represent a problem and an obstacle with varying degrees.
The surveyed sample has also commended the single-window service provided by Abu Dhabi Business Center and recognized the efforts put by ADDED in raising its suggestions and recommendations to decision-makers in light of the requirements of all investors. Concerning the incentives given to investors in the face of local competitors, the survey's results indicated that a slight majority of investors (54.6%) think that these incentives were not effective or influential in the face of local competitors. Regarding the incentives given to investors in the face of foreign competitors, the results indicated a similar attitude, with (53%) of respondents saying that these incentives were not really effective or influential in the face of foreign competitors.
Some investors confirm that the ADDED role is effective and helpful in reflecting their requests to decision makers. As many as 84% of respondents supports this view, compared to 16%, who see that its role is insufficient. the single-window service provided by Abu Dhabi Business Center, 77% of investors see that it is effective.