The UAE cabinet has approved a new companies law that raises foreign ownership limits from 49 per cent, according to the official news agency Wam in a bid to attract more investment. The new limit has not yet been disclosed.

Foreign ownership is currently capped at 49 per cent for companies listed the country.

Sultan al-Mansouri, the minister of economy, has said that the new law contributes to enhance the competitiveness of the national economy at all local, regional and international levels. The move to raise foreign ownership will also enhance the performance of the business environment and investment climate in the UAE, he said.

This brings the UAE a step closer to attaining an upgrade from frontier market to emerging market status from stock index company MSCI. A decision from the MSCI is expected next week.