UAE bank deposits will now be guaranteed for three years, following the Federal National Councils (FNC) approval of a draft law.??

Emirates news website, Emirates Business, reports that Obaid Humaid Al Tayer, minister of state for financial affairs, said: “The new law encourages financial and foreign institutions to deposit billions of dollars in the UAE’s banks, both national and foreign. The duration of the guarantee is three years and ends on 31 December 2012. The law is temporary and its issuance is important to face the impact of the international financial crisis.

“The law’s issuance is a strong message for the world that the UAE economy and financial sector is strong. It is among a package of laws to be announced soon, including a deposit guarantee institution and a financial tools law.

“Global banks and financial institutions have called for a law to guarantee deposits for six months now. The new law protects the country’s economy and sends a strong message of reassurance for foreign financial institutions.

“The guarantee covers all national banks in the country, branches of foreign banks and foreign deposits that come into the country from outside. We encourage the inflow of foreign deposits.”??

Elsewhere, deputy director of foreign affairs at Dubai Ruler’s Court, Nasser bin Hassan Al Shaikh, told the newsite that  the UAE has no plans to cut the pay of public sector employees. “The government has no plans of doing it. The government is not considering any layoffs and is not considering revising its pay scales.”