Within a study that included 44 international systems

"Mercer Index": Reforms have jumped the UAE to the 25th place globally in "pensions"

The UAE has entered into competition with countries that have distinguished pension systems, such as America and France.

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The UAE ranked 25th globally by the retirement income system, after it entered into competition with countries that have distinguished pension systems, such as the United States, Singapore and France, in the 14th annual cycle of the Mercer Pension Index, which is the second year in which the UAE is included in the report.

Iceland ranked first, followed by the Netherlands, while Thailand ranked last.

This year's session was also marked by the participation of Portugal for the first time as a new addition.

The Mercer Institute for the annual Global Retirement Index conducted a study that included 44 global pension systems, representing 65% of the world's population.

During which he reviewed retirement income systems around the world, highlighted some of the shortcomings in each system, and presented his specific suggestions for possible reform areas that would help provide more convenient and sustainable retirement benefits.

According to the study, the value of the overall index of the UAE has improved from 59.6 in 2021 to 61.8 this year, as it jumped in its classification from (C to C Plus), primarily due to the improvement in its scores in terms of sufficiency and sustainability, as the adequacy ratings are supported. Pensions in the UAE Through the generous pension benefits in the country, which guarantees continuity of income to maintain a good quality of life with an adequate minimum pension compared to earnings.

In terms of sustainability, the study attributed this improvement to the high rate of labor force participation in the UAE, especially for individuals over 55 years of age, and the strong governance structure related to the UAE's national pension system contributed to its advanced ranking in terms of integrity.

In general, the UAE has put in place a sound structure for the pension system funded for Emiratis, in conjunction with the cancellation of the public and private sectors mandatory contributions during the employee's period of work, in order to make progress in implementing a new retirement savings plan aimed at supporting employers in the private sector and resident employees to plan for their financial future.

The UAE recently announced the launch of a new mandatory unemployment insurance plan, as part of its intensification of efforts to attract and retain talent, and the plan applies to public and private sector employees alike, with the aim of helping both Emiratis and foreigners, employees receive compensation of up to 60% of their previous salaries. For a period of three months if they lose their jobs, moreover, the recently launched “Golden Pensions” program aims to help foreign employees in the private sector invest end-of-service benefits in addition to supporting employers to finance their end-of-service financial obligations.

Commenting on the results of the index, Robert Ansari, head of investment and retirement at Mercer Institute, said: “The UAE index rose this year, and its rank rose from (C to C +) included in the index for the second year only, achieving better performance than a number of its peers in The world has been participating for many years, while the UAE is now preparing to increase the number of its citizens who will enter retirement age.”

He added that "a large number of local and international companies dealing with the UAE are aware of the benefits of private pensions and employee savings plans in the workplace as a way to attract and retain talent."

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