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UAE Freezones Biz News Updates
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UAE free zones see Dh515b in trade
From innovative marketing to new-age facilities, a look at why the UAE’s
free zones are such a success
Having established their importance to the UAE economy, the country’s free
zones are now focused on building a global value chain that supports the
increasingly important pursuit of sustainable economic growth.
“Free zones have rapidly expanded because they offer a proven investment and
economic development tool for the global value chain,” Dr Mohammad Al
Zarooni, Chairman of the World Free Zones Organisation, said at the annual
conference and exposition of the American National Association of Foreign
Trade Zones in Los Angeles last month. “With an ever-shifting macroeconomic
landscape, the role of free zones as hubs for economic activity has impacted
the dynamic of international trade investment flows and manufacturing supply
chains,” he added.
The UAE is home to nearly 40 free zones specialising in a variety of
business sectors, from media and advertising to technology and environmental
business. Last year, they accounted for approximately 33 per cent of the
UAE’s non-oil trade and 37 per cent of Dubai’s non-oil trade. Free zone
growth has been in line with the country’s focus on foreign trade,
investment and industry sectors. In total, free zones accounted for trade
worth ?Dh269.6 billion in the first six months of last year, as compared to
Dh250.9 billion in the corresponding period of 2013, according to the
Federal Customs Authority. Official data for the whole of 2014 was not
available, but the value of trade at Dubai’s free zones alone is expected to
grow 5 per cent this year to reach Dh515 billion versus Dh489bn in 2014,
according to local news agency WAM.
Sources at the Dubai Customs and the Chamber of Commerce say the value of
trade at the emirate’s free zones could even soar by 7 per cent this year,
WAM said.
As a testament to the success of the principle of free zones, that annual
total is nearly double the value of trade for the whole of 2009, which was
Dh286 billion.
Among the most successful has been the Dubai International Financial Centre
(DIFC), which expects to triple in size over the next ten years as it aims
to position itself as the region’s most prominent banking hub, in spite of
competition from the new Abu Dhabi Global Market, DIFC governor Essa Kazim
told Reuters. While the centre’s growth initially came mainly from European
and US companies, half of the targeted expansion for the next decade will
come from other emerging markets in the south-south trade corridor,
including Latin America, Africa and South Asia, in particular India and
China.
Indeed, much of the zones’ growth has come from assiduously courting
international companies to invest in the UAE, and benefit from the country’s
strategic geographic location as a trading hub between east and west.
Last month, Abu Dhabi Ports, the master developer, operator and manager of
industrial zones and ports in the emirate, showcased the facilities of its
Khalifa Industrial Zone Abu Dhabi (Kizad) and Khalifa Port to Indian
businessmen at an invitation-only event. T.P. Seetharam, the Indian
Ambassador to the UAE, delivered the keynote speech at the event, which
attracted over 70 top Indian businessmen from across the UAE, WAM reported.
“As Indian businesses based in the UAE and India are keen to expand their
business, we are happy to introduce the unique offerings of Kizad and
Khalifa Port to them,” said Captain Mohammad Juma Al Shamisi, CEO of Abu
Dhabi Ports. “Kizad’s outstanding access to markets, world-class
infrastructure and dedicated investor support, with Khalifa Port at its
doorstep, will prove attractive to their businesses and expansion plans. I
am confident that our offerings have the potential to support efforts to
boost trade ties between India and the UAE.”
Offerings for investors, such as Kizad’s logistics park and light industrial
units, were also showcased.
If they are reaching out to emerging economies, free zones are not ignoring
the G8. Also last month, the Ras Al Khaimah Free Trade Zone (RAK FTZ), which
has over 8,000 companies in its portfolio, partnered with Business France,
the French Business Development Agency, to promote its services during Gitex
Technology Week, a trade event for companies in the technology sector. Tomas
Csobonyei, Business Development Director, RAK FTZ, said the partnership
opened up opportunities for French businesses to set up regional offices in
the UAE. “We are keen in developing ways to nurture companies and helping
them become booming enterprises,” he said. Also in October, the Jebel Ali
Free Trade Zone conducted a seven-day roadshow in Germany, covering the most
important commercial centres in the European nation, including Munich,
Dortmund and Cologne.
Innovative initiatives are key to helping free zones attract investment. The
newly announced Dubai World Trade Centre Free Zone, for example, is one of
only two that will offer dual licences, which allows it to attract both
onshore and offshore licensed companies. The other is the nearby Dubai
Design District.
Innovation is also rewarded. The RAK FTZ this year launched a business
competition to grow the culture of entrepreneurship in the emirate. As a
prize, the Start-up Champ contest offered a business set-up package for
innovative business plans.
In the UAE, free zones are now being looked at as an integral part of the
country’s strategy for future economic development to cement its place in
global trade, Sultan Bin Saeed Al Mansouri, UAE Minister of Economy said at
the annual International World Free Zone Conference and Exhibition in Dubai
this summer. “Free zones play a key role in globalising and diversifying the
UAE’s economies. They help stimulate trade and investment, and facilitate
the transfer of skills, knowledge and technology.”
Nov 12, 2015 |
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Courtesy Al Nisr Publishing LLC
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