DUBAI 2019 GUIDE Made in Dubai 1
CONTENTS 03 06 OVERVIEW FUTURE GROWTH 08 12 GOVERNMENT SUPPORT WHY DUBAI? 15 TRADE EVENTS Report dated December 2018 2
OVERVIEW 1 Within the last decade, the contribution of the industrial sector in Dubai s Gross Domestic Product (GDP) ranged between 11% to 14%. Dubai has 18 industrial areas, eight of which are within Free Zones and representing 30% of total industrial areas within the emirate. The industrial sector is a key economic contributor and enabler of non-oil GDP growth for Dubai and the contribution of manufacturing to the city s GDP is growing each year. Producer Price Index (PPI) of Manufacturing Sector of Q2-2018 showed a year-on-year increase of 9.45% compared to Q2-2017, establishing the sector as the third largest in terms of GDP contribution. 3
OVERVIEW In 2017, manufacturing activities contributed 9.4 percent of Dubai s GDP with a total value of US$100 billion in 2017, registering a 2 percent year-on-year growth and contributing by 6.8 percent to overall economic growth. Only transport and storage have seen a stronger growth rate than manufacturing in recent years and expectations are that the sector will contribute 25 percent towards the UAE s GDP by 2025. 9.4% of Dubai s GDP contributed by manufacturing activities worth $100B in 2017 EMAL (Emirates Aluminium Company) 300 customers from 57 countries Homegrown companies such as Emirates Aluminium Company (EMAL), an operating subsidary of Emirates Global Aluminium (EGA) operates the world s largest single-site primary aluminium smelting that produces foundry alloy, billets and high-purity aluminum for hightech uses. Dubai Cable Company (DUCAB), the region s second biggest manufacturer of aluminium and copper electrical cables is also among the key drivers of Dubai s manufacturing and industrial output. 4
OVERVIEW MULTINATIONALS INVESTMENT GROWTH Multinationals are joining the fray in growing numbers, a recent example being the opening in Dubai in 2016 of Unilever s largest personal care products manufacturing plant in the Middle East. The US$272 million facility will produce 500 million items annually primarily for export to Europe and the MENA region. And in 2017 FMCG major Nestle announced the opening of its 18th Middle East factory in Dubai South. The US$144.3 million plant will employ 340 people and produce coffee and other confectionaries for regional markets. DUBAI INVESTMENTS 15% rise in manufacturing activity income worth $435.5M in 2017 UAE-manufactured exports have risen dramatically in recent years as indicated by the 15 percent rise in the manufacturing activity income of Dubai Investments, the Dubai Financial Market-listed company, from US$ 381 million in 2016 to US$435.5 million in 2017. 5
From 2007 to 2017, the UAE s industry sector (which consists of the extraction, manufacturing, utilities and construction sectors) has grown by 31% and is forecast to grow a further 34% by 2027. During the same period, Abu Dhabi s industrial sector is forecast to grow 56% and Dubai s by 51%, up from 13% and 6% respectively. Presently this sector employs over two million people which accounts for around a third of total employment within the UAE. Technologies such as artificial intelligence, data analytics, robotics and the Internet of Things (IoT) are revolutionising the manufacturing sector. Blurring the lines between machinery and software, these solutions are empowering employees, transforming business models, and optimising operations. FUTURE GROWTH 2 NINE YEAR PREDICTED INDUSTRY SECTOR GROWTH 34% forcast of UAE industry sector growth 51% Dubai industry growth 6
FUTURE GROWTH DIGITAL TRANSFORMATION From production lines to service delivery, every aspect of the manufacturing process is being enhanced by digital transformation. In addition, IoT is helping many industries such as aluminium, steel, and pharmaceuticals to streamline asset management, develop products and improve the way customers are served. At the same time, cloud-based tools are facilitating communications and cutting down on travel and support costs. In March 2017 it was announced that the UAE s first micro-factories will be established focusing on new manufacturing technologies like 3D-printing with one of the goals being to build a Dubai-based facility focused on consumer goods and services companies. The project is expected to play a crucial role in revolutionising Dubai s design and manufacturing capabilities. Dubai s industrial growth is expected to reach US$16.1 billion and add 27,000 new specialised jobs by 2030. 7
GOVERNMENT SUPPORT 3 The government has embarked on a concerted effort designed to promote, develop and sustain a prolific manufacturing and industrial sector in Dubai. Under its Dubai Industrial Strategy 2030, the government has identified 75 initiatives to transform Dubai into an international hub for knowledge-based innovation and sustainable industrial activities. The objectives behind the strategic framework are manifold and include the increase of total GDP and value-added of manufacturing by an estimated US$4.9 billion and contributing to Dubai s ambition of becoming the centre for the global Islamic products market by increasing the number of halal-certified manufacturing companies. Dubai Industrial Strategy 2030 75 initiatives $4.9B estimated increase of total GDP and value-added manufacturing 8
GOVERNMENT SUPPORT Aerospace, maritime, aluminium & fabricated metals, pharma & med equipment, F&B and machinery & equipment will all benefit from the strategy which is anticipated to add US$44.8 billion to Dubai s economy by 2030. AEROSPACE: Emirates airline is considered one of the leading companies in the world and owns a large and competitive fleet globally. The strategy aims at supporting Emirates airline and Dubai s longstanding competitiveness in this industry over the long term, through the localisation of manufacturing capabilities in certain aerospace sub-industries. MARITIME: DP World is considered one of the largest ports operators internationally. Given the continuous increase in magnitude and scale of trade and sea traffic, the strategy will aim to capitalise on such promising opportunities through the localisation of manufacturing capabilities in certain maritime sub-industries. ALUMINIUM & FABRICATED METALS: Dubai is one of the leading producers of fabricated metals; particularly Aluminium. While this leading position is based on the manufacturing of (upstream) primary products, the strategy will aim to enhance the emirate s competitiveness and expand its production base to include (downstream) finished products. FAST MOVING CONSUMABLE GOODS (FMCG): The selection of this sector will directly feed into and support the vision of Dubai being the Capital of Islamic Economy especially since Halal Industries is one of the key seven targeted sectors in that vision. MACHINERY AND EQUIPMENT: This sector represents 25% of the overall industrial sector in Dubai. The sector is highly significant and its competitiveness must be maintained given its lucrative investment and profitability opportunities. 9
GOVERNMENT SUPPORT The Department of Economic Development has a pivotal role together with Dubai Export Development Corporation and the Dubai Chamber of Commerce and Industry. The Dubai Industrial Strategy aims to transform the UAE into a global platform for innovative industries and a destination of choice for international companies seeking and integrated and favourable environment for sustainable growth. The strategy s prerequisite for nationwide success is the seamless collaboration between disparate Federal governmental departments and authorities including the Ministries of Labour, Public Works and Environment & Water. The UAE s Industrial Coordination Council is developing a national strategy to boost the sector and safeguard intra-governmental cooperation. In a further move designed to boost the UAE s manufacturing capabilities an initiative for the standardization of the Made in the UAE label was approved in 2017. Promotion of the Made in the UAE label is hoped to create global awareness and reputation about the national brand helping to raise the profile of the country as a manufacturing hub for the entire Middle East. 1010
WHY DUBAI? 4 LOCATION & CONNECTIVITY Dubai is a key connecting hub between the markets of the East and West Ideally located to bridge the crucial time zone gap between the markets of the East and West to enable 24/7 services and connectivity. Easily accessible through two international airports Dubai International (DXB) and Dubai World Central (DWC) within a 4 hour flight of one-third of the world s population, and within 8 hours of two-thirds. 90 airlines operate 6,500 flights a week from DXB, to 240 destinations. 15 passenger carriers operate an average of 153 flights weekly to more than 30 international destinations across 10 countries from DWC. DUBAI A KEY HUB 6,500 flights a week 240 destinations DXB passenger numbers are projected to reach 103.5 million by 2020 while passenger traffic across Dubai s two primary airports is forecasted to rise to 200 million by 2030. Home to the world largest manmade port Jebel Ali a premier gateway for over 90 weekly services connecting more than 140 ports worldwide. Expansions currently underway at the Port will bring total handling capacity to 22.1 million TEU by 2018. World largest manmade port connecting 140 worldwide With its diverse and mature consumer base, Dubai has a proven track record of being the launch-pad to test and expand operations across the wider Middle East, Africa and South Asia. Non-oil trade between Dubai and Africa is valued at US$34billion having amounted to US$192 billion over the 2012-2017 period. $34B non-oil trade value with Africa Non-oil trade between Dubai and India reached US$27 billion in 2017, representing 7.6 per cent of Dubai s total non-oil foreign trade for the same year, and is projected to increase by 5% to US$30 billion by 2020. 12 111
WHY DUBAI? TALENT POOL Dubai is an incubator for exceptional home-grown talent and a magnet for the world s most ambitious, sophisticated and forward-thinking scientists, engineers, technologists and innovators who yearn for a rewarding, career-enhancing ecosystem to thrive, prosper and change the world. Dubai ranks 6th globally in a list with the most attractive cities for a global workforce according to Boston Consulting Group. The Dubai government is implementing talent attraction strategies designed to increase its intake of knowledge workers by 40% by 2021. Dubai is home to over 200 nationalities, bringing together one of the world s richest and most diverse pool of languages and skills to suit any business. The UAE ranks 4th globally in availability of skills and competencies in the talent pool and 5th worldwide in the Appeal index, which measures the extent to which a country taps into the overseas talent pool, according to the IMD World Talent Ranking.. 1212
WHY DUBAI? FOREIGN DIRECT INVESTMENT DUBAI Dubai ranks among the top 10 international cities in attracting foreign investment estimated at US$7.4 billion in 2017, an increase of 7.1 per cent compared to 2016. Liberal and pro-investment policy decisions had gone a long way in setting Dubai on a path towards achieving comprehensive and sustainable development based on innovation and high productivity. Foreign direct investment has played an instrumental role in realising these achievements through its contribution to job creation and technology diffusion. Dubai is ranked #1 in the world in terms of FDI technology transfer and #3 as location for AI & Robotics. Top 10 international cities Foreign investment $7.4B in 2017 Increase 7.1% 1313
TRADE EVENTS 5 The event highlights MENA s role adds a global aluminium production powerhouse ALUMINIUM MIDDLE EAST Launched in 2009 Aluminium Middle East is the biggest gathering for aluminium professionals and the leading exhibition for aluminium products, technologies and investments in the Middle East. Launched in 2009, the event brings together international industry front-runners including producers, manufacturers and processors of raw materials and end products made with aluminium components, as well as suppliers of technologies and accessories for aluminium production, processing and refinement. The event highlights the Middle East s future role as the world s powerhouse in aluminium production and facilitates discussions on uplifting the downstream sectors to support this phenomenal growth in upstream industries. The event is held annually at the Dubai World Trade Centre 1414
TRADE EVENTS MENA s sole summit for the future of manufacturing FUTURE & TRADE SUMMIT 500 professionals The Future Manufacturing & Trade Summit is a leading manufacturing and trade event and remains one of the only platforms in the Middle East for professionals to gain and share industry knowledge. The forum brings together over 500 professionals from across the region to benefit from an interactive twoday summit on technological advancements, innovative strategies, and real-life case studies. The event is held annually at the Dubai World Trade Centre 1515
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