Room to grow • Chapter summary
ot often known for its industrial capabilities, there remains significant untapped potential for Dubai to leverage its dominance in trade and logistics to benefit Dubaibased industry and manufacturing. The Dubai Industrial Strategy 2030, which aims to transform the Emirate into an “international hub for knowledge-based, innovative, and sustainable industrial activities,” has identified 75 initiatives to this end; the strategy is projected to help generate an additional AED160 billion by 2030. Launched by Sheikh Mohammed Bin Rashid Al Maktoum in 2016, the strategy aims to increase the total output and value-added of the manufacturing sector through six targeted subsectors: aerospace, maritime, aluminum and fabricated metals, pharmaceuticals and medical equipment, food and beverage, and machinery and equipment. Several Dubai-based, Dubai-grown companies, such as Dubai Refreshment and DUCAB, align with this strategy, as well as increased investment from international companies such as KSB.
Enabling this strategy are the industrial zones such as Dubai Industrial City and National Industries Park. In 2018, 40% of Dubai Industrial City’s sales growth came from the expansion of existing business partners, pointing to the increase of Dubai’s industrial capacity. And in its efforts to become the Islamic capital of the world, the Emirate is pushing the halal industry, particularly its role as a leader in standardization of halal certification. Also in 2018, Dubai Islamic Economy Development Center and the Dubai Airport Free Zone Authority launched the first-of-its-kind Halal Trade and Marketing Centre.
NFor companies that offer products and solutions for the infrastructure sector and construction companies, the knock-on effects of Expo 2020 and stimulus of the construction sector not only in Dubai, but also across the region, give cause for optimism. Electric Way, for example, is working with Expo 2020’s major contractors to increase time and cost efficiencies. Digitalization is only set to quicken with the appointment of an ambassador for the Fourth Industrial Revolution.
Key to enhancing efficiencies is technology and the automation of industry. Digitalization has meant a shift of labor demands rather than replacing the need for human resources. For Wilo, which recently inaugurated its new Dubai facility emphasizing its presence in Dubai, the focus is very much on R&D and innovative technologies.
With this boosted industrial output, Dubai looks to increase distribution and export efforts. In its July 2019 economic bulletin, the Dubai Chamber of Commerce and Industry addressed the untapped potential for UAE exports to Africa totaling USD3.6 billion—an opportunity to double the value of current exports across most categories. Looking eastward, India and China offer several opportunities given demand driven by sheer population volumes. Here, industry can capitalize on linkages to the logistics and transport sectors including through several Silk Road-related strategies. In July 2018, the UAE and China signed an MoU for cooperation on China’s One Belt, One Road Initiative and the 21st Century Maritime Silk Road Initiative. Later, in March 2019, Sheikh Hamdan Bin Mohammed approved Dubai’s Silk Road strategy. ✖
What is the evolution of DI, and how are you aligning with the broader visions of the Emirate?
DI was established in 2004 to accelerate growth in manufacturing and logistics and unlock new opportunities in the Emirate’s economy. Our strategic location plays a vital role in developing the industrial area outside of the city. We contribute to Dubai’s industrial growth by providing a cost-effective business ecosystem with industrial land, warehousing facilities, and well-equipped worker accommodation with supermarkets, healthcare centers, mosques, and sports facilities. The infrastructure creates a community and commercial hub for international and local manufacturers and traders to establish their business and support goals underpinned by the Dubai Industrial Strategy 2030. This includes a sharper focus on the industrial light manufacturing industry to help the Emirate increase exports, reduce imports, and build a sustainable, diversified economy.
Which subsectors in industrial light manufacturing are you emphasizing?
We have an excellent urban design in DI that focuses on six zones: food and beverage; chemicals; base metals; minerals; machinery equipment; and transport. We also have supporting zones for logistics and light manufacturing. This attractive masterplan assures companies that their operations will not be interrupted, while our diverse mix of business partners helps manufacturers find suppliers in one of our six zones to build an integrated, localized supply chain.
How do you ensure you can sustainably cater to the CAPEX demands across all these zones?
This was a consideration when we developed the masterplan and we have established certain power limits for our zones. Based on the masterplan, we have allocated different needs for transport, water, and energy. We also control demand for additional power through an application and evaluation process. In 2018, we invested in covering new zones and new infrastructure requirements. We have the flexibility investors need to customize their infrastructure. With some of our partners, we know what they want from the start and work hard to support them early on and in challenging times to ensure
We are proud of our business ecosystem and continue it build with focus and efficiency. We are developing 550 million sqft of land step-by-step to be sustainable. We maintain strong relationships with the more than 730 business partners at DI, who are our ambassadors in the market. We also have a comprehensive expenditure plan and invested in four substations for total of 800MW capacity. We also continually monitor our power capacity to ensure we can meet our business partners’ energy demands now and in the future. We also invest in digital transformation, automation, and renewable energy to reduce operational costs for our partners and create an environment that supports organic growth.
We have 140 operational factories in DI, and automation is an increasingly important part of the mix; however, factories still need workers and the rise of automation presents an opportunity for employers to retrain staff and help them develop new skills as businesses expand their use of machine learning and robotics.
What is your vision for your industrial hub for the coming decade?
We are the main stakeholder in the Dubai Industrial Strategy 2030 and work closely with Dubai Exports, the co-lead of the strategy, to help our business partners drive manufacturing and logistics innovation. By developing world-class infrastructure and providing partners with end-to-end solutions to enhance ease of doing business with online access to government and visa services, we create an ecosystem for players in the light and medium manufacturing sectors to thrive. DI contributes to Dubai’s status as a sustainable, technologically advanced manufacturing hub that helps multinational corporations and local entrepreneurs across food and beverage, base metals, transport equipment, machinery, logistics, chemicals, and minerals contribute to the Emirate’s economic success story. ✖