STEAMING ALONG
The government's focus on heavy industries has raised concerns among major manufacturing players, who seek to establish a direct channel of communication to explore opportunities for cooperation and improving CAPEX by filling in the gaps.
Over the 10 years to 2018, the UAE's industry sector, consisting of the extraction, manufacturing, utilities and construction sectors, has grown by 31% and is forecast to grow a further 34% in the next 10 years to 2027, according to data from Oxford Economics. Over the same 10-year period to 2027, Abu Dhabi's industrial sector is forecast to grow 56%. The growth and diversification of Abu Dhabi's industrial sector are seen as key to the country's economic future, and the private sector seeks to put forward its long-term vision for the sustainability of the manufacturing industry in the Emirate with a clearly defined strategy. Part of this strategy consists of advancing the idea that oil should not be factored in as energy, but as an ingredient in the industrial process. Energy-intensive industries, chemicals, paper, and packaging still offer a wide array of opportunities in terms of local production.
Abu Dhabi's industry sector cannot be fully understood without mentioning Senaat, one of the UAE's largest industrial investment holding companies owned by the government of Abu Dhabi. Managing more than AED27.2. billion of industrial assets, Senaat operates in four key industrial sectors; metals, oil and gas services, construction and building materials, and food and beverages manufacturing, announcing operating earnings of AED2.1 billion FY2017.
Overall, 2017 was a transition year for Abu Dhabi's industry sector for many reasons. Instead of directly investing into the sector, the authorities are rather making policy changes that will facilitate and ease investment from private investors. The government believes what will make the sector among the most competitive regionally and globally will be maximizing Abu Dhabi's attractiveness among industrial investors. As such, in 2017, the Emirate was able to attract some AED6.2 billion in investments specific to the sector, with some 37 new industrial facilities came online in 2017.
The numbers of industrial licenses also witnessed a significant growth: in 2017, there was an 85% increase YoY in the number of industrial licenses that went into production, with the number of new industrial licenses granted in 2017 rose nearly four times, from 22 in 2016 to 86 in 2017, bringing the total number to approximately 1,657 at the end of 2017. The most popular subsector for these licenses has been metal industries, which numbered 428. Other popular industries include building materials with 393 licenses; fiberglass, plastic, and sponge with 210; wood, cardboard, and paper industries with 176; and chemical industries with 160.
Part of the government effort has included the development of the Khalifa Industrial Zone of Abu Dhabi (KIZAD). Unveiled in 2010 and opened two years later, KIZAD is playing a critical role in achieving the Emirate's industry goals. The total value of investments at the end of KIZAD's first year topped USD7.2 billion, and the zone has not given up its momentum, with new international firms constantly investing. Although KIZAD remains focused on the container side, as steel import-export traffic grows, investors are hoping to see more infrastructure for cargo using a shore crane.
The aluminum and steel industries have proven to be Abu Dhabi's strongest outside of oil. Leading the local steel market is Emirates Steel, which has in recent years seen accelerating growth. ESI meets approximately 60% of Abu Dhabi's demand for certain types steel, exporting the rest along with other Abu Dhabi-based companies to more than 50 countries around the globe, to markets in Asia, Europe, and the Americas. At a time when raw material prices are rising, and the final products are not necessarily in line with that trend, local steel players have recently been able to regain market share in the GCC, especially since the Chinese market has been regulated.
With growing demand for both steel and aluminum across international markets, officials and experts anticipate the local industry will continue to remain a pillar of the Emirate's non-oil economy. Working alongside ESI is Emirates Global Aluminum (EGA), ranked among the five-largest aluminum producers in the world. EGA has an ambitious plan to increase its regional market share to 51% by 2020. With a staff close to 7,000, the aluminum company currently produces more than 2.3 million tons of aluminum each year, with 95% of its products adding value to the market.
Alongside the success of the Emirate's non-oil economy, the petrol industry remains an important aspect of local industry. Its role in the coming years, however, is sure to change, and TBY sat down with Ali Vezvaei, the Executive President and CEO of Bilfinger Middle East, to get a better understanding of the challenges facing the industry. “For Middle East producers, blessed by the low lifting cost, the game is all around the cost of availability and reliability and maintenance," he said. “This is where the equation is heavily stretched. As long as the oil price is around USD70-75, shale producers have a healthy cash flow and solid margins to service their debt and continue to drill. The challenge comes when the needle drops to around USD40-50. That is where the social priorities prevail, growth CAPEX freezes, and the entire eco-system suffers."
Moreover, the UAE and Abu Dhabi are stepping up efforts at an accelerated rate in order to become a hub and the world's first open lab for experimenting and adopting Industry 4.0 technologies. This approach presents substantial opportunities for foreign companies that are considering establishing manufacturing operations in the Abu Dhabi and for local manufacturers. Key pillars of the Industry 4.0 Strategy include employing space data and technologies to make intelligent and strategic decisions, leveraging bioengineering, advanced sciences, and technologies; focus on designing and programming 3-D additive design, and manufacturing technologies to unlock the competitive potential of the UAE economy and entrepreneurs globally.
STEAMING ALONG
TABLE OF CONTENTS
Focus: Tackling Unlawful Cryptocurrency Use
Crypto Crime
The rapidity and anonymity of crypto-transactions make them attractive not only to risk-prone investors, but also to criminals. Finding an efficient solution that does not completely undermine or overturn the nature of digital currencies is proving to be extremely hard.
read articleGuest Speaker
Juan Carlos Varela, President, Republic of Panama
TBY talks to Juan Carlos Varela, President of the Republic of Panama, on expanding the country's diplomatic footprint, the importance of participating in Expo 2020, and both countries' respective leadership roles as regional entrepôts.
read articleInterview
Rashed A. Al Blooshi, Chief Executive, Abu Dhabi Securities Exchange (ADX)
TBY talks to Rashed A. Al Blooshi, Chief Executive of Abu Dhabi Securities Exchange (ADX), on highlighting the opportunities available to companies on ADX, adopting best practices in the field, and further developing the market.
read articleFocus: ADNOC’s Partnership Model
Spheres of Influence
Following the announcement of an expanded partnership model and a more active approach to managing its businesses and portfolio of assets, a series of cooperation accords position the national oil company as a champion of commercial liberalism.
read articleInterview
hmed Omar Abdulla, CEO, Abu Dhabi Polymer Company Ltd (Borouge),
TBY talks to Ahmed Omar Abdulla, CEO of Abu Dhabi Polymer Company Ltd (Borouge), on the impact of its new Borouge 4 plant, specialized solutions for global challenges, and the need to continue to invest in innovation.
read articleInterview
Philippe Peccard, President Middle East Engineering & Investment Projects, Linde Group
TBY talks to Philippe Peccard, President Middle East Engineering & Investment Projects of Linde Group, on being a key partner of its regional partners, developing the downstream value chain, and further enhancing operations with technology.
read articleFocus: In-Country Value
Time to Commit
The announcement of the In-Country-Value program is a significant step for ADNOC and Abu Dhabi in growing the local private sector. Vertically, it will develop the energy industry through a trickle-down effect; horizontally, it will affect other sectors through a multiplier effect in the long-term.
read articleInterview
Ali Vezvaei, Executive President & CEO, Bilfinger Middle East
TBY talks to Ali Vezvaei, Executive President & CEO of Bilfinger Middle East, on its keys areas of focus in the UAE, trends in the hydrocarbons sector, and the application of energy efficiency technologies to new sectors.
read articleInterview
Samia Bouazza, Managing Director , Multiply Marketing Consultancy
TBY talks to Samia Bouazza, Managing Director of Multiply Marketing Consultancy, on satisfying sophisticated consumers with high purchasing power, targeting different categories of the population, and thinking globally while acting locally.
read articleInterview
Yousuf Al Shaibani, Director General, Mohammed Bin Rashid Space Centre (MBRSC)
TBY talks to Yousuf Al Shaibani, Director General of the Mohammed Bin Rashid Space Centre (MBRSC), on the goals of the national space program, attracting youth to the program, and the significance of KhalifaSat.
read articleInterview
Abdulla Jassem bin Kalban, Managing Director & CEO , Emirates Global Aluminium (EGA)
TBY talks to Abdulla Jassem bin Kalban, Managing Director & CEO of Emirates Global Aluminium (EGA), on its expansion upstream, strategies to grow the sector, and sustainability initiatives.
read articleInterview
Sheikh Abdulla bin Mohammed Al Hamed, Chairman , Department of Health (DoH)
TBY talks to Sheikh Abdulla bin Mohammed Al Hamed, Chairman of the Department of Health (DoH), on facilitating investment for local and foreign investors and building and maintaining a sustainable workforce.
read articleFocus: Technical Training vs. Academic Teaching
Balanced Learnıng
Abu Dhabi's technical institutes are growing in popularity among young Emiratis; however, finding a balance with more traditional academic programs is paramount to ensure the development of a truly knowledge-based economy.
read articleInterview
Noura bint Mohammed Al Kaabi, Minister , Culture and Knowledge Development
TBY talks to Noura bint Mohammed Al Kaabi, Minister of Culture and Knowledge Development, on the Creative Industries Contributions Index, bridging the AI-culture divide, and adopting a systems leadership approach moving forward.
read articleInterview
Mohamed Khalifa Al Mubarak, Chairman , Department of Culture and Tourism (DCT)
TBY talks to Mohamed Khalifa Al Mubarak, Chairman of the Department of Culture and Tourism (DCT) Abu Dhabi, on the role of innovation, the late Sheikh Zayed's cultural vision, and strengthening cultural engagement among youth.
read articleInterview
Saif Saeed Ghobash, Undersecretary , Department of Culture and Tourism (DCT)
TBY talks to Saif Saeed Ghobash, Undersecretary of the Department of Culture and Tourism (DCT) Abu Dhabi, on becoming a beacon of cultural tourism, tailoring its approach to different markets, and penetrating the MICE segment.
read articleInterview
Humaid Matar Al Dhaheri, Group CEO , Abu Dhabi National Exhibitions Company (ADNEC),
TBY talks to Humaid Matar Al Dhaheri, Group CEO of Abu Dhabi National Exhibitions Company (ADNEC), on fast-tracking Abu Dhabi's economic diversification, the importance of the Year of Zayed, and technology's impact on the world of event planning.
read articleInterview
Dr. Thani bin Ahmed Al Zeyoudi, UAE Minister , Climate Change and Environment
TBY talks to Dr. Thani bin Ahmed Al Zeyoudi, UAE Minister of Climate Change and Environment, on the UAE's commitment to reducing its ecological footprint, transitioning to a climate-resilient green economy, and the importance of sustainable green finance.
read articleInterview
Neri Askland, Vice President , Middle East and UAE Country Manager of Statoil
TBY talks to Neri Askland, Vice President of Middle East and UAE Country Manager of Statoil, on its efforts to help reduce its carbon footprint, opportunities for R&D in the area, and its collaboration with Masdar.
read articleFocus: Nuclear Energy
The Nuclear Option
The UAE is the first country in the MENA region to develop nuclear power, with Abu Dhabi's Barakah nuclear power plant. The Emirate hopes to achieve energy security and embrace alternative sources of energy, ensuring full cooperation and support from the international community.
read articleInterview
Christer Viktorsson, Director General , Federal Authority for Nuclear Regulation (FANR)
TBY talks to Christer Viktorsson, Director General of Federal Authority for Nuclear Regulation (FANR), on the role of the institution in advancing the nuclear energy regulatory environment, the Barakah Power Plant, and the importance of an integrated network.
read articleInterview
Eng. Omar Husain Al Hashmi, Acting Managing Director , Abu Dhabi Sewerage Services Company (ADSSC),
TBY talks to Eng. Omar Husain Al Hashmi, Acting Managing Director of Abu Dhabi Sewerage Services Company (ADSSC), on its successes with STEP, helping Abu Dhabi to reduce its carbon footprint, and its successful Emiratization policies.
read articleInterview
Saeed Al Bahri Salem Al Ameri, Director General , Abu Dhabi Food Control Authority (ADFCA)
TBY talks to Saeed Al Bahri Salem Al Ameri, Director General of Abu Dhabi Food Control Authority (ADFCA), on the Farmers Income Support Program, the UAE's agroecological climate, and introducing intelligent control systems.
read articleInterview
Falah Al Ahbabi, Chairman, Department of Urban Planning and Municipalities (DPM)
TBY talks to Falah Al Ahbabi, Chairman of Department of Urban Planning and Municipalities (DPM), on coordinating joint-investment programs and strategic alliances with the private sector and integrating technology within developments and services.
read articleInside Perspective
Mohammed Ahmed Bin Abdulaziz Al-Shehhi, Undersecretary of Economic Affairs, the Ministry of Economy
Mohammed Ahmed Bin Abdulaziz Al-Shehhi, Undersecretary of Economic Affairs of the Ministry of Economy, on efforts to enhance the UAE's intellectual property framework, creating a knowledge-based economy, and fostering a culture of innovation.
read articleInterview
Khalifa Al Mubarak, Group Chief Executive Officer & Managing Director, Mubadala Investment Company
TBY talks to Khaldoon Khalifa Al Mubarak, Group Chief Executive Officer & Managing Director of Mubadala Investment Company, on the company's diversification strategy, its technology investments, and its focus on innovation.
read articleFocus: Economic Stimulus Package
Desert Breeze
Abu Dhabi unveiled the new stimulus package, Ghadan 21, in effort to counter the post-oil crisis slowdown. While it might be too soon to call for the end of austerity measures, it definitely signifies the leadership's commitment to grow the Emirate's economy.
read articleInterview
Rashed Lahej Al Mansoori, Chairman, Statistics Centre- Abu Dhabi (SCAD)
TBY talks to Rashed Lahej Al Mansoori, Chairman of Statistics Centre-Abu Dhabi (SCAD), on its efforts to improve data collection and lower costs, innovative statistical development tools, and its Emiratization policies.
read articleInterview
Saeed Al Neyad, Director General, Abu Dhabi Monitoring and Control Centre (ADMCC)
TBY talks to Saeed Al Neyadi, Director General of Abu Dhabi Monitoring and Control Centre (ADMCC), on being a critical enabler for various key partner organizations, efforts to increase Abu Dhabi's competitiveness in tourism and commerce, and improving the quality of life for citizens and visitors.
read articleInterview
Nick Cochrane-Dyet, Chairman, British Business Group (BBG)
TBY talks to Nick Cochrane-Dyet, Chairman of British Business Group (BBG), on Abu Dhabi's forward-looking strategy, the need for British firms to continue to bring value to the Emirate, and areas of opportunity for the UK.
read article
