Dubai FDI releases report on investment prospects across key sectors in the emirate
Dubai FDI, the foreign investment agency in the Department of Economic Development (DED), has compiled summary reports on trends and opportunities across diverse sectors in Dubai to help investors worldwide and attract further attention to the ease and competitiveness of doing business in Dubai.
The reports cover such key sectors as Logistics, Retail, Information Technology, Healthcare and Green Technology, and the prospects in each of these sectors in the backdrop of the ongoing economic development strategies adopted in the UAE and Dubai.
“As part of the UAE and as the hub of a region of vast economic potential, Dubai has moved to a new level where its approach to business and ambitions are attracting international attention. Dubai FDI focuses on enabling Dubai to capitalise on this global attention and attract businesses and investors to reap rich rewards by being in Dubai,” commented Fahad Al Gergawi, Chief Executive Officer of Dubai FDI.
Al Gergawi added that the sector reports list the key areas where businesses and investors can deploy their expertise and resources profitably and sustainably. “The reports provide an overview of each sector and ongoing projects and plans in the respective sector, and the areas where investors can explore participation and public-private partnerships.”
The report on the Retail sector tracks the anticipated impact of increasing private consumption in the UAE – estimated to grow at an average of 7.8 per cent by 2015 – along with that of high disposable incomes, retail real estate expansion, steady inflow of international retailers, population growth and rising fashion consciousness in the country, on retailing in Dubai.
Between 2012 and 2015 retail sales in the UAE is estimated to grow 32.9 per cent, from AED 114 billion to AED 151 billion, according to the Dubai FDI report. “The vital role of retailing in economic development along with the constant growth in demand makes the sector one of the most lucrative foreign investment prospect in Dubai,” said Al Gergawi.
Referring to Dubai’s efficiency, viability and profitability as a logistics hub the sector report states that ongoing expansion of the transport infrastructure has further brightened investment prospects in the logistics and related sectors in the emirate. Dubai is the world’s third largest re-export hub and the UAE logistics market is expected to reach AED 34.5 billion in 2014.
Being a vital element of a competitive freight network and located strategically in the Middle East, North Africa and South Asia (MENASA) region, Dubai provides the best connections to a quarter of the world’s population and a combined gross domestic product (GDP) of AED 13.2 billion, which has tripled in size in the past decade.
Healthcare in Dubai is by far the best in the region and has also diversified into research and development, pharmaceutical production, equipment manufacturing as well as medical tourism, thus opening up for foreign investment and participation, says the report.
The population in the Middle East is estimated to cross 520 million by 2030 and the healthcare needs of the UAE alone is expected to reach nearly AED 30 billion by 2015, which demands substantial investment in facility development and management in addition to private sector expertise in specialised research, diagnostics, therapies, education and training.
The report on Information Technology (IT) points to specialised industry clusters like Dubai Internet City and Dubai Silicon Oasis, which Dubai has developed with a view to enabling software developers, hardware manufacturers, service providers and network designers to capitalise on Dubai’s location, high internet penetration and focus on innovation.
Quoting from recent studies the report says that the IT spending in Dubai alone will hit AED 5 billion in 2014. The government’s strategic focus on e-services and the need for IT security in light of the fast growth in the emirate’s banking, financial and insurance sectors ask for increased investment in this sector.
The emergence of sustainability as a priority in government strategy and the potential it has created for investment in clean technologies are detailed in the report on Green Technology. Dubai has pioneered renewable energy benchmarks in the region and has launched an Integrated Energy Strategy with a view to a 30 per cent reduction in carbon emissions by 2030.
The Mohammed Bin Rashid Al Maktoum Solar Park, commissioned in 2013, is the first utility-scale project of its kind in the region and a prelude to promising renewable energy initiatives in Dubai. The first phase of the park can produce 10MW of electricity and by 2030, the park will produce 1,000MW when all its phases will be completed.
Dubai has also announced significant investments in alternative and sustainable energy projects on estimates that its energy needs will double in the next decade, overall an attractive proposition for companies looking to set up or expand in the Middle East.
“There indeed is an explicit commitment from the government to leading and facilitating investment in sustainability. In 2012 Dubai launched the ‘Green Economy Partnership’ to promote sustainable growth and Dubai FDI has been entrusted to liaise between local, regional and international firms interested in promoting the partnership,” remarked Al Gergawi.
The partnership seeks to spur sustainable and green growth of Dubai economy and promote its position in the global green economy value chain. Public-private partnerships will be a major focus area of the new initiative.