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The free zone is a major contributor to Dubai’s economy

The free zone is a major contributor to Dubai’s economy



Jebel Ali Free Zone: scaling new heights

Home to over 7,000 firms, the free zone’s total trade volume was $80.2 billion last year and the zone accounts for almost 32 per cent of total FDI flowing into the country

November 2017

Dubai-based Jebel Ali Free Zone (Jafza), a subsidiary of global trade enabler DP World, has consolidated its position as a major trading and logistics hub by growing its non-oil foreign trade by 17 per cent from 23.9 million tonnes to 27.9 million tonnes in 2016, worth $80.2 billion.

Sultan Ahmed Bin Sulayem, Group chairman and CEO of DP World, said: “The value and volume of trade through Jafza underlines the strength of the national economy and its ability to adapt to global trading conditions, create investment opportunities and open up new markets to exports from the UAE.”

Bin Sulayem added that Jafza supports economic diversification in line with the directives of His Highness Sheikh Mohammed bin Rashid Al Maktoum, Vice President and Prime Minister of the UAE and Ruler of Dubai, to provide services and incentives to investors that meet their aspirations and provide additional benefits to compete in local, regional and global markets. He noted that despite conditions facing the global economy, Jafza, has been able to progress through flexible policies and innovation. Efforts to develop commercial and customs services for existing companies in the freezone to support business and attract more companies wanting to explore the markets of the region were also playing a major role.

Bin Sulayem: Jafza attracts international companies that add value to the UAE’s economy

Bin Sulayem: Jafza attracts international companies that add value to the UAE’s economy

“Jebel Ali Port plays a pivotal role in enabling international trade so companies operating in Jafza can import and re-export their goods and products to the various countries of the region. Dubai Logistics Corridor, which connects Jebel Ali Port and Al Maktoum International Airport in one customs zone, reducing the time taken for the movement of goods between sea and air transport modes and making the area the main transit gateway in the Middle East,” he added.

 

BUSINESS PARTNERS

Meanwhile, China has maintained its position as Jafza’s largest trading partner with $11.3 billion worth of trade during the year with many Chinese companies in Dubai using logistics capability to re-export goods and products. Saudi Arabia is the second largest Jafza trading partner with $7 billion, while Vietnam was third with $4.3 billion through the import of electronics and electrical appliances, followed by the US with a trade volume of $ 3.7 billion.

 

BUSINESS SECTORS

Machinery, electronics and electrical goods accounted for 49 per cent of Jafza’s total trade with Jebel Ali Port’s ability to handle heavy equipment playing a key role, coupled with high consumer demand in the sector. Petrochemicals, oil and gas sector had 16 per cent of total trade, followed by food and FMCG (8 per cent), textiles and garments (7 per cent), automotive and spare parts (6 per cent).

 

TRADE WITH REGIONS

Trade with the Asia Pacific region came to $32.4 billion, followed by the Middle East at $27.2 billion, the European continent ($9.9 billion), the Americas ($5.5 billion) and Africa ($5 billion).

A major destination for foreign direct investment (FDI) in the Middle East, Africa and CIS states, Jafza registered 122 new companies from 33 countries during the first three months of 2017.

According to a study by Ernst & Young, the free zone accounts for almost 32 per cent of total FDI flowing into the country.

More than half (55 per cent) of new companies were from the Middle East region, followed by 22 per cent from Asia-Pacific, 16 per cent from Europe, 4 per cent from Africa and 3 per cent from North America.

“The number of companies reflects investor confidence in Jafza services and facilities in a wide range of industry sectors,” Bin Sulayem said.

“Our strategy is also guided by the UAE 2021 Plan and Dubai 2021 Plan in the country’s preparation for the post-oil economy,” he added.

Bin Sulayem noted that as a result of the business expansion by existing companies and the inclusion of new ones, Jafza has leased more than 158,000 sq m of space with plots of land totaling 148,000 sq m and warehouses 5,700 sq m.

Jafza and Jebel Ali Port contribute 21 per cent of Dubai’s GDP

Jafza and Jebel Ali Port contribute 21 per cent of Dubai’s GDP

He said that the occupancy of warehouses and light industrial units had reached 82 per cent after new units were added last year, while the occupancy of staff accommodation had exceeded 95 per cent.

The occupancy for office space in the Free Zone was now 66 per cent following the addition of new office space in Jafza’s new office building, Jafza One. Showroom occupancy stands at 78 per cent, with small offices and workstations for SMEs at 98 per cent.

The 7,000 plus companies in Jafza employ over 135,000 people, which is one out of 21 Dubai residents works in Jafza.

 

BUSINESS SECTORS

Of the 122 companies registered, 20 per cent were in the general trading and retail sector, followed by 11 per cent in steel and building materials, with 10 per cent each in the automotive and transport, equipment, machinery and services
sectors.

Meanwhile, Jafza is working on an integrated project to re-engineer its operations and services. In Q1 2017, it completed the automation of more of its services with customers no longer required to physically visit the service centre for additional services. These can now be completed through the Group’s Dubai Trade portal or by calling the Jafza call centre.

The Free Zone has also implemented a digital signature system in coordination with its strategic government partners, embassies and consulates in the country so that the documents can be directly emailed to customers’ registered email address. Verification can also be done through a dedicated website.

 

INFRASTRUCTURE

In cooperation with the Roads and Transport Authority (RTA), Jafza is building another six-lane two-way bridge to link Jafza North and Jafza South, to ease traffic on the Dubai Logistics Corridor, especially container traffic headed from Jebel Ali Port to Al Maktoum International Airport. The project is expected to be completed by the end of the year.

During the first quarter, Jafza also began the construction of a 150,000 sq m residential complex for workers, with 13 buildings and 3,536 rooms.

 

NAMED BEST FREE ZONE

Jafza has won ‘Free Zone of the Year 2017’ for large tenants in Middle East and globally. It has been named the world’s best free zone for 2017 in key categories of the FDi magazine›s annual awards for global free zones.

Jafza won Free Zone of the Year 2017 for Large Tenants in Middle East and globally and was highly commended in the Global Overall and Middle East Overall categories. It was also commended for its facilities upgrades and contribution to the UAE’s national economy.

Sultan Ahmed Bin Sulayem, chairman and CEO of DP World and chairman of Ports, Customs and Free Zones Corporation (PCFC), said: “We are delighted that Jafza has won this award from FDi magazine. It is one of Dubai’s success stories and has developed in accordance with the vision of His Highness Sheikh Mohammed bin Rashid Al Maktoum, Vice President and Prime Minister of the UAE and Ruler of Dubai to make the emirate a hub for business and commerce. ”

Bin Sulayem said the awards confirmed the status of Jafza as a global destination for foreign companies keen on entering the Middle East and Africa markets. “Jafza is a centre for trade and logistics, which provides unrivalled benefits and incentives as well as excellent services that meet customer expectations. It attracts leading businesses and international companies through a wide range of facilities and requirements that enable them to achieve their objectives in the region,” he said.

Jafza and Jebel Ali Port contribute 21 per cent of Dubai›s GDP and play a pivotal role in diversifying the emirate›s economy by attracting international companies that add value to the national economy. “We are working to facilitate business and build partnerships with a number of countries that open markets to companies operating in Jafza,” Bin Sulayem added.

Bin Sulayem added that Jafza is working with the Executive Council to implement Dubai’s plans to become a manufacturing centre. He highlighted the moves to attract more industrial companies with incentives for them to start production here.

Jafza is home to more than 7,000 companies, including 100 or the Global Fortune 500 companies. Most of them have established their regional headquarters in Jafza to service key markets in the Middle East, West Asia, Africa, the Commonwealth of Independent States and the Indian subcontinent.




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