The UAE is launching a series of initiatives including setting up new industrial units to increase industrial exports and boost the sector’s contribution to the national economy, Dr Sultan Al Jaber, Minister of Industry and Advanced Technology, has said.
With the initiatives launched last year, the UAE has already managed to increase the industrial sector’s contribution to national gross domestic product to Dh182 billion ($50 billion), a 38 per cent increase from Dh132 billion in 2020, Dr Al Jaber said in his key note speech at the second Make it in the Emirates forum in Abu Dhabi.
The value of the UAE’s industrial exports rose to Dh175 billion last year, a 49 per cent increase from 2020 on the back of the National Strategy for Industry and Advanced Technology launched by the ministry, he said.
This year, the UAE plans to “increase the value of purchase agreements for local manufacturers and industrial investments by more than Dh10 billion, taking the total value of products targeted for localisation to Dh120 billion”, Dr Al Jaber told delegates on Wednesday.
Last year, national companies including Adnoc announced investment of Dh110 billion over the next decade to purchase 300 products from local manufacturers.
“I am pleased to share with you that in the first year alone, 28 per cent of these offtake agreements have been implemented, representing a total value of Dh31 billion,” Dr Al Jaber said. “This is an outstanding achievement.”
The Arab world’s second-largest economy also plans to launch more than 30 “innovative industrial projects” valued at about Dh6 billion.
“These projects include pioneering initiatives such as setting up the first hydrogen electrolyser plant in the UAE,” he said.
The UAE launched its broader industrial strategy, Operation 300bn, in 2021, which aims to position the country as an industrial centre by 2031. The 10-year strategy focuses on increasing industry’s contribution to GDP to Dh300 billion by 2031, from Dh133 billion in 2021.
The strategy focuses on boosting production in 11 priority areas, supporting the growth of national industry, attracting foreign investment, modernising legislation and ensuring availability of dedicated financing for industrial companies.
The Ministry of Industry and Advanced Technology, which was created in 2020 to increase the competitiveness of products made in the UAE, is leading Operation 300bn.
The Make it in the Emirates campaign encourages local and international investors to manufacture and export products from the UAE.
The UAE has also been expanding its In Country Value (ICV) programme that aims to boost private-sector participation in the economy, diversify output and localise critical parts of the supply chain.
State energy company Adnoc is allocating more than Dh20 billion for the purchase of structures and metal products “exclusively from national factories, an initiative that will provide more opportunities to manufacture of products such as cables and pipes”, Dr Al Jaber said.
Last year, the ICV programme redirected Dh53 billion into the national economy, a 25 per cent rise from a year earlier.
The UAE, which is hosting Cop28 this year, is also adopting “a new standard” within the national ICV programme called “Green ICV, to encourage sustainability practices and motivate companies to reduce emissions”, said Dr Al Jaber, who is also Cop28 President-designate.
The industrial sector in the UAE has grown rapidly over the last few years, despite a global economic slowdown. The government is also accelerating the adoption of Fourth Industrial Revolution technologies in the sector under the UAE Industry 4.0 programme.
In 2022, the ministry supported a further 175 factories in developing a road map for their technological transformations, bringing the total number to 275.
It aims to unveil more than 1,000 technological projects by 2031, raise advanced technology exports to Dh15 billion and increase the GDP of advanced technology to Dh110 billion.
The ministry has also taken several steps to improve the ease of doing business and ensuring the industrial sector's access to financing.
This year, First Abu Dhabi Bank, the biggest lender in the UAE by assets, will allocate competitive financing solutions for industrial sector companies. Mashreq is also joining the financing initiative with a Dh1 billion funding commitment to the industrial sector, Dr Al Jaber said.
This financing is on top of the funding being provided by Emirates Development Bank, which last year completed financing deals worth Dh3 billion to support and enable the Make it in the Emirates initiative.
The ministry also aims to provide “5,000 sustainable job opportunities for UAE nationals in the industrial sector through the Industrialist Programme”, with the support of Nafis and the Ministry of Human Resources and Emiratisation, he added.
