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Sharjah’s economy has highest level of diversification

(Wam) / 2 May 2012

SHARJAH - The Sharjah Investment and Development Authority (Shurooq) announced that it has finalized an in-depth study on the Emirate’s business conditions and investment opportunities in various sectors, in its efforts to develop economy and encourage investment in Sharjah.

The announcement was made by Shurooq on the sidelines of its participation in the Arabian Travel Market (ATM) 2012, which is being held at the Dubai World Trade Centre.

The study, conducted in collaboration with Deloitte, a leading international consultancy firm, offers a sector guide of investment opportunities in the Emirate, as well as an overview of investment trends and prospects in the UAE and Sharjah in particular.

Unveiling the study’s details, Marwan bin Jassim Al Sarkal, CEO of Shurooq, said: “The study offers comprehensive information on Sharjah’s competitive advantages and regulatory environment, and highlights key sectors that offer significant investment potential to local and foreign investors.

“The study mainly aims to aid the investors’ understanding of Sharjah’s business conditions and investment opportunities, as well as to offer an overview of the regulatory landscape, including processes and requirements for setting up a business in the emirate,” he clarified.

Al Sarkal said Shurooq conducted the study in its capacity as the Emirate’s investment body tasked with stimulating business, developing assets, and attracting investments to the emirate of Sharjah.

“The study comes in line with Shurooq’s strategy of promoting Sharjah, highlighting the emirate’s attractions, its economic investment opportunities and tourist characteristics, as well as its geographic location, sophisticated infrastructure and advanced telecom networks which allow easy access to local and international markets,” Al Sarkal explained.

The study shows that Sharjah’s economy has one of the highest level of diversification in the region: Sharjah is the only economy in the Middle East with no single sector contributing to more than 1/5th of GDP.

Sharjah enjoys a strategic location between Europe and the Far East. Sharjah is the only GCC hub with direct access to the Gulf and Indian Ocean, offering a gateway to 160 countries, including 2 billion people, Al Sarkal said.

Shurooq’s CEO went on to say that the study also highlights the many factors that make Sharjah a stable investment environment that can compete at a global level.

Referring to infrastructure facilities provided to investors and tax policies, Al Sarkal said investors who wish to set up a business in the emirate will not have to pay corporate taxes or personal income taxes, while they can get a full allowance for capital repatriation and there is no minimum capital required from them.

According to the study, Sharjah is the 3rd largest emirate by contribution to the UAE’s GDP after Abu Dhabi and Dubai as it accounted roughly 5 percent of the UAE’s GDP and 8 percent of the total non-oil GDP in 2012.Sharjah is the third fastest growing economy in the country and has already attracted almost a quarter of the UAE’s business establishments.

The study demonstrates the Emirate’s strong economic growth from 2002-2009, where Sharjah’s GDP registered a Compound Annual Growth Rate (CAGR) of 13 per cent, one of the highest in the UAE, while its GDP per capita increased by 50 percent in the period between 2005 and 2009.

Sharjah registered a Compounded Annual Growth Rate (CAGR) of six percent between 2008 and 2010, demonstrating a strong resilience during the global financial crisis, which can be attributed to the Emirate’s economic stability due to the diversity of its economy, its strong manufacturing base, and the abundance of small and medium size companies (SMEs), the report said.

The emirate has weathered the global financial crisis relatively due to its well-diversified economy, one of the highest levels of diversification in the region.

Sharjah is the 3rd largest Emirate by contribution to GDP after Abu Dhabi and Dubai It accounted roughly about 5% of the country’s total GDP and 8% of the total non oil GDP in 2010.

Between 2005 and 2009, GDP per capita increased by 50%, which is the fastest growth among the UAE’s major emirates.

The study shows that manufacturing, real estate, business services and trading are the current sectors of Sharjah’s economy, while transportation, tourism, logistics and healthcare are the fastest growing sectors. It also highlights Sharjah as a regional-re-export hub and education hub.

According to the report, Sharjah is recognized as a key hub for manufacturing and industrial activities in the region. Sharjah contributes to 33% of the UAE’s manufacturing sector and is a key destination for investment in basic resources, the study says.

The study covers all the emirate’s sectors, property, education, health, retail, hospitality, tourist and investment sectors, offering an accurate assessment of each sector and defining investment opportunities across the emirate.

Shurooq was established in 2009 with the aim of achieving social, cultural, environmental and economic development on the basis of Sharjah’s distinct Arab and Islamic identity, and to encourage investment by adopting the best international standards in providing quality services that help attract investors from the region and the world.

Shurooq’s key mission is to provide facilities and incentives to help overcome obstacles facing investment activities in the Emirate, evaluate tourism-related infrastructure projects, and lay down the necessary plans to complete such projects.

 
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