Excelling in development
From construction perspective, the UAE has made a leap forward as it is now home to one of the best infrastructure in the region.
Construction and heavy machinery equipment industries are cementing the path of development, as UAE rises to new heights
The UAE is a growing entity and has great opportunities for all in terms of investment, development and human resource richness. Its economy is upbeat, and the country has made great strides in a host of sectors such as industrialisation, aviation, tourism, hospitality and last but not the least healthcare.
Construction and heavy equipment industries, however, stand out spectacular, as they have led from the front in turning the desert oasis into a heartthrob for development and investment. The UAE has turned tables and is a magnet today in being the hub for heavy equipment industry in terms of imports and local manufacturing, as well as a bonanza zone for real estate development.
The UAE has one of the lowest construction costs in the world, and that is owing to the surge in demand and the availability of a foolproof infrastructure. Moreover, the governmental policies are pro-development and real estate is one of the biggest revenue earner in the country. The sector enjoys trust of local and international investors, and that is evident from the construction boom that the UAE has seen since the year 2000.
Intense competition, technological superiority and low labour costs are other factors that have led to a surge in construction investments. Friendly and hassle-free visa policy and the encouragement on the part of authorities to welcome real estate investors with added privileges of residence visa have acted as a catalyst. Diversification of economy to non-oil sectors has also promoted construction, industrialisation and heavy machinery sectors in a magnificent manner.
According to a report by the UK-based construction services firm Turner & Townsend, earlier this year, the UAE's cost of construction is cheapest in the region, i.e., $1,455 per square metre as compared to $2,416 in Qatar. Likewise, it is $3,900 per square metre in New York, $3,617 in London and $2,629 in Paris. The prime reason as to why construction has got a shot in the arm is the upcoming mega-event of Expo 2020 in Dubai, which has made the UAE the centre-stage for activities as big-ticket projects are in the offing.
From construction perspective, the UAE has made a leap forward as it is now home to one of the best communication and logistics infrastructure in the region and beyond, and has state-of-the-art hospitality and leisure facilities for millions of tourists. It is home to some of the renowned construction companies in the world, and this activity has spiraled chain reaction of development in a number of other related industries.
Similarly, global consultancy Arcadis' says that Expo 2020 would lead to an increase in construction activities, and the UAE is set to become the second fastest market with a growth rate of 10.2 per cent. A gigantic construction boom expected in Abu Dhabi, coupled with its industrialisation plan, is set to soar development index in the region, and help attract new companies and promoters.
So is the case with heavy machinery equipment. The UAE is one of the biggest importer of heavy machinery for construction projects, and at the same time has a sophisticated indigenous heavy machinery industry. The goal of the government is to promote mega-projects across the emirates on competitive prices, in order to foster growth.
A number of heavy machinery companies are in business with the sole objective to maintain and service heavy equipment machinery. They keep on updating and servicing their fleet of machines with latest innovations. The Galadari Trucks and Heavy Equipment in partnership with Japanese brand Komatsu is at the vanguard of heavy equipment industry in the UAE. It has a market share of around 59 per cent, and has been rated as the market leader for 5th consecutive year in 2018.
Likewise, Marwan Heavy Equipment, SDLG, and other companies have a wide range of industrial and construction machinery and are progressively cementing the path of development. The UAE has one of the most promising industrial base in the region, which is adaptive and pro-technology. This is why the necessity for heavy machinery in terms of construction and renovation activities are always a constant. Moreover, day by day the UAE is opening up new opportunities for private business, enabling foreign firms, entrepreneurs and investors to benefit from the free-zone facilities as well as bidding in heavy industry evolution.
Apart from the real estate boom as the UAE develops in both horizontal and vertical forms, one of the most developing segment in the UAE economy is the production of heavy mechanical equipment. There is a beeline of professional companies from all around the world who are interested in having a stake in development and profiting from the bonanza of growth. A study says, in the emirate of Dubai, more than one million units of the new expert hardware is created every year in the heavy machinery market in the region. Likewise, there is a surge in production of mechanical equipment and vehicles related to construction and several other heavy excavations, including the mining industries.
It is hoped that the UAE's 2030 industrial strategy will get a boost owing to massive investment and profile enrichment of construction and heavy machinery sector. The UAE is line with big competitors in the sector such as India and China, and the growth trajectory of UAE shows that construction and heavy machinery-related business have a way to go ahead.