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Jafza plays an important role in drawing more FDI to UAE

DUBAI - The UAE continues to attract foreign direct investment, or FDI, and the Jebel Ali Free Zone, or Jafza, plays a key role in drawing multinationals to the country.

Built over an area of 48 square kilometres, the entity of Economic Zones World, or EZW, ranks among the world’s largest and the fastest growing free zones.

In its 25 years of operation, Jafza has posted more than 320 times growth in its number of companies growing from 19 in 1985 to over 6,400 in 2009.

The growth did not stop even during the downturn, with the number of companies rising from 6,179 in 2008 to 6,413 in 2009 and 6,550 by the second quarter. In the first half of the year, Jafza has leased 572 new facilities (63 per cent more than 350 for the same period in 2009). 200 of these have been existing customers expanding, which is a positive indicator of the recovery of the economy.

“Jafza consistently strives to contribute to the national drive to attract foreign investments. This has been a focus for us over the past 25 years. We remain committed to continually creating an ideal environment for investors to use as a gateway to the entire region, and beyond,” Economic Zones World Chief Executive Officer Salma Hareb said.

During the first half, the free zone has received a significant number of inbound projects. New arrivals so far have included Mitsubishi Corporation, Petrochina, JVC Professional, Proclad Stream-Flo, Schoeller-Bleckman and Isuzu Motors, among others.

A combination of an investment atmosphere and a customer-centric business policy have helped raise the number of investors from outside the Middle East to 3,500 — 54 per cent of the total of 6,512 companies in Jafza. The number rises to 5,125 when regional investors, other than from the six Gulf states, are added.

This performance has enabled Jafza to play a central role in the flow of foreign investments into the country, which amounted to $ 69 billion, according to figures announced by the UAE Ministry of Economy in June 2010.

Between 1999 and second quarter of 2010, the number of companies in Jafza grew from 1,134 to 6,550, a growth of almost 600 per cent.

The investment flow, which was growing at a steady pace, saw a steep rise in 2003 when the boom set in and continued until the start of the recession in 2008.

“There has been a qualitative improvement in the FDI that Jafza has attracted over the past two years, with proportionately more well-established manufacturers and service providers moving here in search of stable operational bases. Our value proposition was, and continues to be, integrated infrastructure, the best international practices and exceptional customer service,” Hareb said.

abdulbasit@khaleejtimes.com