12 Sep 2022
Industrial Development Bureau, DED - Abu Dhabi
The H1-2022 manufacturing report, issued by Industrial Development Bureau (IBD), part of the Abu Dhabi Department of Economic Development (ADDED), has confirmed strong growth of the Emirate’s industrial sector. New industrial licenses (Rowad) reached 136, and those transitioning to the construction phase reached 62, with the number of licenses having moved from under-construction to in-production reached 44 factories. Total number of active in-production licenses were 866 by end of June 2022.
The total value of Capital Expenditures (CAPEX) of industrial establishments that switched to in-production stage rose to AED 3.1 billion compared to AED 1.03 billion in the same period last year.
The report revealed positive indicators including the growing number of government tenders awarded to companies with In-Country Value (ICV) certificates, under the Abu Dhabi Local Content programme (ADLC), reaching 466 tenders, up from 95 tenders in H1-2021. The value of tenders won by ICV holding companies rose from AED 556 million in first six month of 2021 to AED 970.5 million in H1-2022.
Tenders with local content value represent 41.9% of tenders awarded to ICV certificate holding companies, which means AED 407 million were re-injected in the local economy to support local products, compared with AED 215.2 million in first half of 2021.
During H1-2022, tenders awarded to ICV holding companies made up 56.1% of 827 total government tenders, with 72% of total value of government tenders, amounting to AED 1.33 billion.
The ADLC programme contributes to the growth of the Emirate’s GDP, enhancing the knowledge economy attributes, technology utilisation, and increasing Emiratisation rates.
The number of highly skilled employees in factories enrolled in the Electric Tariff Incentive Programme (ETIP) reached 41% of the total.
The IDB’s H1-2022 report also reflected a growing interest in the Golden List initiative, developed to increase demand on locally manufactured goods through government procurements. The number of manufacturers that joined the list topped 127 by end of June 2021, an increase of 14.4% compared to 111 establishments as of 31 December 2021. The number of registered products in the list grew by 33.9% to reach 655 products from 489 the same period last year
The report revealed that total value of customs fees exemption granted to manufacturers in Abu Dhabi during first half of 2022 reached AED 1.02 billon, with 5 new factories having earned Electric Tariff Incentive Programme (ETIP) certificates. The ETIP aims to boost productivity of industrial facilities and enhance their economic impact and energy efficiency, by providing competitive electricity tariffs.
H.E. Rashed Abdulkarim Al Blooshi, Undersecretary of ADDED, said: “The strong indicators of IDB’s H1-2022 report reflects the strength of the manufacturing sector in Abu Dhabi, which is a key priority for achieving our economic diversification objectives. The industrial sector is the largest contributor to Abu Dhabi’s non-oil GDP in addition to its role in creating jobs and enhancing knowledge and innovation-driven initiatives”.
“We are building on these successes and will continue our efforts to ensure ease of doing business, support industrial financing, and FDI attraction to achieve objectives of the recently launched Abu Dhabi Industrial Strategy to strengthen the Emirate’s position as the region’s most competitive industrial hub. To this end, Abu Dhabi is investing AED10 billion across six transformational programmes to more than double the size of the manufacturing sector to AED172 billion by 2031 and create new 13,600 skilled jobs, with a focus on Emirati talent,” H.E. Al Blooshi added.
As part of IDB’s efforts to ensure compliance of industrial establishments with laws, regulatory framework, and licensing criteria as well as providing technical and administrative guidance to enhance performance, 741 field visits were carried out covering 576 industrial facilities, including 417 in Abu Dhabi, 143 in Al Ain, and 16 in Al Dhafra. Total investments of these facilities exceed AED 2.5 billion.
The Industrial Development Bureau is expanding the scope of the self-monitoring programme for facilities with high levels of compliance, to include more than 80 industrial facilities until 2023, compared to 43 by end of June 2022. This will be achieved by upskilling workers, and further advancing UAE nationals’ expertise in aspects related to senior management and corporate governance.
H.E. Sameh Al Qubaisi, Director General of Economic Affairs at ADDED, said: “IDB is implementing initiatives to deliver against Abu Dhabi Industrial Strategy’s objectives. The Smart Manufacturing Programme has assessed readiness of 76 facilities to transition to Industry 4.0 technologies. In addition, we are strengthening partnerships with leading global players to empower manufacturers to switch to Industry 4.0, and to support a circular, smart, and sustainable economy”.
To enhance the competitiveness of the funding environment, IDB has signed Memorandums of Understanding with 10 banks, including the Etihad Credit Insurance, Abu Dhabi Export Office, Abu Dhabi Securities Exchange (ADX), and Maqta Gateway to help improve financial inclusion for industrial facilities.