In This Issue - The Business Year

In This Issue - The Business Year


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In This Issue FOREWORD HH Sheikh Mohammed Bin Rashid Al Maktoum, Vice-President and Prime Minister of the UAE and Ruler of Dubai, on the run-up to Expo 2020 10 ECONOMY REVIEW ON TOP OF THE WORLD Solid GDP growth is set to continue, spurred on by a robust non-oil sector 29 ECONOMY FOCUS: DUBAI PLAN 2021 IN PURSUIT OF HAPPINESS Achieving the six pillars of development 40 TRANSPORT INTERVIEW PAVING THE WAY HE Mattar Al Tayer, Chairman of the Board and Executive Director of the Roads & Transport Authority (RTA), on the use of new technology 120

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Contents DUBAI 2015 10 His Highness Sheikh Mohammed Bin Rashid Al Maktoum, VicePresident and Prime Minister of the UAE, and Ruler of Dubai • Foreword


75 The write premium • Review: Insurance

29 On top of the world • Review

12 Year in review

30 Dr. Ashraf Gamal El Din, CEO, Hawkamah • Column

78 Michel Khalaf, President of Europe, Middle East, and Africa at MetLife • Interview


32 Abdul Baset Al Janahi, CEO, Dubai SME • Column

80 Andrew Smith, CEO of RAK National Insurance • Interview

35 HE Reem Ebrahim Al Hashimi, Minister of State of the UAE • Interview

81 How about this? • Focus: Islamic insurance

15 Toward 2020 • Review 18 Timeline 20 Ban Ki-moon, Secretary-General of the United Nations • Guest speaker 21 HE Dr. Saleh al-Mutlaq, Deputy Prime Minister of Iraq • Guest speaker 22 Keeping the peace • Focus: Regional role 23 Hon. Hanna Serwaa Tetteh, Minister for Foreign Affairs and Regional Integration of the Republic of Ghana • Guest speaker 24 Lilianne Ploumen, Minister of Foreign Trade and Development Cooperation of the Kingdom of the Netherlands • Guest speaker 25 Humanly possible • Focus: Humanitarian aid 26 HE María Ángela Holguín Cuéllar, Minister of Foreign Affairs of the Republic of Colombia • Guest speaker 27 Abdalla Salem El-Badri, Secretary General of OPEC • Guest speaker

82 Joseph Faddoul, Executive Director at Chedid Capital Holding • Interview

36 HE Sultan Ahmed Bin Sulayem, Chairman of DP World • Interview 38 Dr. Nadir Mohammed, Country Director of GCC Countries for the World Bank • Interview 40 In pursuit of happiness • Focus: Dubai plan 2021 42 HE Sami Al Qamzi, Director General of the Department of Economic Development • Interview 43 Fahad Al Gergawi, CEO of Dubai Investment Development Agency (Dubai FDI) • Interview 44 In it to win it • Focus: National innovation strategy 45 HE Hamad Buamim, President and CEO of the Dubai Chamber of Commerce and Industry • Interview

53 Dr. Amina Al Rustamani, Group CEO of TECOM Investments • Interview

84 Jerome Droesch, CEO Gulf and Middle East for AXA Insurance • Interview

54 Stands to reason • Forum: Why Dubai? 56 Mahmud P.K. Merali, Group Managing Partner at Merali’s Chartered Accountants & Registered Auditors • Interview

57 FINANCE 57 Fast and furious • Review: Banking 62 HE Abdul Aziz Al Ghurair, CEO of Mashreq Bank • Interview

46 The islamic economy • Roundtable

64 Right on the money • Forum: Wealth management

50 No rig too big• Focus: Drydocks world

66 Number crunching • Focus: Payment processing

52 HE Ahmed Mahboob Musabih, Director of Dubai Customs • Interview

67 Abdulla Qassem, Chairman of Network International • Interview 68 Bhairav Trivedi, CEO of Network International • Interview 69 Instruments fully tuned • Review: Capital markets 71 HE Essa Kazim, Chairman of Dubai Financial Market (DFM) • Interview 72 Stock in trade • Vox populi: Trading 73 Budgeting for growth • Focus: The budget 74 Current accounts • B2B: Banks

In partnership with: Dubai FDI



DUBAI 2015


& INDUSTRY 85 From sunset to green rise • Review: Energy 89 HE Saeed Mohammed Al Tayer, Managing Director and CEO of Dubai Electricity and Water Authority (DEWA) • Interview 90 Ahmad M. Bin Shafar, CEO of Empower • Interview 91 Panel show • Focus: Solar power 92 Benoit Dubarle, President of Schneider Electric in the UAE • Interview

109 Kevin Kelly, Senior Maverick and Co-founder of Wired magazine • Guest speaker

93 Happily grinding away • Review: Industry

110 Smart thinking • Focus: Tech hubs

97 Ahmed Bin Sulayem, Executive Chairman of Dubai Multi Commodities Centre (DMCC) • Interview

111 Smart and connected • Forum: ICT companies

98 What’s Nexus? • Forum: Dubai as a hub 100 Andrew Shaw, Managing Director of Ducab • Interview 101 What’s at steak? • Focus: The halal industry 102 Saleh Abdullah Lootah, Managing Director of Al Islami Foods • Interview

112 Andrew Horne, General Manager of Xerox Emirates • Interview 113 Behind the scenes • Vox populi: Smart technology 114 Bureaucracy made easy • Focus: Smart government



115 Operation stopover • Review


& IT

103 Creating the future • Review 108 HE Hamed Obaid Al Mansoori, Director General of the Telecommunications Regulatory Authority (TRA) • Interview

120 HE Mattar Mohamed Al Tayer, Director General and Chairman of the Board of Executive Directors of the Roads & Transport Authority (RTA) • Interview 121 Mohammed Abdullah Al Jarman, General Manager of Emirates Transport • Interview

122 Route canal • Focus: Dubai water canal 124 HE Khalifa Al Zaffin, Executive Chairman of Dubai Aviation City Corporation (DACC) • Interview 125 David J. Greer OBE, CEO of Serco Middle East • Interview 126 Rail in comparison • Focus: Metro expansion 128 Right on time • Forum: Logistics 130 Raman Kumar, Managing Director of Al-Futtaim Logistics • Interview 131 Steen Hartwig, Managing Director of Freightworks • Interview

133 MARITIME 133 All hands on deck• Review 136 Amer Ali, Executive Director of the Dubai Maritime City Authority (DMCA) • Interview 137 Mohammed Al Muallem, Senior Vice-President and Managing Director, UAE Region of DP World • Interview 138 By the sea shore • Focus: Dubai maritime city & vision 2030 140 Mishal Hamed Kanoo, Deputy Chairman of the Kanoo Group • Interview



141 Expo(nential) development ahead • Review: Construction 144 Brian Dawes, Regional Manager - Middle East, Applus Velosi • Column 145 Yu Tao, President and CEO of China State Construction Engineering Corporation—CSCEC (Middle East) (L.L.C) • Guest speaker 146 Rizwan Sajan, Founder and Chairman of Danube Group • Interview 147 A rising phoenix • Review: Real estate 150 Imad Dana, CEO of Al Zorah Development Company • Interview 151 Stronger foundations • Forum: Stabilizing real estate 152 All the world • Focus: Mohammed Bin Rashid city 153 Behind the scenes • Vox populi: Facility management 154 Home free • Forum: Residential developers


Managing Editor Leland Rice Regional Director Betül Çakaloğlu Country Manager Burcu Sapmaz Assistant Country Manager Burcu Akkan Country Editors Aaron Teitelbaum, Maite Ventura Project Assistant Hanna Abdulla Chief Executive Officer Ayşe Hazır Valentin Commercial Director Laila Bastati Editorial Director Christopher Copper-Ind Senior Editor Mark A. Szawlowski Associate Editor Terry Whitlam Web Editor Peter Howson Sub-Editors Aidan McMahon, Lewis King, Lily Leach, Victoria Araj Editorial Assistant Asiye Duman Assistant Web Editor Ece Çolak Contributor Jason J. Nash Transcribers Nikolai Davis, Deanne de Vries, Attila Pelit, Pronto Publishing Services, Olga Gertcyk Heather Conover, Claire Livesay Art Director Berin Cansu Zafer Jr Art Director Bahar Kara Graphic Designers Ceren Bettemir, Lavì Abeni, Çağıl Aygen, Sérgio Caldeira, Melahat Çakır Cover Illustrator Kürşat Ünsal PR Manager Shweta Mulani HR Executive Inés Delgado Operations Manager Semiha Elkıran Operations Executive Öznur Yıldız Operations Assistants Gamze Zorlu, Şölen Cenberoğlu Financial Operations Manager Serpil Yaltalıer Finance Manager Ana Mari Finance Assistant Janine Escobar Circulation & Marketing Director Amy Burtin Publisher Peggy Rosiak The Business Year is published by The Business Year International, Trident Chambers, P.O. Box 146, Road Town, Tortola, British Virgin Islands. Printed by Apa Uniprint, Hadımköy Mahallesi 434 Street No:6, 34555, Arnavutköy, İstanbul, Türkiye. The Business Year is a registered trademark of The Business Year International, Copyright The Business Year International Inc. 2015. All rights reserved. No part of this publication may be reproduced, stored in a retrievable system, or transmitted in any form or by any means, electronic, mechanical, photocopied, recorded, or otherwise without prior permission of The Business Year International Inc. The Business Year International Inc. has made every effort to ensure that the content of this publication is accurate at the time of printing. The Business Year International Inc. makes no warranty, representation, or undertaking, whether expressed or implied, nor does it assume any legal liability, direct or indirect, or responsibility for the accuracy, completeness, or usefulness of any information contained in this publication.

ISBN 978-1-908180-49-0

155 HEALTH 155 Green and growing • Review 156 Marwan Abdulaziz Janahi, Executive Director, DuBiotech and EnPark • Column 160 HE Dr. Raja Al Gurg, ViceChairperson and Executive Director of the Dubai Healthcare City Authority (DHCA) • Interview 161 There is a light • B2B: Hospitals 162 Sustainably healthy • Focus: Rashid Hospital project 164 Dr. Reem Osman, CEO of Saudi German Hospital-Dubai • Interview

187 Home from home • B2B: Serviced apartments 188 Host to much • Focus: Dubailand 190 Karim Bizid, General Manager of The Oberoi • Interview 191 The best sense • Photo essay: A global cuisine 194 Fit the bill • B2B: Local players

172 Dino Varkey, Group Executive Director and Board Member, GEMS Education • Column 173 Anant Agarwal, CEO of edX • Guest speaker 174 Bookworms • Forum: Education 176 School in the crown • Focus: Private schools 177 Prof. Muthanna G. Abdul Razzaq, President and CEO of the American University in the Emirates (AUE) • Interview 178 Getting the pulse • B2B: Developing local expertise

179 TOURISM 179 The choice is yours • Review 180 Ahmed Ramdan, Group CEO, Róya International • Column 184 HE Helal Saeed Al Marri, Director General of the Dubai Department of Tourism & Commerce Marketing (DTCM) • Interview 185 Gerald Lawless, President and CEO of Jumeirah Group • Interview 186 Philippe Zuber, COO of Emaar Hospitality Group • Interview

208 Abdulla Galadari, Managing Director, Galadari Advocates & Legal Consultants • Column

214 Are you being served? • Forum: Hotel management

200 Open up • B2B: Brand awarenes

169 Hey teacher! • Review

207 Merali's provides an overview of the business environment in the Emirate • Review: Doing business

198 Ashish Nanda, Senior General Manager, Shift Car Rental & Leasing • Column

166 Healthy minds, healthy bodies • Focus: Medical research



211 Merali's provides an overview of the tax regime in the country • Review: Taxation in the UAE

199 HE Mohammed Abdul Rahim Al Fahim, CEO of Paris Gallery Group of Companies • Interview

168 Faisal Bin Juma Belhoul, Chairman of Amanat Holdings PJSC • Interview


196 Valley of the malls • Review: Retail

165 Sugaring the pill • Forum: Healthcare

167 Zeyad Hassan Al Moosa, Managing Director and Partner of GulfDrug • Interview


201 Karl Hamer, Managing Director of Al Habtoor Motors • Interview 202 Smart fashion • Focus: Dubai design district 204 Best of the best • Forum: Cars 205 Michel Ayat, CEO of AWR Automotive • Interview 206 Operation unwind • Life & leisure

216 When in Dubai...



DUBAI 2015



FOREWORD TO THE BUSINESS YEAR: DUBAI 2015 His Highness Sheikh Mohammed Bin Rashid Al Maktoum, Vice-President and Prime Minister of the UAE, and Ruler of Dubai.

THE UAE IS, in 2015, consolidating its po-

sition as a regional leader and a beacon of stability within the Middle East. More people than ever are visiting the Emirates for business and leisure. This year, in particular, the UAE is focusing on the goals and ambitions that will culminate in Dubai’s hosting of World Expo 2020, which will coincide with the 50th anniversary of the UAE’s founding, and in the realization of the UAE’s collective Vision 2021 a year later. Realizing this Vision, and the efforts that are going into making Expo 2020 an event of international significance, depends entirely on the energy, creativity, and collaboration of our people. The theme of Expo 2020—Connecting Minds, Creating the Future—brings together the country’s objectives and our goals both internationally and at home. The event will bring the world to Dubai to learn, experience, and share ideas in just the same spirit of sharing and learning that inspired the very first such exhibition, in London’s Hyde Park in 1851. Our aims are many and varied, yet all seek the same level of international excellence. In the realm of economy, we work to establish Dubai as the world’s center for Islamic economy by 2018. Last year, we created the Dubai Islamic Economy Development Centre (DIEDC) to encourage the realization of this goal within just three years. Dubai already plays host to a thriving Islamic finance sector, which has been growing at nearly double the pace of the conventional financial sector over the last few years. Also by 2020, we plan to attract 20 million visitors a year to Dubai, as part of our 2020 Strategy to make Dubai an unrivaled destination for the 21st century. The foundations for

this growth are strong and stable. The UAE is eighth in the world, and first in the Middle East, in the IMF’s global competitive rankings. Coming to Dubai has never been easier—Al Maktoum International Airport, sitting at the heart of Dubai World Central, is fast becoming one of the world’s most premier air hubs, and will be able to handle up to 160 million passengers per year and 12 million tons of cargo annually. Education lies at the heart of both our success as a nation and the values that together make up our Vision 2021. Equipping all residents of Dubai, whether Emirati or expatriate, with the knowledge and skills that will make our country still greater is a key task. Having established a system of universal education, we are now moving to make this system an example of world excellence. It is through education that we as a nation can excel and maintain our position at the forefront of global excellence across all sectors. It is this level of expertise that led us to set up the UAE Space Agency—a pioneering Emirati project to launch an unmanned probe to Mars in 2021, an event which will mark the affirmative arrival of the Arab world to the age of space exploration. Dubai’s ambition to be the best city in the world rests upon the simple values of hard work, enterprise, and openness. The people and their stories in these pages of The Business Year: Dubai 2015 are testimony to the fact that Dubai’s story is that of its people, their energy and ideas. Together, we are weaving these stories, ensuring that Dubai’s future will be even more successful to further complement the extraordinary achievements of our past. Yet this marks just the beginning of our journey. ✖

Dubai’s ambition to be the best city in the world rests upon the simple values of hard work, enterprise, and openness. The people and their stories in these pages of The Business Year: Dubai 2015 are testimony to the fact that Dubai’s story is that of its people, their energy and ideas.


DUBAI 2015


Dubai went back to basics following the global economic crisis of 2008, setting it in good stead for the fall in oil prices as it reaps the rewards of a diversified economy.

Year in Review IRAN



Umm Al Quwain Ajman Sharjah I Dubai P Port Rashid P Jebel Ali

Khor Fakkan Fujairah

I Al Maktoum

DUBAI Abu Dhabi

4,114 sqkm Al Ain



P Port I International Airport


DUBAI’S BROW REMAINS as dry as the desert it grew out of, its Gulf neighbors, used to feeding on petrodollars, left to do the sweating in the face of low oil prices. Dubai is also bucking a wider UAE trend of belt tightening, ramping up spending by 9% in 2015 without clocking a deficit. Backed by strong spending, predictions for 2015 suggest growth of 4.4%, higher than the 3.1% clocked in 2014. For those left scratching their heads at just how Dubai has managed to sit so pretty, the devil is in the detail; oil represents just 2% of GDP, with the bulk of the economy comprised of tourism, retail, real estate, trade, logistics, and manufacturing. The Emirate certainly doesn’t lack direction, with a buzz surrounding the approaching 2020 Expo, an event the authorities are hoping will be a platform to show off all Dubai has achieved and establish the Emirate as more than just a stopover destination. It hasn’t all been smooth sailing since Dubai dusted itself down following a collapse in its real estate sector post 2008, however, with observers raising concerns over 2014 that prices were approaching pre-crisis levels, and up by over 50% since 2012. Jones Lang LaSalle foresees a cooling off over 2015, however, estimating a 10% drop in prices over the year. In terms of construction, things certainly are not slowing down, with constructors buoyant following 3.5% growth in 2014, up from 2% in 2013. Projects include infrastructure works in preparation for the Expo, as well as multi-billion dollar megaprojects such as Jumeirah Gardens, Dubailand, and Dubai World Central. And although the government has chosen not to run a deficit in its spending budget this year, it has still found the cash to support infrastructure development, as well as healthcare, which receives over one-third of the allotment. Dubai gets the majority of its revenues from state services charges, while revenues from corporation tax and customs duties on foreign banking institutions are expected to rise by 12% in 2015. Elsewhere, inflation stands at just 0.62%, although the CPI rose by over 4% in the first two months of 2015 due to changes in housing and utility costs, which represent over 40% of consumer expenses. With a drop in rent prices looking likely over 2015, however, on top of consolidation in the dollar, inflation is very unlikely to run out of control in the fore-

seeable future. On the trade scene, imports totaled over $70 billion in 1H2014, compared to $13.6 billion in exports over the same period. It’s here that the absence of substantial oil and gas reserves makes itself felt, with exports mainly consisting of semi-precious and precious stones and metals, and base metals and related products. Helping to balance the books is a significant inflow of FDI, which totaled $7.8 billion over 2014. The lion’s share of these inflows were destined for the real estate, financial services, IT, hospitality, and alternative energy segments, and came from the US, the UK, India, the Netherlands, Germany, and Italy predominantly. Significantly, approximately 80% of the projects that received FDI had a regional perspective, suggesting that multinationals increasingly see Dubai as a launchpad to the surrounding regions. On the domestic front, Dubai’s ambition is embodied in Dubai Mall, which, located in downtown Dubai, is the world’s largest shopping mal in terms of GLA at 350,000sqm. Demographics are also being kind to the retail sector, with tourism, expected to ramp up following Expo 2020, coupled with a steady flow of new foreign nationals to Dubai’s shores, expected to keep the money flowing at outlets across the Emirate. This is also good news for the Emirate’s educators, who operate in a sector that prides itself on giving expatriates access to a multitude of foreign curricula. According to the Knowledge and Human Development Authority (KHDA), there are 158 private schools in Dubai, with 10 having opened their doors in the 2013/14 school year. Indeed, the government sees education as key in the development of its knowledge economy, not to mention its pursuit of a more economically active Emirati population. For Dubai, strong state spending does not rely on the price of crude. Therefore, it becomes easier to predict the continued growth of the Emriate’s economy and, as such, its continued attractiveness to investors. In the World Bank’s Ease of Doing Business ranking for 2015, the UAE was listed at 22, climbing three positions since 2014, suggesting the last thing the authorities want to do is squander an opportunity to make Dubai the home of an even greater number of multinationals looking for a bastion of stability to do business in the region. ✖


For those left scratching their heads at just how Dubai has managed to sit so pretty, the devil is in the detail; oil represents just 2% of GDP, with the bulk of the economy comprised of tourism, retail, real estate, trade and logistics, and manufacturing.


RULER Sheikh Mohammed Bin Rashid Al Maktoum LEGISLATIVE POWER 40-member Federal National Council (8 from Dubai)

POLITICAL STRUCTURE Constitutional Monarchy GDP GROWTH 3.1%

LOCAL GOVERNMENT STRUCTURE One of Seven Federal Emirates






Source: Dubai Statistics Center






Ban Ki-moon, Secretary-General of the United Nations, on creating a more accountable and transparent world.

HE Dr. Saleh al-Mutlaq, Deputy Prime Minister of Iraq, on the development of bilateral relations, and regional security.

Through many regional stability issues facing the Middle East today, the UAE has played a central role in stability.

Diplomacy REVIEW

In the run-up to hosting World Expo 2020, the Emirate’s strong foreign relations and openness to FDI stand it in good stead to reap rewards from hosting the event. The onus now is on preparing the city for the influx of visitors, and in so doing meeting its goals for Vision 2021.


he world’s eyes are increasingly turning to Dubai: for trade, investment, travel, for guidance in regional affairs, and in the run-up to World Expo 2020, for inspiration. The Emirate’s government policies are adapting to this heightened international scrutiny, building on a tradition of a liberal and outward looking business environment to take Dubai to new levels of international importance. As HH Sheikh Mohammed Bin Rashid Al Maktoum writes in his Foreword to The Business Year: Dubai 2015, Expo 2020 “brings together the country’s objectives and our goals both internationally and at home. The event will bring the world to Dubai to learn, experience, and share ideas.” At the same time, security issues in the wider Middle East region are calling upon Dubai’s role as mediator and aid donor as never before. Dubai is working ever more closely with its GCC partner members on security (the UAE has joined the

TOWARD 2020 Saudi coalition of countries in the military campaign started in March 2015 in Yemen). The country’s role in the GCC is also increasingly one promoting trade and general diplomatic cooperation across the region and beyond. The Emirate’s stability affords it an almost unique role in hosting international conferences on global affairs, in addition to its well-established reputation as the region’s foremost center for international travel and business. The country’s government structures are at the heart of shaping these efforts.


Through both military and, increasingly, diplomatic means, the UAE has found itself playing an ever greater role in working to resolve regional security issues in 2015. War and conflict in neighboring countries are threatening the region’s stability and prosperity as never before.

Since its founding in 1971, the UAE has been governed as a federation of constitutional monarchies. The balance of power between the seven Emirates of Dubai, Abu Dhabi, Sharjah, Ras Al Khaimah, Fukairah, and Umm Al Quwain favors Dubai and Abu Dhabi, as the largest Emirates, with the greatest share of pow-



DUBAI 2015

er. The ruler of Abu Dhabi also serves as the country’s President, while the ruler of Dubai is the Prime Minister and Vice-President. The government, at federal level, has responsibility for foreign and economic policy, as well as national security. Since 2006, HH Sheikh Mohammed Bin Rashid Al Maktoum has served as Ruler of Dubai, Prime Minister and Vice-President of the UAE. The Al Maktoum family has ruled Dubai since 1833. HH Sheikh Mohammed also sits on the board of the UAE’s Supreme Council, the country’s highest executive body, in which each of the seven Emirates is represented. The Council formulates and regulates national legislature relating to fiscal, budgetary, trade, and security policy and trade agreements. The last parliamentary elections were in 2011, when 20 seats on the Federal National Council were appointed. At the same time, the UAE sought to expand the country’s electoral college to more than 130,000 eligible voters, widening participation in the political process and including female candidates also. Dubai has eight representatives on the 40-member Council. Dubai also, of course, has its own local government, in the form of the Dubai Municipality. The Municipality was established in 1954 by HH Sheikh Rashid bin Saeed Al Mak-

toum, the late Ruler of Dubai, and chaired by HH Sheikh Hamdan bin Rashid Al Maktoum, Deputy Ruler of Dubai. Charged with overseeing local government entities, Dubai Municipality is responsible for the city’s transport and infrastructure, planning, housing and environment, health and education, and financial and budgetary management.

FOREIGN RELATIONS Dubai’s liberal climate toward foreign investment and cooperation and its modernizing outlook have encouraged extensive and long-lasting relations with Western countries as well as close ties with much of the wider Islamic world. Fostering strong and mutually beneficial international relations is an enduring, and founding, principal for Dubai. The city was arguably built on trade, on links with other countries, and on maintaining an approach to policy that is welcoming and outward looking. The Emirate, and the wider UAE, plays a pivotal role as a member of the Gulf Cooperation Council (GCC), the Arab League, OPEC, the Organization of Arab Petroleum Exporting Countries (OAPEC), the UN, and the Organization for Islamic Cooperation (OIC). Dubai is increasingly host to conferences and forums from around the world. In a troubled and often turbulent region, the UAE provides much-needed stability. HH Sheikh Mohammed Bin Rashid Al Maktoum welcomes Michelle Bachelet, Chile's President, on a state visit to Dubai in 2015

Image: Gobierno de Chile


Through both military and, increasingly, diplomatic means, the UAE has found itself playing an ever greater role in working to resolve regional security issues in 2015. War and conflict in neighboring countries are threatening the region’s stability and prosperity as never before. Faced with this grim reality, the UAE has adopted a fresh approach that seeks to bridge religious divisions above all else, with Abu Dhabi hosting an international conference in 2014 to encourage countries and religions to work together to “counter religious extremism.” Alongside this regional effort, the UAE— and Dubai in particular—is quietly fulfilling its remit for foreign aid. Indeed, the country is the biggest humanitarian donor in the world, pledging upwards of $5.89 billion in 2013. Some 140 countries around the world have been the recipient of the UAE’s foreign assistance, distributed via 38 donor groups. Foreign aid accounts for 1.33% of the country’s gross national income. In 2014 to 2015, there has been a particular emphasis on providing assistance to countries in the Middle East and North Africa strongly affected by war and instability in recent years. Yemen, Jordan, Lebanon, Palestine, Egypt, and Libya have been the particular focus of aid spending. The International Humanitarian City (IHC) was founded by HH Sheikh Mohammed Bin Rashid Al Maktoum in 2003 to support infrastructure projects, and relieve poverty, assist refugees and victims of natural and humanitarian disasters, and families suffering famine. The Dubai International Humanitarian Aid and Development (DIHAD) Conference and Exhibition is now in its 12th year. The conference is held annually in Dubai and has become a foremost event in the calendar for bringing together leaders from around the world, and influencing international policy on key humanitarian issues and situations globally. The conference attracts more than 10,000 delegates.

AN INTERNATIONAL CENTER In 2015, as momentum for World Expo 2020 builds, this international outlook is shaping Dubai as never before. By 2020, Dubai alone plans to attract more than 20 million visitors a year. The 2020 strategy seeks to build on Dubai’s reputation as a center for business



Alongside this regional effort, the UAE—and Dubai in particular—is quietly fulfilling its remit for foreign aid. Indeed, the country is the biggest humanitarian donor in the world, pledging upwards of $5.89 billion in 2013. Some 140 countries around the world have been recipients of the UAE’s foreign assistance, distributed via 38 donor groups.

Image: Number 10

and pleasure, fully utilizing the Emirate’s transport infrastructure and biggest-in-theworld airports to handle up to 160 million passengers per annum. Dubai has perhaps grown more swiftly over the past 15 years than any city on the planet— the remarkable scale of the change matched only by the city’s dizzying architecture. Yet in the midst of such change, Dubai’s values have held true. Its outlook has never been more open—to ideas, to trade, to diplomacy and international relations. That constant is set only to strengthen in years to come, as the region, and the wider world, increasingly looks to Dubai as a shining example. ✖

David Cameron, the British Prime Minister, has sought to double bilateral trade to $40bn by 2020



DUBAI 2015




December 2nd, 1971

October 5th, 1972

The Bani Yas tribe, led by the Maktoum family, settles at the creek on the Shindagha Peninsula and declares Dubai’s independence from Abu Dhabi.

His Highness Sheikh Rashid bin Saeed Al Maktoum, first-born son of Sheikh Saeed and eighth ruler of Dubai from the Al Maktoum family, is born.

Offshore oil is discovered approximately 97km from Dubai in the Fateh Oil Field. HH Sheikh Rashid named the field “Fateh” meaning “good fortune.”

The United Arab Emirates (UAE) federation is formed with six of the seven emirates, with Ras Al Khaimah joining later on. The UAE joins the Arab League.

The first in a wave of projects to adopt modern trading infrastructure, Rashid Port is inaugurated. Originally intended to be a 4-berth port, it is further extended to 16 berths.

October 7th, 1990


October 1999

December 1999

January 2001

“Father of Dubai” HH Sheikh Rashid bin Saeed Al Maktoum, dies at the age 78 and is succeeded by his son HH Sheikh Maktoum bin Rashid Al Maktoum.

The Dubai World Cup, the world’s richest thoroughbred horse race, is held for first time at the Meydan Racecourse.

Information technology park Dubai Internet City (DIC) is founded, becoming the largest ICT hub in the MENA region.

Burj Al-Arab, constructed on a man-made island, opens its doors to guests. Designed by WS Atkins, it is the world’s only seven-star hotel.

Dubai Media City (DMC) is launched as a tax-free zone to hold global and regional media companies in the GCC and Middle East, including news agencies and broadcast facilities.




Over the last century Dubai has transformed itself through a wave of infrastructure development, long-term strategic planning, and leading-edge construction. May 19th, 1973




October 25th, 1985

The United Arab Emirates dirham is introduced as the uniform currency of the emirates, replacing the Qatar and Dubai riyal.

The emirate’s population grows by over 200%, due to a substantial increase in expatriate immigration.

The Jebel Ali port opens to supplement growing activity at Rashid Port. The largest man-made harbor in the world, it is home to 5,000 companies from 120 countries.

The Jebel Ali Free Zone (JAFZA) is inaugurated by the government of Dubai. It is the largest and fastest growing free zone in the UAE, home to over 6,400 companies.

Emirates Airlines flies its first routes out of Dubai with just two aircraft—a leased Boeing 737 and an Airbus 300 B4.

June 2001



January 4th, 2010

December 17th, 2014

Construction begins on the Palm Jumeirah island, a man-made archipelago extending into the Persian Gulf, taking the form of a palm tree crowned by a crescent.

Upon the death of his elder brother HH Sheikh Maktoum Bin Rashid Al Maktoum. HH Sheikh Mohammed Bin Rashid Al Maktoum becomes Vice-President and Prime Miniser of the UAE and Ruler of Dubai.

Aiming to promote social and economic development, the first long-term strategy in Dubai and the region, the Dubai Strategic Plan 2015, is launched.

The Burj Khalifa, the tallest man-made structure in the world, standing at 828m, is completed in Downtown Dubai.

Sheikh Mohammed launches Dubai Plan 2021, a new 7-year strategy for development, supplementing Dubai Strategic Plan 2015 and aligning it with UAE Vision 2021.



DUBAI 2015


transparent GOAL Ban Ki-moon, Secretary-General of the United Nations, on creating a more accountable and transparent world and the summits that can help to address that.

BIO Ban Ki-moon is the eighth Secretary-General of the United Nations. His priorities have been to mobilize world leaders around a set of new global challenges, from economic upheaval to pandemics and increasing pressures involving food, energy, and water. He has sought to be a bridgebuilder, to give voice to the world’s poorest and most vulnerable people, and to strengthen the Organization itself. The Secretary General was born in the Republic of Korea on June 13th, 1944. He received a Bachelor’s degree in International Relations from Seoul National University in 1970. In 1985, he earned a Master’s degree in public administration from the Kennedy School of Government at Harvard University. At the time of his election as Secretary General, he was his country’s Minister of Foreign Affairs and Trade. His 37 years of service with the Ministry included postings in New Delhi, Washington, DC, and Vienna. During this time he had responsibility for a variety of portfolios including Foreign Policy Adviser to the President, Chief National Security Adviser to the President, Deputy Minister for Policy Planning, and DirectorGeneral of American Affairs.

The UAE has shown dynamism in modernizing its government while preserving rich traditions. I also applaud the Emirati government for helping to advance progress on climate change and renewable energy. We are in a time of international turmoil. The Israeli-Palestinian conflict continues to take a terrible toll on individuals while undermining prospects for long-term peace and stability. The Arab world faces many other security threats, from instability in Libya and Yemen to the threat of Da’esh in Syria and Iraq. We have all been appalled by the recent upsurge in terrorism and violent extremism. I have repeatedly condemned the repugnant and cowardly behavior of those committing atrocious acts against innocent civilians. The challenges facing governments are not only on the emergency front. People around the world are calling as never before for greater transparency, accountability, and democracy. Those that answer these calls will be strong. Leaders who place themselves above the law and their people put their own governments at risk of collapse. Corrupt, abusive, and exclusive public institutions breed hopelessness that leads to unrest and instability. True stability demands trusted institutions that deliver for people equally. Efficiency in government is more than a matter of smooth functioning—it demands public institutions that truly serve the common good. I commend HH Sheikh Al Maktoum and the Cabinet for declaring 2015 as the Year of Innovation. For the UN and the world, this is a year to take transformative steps toward a more sustainable, equitable, and peaceful world. We are the first generation that can end poverty and maybe the last that can avert the worst impacts of climate change. People need effective governments to achieve our ambitious plans for a more sustainable future. There are three important events this year: the Third International Conference on Financing for Development in Addis Ababa in July; the Special Summit on Sustainable Development

in New York in September; and the Climate Change Conference in Paris in December. The success of these plans will depend on accountable and transparent governments that engage people in decisions affecting them. Civil society groups often stand for issues that communities care about most; human rights, basic services, and justice. I am proud to have intensified the UN’s cooperation with these groups and I count on governments to give them a meaningful say in national policy making. States should also involve more citizens in co-designing solutions to development challenges. IT can allow people to help set priorities. The UN harnessed this power through our MyWorld global survey on peoples’ concerns. More than 7 million individuals have responded by stating their aspirations and hopes for a better future. When governments open their books to the public, they earn trust. And that is critical to building stronger communities and states. Businesses also have great influence. The private sector can serve the public interest with creativity and innovation. States should reward corporations that are socially responsible. The UN Global Compact is helping governments understand that sustainable investments generate public benefits. I have seen successful government activities around the world; from e-governance in northern Europe to youth mobilizations in southern Africa. There is no one-size-fits-all solution, but there are universal principles that should guide every country. To establish accountability, we need the rule of law and equal access to justice for all people. All societies must actively fight corruption and bribery. People respect governments that punish dishonest officials for their crimes. IT can drive progress, but only when there is an open and free environment that encourages civic engagement and constructive criticism. Improving government is not just a matter of efficiency, it is essential to equity, justice, and stability. I welcome initiatives to cut red tape, lower costs, and fight fraud. We are doing this at the UN. Since my first day in office as Secretary General of the United Nations, I have insisted on transparency and accountability. We are creating a more modern, dynamic, and responsive UN that earns even greater public trust. I am the first Secretary General to publically disclose my financial assets, and I have asked all senior officials across the UN to be just as open. ✖





CLOSE neighbors How would you characterize the bilateral relationship between Iraq and the UAE?

TBY talks to HE Dr. Saleh al-Mutlaq, Deputy Prime Minister of Iraq, on the development of bilateral relations, strengthening that relationship, and security in the region.

The relationship between Iraq and the UAE extends to the first days of Declaration of the Independence and Union of the UAE in 1971, as this announcement forms the emergence of a young state under the name of the “United Arab Emirates” and under the banner of the late HH Sheikh Zayed bin Sultan Al Nahyan. Since then, this bilateral relationship has formed into a comfortable and positive development for the Iraqi people. Iraqis look at the Emiratis as brothers and stand alongside them on issues, conflicts, and problems that have been raised about their national sovereignty over some UAE islands. These fraternal efforts represent a good omen for both the Iraqi and the UAE peoples. In addition, our Emirati brothers were always first to support the Iraqi people in a lot of problems and tribulations we faced. I would also like to emphasize that despite some politically motivated recklessness that has tried to disturb the relationship between the two countries; these external actors cannot diminish the relationship between our two countries. All in all, the UAE and Iraq is a fraternal relationship based on mutual respect and historical linkages that encourages us to classify this relationship as first class.

ered as the first opportunity to stimulate, promote, and develop this relationship. We recognize the importance in solidifying a positive and mutually beneficial relationship between the two countries as they both represent economic importance to the region as a whole. In addition to this, Iraq possesses not only substantial material wealth; however, a tremendous amount of human capital. Our two governments concluded many decades ago that the reconstruction of Iraq begins in the fields of housing and infrastructure. There are other opportunities, which complement the exchange of scientific and cultural experiences and areas of sport and tourism, art and so on. How do you see the UAE playing a role in the security of the region?

What are the key areas of opportunity to further strengthen this relationship?

Actually, the UAE has attained good cumulative expertise in security fields, which helps to open other prospects through which it can perform its duties at the regional level. Similarly, the UAE also plays a role in the diplomatic framework regarding the security of this region due to the considerable amount of tension and presence of different threats. On an international level, the UAE is an active participant in the international coalition against terrorism and extremism. These factors have enabled the UAE to play an important security role for deployment of stability and limit the threat of terrorism and extremism.

There is no doubt that the economic aspect of trade and investment could be consid-

What role does a unified Iraq play in developing long-term

and lasting peace in the Middle East?

There is no doubt that a unified and safe Iraq reflects a positive impact on the region as a whole. Conversely, there are risks that threaten the entire region as a result of the situation happening in Iraq recently. We are confident that today Iraq is fighting terrorism on behalf of the nation and for all humanity. In light of this, it is necessary to unite the Arab and international efforts to provide an appropriate support for Iraq to flush out this terrorism. By supporting Iraq’s security and military institutions as well as strengthening the bonds of brotherhood among its people, Iraq will be able to establish its vital role and come back as a positive and basic player in the security of the region. ✖

BIO Since 2010, HE Dr. Saleh al-Mutlaq has been Deputy Prime Minister of Iraq for Reconstruction Services and also heads the Ministerial Committee for Reconstruction and Services and the Committee on Education Strategy. He is one of the most senior figures from Iraq’s Sunni minority in Prime Minister Haider Al Abadi’s Shiite-led government. Previously, he was the Secretary General of the Democratic Party in 2003. After graduating from the University of Baghdad in 1968, he received his PhD from the University of Aberdeen in Scotland 1974.



DUBAI 2015


KEEPING THE PEACE Through the many regional stability issues facing the Middle East today, the UAE has played a fundamental role in stability not only through military channels, but also by diplomatic means.

THE UAE has put itself on the map on an international level through its achievements both socially and economically since its meteoric rise in the early 2000s. However, conflict throughout the Middle East and North Africa has threatened to destabilize the region while also casting serious doubts on global security. But in addition to its military involvement in the coalition against ISIS, the UAE has taken prudent steps through diplomatic and peaceful means to contribute to the regional and international security. As religion plays a central role in this challenge, the UAE has recognized the importance of facilitating religious dialog across cultures and using its strategic geographical positioning as a platform to accomplish this. In December 2014, the world’s leading religious leaders convened in Abu Dhabi for the first global multi-religious, high-level conference on violent religious extremism, named “Religions Working Together to Counter Violent Religious Extremism.” The conference was hosted by the Forum for Promoting Peace in Muslim Societies and was convened in cooperation with Religions for Peace. The forum gathers intellectuals and leading thinkers from around the world to clarify that Islam is a religion of peace. Participants included Sheikh Abdullah bin Bayyah, President of the Forum for Peace in Muslim Societies; Cardinal John Onaiyekan, Archbishop of Abuja, Nigeria; and Nassir Abdulaziz Al Nasser, High Representative for the United Nations Alliance of Civilizations. Participants agreed that now is the time for action against all violent religious extremism and they must use their knowledge and influence to provide their followers with the correct explanations of their religious texts. Ultimately, this conference illuminated the issue religious extremism and created a message across religions that this is a challenge that must be addressed internationally.

The UAE has also taken the issue of Islamic extremism to the United Nations as well as partnering with other nations to pursue an intergovernmental approach. In February 2015, HE Anwar bin Mohammed Gargash announced at the UN Security Council that the UAE intends to launch a new diplomatic initiative aimed at building international cooperation and facilitating dialogue through the Contact Group on Countering Extremism. This Contact Group would bring together select governments along with regional and international organizations

As religion plays a central role in this challenge, the UAE has recognized the importance of facilitating religious dialog across cultures and using its strategic geographical positioning as a platform to accomplish this. and formalize the threat of Islamic extremism within on an international level. Once brought together, these entities will be able to develop and disseminate concrete solutions as well as best practices in countering extremism. Progress made through the contact group will compliment and reinforce the efforts of the anti-ISIS coalition and support the UN to take effective collective measures for the prevention and removal of threats in conformity with the principles of justice and international law, as enshrined in the UN Charter. By doing so, the UAE would be able to identify itself as a premier leader in combating Islamic extremism on the biggest intergovernmental stage. Through organizing global conferences on promoting religious peace as well as pursuing diplomatic results through the UN, the UAE has underscored the importance of a peaceful resolution to regional security issues. Through these, the UAE aims to be a regional leader in addressing international security issues as well as being a premier peace advocate. ✖






The Dubai Chamber is opening an office in Accra

TBY talks to Hon. Hanna Serwaa Tetteh, Minister for Foreign Affairs and Regional Integration of the Republic of Ghana, on the country’s presence in Dubai and how the two are working together.

BIO Hon. Hanna Serwaa Tetteh is the Minister for Foreign Affairs and Regional Integration of the Republic of Ghana. She is also the Member of Parliament for the Awutu-Senya West Constituency in the Central Region. Prior to her appointment as Foreign Minister in February 2014, she was the Minister of Trade and Industry for the entire four-year period in the previous term of the Government of the National Democratic Congress. She is a lawyer by profession having studied law at the University of Ghana, Legon and obtaining her Bachelor of Laws (LLB) Degree in 1989. She subsequently attended the Ghana School of Law and was called to the Ghana Bar in 1992. She began her legal career in private legal practice with the law firm of Ansa-Asare & Co., and also worked briefly with the Commission on Human Rights and Administrative Justice.

The Dubai Chamber is going to open a representative office in Ghana. How do you assess bilateral relations between Ghana and the Emirate of Dubai?

We have an excellent relationship with the UAE, especially with Dubai, and we have a Consul General in the Emirate. We have had a diplomatic presence there for the last five years. In addition, we have seen a considerable amount of business between Ghana and Dubai already, and Emirates is one of the most popular airlines that crosses the skies from Accra to not only Dubai, but the whole Far East, as well as other parts in the Middle East and Asia. There are also a large number of Ghanaian businesses that have opened representation offices in Dubai and vice versa. The Dubai Chamber is going to open an office in Accra, which is something positive that will take this relationship forward in a faster manner. I would say things are going well, and I hope that our relationship continues to develop. Which specific sectors have the most potential for growth

between the two countries?

The sectors where we see growth have always been in the areas of trading, financial services, and infrastructure development.

Ghana took part in the Africa Global Business Forum hosted in Dubai in 2013

What are the strengths that Dubai holds for Ghanaian investors?

The strengths of Dubai for our investment community are numerous. Dubai has always been seen as a hub. It is a in convenient location between the East and Ghana, because a number of the businesses that have been established in Dubai also do business with the Far East and Asia. However, they have their offices located in Dubai because it offers easy access in terms of connectivity in moving from one location to the other. This has considerably helped business between Dubai, Ghana, and wherever else in Asia and the Middle East that our companies have operations. What are your expectations for Ghana regarding the Expo 2020?

I am sure we will have a fantastic display, and I believe people will find our stand

beautiful. Yet, more importantly I hope it creates the right kind of connectivity and helps to strengthen the relationship between Dubai and Ghana. I hope that it especially appeals to businesses and people working out of Dubai and Ghana. What are the conclusions you draw from the Africa Global Business Forum hosted in Dubai in October 2013?

I believe it was a great forum, and extremely helpful. I also came last year to a similar forum, and this time it was smaller. This makes the forum more effective, and I expect that the people attending will be able to build relationships that will make them want to come here, as well as encourage the business community from Dubai to continue to interact with Ghana. ✖



DUBAI 2015


working FORWARD TBY talks to Lilianne Ploumen, Minister of Foreign Trade and Development Cooperation of the Kingdom of the Netherlands, on collaboration between the two states and the idea of trilateral cooperation. How is the Netherlands strengthening its trade relationship with the UAE?

BIO Lilianne Ploumen was appointed Minister of Foreign Trade and Development Cooperation in the Rutte-Asscher government in November 2012 and was Chair of the Labour Party (PvdA) from October 2007 to January 2012. Minister Ploumen brings her a wealth of experience in non-profit organizations before joining government and served as Head of Quality and Strategy for the development organization Cordaid as well as founding Ploumen Projecten, an organization specializing in market research and innovation for commercial and non-profit clients. Minister Ploumen previously held the position of Vice Chair of the Evert Vermeer Foundation, and was a member of the Labour Party’s South-North Committee (advising on international cooperation). She has also been a board member of feminist organization Opzij and Women Inc., as well as a member of the Stop Aids Now! supervisory board.

One could say that we want to strengthen our relationship with the more traditionally important sectors of the economy; however, we are also interested in the strategy of the Emirates to diversify its economy and to look for innovation. What I find interesting is that the authorities look for innovation within the traditional oil and gas sector, but they are also looking to invest in renewable energy. Investing in renewables is about investing in the hardware and technology, yet also in investing in changing the mindset of the people. When you are as resource rich as the Emirates, the first challenge is to acknowledge that you need diversification in order to keep up a strong economy for the longer term, which Dubai did. How would you describe the opportunity for further collaboration between the Netherlands and the UAE in the agriculture sector?

We are the second largest exporter of agricultural goods on a global scale. Of course, we have strong ties to the Emirates in that sector, but there are still many opportunities in the areas of fresh fruits, for example, and oth-

Facilitating the UAE’s goals for innovation within renewable energy

er places where we have not really explored the market enough to take all the opportunities. Here is a well-developed market with a strong demand for quality products and also the logistics are well organized, which makes an excellent market for our fresh fruits and vegetables. Is the UAE important as a place to offset the effects of the EU sanctions on Russia concerning agricultural products?

Yes. Regardless of the sanctions, we are always looking for new markets and opportunities for deepening our relationships with international markets. Our agricultural market has felt some impact, albeit minimal, from the sanctions. The agricultural sector has managed to look for new markets, meaning all in all the numbers game is still good. Obviously, the UAE represents a good opportunity for us for future collaboration. In October 2015, there will be a trade mission with

agricultural companies coming here, and I believe that would be a good moment for Dutch companies to look into more specific opportunities here as well as to team up with businesses already present here. What opportunities exist for collaboration with the UAE in the distribution and development of international humanitarian aid?

It is right to say that the UAE is one of the key players on the humanitarian development front. Actually, in 2014, it ranked first in the world, which is a wonderful achievement and I am glad that it is interested to work with us and continue its successes along the lines of trilateral cooperation. I believe the days of the concept of a donor-recipient paradigm are more or less over. We want to look at how we can work together using a new model. For the Emirates and us to work in a third country would be interesting; for example, we could work together in Africa, Asia, or even the Pacific. Equally important to trilateral cooperation is knowledge exchange. A new kid on the block always sees new things that you don’t see. And so, we invited the UAE to give its perspective on how The Netherlands is doing and I think that’s the way we should proceed. The humanitarian efforts that it is making in the region are also appreciated and we work with them through the UN channel, which is best positioned to coordinate humanitarian operations. It is good to know what the others are doing, looking at the gaps, and not doubling efforts. We want to continue to work with the UAE, the UN, and other key donors to achieve our humanitarian aid objectives. ✖





HUMANLY POSSIBLE Through its facility offerings, geographic location, and strategy for the future, International Humanitarian City (IHC) aims to continue its trend as a major player internationally for humanitarian aid.

ESTABLISHED IN 2003 by HH Sheikh Mohammed Bin Rashid Al Maktoum, Vice-President and Prime Minister of the UAE, and Ruler of Dubai, IHC has already grown to become the world’s largest and busiest logistics hub for humanitarian aid with nine UN agencies and nearly 50 NGOs and commercial entities as members. Since its inception, IHC has delivered just under $275 million in aid to countries in need all over the world. The IHC’s commitment to excellence in facility offerings, along with its ideal geographical location, make it an extremely donor-friendly international hub for operations. Furthermore, due to its successes and demand going into the future, the IHC is set for future growth and development. Part of the success of IHC can be contributed to the facilities that it has in place along with its free zone classification. IHC offers a warehousing complex of over 50,000sqm, including specialized cold storage for perishables and medical supplies. To accompany the warehousing, IHC has over 10,000sqm of office space for the housing of UN agencies, major NGOs, and private businesses. Moreover, it eases the burden on member organizations by taking care offering facilities management solutions like maintenance, security, and leasing. It also provides assistance with customs formalities, visas issuance, and other government services required. Importantly, IHC operates as a free zone within Dubai allowing members 100% foreign ownership of their organization, 100% repatriation of capital, profits, and funds, 100% free transfer of funds, 100% exemption from taxes, and 0% import or re-export duties. All in all, with superior facilities along with financial incentives, IHC poses an ideal destination for humanitarian-oriented investment. Perhaps the defining factor of success to the IHC is its proximity to not only world-class logistics facilities on a local level for inbound shipments, but also its geographic location for outbound shipments. The IHC is strategically located only 18 km from the new Al Maktoum Airport, a major new transport facility located in the heart of Dubai World Central. The Al Maktoum Airport is planned to have six 4,500-meter parallel runways with Dubai World Central having a cargo capacity reaching up to 1.4 million tons per annum upon completion. In addition to the IHC’s air connection, the humanitarian hub is also closely linked to sea transport only 21 km away via the Jebel Ali Port, the world’s largest man-made port and biggest shipping center between Rotterdam and Singapore. Importantly, Dubai World Central is connected to Jebel Ali Port and Jebal Ali Free Zone via a logistics corridor to form a single custom-bonded free zone environment. On a larger scale, and crucial to Dubai’s success as a global trade hub, is the ideal

global geographic positioning of Dubai. Through this global centric position, IHC is able to play a key role as a logistical intermediary between donor regions of North America, Europe, East Asia, and their recipient counterparts throughout Africa, the Middle East, and Southeast Asia. With this combination of logistical efficiency via both air and sea, along with the ideal location of Dubai on an international level, the IHC will continue to play a pivotal role in the distribution of humanitarian aid internationally. As instability has spread across the Middle East, including in Yemen, Syria, and Iraq, and the continuing demand from the African continent, the expectations for humanitarian assistance are only expected to increase. Along with this increase of demand comes the necessity for building capacity and efficiency in the IHC. In recognition of this, HH Sheikh Mohammed, in cooperation with Shaima Al Zarooni, CEO of IHC, launched the 2015-2021 strategy for IHC. This strategy rests upon four pillars: Connect, Innovate, Lead, and Partner. As an established international leader in humanitarian aid, IHC aims to be a leading organizer and facilitator of humanitarian events, thereby connecting the best humanitarian-oriented minds internationally. In so doing, IHC will host the World Humanitarian Forum every two years in September. As a key component of the Dubai Plan 2021, IHC has targeted being a leader in innovation as a key government entity. The IHC also established a key leadership panel consisting of individuals such as Baroness Valerie Amos, United Nations Under-Secretary General for Humanitarian Affairs and Emergency Relief Coordinator, and Ertharin Cousin, Executive Director of the World Food Program. Finally, IHC aims facilitate CSR partnerships by organizing private-sector events and launching the first International Humanitarian Impact Fund with the first donation of just under $275,000 by HH Sheikh Mohammed. ✖



DUBAI 2015


TBY talks to HE María Ángela Holguín Cuéllar, Minister of Foreign Affairs of the Republic of Colombia, on aspects of relations between Colombia and the UAE, visa exemptions, and encouraging bilateral trade.

UAE co-sponsored the Colombian initiative on Sustainable Development Goals at UN Conference Rio+20

latin CHARM How would you characterize the bilateral relationship between the UAE and Colombia?

Colombia and the UAE established diplomatic relations in 1976. In recent years, both countries have opened embassies in their respective capitals and this, together with high-level visits, has strengthened our bilateral relationship. I have met the Minister of Foreign Affairs, HH Sheikh Abdullah, on several occasions, in Colombia, in the UAE, and at the UN, and we have discussed different bilateral political and economic issues. We have also signed several agreements and MOUs that provide concrete actions and roadmaps for different sectors in both countries. The UAE co-sponsored the Colombian initiative on sustainable development goals (SDGs) that ended up being the most concrete result of the UN Conference Rio+20. The SDGs are now the basic framework for the UN’s post-2015 development agenda and will replace and give enhanced continuation to the Millennium Development Goals. Similarly, Colombia was the first country in the world to support Dubai’s bid to host the World Expo in 2020. In what areas are Colombia and the UAE strengthening ties?




BIO María Ángela Holguín Cuéllar is a graduate of Political Science and has two decades of public and private sector experience. She has held high positions in the government, including at the Office of the President of Republic, the Ministry of Foreign Affairs, and the Office of the Inspector General of the Nation. As part of her broad professional experience in the diplomatic field, María Ángela Holguín Cuellár has held, among others, the positions of Vice-Minister of Foreign Affairs of Colombia and Deputy Minister in 1998, Ambassador and Permanent Representative of the Colombian Mission to the UN from 2004–06, Ambassador of Colombia to Venezuela from 2002–04, and Commercial Attaché of the Embassy of Colombia in France in 1992. In addition, she was made Coordinator for Colombia of the IADB Assembly and Inter-American Investment Corporation in 1997, and Executive Director of the Latin American and Caribbean Regional Conference on Early Childhood in the same year.

tance, the two countries have shown great political will to strengthen ties in areas such as trade, investment, energy, education, culture, and sport. Since the opening of the Embassy of Colombia in Abu Dhabi in 2012, exports from Colombia to the UAE have increased from $5 million to $100 million over the past year. Although this is still a modest figure, it shows the great opportunities that all exporting sectors have identified, and I am convinced that in trade and investment we can do many things together. How does the recent UAE visa exemption for Colombian diplomatic and official passport holders bring the two countries closer together?

My visit to the UAE last November within the framework of the Sir Bani Yas Forum was a great opportunity to once again meet with the Foreign Minister. We reviewed the bilateral agenda and undertook three agreements: one to establish a mechanism for political consultations; another on a Joint Committee on Bilateral Cooperation; and a third on visa exemptions for holders of Diplomatic, Official, and Special passports. All visa-free mechanisms facilitate contact between nationals of different countries. In the future, we hope to establish a visa-free system

similar to those we have set up with other countries. In 2011, Colombia eliminated tourist and short-visit visas for UAE citizens. How important is it to attract investment from the UAE and what areas are particularly attractive?

Colombia is one of the most attractive countries in Latin America for foreign investment, and the figures speak for themselves. FDI increased from $6.758 billion in 2010 to $16.2 billion in 2013. According to the World Bank 2014 Doing Business report, Colombia is one of the most business-friendly and reforming countries in Latin America. The Colombian government is committed to offering incentives to boost investment, investor stability, and, most importantly, legal stability. In Colombia there are specific sectors that attract the attention of foreign investors, namely mining, energy, infrastructure, communications technologies, agriculture, industry, and tourism. Colombia is a new emerging economy determined to become the most educated and developed in Latin America over the coming years. ✖





FLOWETH the oil

BIO HE Abdalla Salem El-Badri was appointed OPEC Secretary General on January 1, 2007. He began his oil industry career with Esso Standard (now ExxonMobil) in 1965 after studies in Accounting, Business Administration, Finance, and Management in the US and Libya. In 1977, he became a member of the Board of Directors of Libya’s Umm Al-Jawaby Oil Company, moving on to become Chairman of the Waha Oil Company in 1980. In 1983, he became Chairman of the Libyan National Oil Company, before being made Minister of Petroleum in 1990. His ministerial career continued with his appointment as Minister of Energy, Oil, and Electricity (1993-2000) and Deputy Prime Minister (2000-2004), before he returned to the chairmanship of the Libyan National Oil Company (2004-2006). During the latter half of 1994, he was both President and Secretary General of OPEC, and again served as its President in 1996 and 1997. In 2013, he was awarded the Abdullah Bin Hamad Al-Attiyah International Energy Award for the Lifetime Achievement for the Contribution to the Advancement of OPEC.

TBY talks to Abdalla Salem El-Badri, Secretary General of OPEC, on the supply and demand of oil and possible price fluctuations in the future. At the end of 2014, there was talk from a number of OPEC Member Countries that it is not in the interest of the Organization to cut production regardless of how low prices may fall. What are your expectations of long-term output for OPEC Members?

There is no doubt that OPEC Member Countries will remain central to the world’s long-term oil supply. Members hold over 80% of the world’s proven crude oil reserves and in our World Oil Outlook (WOO) 2014, total OPEC liquids supply is expected to increase by almost 15 million bpd by 2040, from around 35 million bpd today to just under 50 million bpd. Over the same period, non-OPEC liquids supply is only expected to increase by around 5 million bpd. In addition, OPEC Member Countries are also generally the lowest cost producers, so economically it makes sense to produce this oil. What role is the UAE currently playing in OPEC’s current policy objectives?

Every OPEC Member Country is important to the Organization. In terms of the UAE, it has

of course hosted a number of OPEC Ministerial Conferences, seen its Ministers sit as OPEC Conference President on many occasions, and afforded OPEC a Secretary General in the 1980s. It has also provided staff to the Secretariat and continues to be actively involved in the Organization’s meetings and activities. We respect and appreciate the UAE’s support and input. The UAE has vowed to continually increase production in the next three years, what is the viability of this given the given the state of the market?

With OPEC expected to supply the majority of the additional liquids in the long term, member countries will obviously need to make investments. I am sure the UAE is analyzing the market, both current and future, and making any investment decisions based upon this. Moreover, with most of the 20 million bpd oil demand increase by 2040 expected in Asia, the UAE is ideally positioned geographically to meet the rising oil demand of this region. How has the UAE positioned itself through economic diversification to withstand fluctuations in oil prices?

All OPEC members recognize the importance of looking to other sources of income, and of course, economic diversification is vital. The UAE is currently pursuing its 2021 Vision, which aims to place innovation, research, science, and technology at the centre of a knowledge-based competitive economy. It is evident there is a focus on increasing investment, both local and foreign, in industrial and other export-oriented sectors, such satellite and telecom-

munications, the aviation sector, with the UAE’s two main airlines, Emirates and Etihad, and in clean energy with the Masdar Initiative. Tourism too is playing a major role in the economic diversification of the UAE, with the country now a top tourist destination with many world-class hotels. The UAE is clearly planning for its future through its economic diversification objectives and is well placed to withstand fluctuating oil prices. Although, as with any oil producer, it would obviously prefer to see the oil market in balance, with stable prices that are acceptable to both producers and consumers. Given the decline in Chinese demand and the increasing diversification of energy supplies, what markets do you expect will be vital to OPEC over the next decade?

There has been some weakness in Chinese demand, although this should be put in some perspective. Chinese oil demand is still expanding YoY, and as I already mentioned, the Asian region will be the main hub for oil demand growth in the years ahead. In terms of energy supplies, in our WOO 2014 we see growth for all energies in the next five to 10 years, and in the years thereafter. Of course, there are varying growth rates for energies, but it is clear that fossil fuels with remain central to the energy mix for the foreseeable future, with oil, gas and coal all expected to have shares in the energy mix of between 25-27% by 2035. So to sum up, oil will remain central to the world’s energy needs and Asia will be the biggest growth market for OPEC’s oil supplies in the coming decades. ✖

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HE Reem Ebrahim Al Hashimi, Minister of State of the UAE, on what to expect from the World Expo 2020 in Dubai.

TBY talks to HE Sultan Ahmed Bin Sulayem, Chairman of DP World, on capacity expansion, and operations abroad.

HE Sami Al Qamzi, Director General of the Department of Economic Development, Dubai, on falling oil prices.

Economy REVIEW

Solid GDP growth in 2014 is likely to be repeated in 2015, spurred on by a robust non-oil sector and the promise of Expo 2020.


ubai’s economy is on the rise again, with indicators suggesting various positive developments over the course of 2015. The Dubai Statistics Center (DSC) recorded 3.1% GDP growth in 2014, at fixed and current prices, while predictions for the coming year signpost growth of 4.4%, despite lower overall forecasts for the UAE as a result of reduced oil prices. Again in contrast with prospects for the broader national economy, which will run a fiscal deficit in 2015, Dubai is aiming for 9% more spending and no deficit in its budget for the year. The Emirate’s dynamic diversification strategy, which has been rolled out rapidly over recent decades, affords it the luxury of a diminished reliance on oil revenues, which constitute just 2% of GDP. Tourism, retail, real estate, commerce, and manufacturing will all sustain the economy into the near future, while investment in advance of the 2020 Expo offers further opportunities for economic expansion.

Historically, Dubai survived on a healthy fishing trade and pearl industry, but its fortunes, like those of its neighbors in the Gulf and the UAE, changed upon the discovery and effective exploitation of its oil reserves. The Emirate cannily redefined its economic policies to forestall the onset of so-called “Dutch Disease” by employing the newly flowing oil revenues to develop logistics and transportation capabilities unparalleled in the region. The international connections and infrastructure established during this period allowed Dubai to convince companies from around the world to launch operations from the Emirate, transforming the city into a critical center for global business.


Dubai’s diversification programs have allowed the economy to withstand both the financial crisis and the oil slump of 2014.

However, due to the rapid rate at which the Emirate developed and solidified its international reputation, some challenges emerged. The property and construction sectors were badly affected by the financial crisis of 2008, but resourceful emergency management by



DUBAI 2015

Other segments that indicate encouraging growth are manufacturing, which grew at 6.5% over 2014, and air travel, which recorded a 13% rise in passengers. authorities soon restored stability, and Dubai has successfully recovered in the period since. Continued fostering of innovative new technologies, high-tech businesses, and services have preserved a steady flow of investment into the economy. Though concerns over the real estate sector resurged over 2014, with housing prices rising to pre-crisis levels, and by over 50% in the previous two years, the market is set to strike a better balance in 2015 as lower oil prices render some areas unaffordable. One assessment by Jones Lang LaSalle estimated an average 10% drop in prices will occur across the sector. However, construction firms are confident about the robustness of the sector, which grew at 3.5% in 2014, compared with 2% in 2013. Major infrastructure programs are underway in preparation for the Expo and in response to the expansion of the hospitality sector. Multi-billion dollar megaprojects such as Jumeirah Gardens, Dubailand, and Dubai World Central will continue to drive growth in the economy and attract investment. Other segments that indicate encouraging growth are manufacturing, which grew at 6.5% over 2014, and air travel, which recorded a 13% rise in passengers.

ing by 11%, following the official decision to continue spending instead of closing the deficit. This year, however, the government has chosen to end the deficit, while maintaining funding for infrastructure projects, transportation development, and support for the economy. Healthcare has also received over a third of the allotment, while security spending will comprise the bulk of the remainder. Approximately three quarters of revenues are accrued from charges for state services. Tax revenues from corporation tax and customs duties on foreign banking institutions are expected to rise by 12% in 2015. Inflation stands at 0.62%. The DSC also indicates that the Consumer Price Index had risen by over 4% in the first two months of 2015 compared with the same months of 2014. This was driven in large part by housing and utility costs, which represent over 40% of consumer expenses. Though this is the highest increase since 2009, the consolidation of the dollar and the likelihood of lower rent costs over the course of the coming year will keep inflation in check. “The depreciation of the euro is also likely to reduce inflationary pressures, as prices of imported goods, including consumer durables and capital goods, will decline or stabilize throughout 2015,” stated HE Sami Al Qamzi, Director General of the Department of Economic Development (DED), in conversation with TBY. “Given this outlook, Dubai will be able to avoid the inflationary spiral, but again the government counts on playing an active role if inflationary pressures persist,” he continued.



The approved budget for 2015 came in at over $11 billion, with a 9% rise in spending. In 2014, spending was increased by $10.3 billion, grow-

Direct foreign trade imports totaled $71.9 billion in 1H2014, while exports came to around $13.6 billion over the same period. The former

NON-FINANCIAL CORPORATIONS SECTOR GDP CONTRIBUTION 1H2014 SOURCE: DUBAI STATISTICS CENTER 0.1 Agriculture, Livestock, and Fishing 1.3 Mining and Quarrying 13.9 Manufacturing

1.8 Electricity, Gas, and Water 7.9 Construction

28.2 Wholesale, Retail Trade, and Repairing Services

5.5 Restaurants and Hotels

14.8 Transport, Storage, and Communication

14 Real Estate and Business Services 2.9 Social and Personal Services

DR. ASHRAF GAMAL EL DIN CEO, Hawkamah How would you describe the history of Hawkamah and what milestones it has achieved since its inception in Dubai? Hawkamah was established in 2007 as the center for corporate governance for the UAE, and eventually for the MENA Region. The key concept behind Hawkamah was to bridge the gap between countries in this region, and advanced or developed countries, in terms of corporate governance, transparency, and disclosure. Therefore, it was really a policy initiative that we should have this sort of institute to improve corporate governance practices. Over the past few years, Hawkamah has trained over 2,000 people in this part of the world.

How do you see Hawkamah playing a role in the reformation or advisory of family-owned companies in the GCC? This part of the world is unique in terms of ownership structures of companies. Here families own the majority of companies, and the government owns the majority of the remainder. Hence, you really see a structure where there is a concentration of ownership, whether within families, or by families and the government. What we have been telling people for the past few years is simply that corporate governance is not only about large companies, it is not about listed companies and banks, it is about how to make sure that your business is sustainable in the long run. When we operate in different countries in the region, we find that many problems exist in family-owned companies.

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DUBAI 2015

contributed 66.1% to direct foreign trade, while the latter represented just 12.5%. The remainder of this trade consisted of re-exports, which came to a value of over $23 billion, contributing 21.4% to the total according to DSC data. The bulk of this trade was in semi-precious and precious stones and metals, as well as imitation jewelry, while machinery, electrical, and electronics equipment and vehicles, aircraft, and transport equipment also contributed substantially to imports and re-exports. The principal export product category was also semi-precious and precious stones and metals, with base metals and related products coming in as the second most exported product type. Custom warehouse trade was dominated by imports over the first six months of the year, with a total of approximately $2.34 billion compared with $0.19 billion in exports being recorded by the end of the period. Free zone trade imports amounted to over $37 billion, while re-exports were valued at just under $28 billion.

DIRECT DEBIT A total of approximately $7.8 billion in foreign direct investment came into Dubai over the course of 2014. The vast majority of these inflows were designated for the real estate, financial services, ICT, hospitality, and alternative energy segments, and came from the US, the UK, India, the Netherlands, Germany, and Italy. Over 80% of the dozens of projects that received FDI over the year were directed toward regional markets, indicating the importance of the Emirate as a base for multinational corporations seeking to reach markets in Africa and Asia, and to avail of the world-class shipping and logistics infrastructure in place.

The domestic market is also showing promise, with consumer confidence on a high. The retail sector is expected to grow, with tourism driving much of the spending on fashion items and other non-grocery goods. The steady immigration of foreign nationals to the Emirate also suggests positive trends for domestic consumption and investments in this area. Of Dubai’s 2.35 million population fewer than 15% are Emirati, with many of the newcomers that are affecting the demographic balance arriving in anticipation of the 2020 Expo.

FOUNDATIONS FOR THE FUTURE The Emirate’s winning bid was celebrated in November 2013 with an extravagant fireworks display at the 829m Burj Khalifa, the world’s tallest building, in downtown Dubai. The city’s dedicated pursuit of innovative new forms of development will be showcased over the sixmonth event, and to this end a theme entitled “Connecting Minds, Creating the Future” has been selected. The three additional sub-themes of mobility, sustainability, and opportunity have been designated to further promote the Emirate’s unique contribution to the world. As the first Expo to be held in the Middle East, North Africa, and South Asia regions, the bid foregrounded Dubai’s important role as a connector of peoples and countries. Officials claim that the event will attract over $20 billion in investment, while the cost of running it and preparing the required infrastructure will come to over $8 billion. Dubai’s unmatched business environment is the reason why investors have not lost confidence. A commercial infrastructure that is

ABDUL BASET AL JANAHI CEO, Dubai SME What have been some of the major projects of Dubai SME since 2013? We started 2014 with the formal launch of the Dubai Entrepreneurship Academy, an innovative center to provide existing and potential entrepreneurs with the skills and knowledge they need to become future business leaders. The Academy has already rolled out diverse programs and will continue to add sector-specific and industry-relevant programs. Dubai SME also produced a comprehensive, first-of-its-kind report on the state of the Dubai SME sector covering the size, composition, profile, and characteristics of SMEs in 2014. The report was aimed at providing a multi-dimensional overview of the SME sector in Dubai, thus helping people working in the realms of policy, human resource development, technology solutions, corporate governance strategies, banking, and financial services to evaluate and respond to prevailing trends and needs in the sector, and respond accordingly. Later in 2014, Dubai SME announced the launch of the Hamdan Innovation Incubator

(Hi2), a complete support environment to stimulate and foster innovative entrepreneurial projects among the nation’s youth, under the patronage of Sheikh Hamdan Bin Mohammad Bin Rashid Al Maktoum, Crown Prince of Dubai and Chairman of the Executive Council. How would you describe the competitive environment for SMEs in Dubai in relation to the GCC? The Dubai SME sector, like most other economies, is extremely robust and vibrant. It contributes 40% to annual GDP and employs 42% of the Emirate’s workforce. Dubai’s diversified economy is based largely on the SMEs, which are serving many parts of the industry value chains whether domestically or internationally. SMEs in Dubai also enjoy a distinct geographic and demographic advantage in addition to a unique operational environment. A highly demanding population provides incentive to innovate and improvise products while ease of access to high growth markets provides an ideal business development platform.


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DUBAI 2015

based on innovation and services continues to serve as the cornerstone of its economy, with sector-specific support in terms of funding, legislation, and facilities guaranteeing the Emirate’s role as a center of operations for numerous businesses long into the future. A network of over 20 free zones has been established to provide bases for multinationals from numerous sectors, creating hundreds of thousands of jobs. The Dubai International Financial Centre and the Jebel Ali Free Zone, for example, each offer unique competitive advantages for around 20,000 firms, the former intended to bolster banking and investment activities, and the latter based on its integrated logistics platform which includes the largest and deepest manmade port in the region. Complete ownership by foreign corporations is permitted in these free zones, which contribute over $20 billion to the Emirate’s GDP. The shrewd planning of Dubai’s administration and progressive vision of its ruler HH Sheikh Mohammed Bin Rashid Al Maktoum have created a destination in which foreign businesses can thrive. In the Ease of Doing Business ranking for 2015, the UAE was listed at 22, climbing three positions since 2014. And as oil prices remain in flux, Dubai can be glad that its strategies for diversification have borne fruit, as proven by the economy’s swift recovery from the financial crisis. ✖

MONTASER AL KUZBARI Chairman and CEO, Al Adiyaat Group Making wise investments and generating a healthy return on invested capital are the two main drivers that we base our business on. There is a fine line between responsibly growing shareholder value and doing whatever is needed to generate profit. We take into consideration many non-financial factors like environmental, social, and governance issues that can create or destroy long-term shareholder value in the companies in which we invest. Each investment that we have done has its own potential, including bioscience, Klafs, Values, and Emocean Marine, which are all companies with high potential for growth both internally and externally.


What are the main features that Expo 2020 will introduce compared with previous Expos?

Every World Expo has unique offerings, and through their theme and subthemes introduce and address timely and relevant global challenges. The Expo 2020 Dubai, the first World Fair in the Middle East, Northern Africa, and Southern Asia, will offer a theme that centers on developing partnerships that can inspire our global insight and ability to shape a better future. Our three subthemes: opportunity, mobility, and sustainability, are our interconnected drivers of progress that can provide the prism through which we can examine, connect, and address the changes we are experiencing today but haven’t addressed collectively in previous World Expos. In addition, Expo 2020 is expected to attract 25 million unique visits, 70% of which will be international visits—the



What is the philosophy behind Expo 2020's motto of “Connecting Minds, Creating the Future?"

This represents the essence of the World Expo, of our generation, and of our nation’s aspirations—the powerful spirit of partnership and collaboration that has been the driver of UAE’s success in paving new paths for development and innovation. The theme carries a special meaning for Dubai, a historical hub of connectivity for the region and globally. Originally known as Al Wasl, Arabic for “the connection” or “intersection point,” Dubai has evolved from a regional trading center into a diverse and progressive economic, social, and environmental leader regionally and globally. We are living in an age where long-term solutions to global problems must be resolved by global sharing. The 21st-century trends and transformations, such as population growth, urbanization, and new technologies are converging. These can be the source of major concerns, but also of exceptional future opportunities. Our greatest responsibility in the coming decade is to develop partnerships that can inspire us to shape a better future.


TBY talks to HE Reem Ebrahim Al Hashimi, Minister of State of the UAE, on what to expect from the World Expo 2020 in Dubai.

THE WORLD’S a stage first time in World Expo history that international visitors will exceed domestic visitors. Likewise, Expo 2020, which will be open from October 2020 to April 2021, is the first Expo to operate during this seasonal period and will be the first Expo to offer one pavilion per country, encouraging and financially supporting the inclusion of eligible developing and low-income nations to foster inclusive, high-quality participation from around the world. What will be the impact of Expo 2020 on FDI and trade?

Expo 2020 Dubai will provide an environment for global entrepreneurs to explore progressive and realistic ideas and build smart and sustainable relationships. The Expo 2020 Dubai theme “Connecting Minds, Creating the Future” represents the very essence of the World Expo. It is a deep commitment to encourage collaboration, partnerships, and innovative paths to address our local, regional, and global challenges—economic, social, and environmental. As the first World Expo in the Middle East, North Africa, and South Asia region, the Expo theme is both timely and opportune, as we are living in an age where long-term solutions to problems can only be resolved through collective problem solving. For the international business community, which is becoming more connected and interdependent, Expo 2020 Dubai is an opportunity to form partnerships that are key to building emerging markets and communities, and ensuring future generations have the tools to learn and grow.

What are the main challenges that the government face in the medium term?

The infrastructural and operational investment required by a nation to host large-scale international events are often offset by their ability to generate widespread and lasting economic value for the local resident community. To this end, Dubai Expo 2020 is focused on achieving a similar objective with net value outweighing the costs incurred in delivering the event, and ultimately creating long-term benefits as part of a well-planned economic legacy. We are working to ensure that the investments made by Dubai and every participant, as well as the revenue from international visitors, will directly contribute to the UAE economy. We are confident this will have a positive effect on the adjacent industries that are linked to the delivery of goods and services needed to meet the rise in demand. We expect that, with the growth across various sectors, there should be a natural spike in jobs created within the local economy, increasing the income levels of the people, and encouraging higher domestic consumption. What strengths should Dubai demonstrate during Expo 2020?

Dubai’s strength lies in our ability to attract 25 million unique visitors, of which 70% are international, to our city for Expo 2020. These visitors will experience the diversity of our tourism options, the 200 nationalities living and working in Dubai, and understand why Dubai is ranked amongst the world’s top ten cities for international visi-

tors. We want to showcase our world-class travel facilities, how our infrastructure is built for connectivity, and how the UAE has leveraged our hotel, hospitality, and airline assets, together with our presence in the worlds of sport, leisure, and tourism, to make Dubai a world-class destination for global travelers—both business and leisure. We want visitors and residents to witness a productive mega-event like Expo 2020 and leave knowing that Dubai is a hub for leaders, thinkers, international events, trade shows, art, culture, and leisure, and that the people and the business community of Dubai represent the world’s best in class. ✖

BIO HE Reem Ebrahim Al Hashimi completed her undergraduate studies at Tufts University where she earned a Bachelor’s Degree in International Relations and French. She began her career as Commercial Attaché and subsequently Deputy Chief of Mission at the Embassy of the UAE in Washington D.C. She then went on to Harvard University, where she earned her Master’s degree. She is Chairperson of both Dubai Cares and the Emirates Competitiveness Council, as well as being the Managing Director of Dubai’s Expo 2020 Executive Body, and the Chairperson of the National Bureau of Statistics.



DUBAI 2015


container EXCITEMENT TBY talks to HE Sultan Ahmed Bin Sulayem, Chairman of DP World, on capacity expansion, World Expo 2020, and operations in other countries. How would you describe the contribution that DP World makes to the economy?

BIO HE Sultan Ahmed Bin Sulayem has served as Chairman of the Board of DP World since May 30th, 2007. He was previously Chairman of Dubai World, and in this role oversaw businesses in industries as diverse as real estate development, hospitality, retail, e-commerce, and various commodities exchanges, as well as businesses associated with transportation and logistics. He previously served as Chairman of the Port & Free Zone World FZE and he remains one of the two representatives of the Port & Free Zone World FZE on the Board. He is a leading international businessman, with more than 30 years’ experience in the marine terminal industry.

DP World is a vital component of Dubai’s economy, contributing to the success achieved thanks to the vision of our leaders. Together with our partners we are contributing greatly to the development of our country both now and for future generations. HH Sheikh Mohammed Bin Rashid Al Maktoum, UAE Vice-President and Prime Minister and Ruler of Dubai, and those who came before him have set us on a journey to becoming the fourth largest port operator in the world today, with more than 65 marine terminals across six continents. The ports industry is a vital economic pillar. It supports a country’s growth and prosperity. With its modern and efficient ports, Dubai has established an unrivalled position as a maritime hub for the region and our flagship Jebel Ali terminal provides gateway access to a market of more than 2 billion people. Our geographical advantage is complemented by a determination to innovate to meet the present and future needs of our customers. As Dubai prepares to handle the cargo required for Expo 2020, we are favorably positioned to impact world trade. Our acquisition of one of the world’s largest free zones, Jafza, adjacent to our Jebel Ali port and within 45 minutes driving distance from Dubai World Central, will further enhance Dubai’s position and integrate our services for business. Given Jafza’s contribution to Dubai’s GDP stood at around 21% in 2013, we believe the combination of free zone services and a world class port under one roof will be a key feature for Dubai’s success in the future. The details of our operations at Jebel Ali underline our contribution to the country. In 2014, our UAE region handled a record 15 million containers, double-digit growth of 11.8% compared to the previous year. Capacity for an additional 2 million containers came on stream in the third quarter of 2014, providing the resources we need to achieve further volume growth.

Capacity for a further 2 million containers is expected to come on line in the second half of 2015, taking total Jebel Ali capacity to 19 million TEUs. Looking ahead, the connection of Etihad Rail to Jebel Ali Port in the near future will result in a multi-modal supply chain that seamlessly links sea, road-rail, and air through the Dubai Logistics Corridor (DLC), making it a premier gateway for the region and the entire Middle East. How do you see the strategy of DP World in the build up to World Expo 2020 and beyond?

DP World is a major player in supporting the success of this event and we are focusing on making sure we have the infrastructure in place to support the anticipated increase in trade flows by expanding capacity at our flagship Jebel Ali Port. In addition to the capacity expansions at Jebel Ali Terminal 3, we have the infrastructure in place for Terminal 4, which gives us the flexibility to roll out more capacity in line with market demand. Working closely with our customers is integral to our strategy and we also look forward to helping Dubai and the UAE host Expo 2020. How will DP World’s strategy and operations coincide with the Dubai 2021 Vision?

Being a major supporter of Dubai and the UAE’s economy, we are aligning ourselves with the vision to make Dubai one of the world's smartest cities. Jebel Ali’s new container Terminal 3 will be the most technologically advanced terminal in the region once completed, featuring 19 of the world's largest and most modern quay cranes. The Dubai Trade electronic portal provides integrated electronic services that connect a wide range of trade and logistics providers and key government agencies, including Dubai Customs, within a single electronic window. Meanwhile, the integrated Dubai Logistics Corridor ensures that Customs, DP World (Jebel Ali Port), and Dubai Trade present the gateway of choice to the Middle East.




Acquired Jebel Ali Free Zones (JAFZA) for

$2.6 billion

Invested over


DP World has a portfolio of more than 65 marine terminals across six continents

DP World is a major player in supporting the success of this event and we are focusing on making sure we have the infrastructure in place to support the anticipated increase in trade flows by expanding capacity at our flagship Jebel Ali Port.

How do you think that DP World acts as a partner for development of countries throughout Africa, India, Europe, and the Middle East?

We know from experience what modern infrastructure can do for economies, helping to unlock potential and connect traders with world markets, supporting and driving growth. Ports are gateways to world trade and we invest for the long term, contributing to economic growth. We believe there needs to be more private sector and government investment around PPPs, a model we have pursued around the world. At DP World, we have invested over $6 billion over the last five years adding capacity and upgrading our infrastructure in countries around the world and becoming a major employer. For example, studies show some 36,000 direct and indirect jobs will be created by the development of our London Gateway terminal in the UK. Since taking over management of Dakar, Senegal, in 2008 we have made a ma-

billion over the past five years in international port infrastructure

jor contribution to Senegal’s economy with our development of the terminal and the local community. This includes creating more than 200 jobs for local Senegalese people, with specialized training given to all terminal employees, expanding their skills, and bringing operational efficiencies in line with our global standards. Our expansions there have raised capacity from less than 300,000 TEUs to more than 600,000 TEUs and DP World Dakar today handles around one-third more volumes than it did four years ago, benefiting both the trade and Senegal's economy. Meanwhile, our terminal in Callao, Peru is the largest and most efficient container terminal on South America’s Pacific coast and the busiest terminal in the Port there. It is also one of the most productive terminals in the whole of South America. We officially opened the facility in 2011 and in our first year of operation throughput growth at Callao was 22%. It grew a further 22% the following year, proof that the capacity increase provided by DP World was quickly translated into growth opportunities, and a major factor in the increase of Peru’s international trade. To date the cargo value handled by DP World Callao represents around 10% to 12% of total Peruvian GDP. DP World Callao serves both the importers and exporters of Peru, but importantly it acts as a gateway to trade across the wider region, which naturally benefits the Peruvian economy. ✖




DUBAI 2015

INTERVIEW TBY talks to Dr. Nadir Mohammed, Country Director of GCC Countries for the World Bank, on the country’s performance in international rankings, and areas that could be improved in the business environment.

AHEAD of the pack What is your assessment of the reforms made in the local business environment in the UAE?

The UAE is the best performer in the Arab world in the Doing Business 2015 rankings. This strong performance is a direct result of consistent reforms to the business and investment climate in the country. Actually, the UAE is ranked 22nd in the 2015 overall ease of doing business table, but is also among the top 10 most improved performers in the world in the areas measured by the Doing Business survey. For the period covered in the last report, the UAE implemented several reforms that resulted in an improved business regulatory environment. Firstly, in the area of registering property, the country has made property transfers easier by introducing new service centers and a standard contract for property transactions. In the area of getting credit, the UAE improved access to credit information by starting to exchange credit information with a utility. Thirdly, the UAE strengthened minority investor protections by introducing additional approval requirements and greater disclosure requirements for related-party transactions at the stock exchange. What factors lend to the UAE’s distinction in the World Bank’s Doing Business report?

Trading across borders continues to improve in the UAE. Many measures have been

World Bank's DOING BUSINESS SURVEY 2015 • UAE 22nd out of 22nd 189 economies • UAE among top 10 most improved performers

implemented over the past few years. The UAE made trading across borders easier through adding greater capacity at the container terminal in Dubai, eliminating the requirement for a terminal handling receipt, and improvements in the banking sector reducing the cost of trade finance products. It streamlined document preparation and reduced the time to trade with the launch of Dubai Customs’ comprehensive new customs system, Mirsal 2. Accordingly, exporting only requires three documents, and takes seven days on average. The cost to export is $665 per container. Similarly, imports require five documents and take about a week. The cost of importing a container is about $625. These impressive achievements are the result of concerted re-

forms and significant investments to improve the trading system. The UAE has made significant improvements in other areas measured by the Doing Business Report as well. The country is ranked fourth globally in dealing with construction permits, getting electricity, and registering property, and is the best country in the world in terms of payment of taxes. These gains in the business climate make the UAE a favorite destination to do business. What issues do you expect to be at the forefront in regards to further improving the business climate and competitiveness of the Emirates?

Three areas require more reforms to realize even greater improvements in the UAE business climate and its ranking. Firstly, the time it takes to enforce contracts could be improved. Secondly, resolving insolvency requires more reforms to improve the legal framework, cost, time, and recovery rates. And lastly, getting credit could be facilitated further, by building on recent gains in legal rights and by expanding the coverage of the credit bureau and credit registry. The World Bank will partner with the UAE through a new effort to promote competition and further improve the business environment in individual Emirates. As you know, Dubai represents the UAE in the annual global Doing Business Report that

compares 189 economies globally. The new subnational project will go beyond Dubai to measure business regulations and their enforcement in other Emirates by benchmarking business regulations and their implementation across selected locations and comparing them among themselves, as well as with over 180 economies benchmarked by the annual global Doing Business Report. The project will identify regulatory constraints, provide national and international good practice examples, and recommend actions for reform in the areas measured. It will provide a strategic policy tool to the federal and local authorities to advance the regulatory reform agenda at the subnational level in the areas measured. ✖

BIO Before taking up his current post, Dr. Nadir Mohammed held various positions with the World Bank between 1999 and 2009 relating to Egypt, Yemen, Albania, and the MENA region. During 2010-12, Dr. Mohammed was on external assignment from the Bank, serving as Acting Director of Strategy for the Kuwaiti Prime Minister’s Office. He also served as Senior Advisor in the Poverty Reduction and Economic Management (PREM) network in 2012-13. Before joining the World Bank, Dr. Mohammed worked for the African Development Bank, 1994-96, and the Islamic Development Bank, 1996-98. He started his career in academia, and is a graduate of the University of Khartoum with a BSc in Economics. He also has both a M. Phil and a PhD in Economics from the University of Cambridge, UK.

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IN PURSUIT OF HAPPINESS Following the completion of Dubai Strategic Plan 2015, the Dubai Executive Council announced Dubai Plan 2021, which sets out six pillars of development that support the social and economic development of Dubai.

OVER THE LAST TWO DECADES, Dubai has undergone unprecedented growth and an unrivaled transformation on a global level. Through such a rapid pace of development, the essence and importance of controlled and directional growth has been emphasized by HH Sheikh Mohammed Bin Rashid Al Maktoum, UAE Vice-President and Prime Minister and Ruler of Dubai. As such, HH Sheikh Mohammed established the first documented long-term strategy for the Emirate, namely Dubai Strategic Plan 2015 (DSP 2015). DSP 2015 embodied the vision for development set forth by His Highness, which centered on five main areas of development: economic, social, security and safety, infrastructure and environment, and government excellence. With these thrusts identified, DSP 2015 provides both the private and public sectors with a roadmap of development for the next seven years. As DSP 2015 finalizes this year, Dubai’s Executive Council, under the patronage of HH Sheikh Mohammed, have announced Dubai Plan 2021 (DP 2021), the next installment of His Highness’ vision for the Emirate. As Dubai continues to accelerate economically, socially, and toward World Expo 2020, DP 2021 aims to reinforce Dubai’s positioning as a global center and destination across a number of fields. Importantly, the development of the Dubai Plan 2021 takes into account the impact and involvement of everyone in Dubai: Emiratis, residents, visitors, government, businesses, international organizations, and others. In so doing, the project for development includes input from key industry stakeholders from both the public and private sectors, including interviews, workshops, and a comprehensive media campaign to spread awareness and garner feedback on the priorities of the plan. Furthermore, the government has established four developmental principles crucial to the long-term success of the plan. The first and foremost objective of the DP 2021 was to yield a strategy to push Dubai to the top ranks of cities around the world. Second, DP 2021 must identify and adopt the best practices in national strategic planning. Third, the plan must be able to be measured and assessed by all constituents. Fourth, the approach to the plan must engage various constituents and stakeholders involved in or affected by Dubai Plan 2021. As such, the development

of DP 2021 began in November 2013 and involved over 60 leaders of the Emirate and the government, 200 government employees, 40 external experts, 70 university students, and 75 workshops, and culminated in the launch of the DP 2021 in December 2014. The end result of over one year of planning and the strategy for the next five years centers around what Dubai considers the core to its previous and future success: the people and society that make up the city. With this, the first and foremost objective of DP 2021 is to achieve people’s happiness. Happiness has been identified as a clear linchpin to success for the aspirations of the city across all areas. The Dubai Plan 2021 seeks to address the needs of the people in order for them to achieve happiness, thereby allowing them to achieve the city’s aspirations. In order to accomplish this ambition, DP 2021 rests upon six pillars. First, Dubai aims to create an inclusive and cohesive society and create an exemplary multicultural destination around the world. Second, Dubai aims to build upon the rich high-quality experience that acts as a critical advantage to create a preferred place to live, work, and visit. Third, Dubai seeks to create a pioneering government that acts as an authority for the people and becomes a leader in creativity, leadership, transparency, and innovation. Fourth, DB 2021 aims to continue the success Dubai has had as a pivotal hub in the economy by ensuring a sustainable and economically friendly global business growth center going into the future. Fifth, Dubai targets to develop economically in line with being a leader in infrastructure integration, connectivity, safety, and environmental awareness. Sixth, Dubai underscores the importance of its people and ensuring their education, innovation, and happiness across all areas of life. As Dubai continues to grow toward its aspirations of becoming the capital of the Islamic economy, a global trade hub, and an international tourism destination, the importance for controlled and guided growth becomes underscored. Through the success of the Dubai Strategic Plan 2015 and over a year of planning including input from both private and public stakeholders, the Executive Council of Dubai put into force the Dubai Plan 2021, which sets forth the roadmap for development, which centers on the theme of improving people’s sense of happiness. ✖

















of the Emirate and the government











F O U R D E V E L O P M E N TA L P R I N C I P L E S 1. Yield a strategy to push Dubai to the top ranks of cities around the world. 2. Identify and adopt the best practices in national strategic planning. 3. Must be able to be measured and assessed by all constituents. 4. Must engage various constituents and stakeholders involved in or affected by DP 2021.




DUBAI 2015


positive THINKING How would you characterize Dubai’s overall economic performance in 2014?

TBY talks to HE Sami Al Qamzi, Director General of the Department of Economic Development, Dubai, on attracting investment, the Mohammed bin Rashid city, and falling oil prices.

BIO HE Sami Al Qamzi was appointed Director General of the Department of Economic Development in September 2008. Before this, he held the position of Director General of the Department of Finance where he worked directly with the Ruler’s Court and Executive Council of Dubai to develop strategies for the Department of Finance. He began his professional career with the Central Military Command of the UAE in 1986 in a financial administrative role. He holds a BA in Economics and Accounting, and is extensively involved in business and industry through his board affiliations.

We expect about 4% GDP growth for the whole year. This is a good performance given the unfavorable international environment, particularly in EU and emerging market economies, including China. The sharp drop in the price of oil has had an impact on tourism and related activities compared to the same period of 2013, yet the number of tourists has increased by about 5.5%, which is higher than the growth in international tourism. In addition, foreign trade has been affected to some extent by the sharp rise in import duties on gold bullion and jewelry in India, a major trade partner for Dubai. Manufacturing performed well with more than 6.5% growth value added. Another sector that experienced a strong rebound is construction and real estate with more than 3.5% growth value added, against less than 2% in 2013 and negative rates in earlier years. Transportation was also a vibrant sector, particularly air transportation where Emirates airline continued its stellar performance with more than 13% increase in passenger numbers between 2013 and 2014. Against this good performance, we should also factor new inflationary pressures that Dubai experienced in 2014, with the consumer price index rising over 4.2% by the end of the year after several years of quasi price stability, essentially due to rising housing cost. What ongoing government projects or initiatives will have the most profound impact on Dubai’s ability to attract investment going forward?

The largest megaproject by far is the Mohammed Bin

Rashid City, a multi-billion dollar mixed-use development with the main components expected to be complete by 2019. It will include a park, larger than London’s Hyde Park, with a capacity to host more than 35 million visitors annually. This park will also accommodate 100 new hotels. A second component will be a large retail space and a new shopping mall— the largest in the world—designed as an extended retail street network. A third component is a cultural district with a large area for art galleries, expected to be the largest of its kind in the MENA region. In addition, 1,500 luxury villas featuring Arab and Mediterranean design will surround the green heart of the city. The Expo 2020 site is another multi-billion project that Dubai is committed to complete a year ahead of the event. Extending over 438 ha, it will include 180 pavilions and an underground rail network. In addition, Dubai’s metro network will be expanded and connected to the Expo site. Other transportation and logistics projects, such as an additional metro line and the expansion of Dubai World Central, are also to be carried out in phases and completed before 2020. How is Dubai’s economy positioned to endure the decline in the price of oil?

The direct effects of the sharp drop in the price of oil since the last quarter of 2014 are limited, as oil accounts for less than 2% of Dubai’s GDP and less than 12% of total government revenue. The indirect effects may have stronger repercussions on Dubai’s economy. On the positive side, economic activities that are energy-in-

The Dubai Integrated Energy Strategy 2030 targets 30% energy reduction by 2030 with target of 16% less carbon emissions

tensive, such as air transportation, will benefit from the drop in oil prices. Emirates airline, for instance, is expecting a sharp rise in profits for the year 2014-15, partly due to favorable trends in energy cost, which accounts for more than 30% of total cost. DEWA, the electricity and water company, may be another beneficiary of the drop in energy prices. As for tourism and related activities, on the one hand, the purchasing power of oil-importing countries will be higher and travelling cheaper, while the flows of tourists from oil-exporting countries may slow down. In addition, recent trends in exchange rates may slow down tourism, particularly from euro zone countries. The drop in oil prices may also influence investment in real estate, as a large number of investors are expatriates such as those from Saudi Arabia and Russia. However, this impact may be salutary for Dubai’s economy, as it will reduce speculation and cool down the real estate market. The best way to shield Dubai from the negative repercussions is diversification, which has been the foundation of the city’s development. As Dubai’s economy has displayed a great deal of resilience to other external shocks, it continues to seize opportunities for further diversification and stabilization. ✖





RIGHT direction

Dubai FDI Most inward investment flowing from the US, the UK, India, and Europe

TBY talks to Fahad Al Gergawi, CEO of Dubai Investment Development Agency (Dubai FDI), on new infrastructure projects, credit data, and the new financial zone. What have been some of the key developments of the past year that have increased the attractiveness of Dubai as an investment destination?

Dubai launched a number of initiatives in 2014 as part of its continuing campaign to enhance the attractiveness of the Emirate as a competitive hub and destination in which people from all over the world could live and do business. While many of these initiatives formed part of an ongoing infrastructure expansion, many others were aimed at integrating progressive and sustainable policies in line with international best practices and the country’s general emphasis on innovation. From an FDI perspective, there were four particular initiatives that stood out. The first was the launch of a new innovation program by TECOM, with an overall investment of $1.23 billion. The fund is planned to support the Dubai Internet City and the newly-launched Dubai Design District (D3). Dubai Internet City’s innovation hub will provide 1.6 million sqf of dedicated space to around 15,000 creative workers, while the Dubai Design District will provide an inspiring and dynamic destination of over 1 million sqf for emerging designers and artists,

thereby attracting designers and entrepreneurs to set up in Dubai as a gateway to the region. Second, the launch of the MENA’s first Google for Entrepreneurs Tech Hub at AstroLabs Dubai, is intended welcome tech entrepreneurs from across the globe seeking to access high-growth emerging markets. The hub is meant to boost innovation and entrepreneurship in Dubai in the IT sector. Third, the Smart City initiative, aimed at transforming Dubai into one of the smartest cities in the world, one in which end-users will have access to innovative services. The initiative will allow 24/7 access to government services remotely, which in turn will improve ease of doing business in the city. Fourth, the Dubai 2021 plan, with focus on the human aspect of Dubai’s growth. The plan will help position the Emirate as a preferred investment destination with a substantial human capital capable of leading Dubai into the future. In addition to these new initiatives, significant milestones have been achieved toward improving cooperation between the public and private sectors, in order to enhance Dubai’s appeal as a business hub. The doubling of the capacity of the Mohammed bin Rashid Al Maktoum Solar

Park to 200 MW, combined with the commissioning of the Dubai Tram project, were milestones in Dubai’s ongoing efforts to improve energy security and infrastructure. The year has also allowed the real estate sector to stabilize after improved regulations addressed investor concerns and financial markets bounced back, indicating maturity and an improved confidence in Dubai’s business environment.

BIO Fahad Al Gergawi began his career in 1994 in the Exhibition Department of the Dubai World Trade Centre. He moved to the Dubai Chamber of Commerce in 1995, and later became the Executive Director for Trade and Industrial Development. Between 2004 and 2008 he worked at Dubai Holding as Executive Director of International Business Development at Dubai Properties Group. He is currently the CEO of Dubai FDI, an agency of the Department of Economic Development in Dubai.

How do you expect the establishment of the Al Etihad Credit Bureau to impact investment within Dubai?

Collecting credit data about individuals and companies is vital for improving transparency, as well as helping lending institutions make informed decisions and encouraging them to finance bigger projects and individuals. This will result in further stimulation to the economy. The credit bureau will also allow the monitoring and regulation of lending practices, which will help organize and add stability to the financial sector. It was recently announced that Dubai is to build a $1 billion financial zone in the heart of downtown. What does this say about the Emirate’s commitment to providing the facilities and infrastructure necessary to become a leading global financial hub?

The joint venture between Dubai’s sovereign wealth fund (the Investment Corporation of Dubai), and the Canadian Asset manager Brookfield is a vote of confidence in the stability of the sector, and anticipates future financial growth. The new development will provide world-class operating space for multinational companies that want to capitalize on the anticipated growth prospects associated with Expo 2020. ✖



DUBAI 2015



Dubai’s National Innovation Strategy aims to foster innovation across both the private and public sectors through primary industries with key indicators to measure its success. IN MID-OCTOBER 2014, HH Sheikh Mohammed launched

the National Innovation Strategy, which aims to make the UAE among the most innovative nations in the world within seven years. The strategy will stimulate innovation in seven sectors: renewable energy, transport, education, health, technology, water, and space. Its first phase includes 30 national initiatives to be completed within three years. These include new legislation, innovation incubators, investment in specialized skills, private-sector incentives, international research partnerships, and an innovation drive within the government. The strategy works along four parallel tracks. The first track will anchor a stimulating environment for innovation in the form of supportive institutions and laws. The second track will develop government innovation by institutionalizing innovative practices with the support of an integrated system of modern tools. The third track will encourage private sector innovation by stimulating companies to establish innovation and scientif-

ic research centers, to adopt new technologies, and to develop innovative products and services. The fourth track will qualify individuals with highly innovative skills by concentrating on science, technology, engineering, and mathematics, including the creation of educational material for schools and universities. The National Innovation Strategy includes 16 indicators to measure progress. Government-sector indicators include the percentage of innovative ideas and the proportion of budget allocated to innovation. Private-sector indicators include R&D investment and the knowledge profile of the workforce. Global indicators include an overall measure comparing countries' innovation capabilities, as well as indicators of the protection of intellectual property, the creation of patents, and the availability of scientists and engineers. The strategy contains practical initiatives in each of its seven priority sectors. In the field of renewable energy, the strategy will establish a new organization to facilitate decentralized power generation projects such as small-scale solar installations. In transportation, the strategy will stimulate innovation in air and sea travel as well as logistics. In education, the strategy will establish innovation labs in schools and universities as part of a drive to equip students with targeted skills such as critical thinking, problem solving, creativity, perseverance, and adaptability. In health, the strategy will promote advanced technologies in healthcare services. On the topic of water, the strategy will seek innovative solutions to the challenge of water scarcity. Finally, the strategy will support space technology for the purpose of exploration as well as satellite communications and specialized research on terrestrial applications. ✖





TRICKS OF THE TRADE TBY talks to HE Hamad Buamim, President and CEO of the Dubai Chamber of Commerce and Industry, on linking markets, connections with Africa, and e-commerce and services.

BIO HE Hamad Buamim has been the President and CEO of Dubai Chamber of Commerce and Industry since November 2006. He is Vice-Chairman of the World Chambers FederationICC in Paris. Educated in the USA, he graduated with honors (Magna Cum Laude) from the University of Southern California in Los Angeles in 1996 with a Bachelor of Science in electrical engineering. In 2002, he obtained an MBA with Honors in finance from the University of Missouri in Kansas City. He is a member of the Board of Directors of the UAE Central Bank, Board Member of Dubai World, Chairman of National General Insurance, and Board Member of Union Properties. Previously, he served as Chairman of Emirates Financial Services, Chairman of Emirates NBD Capital, and Board Member of Emirates NBD Bank and Network International.

Dubai Chamber organized the Africa Global Business Forum 2014, which brought government and business leaders together from the UAE, the Middle East, and Africa. What significance did this have on connecting these dynamic regions?

Dubai has done business with Africa for a long time and Africa has always been an important business and trading partner with the Emirates. Dubai Chamber has been working hard to enhance trade and commercial ties across the continent for a number of years. With the hosting of the annual Africa Global Business Forum we see an extended opportunity to review Africa’s diverse business cultures and explore some of the opportunities for establishing joint partnerships with Dubai’s private sector. Last year’s Forum provided an insight into investment prospects across Africa and Dubai’s position as an ideal partner. The impressive line-up of local, regional, and international speakers discussed areas in relation to trade, finance, logistics, agro-business, and tourism and provided tips on building successful corporate partner-

ships with regional economic trading blocs. As the Forum brought Africa and the world to Dubai, the spotlight will fall on Dubai’s status as an East meets West destination and a world-class hub for major global events, exhibitions, and conferences. As a high-level networking event, AGBF also highlighted the Emirate’s accessible corporate climate, unconditional government support to foreign investors, as well as its advanced infrastructural, banking, and financial services. Dubai Chamber’s commitment to the African region does not end with the Forum, but will be further strengthened with new initiatives and enhanced bilateral relations, which both sides will endeavour to make a success of while leading to the economic prosperity of our respective regions, including the opening of several Dubai Chamber branch offices to drive two-way business and investment. What role do e-commerce and smart services play in the advancement of both the private and public sector business climate?

Embracing online technology is something that all modern businesses need to do to stay competitive today. The UAE accounts for about 60% of the share of e-commerce in the region. Today, traders know the importance of operating a modern business as well as having an online presence, which gives maximum exposure to their products 24/7. Also, the ability to spend online has created a profound advanced effect on the broader economy while improving the efficiency and availability of products without the need to build extensive networks of physical stores. Dubai Chamber offers many of its services online and has also an exclusive agreement with Alibaba for the MENA region that of-

Dubai Chamber of Commerce and Industry signed an exclusive agreement with Alibaba. com to facilitate e-commerce

fers its members elite benefits to help them increase export opportunities and facilitate trade through e-commerce. Dubai Chamber’s partnership with seeks to apply the concept of smart trade in line with the strategy of transforming Dubai into a Smart City, recommended by HH Sheikh Mohammed bin Rashid Al Maktoum, UAE Vice-President and Prime Minister and Ruler of Dubai. has 36 million registered users from more than 240 countries and regions and showcases 2.8 million supplier storefronts. Dubai Chamber and signed an MoU to launch the MENA portal Dubaichamber. com/alibaba, two years ago. Earlier this year, Dubai Chamber signed MoUs with Ajman, Ras Al Khaimah, and Fujairah Chambers of Commerce to grant portal access and exclusive benefits to its members. The portal has various tiers of membership including verified membership, which has reached 12,000 Dubai Chamber members, and trusted membership. Trusted members receive an accredited digital certificate issued by Dubai Chamber that they can upload on their e-profile to enhance reputation and increase exposure. ✖



DUBAI 2015


OPEN FOR MORE TBY sat down with several prominent members of Dubai’s business community to discuss the Emirate’s vision to become the global capital for the Islamic economy, Islamic finance, and Islamic industry.

The Islamic economy is an evolving area, and its evolution creates a lot of opportunities. Abdullah Al Awar is the custodian of this strategy. To begin with, maybe you can articulate the seven pillars of this strategy, and also elaborate on why you think Dubai is in the best position to be a global center? ABDULLAH AL AWAR HH Sheikh Mohammed Bin Rashid Al Maktoum, Vice President and Prime Minister of the UAE and ruler of Dubai, launched the Dubai Islamic Economy Vision in early 2013. This was due to the fact that there was considerable interest in the term Islamic Economy, and, of course, the progress and the potential that this economy serves. This is why Dubai decided to embark on this vision, given the fact that arguably there is no global leader today when it comes to Islamic economic sectors. So what does the term Islamic economy mean? We often hear the term, and I have counted many people, including myself, who refer to the Islamic economy as only one or maybe two sectors, which is not the case. The Islamic economy is comprised of several sectors of the economy; it represents trades, transactions, and economic activities between institutions and consumers that are based on some sort of faith-based belief that has a market or commercial impact. His Highness revealed the road map in August 2013, and it revolves around the development of seven key pillars that form the strategy. To recap, Islamic finance is one of the sectors, as is the halal industry, which would include various products and segments, such as food and beverages, but also lifestyle products, such as cosmetics, and in the medical space as well, specifically pharmaceutical products. The third pillar focuses on enhancing family-friendly tourism, or halal tourism as some people prefer to call it. The fourth is the Islamic digital economy. The fifth is lifestyle, arts, and both fashion and architectural design, as well as other forms of design. The sixth

pillar revolves around the education and knowledge sector. This mainly involves the dissemination of information, as well as human capital. And the last pillar is the development of the Islamic economy and standards. What is unique in my opinion is that these pillars actually converge with each other; there is a synergy between the pillars. Our view is not to handle or manage the pillars singularly, on the contrary, we would like to see linkages and development across the seven areas. Our strategy is developed based on that approach. Our philosophy is also a little bit different from others, I would say, because we believe in inclusion. Hence, we work with the stakeholders and today our stakeholders include foreign government bodies and local Dubai government bodies, but also the private sector, which plays an important role in communicating the strategy and achieving His Highness’ vision. Obviously, sukuk is performing very well as an asset class, and takaful consistently outperforms conventional insurance. Mr Jamal Bin Ghalaita, can you quickly outline in what ways Dubai can be a leader in these asset classes? JAMAL BIN GHALAITA The subject of sukuk is quite wide, there is a regulatory angle to it, a financial requirement for it, and there is a user angle too. These are three theories I see as the pillars for sukuk. From a regulatory point of view, the regulations are changing. The second part of the sukuk is the requirement for liquidity overall. If you look at Islamic banking requirements today, the most liquid Islamic banks are finding it hard to deploy their money around the world. Therefore, most sukuk today are oversubscribed for the simple reason that there is a lot of liquidity around the world. And also people have enough conventional bonds, which have a different structure to sukuk. Sukuk started as an asset bank structure, which gives more comfort to the


ABDULLAH AL AWAR CEO, Dubai Islamic Economy Development Centre

JAMAL BIN GHALAITA CEO, Emirates Islamic Bank

sukuk holders, but if we go to the end-users, they are looking for more sustainable, long-term funding. The long-term funding needs to go to the capital markets, and the capital markets will issue the sukuk. The issue is that the product has not evolved over time. A lot of people have moved and so you have this Islamic category that is used to source this category, and then you have the countries that are tapping into this industry, such as South Africa, Hong Kong, and many other countries. I think that even London has a good structure for sukuk, and we are seeing global corporates start issuing sukuk. I will not list any specifics, but there are a number of companies looking to attract liquidity and they are rated AA or A. These companies can tap into Islamic sukuk, and Dubai is the right hub for launching these sukuk. This is where, hopefully, we can work together with our partners to launch a more creative sukuk structure for people who want to shift from just bonds and trading because there are two, three, or four structures of sukuk that would attract more clients. As I said, it is not just the bonds that are issued that should be guaranteed, but also the underlying assets that should be protected because these attract more liquidity, not just from Islamic banks, but also from conventional banks, as well as individuals. What is very interesting to me is that one of these pillars is the digital economy, which is not what we typically think about when considering the Islamic economy. I know Mr Badr Buhannad has something interesting to say because he is launching initiatives to incubate and facilitate tech start-ups in the Islamic digital sector. How are these ideas progressing? BADR BUHANNAD First of all there are a lot of questions to consider, such as what the digital economy represents and how it links into the struc-

RANDA BESSISO Director of the Middle East-Manchester Business School

ture of the seven pillars. Let us start by defining the digital economy. The digital economy is the internet economy. The internet revolution started in the 1990s and it is really enabling sellers and buyers to conduct business through e-portals and the internet in general, thereby eliminating many of the boundaries and costs that previously existed between the parties. Being within the seven pillars, the digital economy is really enabling the other pillars to conduct business. It is harnessing technology and the internet to promote ease of doing business. Being in the Dubai Silicon Oasis zone, we always back the initiatives of His Highness, especially with the Smart City development and the Islamic economy. And we are responsible for two initiatives regarding the Islamic economy—we are responsible for creating the entrepreneurial hub for entrepreneurs to produce products, services, and technology that supports the transformation of Dubai as the capital of the Islamic economy. And we are also really pushing the boundaries of Arabic content creation and looking at how we can encourage well-established companies to create products and services for Muslims around the world. With all the diverse players in the country talking about the Islamic economy, one common thing that we hear in terms of challenges is, of course, the issue of human capital. Ms. Randa Bessiso is here to speak about meeting the needs of an economy through human capital development. What advantages does Dubai have? RANDA BESSISO Dubai is perfectly placed in this part of the region and in the global economy to actually translate this vision of becoming a hub for the Islamic economy into a reality. We already have in place a number of successful initiatives that will enable Dubai to succeed and claim that space. The UAE is the first country that has a purpose-built free



BADR BUHANNAD Senior VP Risk & Audit-Dubai Silcon Oasis Authority

The digital economy is the internet economy. The internet revolution started in the 1990s and it is really enabling sellers and buyers to conduct business through e-portals and the internet in general, thereby eliminating many of the boundaries and costs that previously existed between the parties.



DUBAI 2015

zone for education, and it is home to the highest number of international branch campuses in the world. Between Dubai, Abu Dhabi, and the other Emirates, there are about 30 international branch campuses, and that is just higher education. In addition, there is vocational training and hundreds of institutions that work on the development of education, training, and life-long learning. We have been a partner of Dubai International Academic City, with a branch of the University of Manchester in Dubai Knowledge Village, for eight years now. We support 1,700 part time MBA program participants and doctoral students. This is in addition to working in collaboration with a number of stakeholders in Dubai, Abu Dhabi, and in the UAE in general. We have seen how collaboration and inclusion in Dubai actually helps facilitate the creation of a knowledge economy. Dubai has world-class infrastructure, well placed in the center of the MENA region, as well as close to Sub-Saharan Africa and Southeast Asia, and we are attracting young talent. The alleged brain drain that we have talked about has been reversed, and now we are witnessing a brain gain. According to Deloitte, two-thirds of bankers in the GCC said that it was a difficult challenge to find technically proficient people to fill entry-level positions for Islamic finance, because obviously this is an evolving sector. Mr Ghalaita, do you find that to be true and how do you deal with that challenge? JAMAL BIN GHALAITA I think that the challenge is there and the issue is that university curricula do not include Islamic finance as a major. However, a lot of universities are adapting to this need because it is quite a broad subject that will help to evolve our economy. It should be part of the education curriculum and the critical part of this is the universities. Universities have to be the provider of both the sharia and economic aspects of finance education because today we are only producing scholars. We need to produce students who know how finance works when it is sharia compliant. Today, we take conventional bankers like me and convert them into Islamic bankers; they have to go through a lot of education, and some people do not succeed. ABDULLAH AL AWAR Islamic finance is not difficult for someone who is business-orientated and who has been brought up with it, but the other way around is actually extremely difficult. I think that the other option is to take a scholar who has an understanding of the religion and the ways of sharia, and equip them with the business knowledge. JAMAL BIN GHALAITA Currently, the most successful method is when people move from conventional finance because they have already learned the business, and then they are educated again. However, there is still the potential to go the other way.

ABDULLAH AL AWAR But I want to make the point as far as knowledge and the build up of talent is concerned that we want to encourage more diversity, because the Islamic pillars are not focused primarily on Islamic finance; there is a need for other sectors too. JAMAL BIN GHALAITA I also think not just with education, but with sharia also, there are ethics to consider. For example, genetically engineered products or produce would prove challenging for sharia to approve in the future, because if it is anything harmful to humans it could be conditional on sharia approval. Halal standards have been formulated over time, and these are the challenges that will come in future. RANDA BESSISO In Dubai we have already launched the first initiative with Hamdan Bin Mohammed Smart University, in collaboration with the Open University of Catalonia, which has a specific MSc program for Islamic finance and Islamic studies. There is a Center of Excellence for Islamic Finance that is being developed. Therefore, we have already moved forward in terms of new initiatives, but obviously Dubai-based organizations alone cannot drive this, and we need that inclusion and we need to continue to attract the talent that can be re-skilled and up-skilled to facilitate all seven pillars. In recent research conducted by Deloitte and Dubai International Academic City, Dubai was ranked number four in terms of the most sought-after education destinations, covering the area of the world from China to North Africa, and Dubai has really overtaken some of the other better-known destinations by coming in just behind the US, the UK, and Australia. Dubai ranked 12th overall, with the quality of the education system ranked ninth in the WEF Global Competitiveness Report 2014-15. So, we have established our credibility, and with Dubai Knowledge Village we are working with one of the best regulatory frameworks for higher education that will attract quality investment and institutions. Furthermore, we have success stories in terms of credible frameworks that are facilitating the fast development of the overall support network for the seven pillars. This includes the area of human capital development with a focus on UAE nationals and the fact that education has been placed at the top of the UAE National Agenda for economic and social strategies. JAMAL BIN GHALAITA One of the questions we have is looking at the situation in the US, where the private sector supports education because the cost cannot be born solely by state schools. Lots of schools in the US, as you know, are supported by the private sector. I think there should be more involvement by the private sector in supporting the education of people and the curriculum, and that means financial solutions.

We need to produce students who know how finance works when it is sharia compliant. Today, we take conventional bankers like me and convert them into Islamic bankers; they have to go through a lot of education, and some people do not succeed.


ABDULLAH AL AWAR From my perspective there has been interest from the Dubai private sector, not directly in education, but related to talent development. I was pleased to see that after the announcement of the vision by His Highness, there was a company established in Dubai, in Knowledge Village, that I think is the first of its kind in the world, and it focuses solely on the development of specialists in Islamic economics. It decided to set it up in response to the vision and while it is from the UK it moved its operations to Dubai and changed itsmodel to focus on recruiting specialists within the seven pillars. This is a good example of a private sector company providing support to the industry. BADR BUHANNAD I think that is one issue that is very important; the private and the education sectors working together. It is especially important for young people who are just finishing high school and going to university because they want to be able to see where they will end up in the next four or five years. Hence it is pivotal when we are opening new programs that the private sector is there to sponsor, guarantee, or to show growth in these sectors. I would like to give an example of the private sector and education working together. The Dubai Silicon Oasis and the Rochester Institute of Technology have been with us for the last five years, and they have proposed another graduate program, and we had one company involved that works with drone technology, specifically developing drone software. When they have problems to solve they work with the students. So part of the student program is to work with our companies to solve their problems. We have a specially dedicated place where they work with the company in that area as well, so this is really about having the private sector and the education sector working together to create results, especially in the new sectors that are emerging in Dubai. ABDULLAH AL AWAR If I could make a point, because I do not want to ignore the point that was made earlier about Islamic economic values attracting wider audience. Today when we talk about transactions or instruments, whether these are finance instruments or halal products for others, we should not just be talking about consumption by the end-users. This is important to the sector's overall strategy, but I agree in terms of relating both to Islamic finance, for example, and values on a more global ethical scale. To me the challenge on one side is saying we want to develop products for everyone, not only for Muslims, but when it comes to workplace standards I think there is room for improvement to include similar requirements. Take for example principles of responsible investing (PRI); how many Islamic finance institutes have signed up to that? There is only one globally that has signed up. Why is this the case? If the principles and values are similar then we should see more. A



lot of people would be attracted, I think, to standard setting through the International Sharia’a Board or others, and also standards that require companies to report on, for example CSR activities. If these standards are in line as much as possible, than Islamic products will increase in number JAMAL BIN GHALAITA This is the point we are trying to reach; if you want to eat halal products, or alternatively you want to eat just any product that is available on the market, you will know the difference in terms of the ethics and the production conditions, and so forth. The same thing applies to sukuks and bonds. We should not copy what is being done today with bonds; we should bring a different financial product to the market to differentiate ourselves, and that is what we are trying to do together with the Dubai government initiative and Abdullah’s team. Can you foresee innovation being part of this, in terms of new instruments? JAMAL BIN GHALAITA Yes, we have been working with NASDAQ, and hopefully we will be working with a commodity market as well to offer different products that will provide liquidity in a halal way. With NASDAQ we have launched a certificate that is similar to the London Metal Exchange certificate. We intend to have a joint workshop in the future to share these ideas about how we can develop the NASDAQ product and certificate further. In fact, it was actually NASDAQ that took on the idea and developed it. This is where we see the future; we need to be innovative and more flexible in our products. I do not think that halal certificates should be the same standard; they should be different and provide a different quality. And I think that halal should be closer to organic rather than genetically engineered. ABDULLAH AL AWAR These will all be part of the standards developed by the UAE, the Emirates authorities, and the Saudi Arabian authorities who took the view, as Mr Ghalaita said, that halal certified products are not just categorized based on the process. Halal also goes beyond just the issues of faith, safety, and the treatment of the animals that are being slaughtered. Everything tie in, such as certification and logistics. RANDA BESSISO I think we need to educate the public here, and we also need to give them information about the benefits of halal products and continue to build that Islamic brand. But we also need to look at how we can translate it into a more universally acceptable and familiar term. Global ethics and government are already being taught as part of business degrees, including those at Manchester Business School, and I think that we just need to continue to look for avenues to promote the sound ethics that underpin that halal brand. ✖

The UAE is the first country that has a purpose-built free zone for education, and it is home to the highest number of international branch campuses in the world. Between Dubai, Abu Dhabi, and the other Emirates, there are about 30 international branch campuses, and that is just higher education.


DUBAI 2015



Drydocks World is one of the leading shipyard facilities in the world and is gaining international recognition worldwide for its construction projects. With the expansion of its rig operations as well as its offerings in the renewable energy sector, Drydocks World is set for sustainable success.

NO RIG TOO BIG LOCATED IN one of the most rapidly developing regions in the world and on a busy trading route, Drydocks World has risen to become one of industry’s most prolific shipyards. Since its founding in 1983, Drydocks World has carried out repair work on more than 750 vessels, 150 rigs, and completed 70 new-build projects and a large number of floating platforms for the offshore oil and gas industry. The flagship yard is the world’s largest and most modern facility between Europe and the Far East. It is supplemented by four other fully operational facilities, one in Singapore and three on Batam Island, Indonesia. The four Asian shipyards have built and repaired over 2,000 vessels of various types and sizes. With an eye for sustainability and growth potential in the oil and gas sectors, Drydocks World is today well positioned for future success. Drydocks World has expanded its operation to increase its focus on oil and gas rig projects to meet client demand. In so doing, Drydocks World has established a dedicated rig division in its operations and has since seen a record nine rigs at its shipyard. With nine rigs already in the yard by February 2015, Drydocks World expects to have a very successful year with Drydocks World is leading the efforts to diversify the economy

Image: Drydocks World and Maritime World

regards to rig projects in addition to its other projects. Ship and rig repair revenue increased by 9% in 2014 and exceeded the targeted annual profit projected in 2014. Drydocks World has also surpassed the target set out for 2014 in terms of rig orders, with 14 orders placed as of October 2014. In the last three years, 35 rigs have been successfully dry-docked and repaired. One of the landmark achievements has been the agreement with Drill One Capital to build the Dubai Expo 2020 NS mega jack-up rig. This jack-up rig, designed by Gusto MSC, one of the partners in the project, will be the first of this design to be built and will be the largest jack-up rig ever built. It is designed to be operated in harsh environments as it will be employed in the Norweigan sector of the North Sea with maximum water-depth of 175 meters and a 25-meter air-gap. The sustainability of business practices has been a major push for Drydocks World as it continuously strives toward the diversification of its construction capabilities. With an eye on the future, Drydocks World is positioning itself as a leading player in renewable energy construction projects. In October 2014, Drydocks World signed an agreement with Petrofac to build the BorWin3 high voltage direct current (HVDC) converter platform in the North Sea. Under the terms of the deal, Drydocks World will fabricate, commission, and load out the BorWin3 platform, which will transmit electricity from BorWin3 offshore windfarms to mainland Germany. The project is due to be installed nearly 100km off the German coast of the North Sea, in a water depth of 40m. The BorWin3 HVDC platform construction follows the completion of the pioneering DolWin2 HVDC offshore platform, which it delivered earlier this year to Aibel in Norway. This platform is the largest of its kind in the world in terms of capacity and is a key part of TenneT’s 900 MW DC offshore grid connection for DolWin2, a cluster of offshore windfarms in the German sector of the North Sea. The construction of Dolwin2 was also a construction marvel with the lift of a record-breaking 10,000 ton lift of the structure to allow for the coupling to the base. While ship repair work will continue to be an important element of what Drydocks World is all about, offshore modules and structures will be increasingly important and will help to drive the company forward in the future. ✖


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DUBAI 2015


trade facilitation

through innovation What role has Dubai Customs played as a trade facilitator?

TBY talks to HE Ahmed Mahboob Musabih, Director of Dubai Customs, on the role the institution is playing in boosting trade. What have been some of Dubai Customs’ recent achievements?

Dubai Customs has sought to continually improve its business performance across all areas of customs work to serve the country’s economy through further trade facilitation. To that end, we have improved our personnel capacities and put in place the latest technologies and systems that expedite processes while securing the community against the entry of prohibited substances. The UAE was ranked third worldwide and first in the MENA region in the Efficiency of Customs Procedures Index from the latest Global Competitiveness Report 2014-15 issued by the World Economic Forum. This is an important recognition for us which adds to many other local, national and international excellence accolades to our name. In 2014, DC achieved high satisfaction scores among our customers (91.2%), employees (86%), suppliers (84%), partners (86%), and above all the community (90%). These satisfaction figures are the result of our longstanding commitment to spreading happiness among all our stakeholders, in line with the vision and “Happiness Meter” initiative of His Highness Sheikh Mohammed bin Rashid Al Maktoum, Vice President and Prime Minister of the UAE and Ruler of Dubai.

The efficient customs facilitation provided by Dubai Customs has supported the growth of Dubai’s foreign trade with all parts of the world. Dubai has become a hotspot of international trade due to the efficiency of customs services and advanced logistics infrastructure, which brings traders and investors who choose Dubai as their favorite destination real added value and increasing business returns. Subsequently, over the last decade, Dubai’s foreign trade has experienced a five-time growth from AED252 billion in 2003 to 1.331 trillion in 2014. How is the integration of Dubai Customs into the 2015 GCC Customs Union progressing?

Dubai Customs has kept pace with the ongoing advancement on the path to full implementation of the GCC Customs Union by 2015, by rigorously applying all relevant resolutions and legislation and reinforcing its relationships with Customs authorities in Gulf countries toward the removal of all barriers to a prosperous inter-regional trade. How does Dubai Customs utilize technology to continue to be a worldwide leader in its field?

Dubai Customs has never ceased investing in technology development and innovation, as we believe it is the only way we can continue carrying out our mission efficiently as a cross-border trade facilitator and protector of society. Some of the major innovations made by DC in the past few years include the "Mirsal 2" system, which stands as a quantum leap in customs work today because of the huge potential and new technologies it utilizes, as well as its unique integration of various customs procedures in one single electronic platform, in addition to the “Risk Engine” tool, and the advanced x-ray

container scanning system and device. This strong base of technology earned our customs practices and business processes world-class recognition, including an international commendation by the 2013 WCO Columbus Diagnostic Mission Report, which praised our experience as a leading model for other Customs Administrations worldwide. What challenges does Dubai Customs face in the future?

We face mega challenges; however, we tend to turn them into opportunities. Striking the right balance between effective control measures and customs compliance on the one hand, and trade facilitation on the other hand, is the foremost challenge we face, as it is linked to Dubai Customs’ fundamental mission of sustaining economic development through compliance, facilitation, and security enforcement. What initiatives are being put in place for World Expo 2020?

We are committed to deliver a perfect and extraordinary exhibition experience to the world, by putting in place superior customs services and facilitations for the mega exposition, including the launch of a smart channel dedicated especially for potential exhibitors to streamline and expedite cargo clearance through a 24/7 automated customs clearance system. In addition, exhibitors can benefit from the pre-clearance feature prior to the actual arrival of goods. Dubai Customs will offer further facilitations to Expo 2020, including temporary admission of goods using ATA Carnet System, Authorised Economic Operator (AEO) program, the B2G integrated electronic channel for clearing several consignments in a single transaction, e-Freight for an automated exchange of air fright documents, alongside other facilitation systems, such as e-Inspection, Cargo Recon-

ciliation, and Claim and Refund e-Services. What does the future hold for Dubai Customs?

Dubai Customs’ future goals are determined based on UAE Vision 2021 and Dubai Plan 2021. Our strategic plan is in line with the directives of His Highness Sheikh Khalifa bin Zayed Al Nahyan, UAE President, to mark 2015 as the “Year of Innovation” in the country in order to stimulate creativity and mobilize resources across all sectors, further placing the UAE among the leading nations worldwide in terms of innovation. Dubai Customs views this nationwide move with utmost attention in pursuance of its strategic vision—to be the leading customs administration in the world supporting legitimate trade. Studied plans are put in place to unleash the spirit of innovation and creativity among DC employees. This helps reinforce customs processes with new innovations to boost DC’s performance and the UAE’s economic growth. We plan to continue being a global leader in four areas: human capital, technology, knowledge, and security. ✖

BIO With more than 21 years of experience in customs work, His Excellency Ahmed Mahboob Musabih has served Dubai Customs since 1994, where he has progressed through several different managerial and leadership positions. He is also an active member in more than 20 local, regional, and international task forces and committees, including the GCC Customs Union Technical Committee, Economic Development Committee and Security and Justice Committee within the Executive Council of Dubai Government. Ahmed Mahboob Musabih is considered one of the most influential young public figures in Dubai and the UAE.





outside THE BOX TBY talks to Dr. Amina Al Rustamani, Group CEO of TECOM Investments, on the company’s key successes, encouraging the creative community, and strategies for further growth. What have been the top two achievements by TECOM Investments over the last two years?

We have achieved a considerable amount over that period of time. Our business performance has been strong. We’ve launched new initiatives and concepts, partnered with a number of leading companies and authorities, supported numerous business partners and nurtured creative talents, and we’ve received a number of awards for our work within the creative industries. But, if I have to pick just two achievements, it would be the TECOM Investments’ role in helping to deliver to Dubai’s Innovation Strategy and the launch of Dubai Design District, d3, in June 2013, and its subsequent selection as the pilot greenfield development site for Dubai’s Smart City initiative. TECOM Investments pioneered the development of Dubai’s knowledge economy, the catalyst being the inauguration of Dubai Internet City in 1999; sixteen years later we have established 11 business communities fostering the growth of over 4,650 business partners operating across six industry sectors. By carefully leveraging and enhancing these communities we will be creating the necessary platforms and comprehensive eco-system to provide the next logical step in the city’s sus-

TECOM Investments MoU with DEWA to support sustainable resource usage tainable economic development. We are already a frontrunner in the government’s innovation strategy, and have announced a number of multi-million dirham initiatives to help deliver this, including a new Innovation Hub in Dubai Internet City, which will be a thriving 1.6 million sqf. business development offering companies across the technology, new media, smart education and sciences sectors world-class facilities and services and state-of-the-art infrastructure, and a Creative Community within d3, which will act as an incubator for emerging local designers and artists. We will also introduce wellness facilities across our business communities, as well as a start-up fund to stimulate innovation, and incubators similar to Dubai Internet City in five innovation centers across all sectors. When we announced we would be building a dedicated destination for design and creativity,

the response from the region’s creative industry was overwhelming. Not long after its public announcement, d3 was honored by being selected as the greenfield development site for Dubai’s Smart City initiative. Since then, strategic partnerships with the telecoms operator du, the energy and water provider DEWA, the Road and Transport Authority, Dubai Police, and Dubai Municipality, alongside a number of leading private sector companies, have been formed to help turn this goal into reality. How would you describe TECOM’s innovation strategy going forward?

Across the Emirate our pioneering business communities are bursting with creative energy. We are proud to be providing a home to over 4,650 business partners, representing a total workforce in excess of 74,000. Our plans for the future are ambitious, and innovation is at the core of our strategy. We have new strategic targets for the next 10 years, which includes growing the number of knowledge and creative workers within our communities, as well as the total number of business partners. Our innovation strategy will help us to achieve these targets and is based on six pillars: developing sustainable smart infrastructure; making

business easier; attracting the right talent and investment human capital; supporting the development and growth of start-ups; fostering dynamic industry ecosystems; and activating a vibrant community. The combined total investment allocated toward our new innovation-focused initiatives is $1.23 billion. This will fund the development of infrastructure for d3’s Creative Community, Dubai Internet City’s Innovation Hub, incubator, and creative spaces in all of our communities, and it will stimulate start-ups and entrepreneurs through the creation of our start-up fund and competition. We are making good progress against our strategy already. ✖

BIO Dr. Amina Al Rustamani has a Bachelor’s, Master’s, and PhD in Engineering from George Washington University, Washington DC, and she is widely recognized as one of the Arab world’s most influential business people. She sits on a number of boards across both the public and private sectors, including the National Media Council, an industry body established to regulate the UAE’s media sector, and Dubai Media Incorporated (DMI). She also sits on the boards of Empower, the Higher Colleges of Technology, Dubai Free Zones Council, Dubai Healthcare City Authority, and HULT International Business School. Originally, Rustamani joined TECOM in 2001 as a Project Engineer for SamaCom. In January 2013, she became Group CEO of TECOM Investments.



DUBAI 2015



The range of international firms based in Dubai bespeaks an attractive business environment, with solid infrastructure and guarantees for investors from abroad.




CEO, NewBridge Pharmaceuticals


General Manager, Astellas Pharma MENA/SSA (Middle East, North and Sub-Saharan Africa)


ENA, with all its population, still only represents around 2% of the total global pharmaceutical market and it is very fragmented. This has put pressure on some of the smaller companies to not be physically present here, but rather look for partners who can become an extension to their values, their best practices and their compliance to market their products. That’s where NewBridge comes in, we have the expertise, network, and the distribution channels, to drive innovative pharmaceutical products to the market and be the onestop solution to these companies across multiple geographies. Innovation in the pharmaceutical industry comes from two sources, big pharma, and small or midsize companies such as those in the biotech segment. When these small or mid-size companies want to reach the world, their initial focus is usually the US, Europe, and Japan. As for the rest of the world, they usually prefer a partnering model, and depending on the country or the region in question they usually prefer a regional partner and this was the niche we found for ourselves. These innovative companies usually want to access emerging markets, get a piece of the action and the growth, but at the same time they don’t want to establish structures themselves in each country or region. They have a very focused strategy and also finite resources, hence the partnering model.


here are some exciting things with cash. Cash is important here. The amount of cash that changes hands versus electronic methods is much greater than many other parts of the world. We have a great technology for cash called Retail 360. It allows clients to be able to deposit their back office cash much quicker, and they can put it on their balance sheet, which is better for their cash flow and security. This is different from the traditional methodology, which will take away some of our traditional business but we believe investing in it now will help in the long term. Some of the electronic security that we are working on with major construction companies for the UAE, from an access control and a video analytics point of view, is also interesting. We are looking to help retailers understand what their footfall is doing, which direction they are walking, and what they are looking for. We can analyze that very quickly and offer them detailed metrics to improve the offering, traffic flow for their customers, which is something we do very well in other countries. Being able to bring that to the UAE is an exciting development for us.


he MENA territory is one of the few markets worldwide where there is a significant growth in this sector, of 9-10%. Our products have a great potential in the region because there is limited competition due to the innovative approach that we take. Our aim for the coming years is to become a category leader in those therapeutic areas. Previously, the MENA region was managed by one of our affiliates in the Netherlands. However as a pharmaceutical company, proximity to our stakeholders is key. We cannot really be a true partner unless we are there on the ground. Close to our patients, doctors and the medical community, close to our business associates and, of course, close to the healthcare providers and authorities in the region. We had to recruit local talent who have a long-standing experience in the MENA region, understand the culture and speak the same language as our stakeholder. We currently have around 170 people in the region working for Astellas having almost doubled our presence versus the previous year.






President and CEO, Turkey and Middle East, GE Healthcare

Regional Vice President of Sales, Middle East, Africa, and Turkey, Bombardier

Senior Executive Officer, Dubai Branch, Head of MEA Asset Servicing, BNY Mellon


nvestment in healthcare is high here, mainly because this is a rapidly-growing market. There is a need for more technology. This will position the Gulf or the Middle East as a unique market. At a time when we see the European and US markets more or less growing by 2-3%, the Middle East is growing at a rate of 8%-10%. In the UAE in 2009, there was a population of 3.4 million. Now it is 9 million with a projected jump to 14 million in a few years. This will create a need for more hospital beds and more quality of care. This aside, lifestyle diseases are a problem. Obesity is causing diabetes and diabetes causes heart problems. Also, we see cancer becoming really widespread. We now have the means to diagnose, so we are seeing it more, but also because the disease is spreading because of lifestyle. All this is a burden to the Ministry of Health and it needs to tackle this. In 2014 we equipped the Ministry of Health in the UAE with 11 new CTs. It wanted the latest technology, and the best for its patients. We went together to Chicago where we had launched our best technology. There has been lots of discussion around sustainability of growth in this part of the world. Like it or not, we are all talking about oil prices dropping. We are an oil price-sensitive market and the bulk of the GDP is oil dependent, but in most of these markets the official plan is that healthcare investment will remain as is.


ne of Bombardier’s main objectives in the region is targeting aircraft sales, but we have other goals to increase our customer services and presence. Bombardier has significantly increased its presence in the region over the years. Most of the sales force is now based in the UAE. The office we are in presently has expanded from eight people to 24 now, and we are still expanding. We chose the UAE obviously for the basic elements it provides us with, such as businesses in the city and airlines including Emirates, which provide us with connections between the Middle East, Africa, and our home in Montreal, Canada. It is easy to fly from here, and it is an easy center to use. That is really why we decided on Dubai, and we have been here since 1998. Dubai International Airport is very crowded and busy, and there is probably no more room for business aircraft there. We feel that this is something that is going to work against users of business aircraft. Otherwise, we don’t have problems in Dubai.



ubai is our regional hub for the MEA & Turkey, and here is where a number of our product experts are based and collaborate with client coverage teams based in the various Representative Offices - Abu Dhabi, Beirut, Cairo, Istanbul and Johannesburg. Our regional focus is predominantly institutional and we typically work with central banks, sovereign funds, financial institutions and large companies. Typically we support sophisticated clients with complex needs. Dubai keeps pushing the boundaries and continues to leverage past experiences to grow its economy and provide opportunities and now looks at the future with a wisdom eye. It is no accident that our main regional office is in Dubai— it is because of this robust ecosystem. For Dubai, the economy is well diversified, and though oil prices have an indirect impact, sources of economic growth are well established and depend on less volatile sectors connected to the service industry. Dubai has done a great job of building infrastructure, whether it is physical, economic, legal, regulatory, or otherwise.



DUBAI 2015


Dubai posted 4.5% GDP growth in 2014 and 4.7% growth in employment

SOUND advice TBY talks to Mahmud P.K. Merali, Group Managing Partner at Merali’s Chartered Accountants & Registered Auditors, on recent developments in the Emirate’s economy, and the UAE Chartered Accountant Certification. How would you describe Dubai’s economic performance in 2014?

BIO Mahmud P.K. Merali is a fellow of the Institute of Chartered Accountants of England and Wales, a Certified Public Accountant in Kenya and Zambia, as well as an Associate Member of the Institute of Taxation in the UK. Currently an Executive Partner of the Baker Tilly Meralis Group, he is the Regional Head for Middle East and South East Asia, and takes the lead as the group’s International and Financial Consultant. Mahmud serves as a consultant to multinational companies in the UK, UAE and East Africa. A board member of a listed Turkish retail chain since 2005, he was appointed Vice Chairman in 2012.

Dubai has changed dramatically over the last three decades. I was here in the 1980s and it was totally different. Since then, it’s become a major business center with a more diversified economy. It obviously has a strategic location. Its growing trade and tourism have helped Dubai become one of the top-five fastest growing cities in the world. In about 300 world cities in the recently released 2014 annual report, Dubai posted a 4.5% GDP growth and a 4.7% employment growth. Its high-quality infrastructure is well maintained, and the Emirate survives any challenges presented by the global economy. It had its downturn a few years ago, but the growth is expected to continue rising above the current level in the coming years and will be driven by both the government and the private sectors. How would you describe the national launch of the UAE chartered accountant certification?

That launch was on the March 19, 2014 where the heads of major audit associations and accounting professionals launched this new joint task force to help forge better relationships. It’s the first of its kind here in

the UAE. The heads of seven major auditing associations and accounting professional bodies resolved unanimously to create a joint action task force to set up this chartered accounting certification. We hope it will create more credibility and awareness of financials. It will be sharing knowledge of key issues of accounting and financials both in the UAE and globally. It will also implement a national qualification called “UAE Chartered Accounting.” It will collaborate on research and policy creating for local and global financial issues, and will be a great stepping stone for knowledge-sharing by accounts. What about the application of the IFRS? In what ways will this create an environment that will prevent the risks that happened in the 2008 crisis?

When the country announced plans to adopt IFRS, it knew what the locals would say. They referred to a number of benefits, mostly to do with equity markets. It is not surprising that academics have looked to equity markets to assess the extent to which the values have materialized from this IFRS. The evidence can be fairly characterized as mixed, partly because of the difference in samples. They have a wide use of proxies for the same underlying, but unobserv-

able, idea. IFRS can be a little bit complex, but they are trying to make it as simple as possible. IFRS had many consequences, both for the valuation of equities and for the equity market more generally. Although there will always be winners and losers because of the change in accounting standards, because of the distributing effects, some consequences are regarded by some companies and investors as unbalanced. How would you describe Merali’s role in the development of sustainable business practices throughout the UAE?

Our motto is “plan with us.” Our mission is to help our clients to excel with a professional, yet individualistic approach. The work ethic of the firm is about hard work, honesty, and trust. The firm has grown to its current position through organic growth. The success of the firm’s growth has always been its commitment to treating clients as individuals. We may grow in size and statue, but the personal relationship between our clients remains paramount. We aim to add value to our clients by providing them solutions that suit their requirements. Our goal is to serve the needs of today’s clients, whether private or public or listed with overseas operations, and help them achieve their vision. ✖





HE Abdul Aziz Al Ghurair, CEO of Mashreq Bank, on Dubai’s recent past, its prominent global reputation, and Islamic finance.

HE Essa Kazim, Chairman of Dubai Financial Market (DFM), on advances in the sector, and predictions for the coming year.

The introduction of mandatory medical insurance is set to revolutionize the compulsory insurance sector.



The liquid, if crowded, banking system in broad brush-strokes is poised to benefit from welcome international attention on the UAE.



ith Dubai in general bristling with innovation, its economic stability promises to attract new businesses, further raising the population and its financial conditions. Add to this the attention that World Expo 2020 will be unleashing, and it becomes clear that the banking system is due for some fresh spoils in the years ahead. The system has long since been shored up to international best practices; in terms of financial reporting, the Central Bank in 2000 made it mandatory for all banks to publish their annual financial statement in accordance with International Financial Reporting Standards (IFRS).

borrowed money. Its core objective is to provide timely credit reporting enabling banks to mitigate lending risks. It can also reward transparent SMEs with kinder interest rates when lending from banks. The Bureau is also a key development in terms of the UAE’s prestige in international markets.


WHERE CREDIT’S DUE Al Etihad Credit Bureau (AECB)—a federal government entity mandated to enhance the UAE's financial and regulatory infrastructure—today provides UAE-based credit reports and other financial data on the 65,000 businesses in the country to have

Selected local banks active in Islamic finance have made their mark with Dubai recognized at global hub of Islamic economy standards and certification.

The UAE boasts the largest banking sector in the Arab world by assets, with a 2014 print of $632 billion, a 20112014 compounded annual growth rate (CAGR) of 10%, and an asset/nominal GDP ratio of 152%. According to Central Bank of the UAE data, total assets of banks operating in the UAE rose 9.7% YoY by end 4Q2014 to $628.9 billion enabled by an 8% rise in credit, to $375.7 billion. In terms of customer deposits by 3Q2014 total deposits of resident and non-resident customers at banks operating in the UAE climbed 11.1% to $3.9 trillion YoY from $3.5 trillion. Resident deposits



DUBAI 2015

appreciated 8.9% to $346 billion YoY, while non-resident deposits rose too, by 33.9% YoY to $42 billion. Capital reserves rose 5.3% for the year as banks persisted with profit distributions during the period. Meanwhile, the total capital adequacy ratio declined to 18.2%, with a Tier 1Ratio of 16.2% at end-2014, respectively down from 19.3% and 16.9% YoY. This was of scarce concern to depositors or analysts, however, as the figures remain well above the respective Central Bank stipulated figures of 12% and 8%, confirming a stable and robust financial landscape. To be classified as a well-capitalized firm requires a Tier 1 capital ratio of 6% or above.

THE SCENERY The banking system is divided into three broad categories, namely local banks, foreign banks operating under local rules banks from fellow GCC member states, and foreign bank representative offices, many of whom operate out of the Dubai International Financial Centre (DIFC). Of the 22 local banks operating in the UAE, seven of them are headquartered in Dubai, more than in any other emirate. As for the 28 foreign and GCC banks operating in the UAE, 20 of them are headquartered out of Dubai, while of the 120 foreign banks with representation offices in the UAE, around 70 view Dubai as home. In 2013, three new players took to the field in the form of Lebanon & Gulf Bank, Housing Development Finance Corporation Limited (India), and Banco Popular Españolq.

Indian market. One obstacle to that particular move could be the Indian banking regulator’s stipulation that only reciprocal banking licenses be granted, enabling Indian banks to set up shop in the UAE. The latter is already a hugely competitive pond where 49 lenders vie for the business of 8 million customers. A remnant of the global credit crunch, the $1.3 billion support package received from the UAE Ministry of Finance was repaid by the ENBD in July 2014. In 2014 net assets were up 6% to $98.8 billion, net total loans of $66.9 billion were up 3%, while total deposits of $70.2 billion were up 8%. Meanwhile, revenue of $4 billion was up 20% YOY and net profit printed at $1.4 billion, up a huge 58% YoY. The financial giant posted healthy capital ratios where CAR and Tier 1 capital printed a respective 16.4% and 15.0%. Notable recent emphasis on boosting customer service has seen large hiring and branch conversion. This was not unnoticed in 2014 when ENBD picked up the “Best Branch Customer Service for 2014” gong from Ethos Consulting’s UAE Banking Benchmark Index. Dubai Islamic Bank (DIB), the largest Islamic Bank in the UAE has garnered three awards at the Islamic Finance News (IFN) Awards 2015, namely for “Pakistan Deal of the Year” for two consecutive years, the “Mudarabah Deal of the Year” and the “Ijarah Deal of the Year.” DIB was the third largest bank

MARCUS GENT Managing Director Middle East and Rest of World, Friends Provident International In Dubai the headline numbers are fantastic. The cost of living is lower than New York, Sydney and London, sometimes by as much as 30%. But these figures didn’t take into account the cost of education and rental accommodation, since these vary so much for people from different countries. A lot of our customers view Dubai as a great place to earn a tax-free income and take home 100% of their salary, whereas in London or New York for example, half of your income can go in tax.

SELECTED LOCALS According to Reuters, the number one bank by assets, Emirates NBD (ENBD), forecasts loan growth of 5-7% for 2015 (the upper limit would pip the 2014 print by 3pp); this regardless of deflated oil prices. Indeed, Dubai’s non-oil foreign trade printed marginal YoY growth to $362.3 billion in 2014. ENBD arose from the 2007 merger of Emirates Bank International (EBI) and the National Bank of Dubai (NBD), in a strategic move to mitigate impact of the global financial crisis on the Emirate’s key banking institutions. FY2014 total assets stood at $102.4 billion, while profit skyrocketed 82% after the bank reclassified its debt pertaining to the stalled Dubai World infrastructure project as “performing.” In 2013 ENBD—the flagship bank of, and 56% owned by the Dubai Government—had bought the Egyptian business of BNP Paribas, and is today contemplating the

JAKOB BECK THOMSEN SEO and CEO, Saxo Bank Digital innovation and the quest to build digital strategies are key trends now and will be for the next decade. We believe we can help major banks to digitalize their strategy within our specialized field trading and facilitation of access to capital markets. Over time wealth will be passed down to the next generation who will be much more IT-literate and more open to online services, at which point we can easily cater for this.


At Chedid & Associates, we understand that trust builds over time, which is why we honor our word and offer first class claims services. Our commitment to you doesn’t end there; with our availability and expertise in the field, you can have peace of mind knowing you have a partner who always has your best interests at heart.

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DUBAI 2015

The UAE boasts the largest banking sector in the Arab world by assets, with a 2014 print of $632 billion, a 2011-2014 compounded annual growth rate (CAGR) of 10% and an asset/nominal GDP ratio of 152%.

by assets in the Emirate (2014: $33.8 billion, up 9% YoY), extended net total loans for 2014 of $20.1 billion, up 3% YoY and printed total deposits of $25 billion on a rise of 17% for the year. The bank posted robust YoY growth in core financing assets 32%, where consumer banking (40% of financing) grew over 23% despite stiff competition. Meanwhile, the corporate banking component (35% of the total) soared 36% for 2014. For 2015 the bank targets further loan growth of between 15%20%, a non-performing loan ratio of NPLs 6%, a return on assets (ROA) of 2.5%. The net interest margin (NIM) is forecast at 3.6%, with return on equity (ROE) foreseen at 18%-19%. An ROE of 17.9% was close to 4pp up YoY, while ROA registered at 2.4%, up from 1.6% in 2013. Sukuk investments for 2014 did particularly well, appreciating healthily on by 38% YoY to $4.4 billion. Mashreq Bank, as the largest private sector bank in the UAE, also reflected the sunnier climate of the Emirati economy, seeing total assets for 2014 of $28.9 billion, up 18% YoY Meanwhile, among other key metrics, total net loans of $15.8 billion rose 15%, and total deposits of $15.8 billion were 17% higher YoY. The bank operates both conventional and sharia-compliant windows through its Mashreq Al Islami subsidiary, confirming its asset quality with one of the lowest NPL ratios among the local banking sector of just 3.7% as at YE2014. With a firm focus on commerce, the bank operates around 20 branches and representative offices across the MENA region, in addition to Europe, North America, and Asia. Also recognized as an innovator in the UAE, among its many firsts Mashreqbank pioneered consumer loans, ATM cash dispensers, debit/credit cards, and international Visa connectivity across the world. It was also the first institution to launch a fully Europay, MasterCard, and Visa (EMV) Chip & PIN compliant mobile POS solution. ROA and ROE

at YE2014 respectively came in at 2.5% and 15.7% for the period. Revenue of $1.6 billion as at FY2014 was 21% higher YoY, while on an annual rise of 33% net income registered at $653.4 billion. Commercial Bank of Dubai (CBD), with close to 17 branches in Dubai, has seen healthy growth figures of late. Total assets for 2014 stood at $12.8 billion stood at up 5% YoY, while for the period total net loans of $8.7 billion were up 6%, matching total deposits, themselves up 4% YoY. Revenue of $599 million was improved YoY by 10%, while net profit printed a dynamic 19% rise to $327 million. Operating income for YE2014 was 10.2% up at $599 million. The bank’s CAR remained strong at 18.1%, while return on average assets rose to 2.6% for FY2014 from 2.4% for 2013. Return on average equity rose to 16.7% for the YE2014 from 15.1% for 2013, while the cost to income ratio printed a healthy 33.7%. Operating Income grew 10.2% YoY from $553 million to $599 million, chiefly on a 9.3% rise in NIM to $435.6 million (2013: $394.7 million) and a 12.5% increase in non-interest income to $179 million (2013: $159 million). The Bank’s personal banking strategy has fortified the sales & distribution network, as well as digital banking. As a result, the personal banking loan portfolio rose 35% for FY2014. Its cost to income ratio was at 33.7%. Gross loans rose 35% YoY from $898.4 million to $1.2 billion as at end-December 2014. CBD’s capital adequacy and Tier 1 capital ratios respectively registered at 18.1% and 16.8%, thus well in excess of regulatory stipulations of 12% and 8%. The past decade or so has seen Royal Bank of Scotland (RSB) increase its international footprint as the UAE’s soaring economy amid appealing loan potential to large state-controlled companies such as Dubai World and Dubai Group. Yet recently, RBS has slimmed down its involvement in the UAE as part of a wider withdrawal from the corporate debt and debt capital markets lines in the MENA region. Accordingly, in April it announced selling roughly $816.8 million of loans belonging to companies in the UAE CBD. According to Reuter’s the loans sold to CBD were mostly extended to large UAE-based companies of excellent credit profiles. The Local banking universe is crowded yet liquid and well regulated, with a watchdog and credit rating agency that have fostered financial prudence and transparency. ✖

OMER HASSAN ELAMIN President, Orient Group When I look at the insurance sector, I am not too optimistic. There are a very large number of companies operating here in the market and, because of this, the competition is very tough. I do not expect that situation to ease soon. The interesting thing about the way the insurance market works in the UAE is that you have six companies controlling 60% of the market. Out of 63 companies, 57 are fighting for the rest.

Powered by Network International



DUBAI 2015


wisdom RECEIVED TBY talks to HE Abdul Aziz Al Ghurair, CEO of Mashreq Bank, on Dubai’s recent past, its prominent global reputation, and Islamic finance.

BIO HE Abdul Aziz Al Ghurair is the CEO of Mashreq Group and is the member of the Board of Directors of Abdullah Al Ghurair Group of Companies, with operations spanning more than 20 countries and business roots stretching back half a century. In 2012, His Excellency was appointed as Chairman of UAE Banking Federation. He has held various dignitary positions, which have had an impact both regionally and internationally. His unprecedented experience in the banking industry specifically and in the business industry generally makes him one of the most well-known personalities, both locally and regionally. He was elected as Speaker of the United Arab Emirates Federal National Council (UAE Parliament) for a tenure of four years, which ended in February 2011. He was recognized many times by leading awards, conferences, and seminars, and is a five-time recipient of the Lifetime Achievement Award.

How would you characterize your success in Dubai?

Our success in Dubai is clearly because of HH Sheikh Mohammad’s vision. He liberated the government offices and made Dubai an attractive place to work, live, and invest. We have approached Dubai with a holistic rather than a fragmented solution. Putting all of that together has really energized Dubai. It was always a hub in the region, but we have managed to grow it onto a much larger scale. It has been a bit of a rollercoaster at times, but the Emirate’s economy is open to the world. This is a result of it being an open economy, and we have developed the agility and ability so that when we suffer a global shock, so we know we are capable of bouncing back. If you look at the UAE or Dubai stock markets in 2013, we have bounced back better than any other exchange. That resilience is in the economy. That is what makes Dubai a dynamic place. How has Mashreq Bank played a role in making Dubai’s economy more resilient following the financial crisis?

As the oldest bank in the country, we have enjoyed witnessing the progress of the economy and the challenges faced by the Emirate over time. Mashreq has always believed in Dubai’s direction, and we have always continued supporting our clients during the difficult times. We have never stopped doing business, and our clients have long histories of operating in the country. We believed they would overcome these challenges, and they

did. Mashreq’s success is because of our customers’ success and the overall strength of the economy. Where are the next steps for the bank?

We are aiming to create a better customer experience. At the end of the day, most banks will offer the same products and services. What will differentiate the banks is the experience that the customer goes through when they do their banking transactions. And this experience cannot be copied overnight. If the customer has a great experience, word of mouth and advertising will encourage more customers to come to us, be they retail, SME, or corporate clients. People will know that we mean business. How would you describe Dubai’s role as a leading city worldwide today?

Dubai has been recognized as one of the leading cities in the world. If you look on the airlines side, Dubai’s airport is by far now the largest airport in terms of international passengers. If you look at Dubai’s ports, we are the third largest transshipment port in the world. We have established ourselves quickly as a prominent hub for business. If you look at regional offices for multinationals, there is no choice for them but Dubai. From Morocco to Oman, the only logical place is Dubai. The free trade zones will attract people to set up their businesses, and we’ve also tried to focus on a sector-based approach. We try to promote the finance sector with DIFC, while for media we have Dubai Media City, and a host


Expected 10% growth in banking sector

Mashreq Bank awarded 2014 Best Regional Retail Bank by Banker Middle East Industry Awards

of other free zones to allow people ownership and a place to set up their factories. Basically, we adapt our free trade zones to a sector focus and in line with the sector’s regulations in order to make the investment climate friendly and conducive to business. What is your vision on the HH Sheikh Mohammed’s goal to make Dubai the capital of the Islamic economy?

It is achievable. We have the market and the know-how here. We are bringing all the segments together as a product, including banking, takaful, and food. We are looking at what it will take, for example, to gain certification for halal food. Anyone can claim it, but we want to make an authenticated Islamic center for certification of halal products. We think it’s achievable. We have a track record. When we set our eyes on something, we tend to achieve it. Whatever we have said, we have been able to achieve it and compete on an international scale. What will be the impact of the Al Etihad Credit Bureau on the financial industry?

A credit bureau is long overdue. We have done a lot of things here in the UAE except the credit bureau. Finally, we have it. I think it will slow down lending by banks because people will discover how much has been borrowed or over borrowed. Long term, it will protect everyone—borrowers, banks, and the economy—from a crisis. We will be doing proper lending, particularly on the retail and SME side. What is your outlook in the coming year?

I am pretty optimistic. We now have a strong currency that is linked to the dollar, which makes it even better for our economy. It may impact some tourists, but our tourist numbers YoY are growing. Because of the infra-



Dubai has been recognized as one of the leading cities in the world. If you look on the airlines side, Dubai’s airport is by far now the largest airport in terms of international passengers. If you look at Dubai’s ports, we are the third largest transshipment port in the world. We have established ourselves quickly as a prominent hub for business.

structure, the environment, the logistics, and the legal system we have in Dubai, it is one of the most attractive destinations in the region. There is no other city that can compete with us. Everything is available here, and the Emirate boasts strong infrastructure and lifestyle options. You can send your kids to Russian, French, Japanese, or Korean schools, and the range of entertainment and sports options is unrivaled. That kind of diversity is difficult to find in other cities. With regard to the turmoil in the region, we can say that we have gotten used to it. We navigate our country through these geopolitical obstacles and leverage our strengths to come out on top. There is no safer destination for investment than the UAE and Dubai. Countries that are blighted by conflict often see their businesses moving and starting again in Dubai. Many firms from around the Arab world have moved their headquarters to Dubai. ✖



DUBAI 2015


RIGHT ON THE MONEY A number of financial services firms exist to help support investors and private wealth funds.



General Manager UA, and Global Accounts Lead, Visa Inc. MENA

Senior Wealth Director, MEA & Turkey, BNY Mellon Wealth Management


ur strategy revolves around facilitating the shift to innovative electronic payment solutions. Technology is at the heart of our growth strategy because the ultimate objective is to provide banks and cardholders with convenient and secure means of payment, and to do that we have evolved our technology over time. We recognize the various opportunities in the UAE, such as smart government and e-commerce. We have also been investing in financial literacy programs, targeted at youth, recent graduates, and professionals, that teach current and future consumers how to use financial products, spend responsibly, save, and budget. Consumers can have access to the best, most advanced, products in the world, but if they do not know how to use them, then consumers are missing out on the full experience or not getting the most value or benefits from these products. We are working closely with government departments and authorities, including Abu Dhabi Tourism Authority and Dubai Shopping Festival, in order to make sure we promote usage of cards.


he vast majority of the wealth in this region has been created in the past 40 years and many families are now going through a profound shift with that wealth, and often the businesses that created it, being handed down to the next generation. Families that are not prepared for this transition are putting their businesses and accumulated wealth at risk of failure. Among several factors that threaten this wealth transfer are unresolved family issues—a major cause of concern in the region. Quite often, the head of a family is so emotionally attached to the business that he may neglect to establish a structure or corporate governance to ensure the company’s long-term health. In the Gulf region, families with assets of over $100 million tend to be led by first- or second-generation individuals. We are one of the world’s largest money managers with $1.7 trillion in assets under management.

ERICH PFISTER Global Head of Private Banking, Falcon Private Bank


ealth creation is slowing down, but it’s still here. Production costs are still way below the market price. We never know when this is going to change. The other thing is diversification. With the drop in oil prices, people here in the region see how important it is to diversify their assets as well, and not to be reliant on one single income source, despite oil still making a lot. That is how we can add value. Being a boutique private bank focusing on wealth management for private clients, we are mainly targeting entrepreneurs and wealthy families, providing a unique access and expertise on emerging markets. Falcon Private Bank will focus its growth mainly on this region and on Southeast Asia. We want to grow in the double digits, as we have done in the last couple of years, by increasing our share of wealth organically and by hiring talented professionals.






Managing Director, Lombard Odier, Dubai

CEO Middle East, Société Générale

Executive VP of Head of Consumer Banking, FGB


ombard Odier is not a newcomer to the region. As far as the Middle East is concerned, we have one office and that is in the UAE. This gives you an idea of the commitment that we have and the importance we give to the region at a global level. In that sense, the UAE, and Dubai in particular, is really the bridge between our Asian offices in Singapore, Hong Kong, and Tokyo, and our European offices. We have formed relationships between Switzerland, London, and Asia with our local contacts here over a span of more than 50 years. To speak of the whole of the UAE, we are confident in the growth of the Emirate. It should reflect in the growth of the market. There is a demand in Dubai for liquidity in the stock market, but there is also strong demand for fixed-income markets and new issuances in fixed-income, as well as in sukuks. Clients more and more are valuing performance, which means that we have to be innovative to make sure that our investments are both performing and out-performing the others.


he main challenge for the region today remains the price of oil. This is very much a hydrocarbon-based area, and the weakness in oil prices has a direct impact on the region’s growth prospects and capacity to fund its ambitious capital expenditures programs. The simple reason is that oil and gas rich countries in the region have accumulated a great deal of wealth and reserves, and have gone through long term investment strategies that have proved efficient in terms of making sure this wealth is invested in a diversified portfolio of assets and also away from the region. When it comes to Dubai’s economy and its business potential, I am very impressed by the speed of its turnaround. Dubai went through difficult times, and during those times Société Générale remained faithful to the Dubai market and to its regional hub. Today, Dubai (and the UAE in general) witnesses a greater stability and healthier financial situation which have definitely reinforced the UAE’s profile as a regional safe haven.



he UAE has witnessed tremendous growth over the past decade and continues to do so. This is especially true in the financial sector where we have seen an increasing number of players in this space. There are 50 banks targeting a small bankable population, leading to around 1.5-2 million customers per bank. Of these 50 banks, there are 25-28 that offer consumer and retail banking services, making this a highly competitive market. In the past two years we have seen banks concentrating on niche products and segments. Although FGB enjoys a large market share in the credit card business, one of the primary reasons for investing in Dubai First was the uniqueness of the company’s business model, operations and products, which have helped us to build customer loyalty. Prime examples include the Emirati Credit Card, the first Credit Card exclusively for UAE Nationals, the Royale Card—recognized by Forbes as one of the top five most prestigious cards in the world, and the SkyyMiles Credit Card—the UAE’s first airline agnostic online loyalty program.



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NUMBER CRUNCHING THE MIDDLE EAST payments industry has been aided by a robust regional economy. Even during a period of major challenges for financial institutions across the world, the regional payments sector proved to be remarkably resilient, in part due to its high per-capita GDP and a diversified population. The UAE in particular has proven to be an attractive market for payment processing companies, backed by efforts to position itself as an international tourist destination and a global hub within easy reach of approximately 2 billion people. Infrastructure spending on sectors such as retail, travel, and tourism has also boosted the growth prospects for the regional payments industry. As payment processors focus on increasing size, scale, and reach through a combination of geographic expansion and innovative product offerings, globalization forces have had a strong impact on the Middle East’s payment processing industry as well. The Middle East has developed a strong financial services industry from which regional payment organizations are emerging. Moreover, these companies are not only looking to support international schemes but are putting into place schemes of their own. This has generated many benefits for the regional payments sector, especially for customers, as increased participation will naturally lead to product innovation and lower prices. The potential for local schemes is further enhanced by the fact that the bulk of transactions are made intra-regionally, requiring a rather small regional footprint of acceptance locations. Two major forces from Southeast Asia that have emerged as strong global participants: JCB and China Union Pay. The Shanghai-headquartered Union Pay is now available in 140 countries including the UAE, while JCB, the only international credit payment brand based in Japan, is being used by 84 million card members. With questions being asked regarding foreign exchange on transaction costs that local banks have to pay for affiliation with international card associations, and the need for routing even domestic transactions through a switch located outside the country, the market has seen the rise of a number of regional payment schemes, customized to the needs of the local customer. This is particularly true of closed-loop schemes where charges between issuer and acquirer are eliminated as they are the same entity. These schemes also mean no competition within the brand, since this would be

E-commerce is on the rise in the Middle East with over 50% of UAE consumers having used an e-commerce platform, while Saudi Arabia and Qatar follow closely behind with nearly 48% saying they have transacted online.

a franchise setup with only one franchisee in each market. Regional payment schemes can also use local market knowledge, enabling them to devise loyalty programs and benefits that understand customer requirements, instead of a one-size-fits-all approach. Despite their obvious potential, it is important to note that the growth of regional payment schemes in the Middle East has been both gradual and complementary to established global schemes. Regional payment providers are first focusing on the under-served segments of the payment card market such as prepaid or contactless payments, before moving into the more profitable debit and credit cards. This is in keeping with industry intelligence from payments associations, which states that prepaid cards will see the biggest growth over the next five years, with transaction throughput expected to double by 2018. Some of the factors contributing to this growth will be the introduction of e-commerce and the transition away from a cash-based society. E-commerce is on the rise in the Middle East with over 50% of UAE consumers having used an e-commerce platform, while Saudi Arabia and Qatar follow closely behind with nearly 48% saying they have transacted online. Moreover, shopping transactions via mobile phones are also expected to grow strongly in the region increasing by almost 20% in the next few years. This growth corresponds with smartphone-in-wallet ratios climbing steeply every month. On the other hand, the transition away from cash in the Middle East is a tremendous opportunity for industry participants. Only about 10% of payments in the Middle East are made electronically. Within this, the UAE is amongst those most rapidly moving toward a cashless society with one of the fastest improving payment systems. In fact, non-cash transactions in the UAE account for 26% of consumers payments by value, compared to 19% in Saudi Arabia and 7% in Egypt. With Dubai’s transformation to a global tourism, shopping, and business hub with a massive catchment area, the payment processing industries represents a tremendous potential for growth. While international players are active in the market, regional players are expected to have an increasing role in devising bespoke solutions for the region. With this, these regional players aim to capitalize on a fast-growing market due to the integration of e-commerce and transition away from a cash-based society. ✖





Number one merchant acquirer in the UAE

point of SALE TBY talks to Abdulla Qassem, Chairman of Network International, on advancing the payment service segment, the role of innovation, and expansion in the wider region. How would you describe the role that Network International has played as a partner in the development of the payment service industry of the UAE?

The vision behind Network International was to create a homegrown company with expert capabilities to service the growing demands of the financial sector in the UAE and beyond. With a strong management team, in-house expertise, and by leveraging next-generation technology, Network International has carved a niche for itself as an innovator in the payments arena within a short space of time. The company has been instrumental in transforming the payments sector in the UAE by providing the infrastructure for this industry to flourish. We are today the largest payments processor and acquirer in MENA, and the second largest in the MEA region. In addition to payments processing, nearly 60 banks across 27 countries in the MEA region use Network International for credit card issuer processing. We also offer end-to-end ATM services to several major banks in the region.

What role does innovation play in the creation of successful products and services to meet the needs of the market?

Our strategic growth plan and roadmap revolve around innovation. This may not just be in the form of a new product or technology, but rather about adapting a technology that works well elsewhere and bringing it first to market. When it comes to payment innovation in particular, it could be about rethinking the business model, processes, product, or the way in which interaction with customers and potential customers takes place. Our aim is to be, in every sense, the leading innovative payments service provider in the emerging economies. What challenges do you foresee Network International facing as it continues to expand throughout the MENA region?

As far as Network International is concerned, we have been able to effectively leverage our excellent performance and reputation in the UAE to tap into key markets across the region. Of course, as we pursue our ag-

gressive growth and expansion strategy we do have to overcome our share of challenges, for instance, making the necessary adjustments based on the various regulatory frameworks in different countries. However, thanks to our world-class infrastructure and highly skilled and experienced manpower, we have been able to maintain our leadership position in almost all of the markets we are present in. What is Network International’s growth strategy going forward?

Our vision for the mid to long-term is for Network International to become the leading provider of innovative payment solutions across the Middle East and entire Africa region. This top-line goal underlines our growth strategy. In terms of geographical expansion, while in the UAE and most of the Middle East we have been going from strength to strength, we have also been steadily building our presence in the high-potential Sub-Saharan and North Africa markets. On a day-today basis, the company is focused on addressing client needs through a proactive approach, aligned with the delivery of consistent, high-quality service. Simultaneously, we will continue to develop world-class products through R&D, while never missing an opportunity to expand into new business lines.

How do you see the payment solutions industry evolving in the Middle East over the years to come?

Solutions providers like us are keenly focused on creating the right infrastructure and platforms to enable these digital solutions. Payments migrate based upon customer convenience, from cash and checks that were physically handed over, and now to online payments. We have already moved to the next stage, where physical access to a computer is needless and customers have the option of on-thego payments solutions via their smart devices. Identifying these next-generation payment trends and leveraging technology to increase customer convenience will shape the future of the payments industry. We will also see increasing innovation and new technologies offered to customers at the point of delivery rather than at the point of sale. ✖

BIO Abdulla Qassem is the Group COO of Emirates NBD and Chairman of Network International and Tanfeeth, both subsidiaries of the Emirates NBD Group. He studied computer science and business administration at St. Edwards University, Austin, Texas, and began his career at Emirates Bank in 1988.



DUBAI 2015


enter PIN TBY talks to Bhairav Trivedi, CEO of Network International, on specialized services, partnerships with international firms, and transaction volumes in 2014. Within the core business of creating tailored payment solutions, where lies the greatest opportunity for growth for Network International?

BIO Bhairav Trivedi is a global payments industry leader who has had a highly successful career as an entrepreneur and corporate leader. He is also the Chairman of Network International Egypt, Network International Global Services India, Network International Singapore, Diners Club International UAE, Egypt, Jordan, and Lebanon, and Times of Money, India. Prior to joining Network International, he was the President and COO of Sigue Global Services, a leading global money transfer company. He was also Managing Director and Global Head of Remittance Services at Citi’s Global Transaction Services. He joined Citi as part of its acquisition of PayQuik, which he founded in 2000. He holds an MBA from the Wharton School of the University of Pennsylvania, and a Master’s in economic system engineering from Stanford University.

Network International has a deep commitment to continuously innovate and build on the customer value proposition. With the growing popularity and use of smartphones, we see the biggest potential around mobile devices and e-commerce as customers demand ingenious and convenient payment technologies that also offer the highest level of security. Another area that has great implications for the UAE payments sector is financial inclusion. Through our partnership with Emirates Identity Authority, we aim to play a pivotal role in launching the UAE’s first smart wallet using the Emirates ID card. We have already demonstrated the use of Emirates ID cards in mainstream financial applications. The addition of a smart wallet will provide a further boost to the UAE’s goal of achieving greater financial inclusion in the country. How will international partnerships, like the one recently struck with PayPal, play a role in the development of e-commerce within the Middle East?

As the leading provider of payment solutions in the MENA, one of our strategic objectives at Network International is to enable the growth of e-commerce across the region through developing speedy

Several instances of over 100 transactions per second recorded in 2014

and secure payment solutions. Our partnership with PayPal empowers UAE-based merchants and start-ups by providing safer and quicker access to cash payments as local merchants with an online presence can now receive cash in AED from their PayPal accounts directly to any bank in the UAE. To provide you some perspective, up until recently merchants in the UAE could only withdraw funds in dollars from their Pay Pal account via a credit card, regardless of the currency of the transaction. This process could take at least seven days, and of course was also subject to currency conversion charges. This was in addition to various applicable fees. The only other public option was to have a US bank account, which only a handful of merchants in the UAE have. Moreover, we have also recently launched Network Online (NeO), a sophisticated online payment gateway that is expected to provide a substantial boost to e-commerce in the UAE. With NeO, mer-

chants will have access to a mobile and e-commerce payment solution that includes industry-leading security protocols and fraud monitoring capabilities. It includes the added security layer of tokenization, the replacement of sensitive data with a unique identifier that cannot be mathematically reversed, to render payment card data meaningless to hackers. What are your company’s expectations for the year ahead?

Although the global economy is at a crucial juncture today and facing strong and complex cross currents, things are looking brighter in the Gulf Cooperation Council countries, especially in the UAE, thanks to heavy government spending and robust private sectors. The level of optimism and positive market sentiments in the UAE have certainly helped Network International make significant progress in recent years, enabling us to stay true to our commitment to our partners and customers. With the wider move toward a smart economy, this is a very exciting time for the payments sector in the UAE. In 2014, we processed more than 550 million transactions, amounting to $22.6 billion in acquiring volume, and had several instances of over 100 transactions per second. While these numbers are indeed impressive, we believe that we can offer even more to the industry, which is why we continue to invest in our core assets, namely intellectual capital and technology. With the roll out of our world-class Network One platform, we will soon be capable of processing several thousand transactions a second, making us an extremely valuable partner for merchants in the region. ✖




Despite prevailing challenges, the DFM, the DMCC, and NASDAQ Dubai collectively position Dubai as an international hub of trade and investment.



INSTRUMENTS FULLY TUNED Fortunately located between the two key capital markets of Singapore and London, Dubai has been leveraging its time zone difference and sleek financial sector to capitalize on regional and global liquidity and commodity flows. Nonetheless, the Emirate’s mission to become a global financial center powered by the three main trading platforms, the Dubai Finance Market (DFM), the Dubai Multi Commodities Centre (DMCC), and the NASDAQ Dubai, has been temporarily dented by ongoing commodity uncertainty. In 1H2014 the Dubai stock market registered close to a 200% rally, rendering it the world’s top performing financial market. Spirits were also buoyed by the Emirate’s winning of the prestigious World Expo in 2020, confirming the UAE’s general status of safe haven in a turbulent region.

DUBAI FINANCE MARKET (DFM) Despite initiation by decree in 2000, the DFM inauspiciously saw active trading on its secondary markets in 2007—just short of the global financial crisis. However, it has bounced back since 2012, amid active interest in in equities, bonds, and sukuks, among other instruments. The DFM has 64 equities, representing a total market capitalization of $87.8 billion at YE2014, up 24.3% YoY. During 2014, the markets of the UAE were upgraded to emerging market status from frontier market, gueling investor appetite, as investment in-flow to the DFM posted at $1.1 billion for the year with 27,000 new investors joining the pool of over 800,000 investors, according to the DFM. It may seem distant today, but oil, too, had at the time averaged at over $100 a barrel for three consecutive years running, in turn fueling infrastructure spending. The benchmark

Dubai Financial Market General Index (DFMGI) struck a record high of 5,374.11 on May 6, 2014, but by December 11, 2014 had experienced its heaviest daily loss of five years—down 7.4%, having shed as much as 8.7% in intraday trading—as oil prices hit $64.21 per barrel, thus over 40% down from the $115 peak of June. Property developer giant Emaar Properties, alone accounting for 18% of the DFMGI, posted a 9.1% drop, with investors recalling the Central Bank’s cautionary use of the “B” word regarding the property market. As of March 16, 2015 on a one-week basis, the DFMGI had lost 6.19%, and 8.22% on a monthly basis. Yet on a three-month basis it had gained 14.13%, and while it had lost 13.29% for a 1-year period, it had gained 109.07% over a 3-year stretch. For 2014 the DMF posted a net profit of $206.7 million, notably up from $77.5 million in 2013. Meanwhile, trading saw a daily average value of $408.4 million, up 136.7% YoY, from $174.8 million in 2013. Total trading value for the year soared 138.6% to $103.4 billion compared to $43.5 billion in 2013. The daily average number of traded shares rose 25% to 639.5 million shares in 2014 up from 510.7 million shares in 2013. The DFMGI rose 12% to 3,774 points at end-2014 from to 3,369.8 points at end-2013. The banking sector led the pack on a 32.3% rise followed by Real Estate and Construction, up 17.6% and Industrials up 17.5%. In contrast, the Services, Insurance, Telecommunication, Consumer Staples, Financial and Investment Services, and Transportation indices respectively shed 54.6%, 29.4%, 24.3%, 16.2%, 6.4%, and 5.6% for the year. The value of shares traded for the period reached $103.9 billion, up 138.6% YoY. The number of shares traded climbed 26.2% to 160.5 billion shares during compared to 127.2 billion shares in 2013. The


63.80% Real Estate and Construction

16% Banking

13.10% Financial & Investment Services 3.60% Transportation 1.20% Insurance 2.30% Other



DUBAI 2015

value of stocks foreign investors purchased in 2014 reached $46.1 billion at 44.4% of total traded value. What they sold for the period printed at $45 billion, at 43.3% of the total traded.


IPO-A-GO-GO The DFM saw a renaissance of IPOs in 2014 as four new public joint-stock companies—Marka, Emaar Malls, Amanat Holding, and Dubai Parks & Resorts were listed. According to Gulf Business UAE asset management firm Daman Investments is poised to receive regulatory approval for its IPO. The company had sold a 22.7% stake to private investors via a share placement back in 2012, valuing it at $120 million. Further ahead, diversified Gulf-based investment group Dubai Investments has earmarked up to three group companies to float in 2016—financial services and property, and also district cooling firm Emicool—according to Reuters in mid-March 2015. In 2014 the holding posted a huge 63% climb in annual profit to $364.8 million. Notable among recent commercial bond activity was of the listing in late September 2014 of Agricultural Bank of China’s $163 million bond on NASDAQ Dubai. China’s third largest bank by assets became the first Chinese issuer to list a bond on an exchange in the MENA. ABC had gone public in 2010 in China, in what became the world’s juiciest IPO by value at $22 billion.

DMCC Established in 2002, the Dubai Multi Commodities Centre (DMCC), located at the DIFC, epitomizes Dubai’s commitment to presenting comprehensive financial instruments to a global audience. In June 2014 it was dubbed ‘Best Free Zone of the Year for SMEs - Middle East & Africa’ and ‘Best Free Zone of the Year for SMEs – UAE’ in the Financial Times’ global fDi Magazine Middle East Free Zones of the Year rankings and awards for 2014/2015. Currently, 70% of the DMCC’s free zone members are SMEs, which rub shoulders with household name corporations. With over 9,000 companies licensed to operate in the zone, the DMCC has steadily built up its presence on the international commodities market, especially in the categories of gold and diamonds. In 1H2014, some $3.37 billion in rough-cut diamonds were exported from the zone, placing Dubai on par with Antwerp, New York, and Mumbai. Yet it is gold that shines brightest, as in 2013, close to 40% of the world’s physical gold trade was realized via Dubai, whereby the total value traded rose to $75 billion, from $70 billion in 2012 and just $6 billion in 2003. The Emirate also registered an annual trade volume rise of 73%, to 2,250 tons of gold. Underpinning the DMCC’s operations is the Dubai Gold and Commodities Exchange (DGCX), established in 2005 as the first multi-commodity derivatives exchange in the MENA region. Derivatives contracts cover a wide variety of instruments,


$243.3 BANKING








including gold, silver, copper, currencies, equities, hydrocarbons, and related downstream hydrocarbon products. In gold, the 0.995 purity Dubai Good Delivery Standard has been established. Other notable commodities include tea, pearls, base metals, and a range of agricultural commodities, as the DMCC leverages synergy with the Pakistani and Indian economies. The DMCC also promotes Islamic finance in the commodities arena, with online exchange DMCC Tradeflow, enabling over 900 Commodity Murabaha transactions in 1H2014, exceeding $200 million. Meanwhile, the DGCX launched its physically deliverable polypropylene futures contract in February 2014; the first plastics contract launched in the MENA region. In April 2014, the Emirate’s regulators issued the “Standard for Issuing, Acquiring, and Trading Sukuk,” a benchmark for Dubai’s local Islamic economy activity.

NASDAQ DUBAI Based inside the DIFC, the NASDAQ Dubai is the international financial exchange in the Emirates and has reasserted itself equity trading. In October 2013, the IPO of Bank of London and the Middle East (BLME) was the first on the NASDAQ Dubai since 2009. The British-based, sharia-compliant bank listed 195.7 million shares on the exchange, giving it an implied MCap of $510 million. This was followed in April 2014 by Emirates Real Estate Investment Trust (REIT) through an IPO valued at $175 million—the first REIT listed in the GCC region. Currently, nine stocks are listed on the equity market, two being GDRs. Most recent, was the listing in March of 2015 of Orascom Construction, headquartered in the DIFC, which regulated by the Dubai Financial Services Authority (DFSA), is a financial free zone established in Dubai. Orascom Construction was created on March 7th, 2015, through the demerger of the engineering and construction business of OCI NV, listed on Euronext Amsterdam. Chairman of NASDAQ Dubai Abdul Wahed Al Fahim explained that: “Nasdaq Dubai offers issuers all the advantages of an international listing, from a base in the business and finance hub of the Middle East, including unique global visibility, recognition, and investor accessibility.” NASDAQ Dubai has seen promising performance in the sukuk arena, with airline flydubai listing a $500 million inaugural sukuk in November 2014, marking the 18th sukuk listed on NASDAQ Dubai since early 2014. The event was emblematic of Dubai’s ranking among the world’s three greatest venues for sukuk listings, where nominal value on its two exchanges as of January 2015 was at $24.05 billion. And as Hamed Ali, NASDAQ Dubai CEO explained in a TBY interview; “In total we attracted $14 billion worth of sukuk into the exchange […] looking at the average subscription interest on that $14 billion, it was 5.5 to 6 times over the average subscription. ✖





PLAY the market TBY talks to HE Essa Kazim, Chairman of Dubai Financial Market (DFM), on advances in the sector over 2014, the Islamic banking segment, and predictions for the coming year. What have been the main developments in the financial sector in Dubai over the past year?

The past 12 months have been momentous at DFM. We have seen encouraging trading activity, while the DFM’s General Index was up by 12% by year-end 2014. Despite the fact that this growth falls short of the wonderful performance of the index in 2013 when it jumped more than 107%, it indicates the resilience of DFM as it managed to keep its momentum after going through two periods of sharp decline during the year. Daily average trading value has increased up 136.7% to $441 million compared to $174 million during 2013. These indicators are the result of growing demand by investors as they increasingly recognize the opportunities available on the market as well as the strong expansion of Dubai’s economic sectors. It also reflects the integrity of the market infrastructure in line with international best practices. In 2014, we have seen a revival of IPO activity with four

IPOs listed on DFM by Marka, EMAAR Malls, Amanat as well as Dubai Parks & Resorts. Other listings are on the horizon. These developments indicate a resurgence in this sector, which will have an enormous effect on DFM as many companies are well prepared to take the same route, based on our communication with them and as a direct outcome of our extensive efforts over the past years to educate private and family businesses on the benefits and requirements of the capital markets as part of preparations for the post IPO and listing environment. In fact, what has been achieved is the outcome of years of hard work to implement DFM’s sustainable growth strategy. This aims to cope with international best practices and the evolving needs of our growing investor base locally and internationally, provide investors and issuers with value-added services, and diversify investment opportunities through attracting new listings of companies operating in dynamic and rapidly growing

economic sectors. DFM has implemented several enhancements and introduced numerous financial instruments and mechanisms such as market making, ETFs, securities lending & borrowing (SLB), direct market access (DMA), rights issues, covered warrants, and the pre-closing session. The year 2014 has also seen an increased pace in our efforts to realize the vision of HH Sheikh Mohammed bin Rashid Al Maktoum, UAE Vice President and Prime Minister and Ruler of Dubai, to position Dubai as the capital of the Islamic economy. The DFM published its “Standard for Issuing, Acquiring, and Trading Sukuk” as a first-of-itskind comprehensive standard that provides issuers and investors the necessary framework and further promotes growth in the Islamic finance sector as one of the main pillars of the initiative. DFM’s steady efforts to encourage issuers to list their sukuk on Dubai exchanges have played a pivotal role driving the total value of sukuk listed on the Dubai capital markets up to more than $25 billion compared to $9 billion before the launch of the initiative in early 2013. With the sharp drop in oil prices, investors have been broadly selling off stock throughout the Middle East, creating stock value drops of up to 6.5%. What is your expectation for the financial markets in the Middle East in the next year?

Without jumping into predictions on market performance or investor sentiment, we believe that the outlook is encouraging in light of the macroeconomic indicators and the favorable business environment. As far as DFM is concerned, we believe that its remarkable performance is well founded based on the strong perfor-

mance of the UAE economy and the buoyant outlook for Dubai over the coming years with the well-deserved success of its Expo 2020 hosting bid. Moreover, we believe that having new companies from multiple and dynamic economic sectors on board, the diversifying of liquidity sources, and a healthier balance between retail and institutional investors will play a crucial role in sustaining market activity and restraining volatility. From a wider regional perspective, we think that the regional financial markets in general are currently in a very healthy position on the back of robust economic activity and strong corporate earnings. ✖

BIO HE Essa Kazim is the Governor of Dubai International Financial Centre (DIFC), Chairman of Borse Dubai, and Chairman of DFM. He began his career as a Senior Analyst at the Research and Statistics Department of the UAE Central Bank in 1988, then moved to the Dubai Department of Economic Development as Director of Planning and Development in 1993. He was appointed as Director General of the DFM from 1999 to 2006. He has a Master’s degree in economics from the University of Iowa, as well as a Master’s in total quality management from the University of Wollongong.



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Due in large part to its strategic location, Dubai is increasingly playing intermediary to some of the world’s most promising markets.

HAMED ALI CEO, Nasdaq Dubai


hat we have achieved is to further establish Dubai as a thriving center for regional and international listings in a variety of asset classes. Most of our listings were of sukuk, establishing us as one of the world’s leading exchanges for Islamic bonds and enabling us to play an important role in the internationalization of this asset class. In total we attracted $13.4 billion worth of sukuk into the exchange in 2014, and it was 5.5 to 6 times oversubscribed. It was also diversified in geographical terms of where investors came from, mainly the Middle East, Asia, and Europe. The first sukuk listing from Hong Kong reflects the growing synergy between East and West. Nasdaq Dubai will continue to strengthen its connections with East Asia to offer listing opportunities across a variety of asset classes including equities. Egypt is also more than ever a key market. Its economy is reviving and its fast growing businesses have a strong appetite for investment. The relationship between the UAE and Egypt is particularly strong, with the UAE supporting the Egyptian economy with billions of dollars and UAE

companies playing an active role there. Nasdaq Dubai is here to help Egyptian companies expand in terms of visibility and investment beyond their local markets and our 2014 agreement with Misr for Central Clearing, Depository and Registry (MCDR) enables us to do that. Other significant listings over the past year included the IPO of Dubai-based Emirates REIT in April 2014— which was Dubai’s first IPO for several years—and then the listing of the shares of Orascom Construction, one of the most established names in Egyptian business, in March 2015. Some may argue that it is Dubai’s city infrastructure, but I believe the key driver that Dubai has, that cannot be copied, is the intellectual capital that is here. The DIFC alone has thousands of financial experts whose input is available across many sectors. Islamic finance, inside the DIFC and outside, is one of the areas in which Dubai excels in depth and breadth of knowledge. Another innovation is our Murabaha platform for Islamic finance, opened in April 2014 by His Highness Sheikh Hamdan bin Mohammad, Crown Prince of Dubai. It was developed with Emirates Islamic, and provides a unique solution for financial institutions and their corporate and individual customers to conduct Islamic financing transactions in a streamlined, flexible and transparent manner. It offers significant advantages over alternative Murabaha channels, including speed, liquidity, a fixed price for the traded certificates, zero spread, and Sharia-certainty. In less than a year, the platform has attracted a number of new financial institutions and achieved more than AED 31 billion ($8.5 billion) in transactions.

GAURANG DESAI Interim CEO, Dubai Gold & Commodities Exchange (DGCX)


lobal equities are exciting. We are working with index and service providers to expand this range further. We are also working with a few Chinese exchanges to make sure we provide access to Chinese and RMB denominat-

CHRISTOPHER FIX CEO, Dubai Mercantile Exchange (DME)


e see ourselves at the beginning of the Dubai-Shanghai trade corridor. Everyone knows this is the world's most stable source of crude oil production, especially

ed products to our market participants. One of the key focus areas for us is to develop physically deliverable products. We launched plastics last year and that was one such initiative in the hydrocarbons base. Currency futures have been the most active segment for us, followed by gold and precious metals. Our volumes are largely in currency futures, but the precious metals segment also has a lot of potential for further growth. We are excited about developments in this space. We have traditionally been growing our currencies portfolio very substantially, but we have also set our targets for precious metals and the development of the local gold market. We’ve already seen a large chunk of the diamond market move from Belgium to Dubai. We’ve also seen many instances of Dubai serving as a broker between Africa, India, and China, which are some of the most exciting markets right now.

water-borne crudes that are servicing the north Asian market. We find that the transformation is more in what is happening on the trading patterns and the fact that China is the number one oil consumer today. In terms of targets, we had a transformational year where we were up over 33%. We were trading 6.5 million barrels a year in 2013 and now we are well above 8.5 million barrels a day. Next year we hope to continue with a strong growth cycle. We’ve had over 85 different participants in the exchange, and when I started in 2012, there were about 50. There is a growing interest and participation in the trade dynamics of the Eastof-Suez-market, meaning that we also have Western companies from London, Singapore, and the US that want to price the actual activity in this market.





BUDGETING FOR GROWTH The Dubai Government recently approved its 2015 budget, historically its largest, marking the first budget surplus since the global financial crisis. The Dubai authorities have utilized successful economic growth in 2014 as a spring board to continually develop Dubai as an attractive Emirate to invest in. IN EARLY JANUARY 2015, HH Sheikh


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government has allowed for increased revenues to support public spending in 2015. Through public spending on infrastructure, continually attracting top human talent for its government positions, and emphasis on social programs, Dubai has focused its government expenditures on economic growth and social wellbeing. Distribution of government expenditure figures show that wages and salaries represented 37% of total government spending while providing 2,530 new jobs for citizens. This is a continuation of the settlement and job creation policy the Dubai government has adopted. General administrative expenses, capital expenditures, grants, and subsidies accounted for 44% of total government spending in 2015. The government has said it’s keen to keep developing, advancing, and supporting government institutions to provide better government services for citizens and residents. The government said that it will also continue to support infrastructure projects by allocating 13% of government spending to infrastructure. The Dubai government plans to continue to deal with loans seriously by allocating 6% of total spending for debt service. The expenditures on social development in the area of health, education, housing, and community development totals 35% of government expenditure. Dubai’s government has also pledged great support to the security, justice, and safety sector by allocating 22% of spending its way. The mainstays of Dubai’s public spending, infrastructure, and transport, were allocated 36% of government expenditure, which will contribute to creating an environment attractive to foreign investors. In sum, the government’s budget has utilized economic growth in 2014 to continue to focus on some of the key objectives of HH Sheikh Mohammed. Dubai has continually shifted its revenue generation away from oil revenues and onto the benefits of economic diversification. Public spending on infrastructure projects as well as social programs play a vital role in the 2015 budget and reflect the importance placed on attracting investment and creating a great place to live. ✖


Mohammed Bin Rashid Al Maktoum, Vice-President and Prime Minister of the UAE and Ruler of Dubai, approved the government of Dubai’s 2015 $11 billion public expenditure budget. This marked not only the largest budget yet, but the first non-deficit budget since the 2008 financial crisis. The budget has approved an $11 billion spending plan, a 9% increase on last year’s figure. Revenues are expected to jump 11% in 2015 compared to 2014, resulting in the first balanced budget since the 2008 global financial crisis. In fact, the no-deficit budget for 2015 will have an operating surplus of $980 million and provide 2,530 jobs. The budget also reflects the growing diversity of Dubai’s economy, increasing social agency efficiencies, and stimulating growth via public infrastructure spending. The government has been able to increase its revenue base through successful budgeting and implementation of government services in 2014 as well as the economic growth of the trade, finance, and real estate markets. Revenues from government services, which represent 74% of total government revenues, is set to increase by 22% compared to 2014. The increase reflects the projected growth rates for the principality, and the evolution and diversity of government services. This increase is due to the remarkable real economic growth by 2014, with limited increments on certain government services and other increments designed to regulate the real estate market. Tax revenues increased by 12% of total government revenues compared to fiscal year 2014, and came to represent 21% of total government revenues. This tax revenue increase can mainly be attributed to customs and taxes on foreign banks, which directly reflects the success of the finance and trade industries in the Emirate. The budget accordingly does not rely on oil revenues, which are set to account for only 4% of total government revenues, a decrease from 5% in 2014, as economic diversification continues. In fact, government revenues rose 11% for the fiscal year 2014, despite lower net oil revenues. All in all, with the increase in the revenue base, the



DUBAI 2015



DAVID HUNT CEO, Gulf Finance

The banking sector in Dubai is internationally recognized as a center of Islamic finance, and being highly liquid has withstood external woes.

CEO, Al Salam Investment

What have been the main achievements for your company over the past year? MARWAN AHMAD ESSA AL THANI Al Salam Investment is focusing on the SME segment in two areas: the advisory business and private equity. What we discovered in Dubai is that we have a number of SMEs, but there is a lack of understanding about these entities. This means a lot of SMEs require advisory services to improve their visibility and to guide them in a new direction. We set ourselves up to be in the advisory business, and we communicate with a range of companies, as well as the government. My focus is on the GCC countries for many reasons. Firstly, there is still a gap in this market in terms of SMEs at the moment. There are both large and small companies, with a huge gap in SME businesses meaning there is a lot of potential. Also, the government understands the importance of the SME sector and we are focused in the same direction. I think the country needs to focus on the SME sector over the next five to 10 years.

DAVID HUNT It has been an interesting year for GFC where we have continued to see strong demand for our lending products. This demand is driven by a dynamic and fast developing SME sector in the Emirates, and the need for small businesses to obtain quick and easy access to funding in order to expand their businesses. With a 15-year track record of having served the countries’ SMEs, we have over the past year also expanded our lending capabilities to cater to companies that can be found in the micro business space. Micro-businesses, for example businesses that typically employ less than 10 people and have an annual turnover of up to AED10 million, have historically been underserved when it comes to funding as many conventional banks view these businesses as being too small, however we see lending in this space as an opportunity and plan to focus on servicing the micro business segment going forward. How does your firm support SMEs, and how do they contribute to the broader economy? MAEAT We can help Dubai

through private equity investment focusing on SMEs. Another tool there is Islamic finance for the government and development, and there are major investors and bankers involved. From our perspective, we are focused on the SME sector and private equity, and we think this is Islamic and fundamental, because if we have this concept for any fund, investors will want it. However, because they do not have any source on the ground to feed them information and knowledge, they do not have the tools to invest, even though they have the money. They need the channels to make the right investments. In 2015, we expect a major rise in the SME sector; we expect to see growth of up to 40%. We also expect a huge jump this year because what the market needs has been achieved to the required level, and we only need to give a little push to reach our target. DH One of the key constraints on the part of SMEs to obtain financing has been their inability to provide adequate financial information and accurate historical data, information that

is needed in order to be able to make a credit decision. Because of this, lenders do not perceive these companies to be ‘bankable’. Many small business owners therefore look to finance their businesses themselves or tend to rely on family and friends for initial investments. At GFC, we offer help and support in developing for instance a good business model or a suitable financial plan and aim to act as partners to our clients. Over the past few years we have seen an increasing number of banks enter the debt finance segment. Given that access to funding has traditionally been one of the main obstacles to obtaining growth capital for SMEs, this is an encouraging indication even if it means that the market for lenders is becoming more competitive. Today many local banks offer SME loans, however since Gulf Finance is not a bank but a finance company, we are slightly different in the way that we operate in that we are able to offer our customers a broader variety of more flexible products which we tailor to suit each client’s individual needs. ✖




The introduction of mandatory medical insurance is set to revolutionize the compulsory insurance sector, yet its impact on market participants remains to be seen.



THE WRITE PREMIUM The insurance industry in the GCC has, per se, seen steady growth propelled by economic development, population growth, regulatory advances, and gradually rising product awareness. Thus, commercial coverage aside, greater personal wealth, and consequently rising automobile sales, as well as the prevailing low penetration (around 2%) of such markets spell rich pickings for those players lasting the distance. The insurance market is estimated to have exceeded $8.2 billion by end of 2014. The UAE insurance industry is largely comprises publicly listed firms, many of which have a majority government holding. UAE insurance companies are obliged to register as public joint stock companies and become listed on the Dubai Financial Market or alternative Emirati bourse. An Arab News appraisal of the sector in 4Q2014 concluded that, while growing commendably, apart from the big five cover-mongers, average premiums per insurer were at roughly $83 million, pointing to industry over-capacity, and a depression of overall market performance. Indeed, last October UAE Insurance Authority made comments sympathetic to consolidation among insurers. There are over 60 companies, where official data revealed 34 national insurance companies and 26 foreign insurance companies in 2013. The first local insurance company established in the UAE was Dubai Insurance Company, incorporated in 1970 by Decree of His Highness, Sheikh Rashid Al Makhtoum. AM Best rated the institution B++ (Good) with a Stable Outlook. Its website declares that the firm; “… offers capacities in all lines of insurance, supported by such leaders in global reinsurance as Switzerland’s Swiss Re, Germany’s Hanover Re, France’s SCOR and CCR, among others.”

PREMIUM DRIVERS The region’s median age of below 30 years implies a rising tendency to buy property and cars, with a consequent rise in demand for respective insurance products. Motor insurance is mandatory in the Emirate, which makes this insurance line a thriving business due to the high levels of car ownership and continued growth of the automobile sector. United Insur-

ance Company posts annual premiums written of $49 million. General manager James Portelli points out that motor and health insurance, while offering potential, “are not rising stars.” The company’s strategy has therefore been “… one of stricter selection and adequate pricing. […] Our concentration for growth will be in other personal lines and SME segments where we feel that we can add value to our customers and do so profitably in the long run.” Distribution channels such as Bancassurance and web-based offerings are gaining in popularity. Andrew Smith, CEO of RAK National Insurance, one of the seven insurance firms selected to facilitate the mandatory health care coverage law, mentioned “…a milestone going into 2015 [being] the planned majority share acquisition by National Bank of Ras Al Khaimah (RAK Bank)... Having a partner like RAK Bank will add value to RAK Insurance; increasing distribution capability and affording us the opportunity to move into new markets and offer new products.”

“INSURANCE? MEH…” Indifference to the virtues of coverage remains problematic, as brought to bear by the fire at the vertiginous Dubai Marina Torch Tower, just two years after a conflagration at the Tamweel Tower in Jumeirah Lakes Towers—a simple cigarette there left 160 residents out of hearth and home, and pocket alike. Indifference also blights the sector’s workforce, as confirmed in Deloitte’s revealing Talent in Insurance Survey 2014. For that year, a study of UAE business students’ professional preferences put Transportation & Logistics 1st on 14.1% of those canvassed, followed by FMCGs on 12.5%. Attesting to Dubai’s diversified economy, Energy appealed to just 3.9%. This, though, dwarfed the 0.1% of students desperate to generate premiums for a living; a flat YoY print. This, quite clearly, has caused the shortfall in qualified workforce all too familiar to emerging markets.

THE OUTLOOK Alpen Capital estimates Gulf region insurance industry annual growth (CAGR) of 18.1% between 2012 and 2017, topping out at $37.5

WAEL AL SHARIF CEO, Takaful Emarat Insurance penetration in UAE is low compared to many countries in the world. A key factor behind this is the lack of awareness as well as fatalism. We, as Takaful operators, have both a duty as well as an advantage. We can rebuttal the impermissibility of insurance when it comes to halal or haram, however, we have a duty, as it is the case with all insurers, to create awareness irrespective of whether it is conventional or takaful insurance being marketed.



DUBAI 2015



billion, with the life and non-life segments on $2.4 billion and $ 35.1 billion, respectively. The former segment is foreseen posting an annual average rate of around 2% during the period, with the latter expanding by 20% annually, thus increasing its share in the regional market from 86.6% in 2012 to 93.6% in 2017. Economic diversification and infrastructural projects will stoke the region’s non-life insurance segment. Additionally, higher medical insurance penetration and growth of motor insurance due to new vehicle sales are contributing to premium generation and sector growth. According to Capital Business, the insurance penetration in the GCC is expected to improve from 1.1% in 2012 to 2.0% in 2017, as industrial growth pips the pace of GDP expansion. Non-life insurance penetration, which is likely to surge from 0.9% to 1.9% during the period, is seen as the main driving factor. By 2017, industry-wide density is set to rise from $367.3 in 2012 to $751.4, although the chasm between life and non-life segments will be yawning all the more.

YOUR GOOD HEALTH! Compulsory insurance lines add much to premium growth; Dubai’s rollout of compulsory health insurance in 2014 is, then, a game changer in more ways than one. The new mandatory health insurance regulation encapsulates the entire population of the Emirate of Dubai, both nationals and expatriates. Employers bear the cost of insuring for their staff, with a two-year deadline set for the rollout by the Dubai Health Authority (DHA)—companies employing over 1,000 staff met full compliance by October 2014, those with between 100 and 999 staff by the end of July 2015, and those with fewer than 100 by the end of June 2016. The DHA foresees spouses, dependents, and domestic workers being covered by 2016. The development will introduce at least 300,000-500,000 people into the realm of the insured. The mandatory packages spans GP visits, referrals, surgery, diagnostics, and maternity and emergencies, excluding cosmetic, non-emergency dental, and optical procedures, up to $40,800 per annum. Takaful Emarat was one of seven firms chosen by the DHA to provide essential cover to lower paid workers, and is the only takaful firm in the group. In a TBY interview, CEO Wael Al Sharif alighted on the firm’s return to the black

after six years seeing red. A major rethink of the operating model had facilitated greater efficiencies whereby; “Takaful Emarat closed 2014 with a profit of $1.9 million up from a loss in 2013 of $4.7 million [which] is considered a significant achievement for a takaful operator in light of competition with conventional players.” The other six institutions are AXA Insurance—voted “Insurer of the Year at the MENA Insurance Awards, 2014, for the 5th consecutive year—Ras Al Khaimah National Insurance Company, National Health Insurance Company (Daman), Oman Insurance Company, Arab Orient Insurance Company, and American Life Insurance Company. A further 43 insurance firms are in possession of the Health Insurance Permit (HIP).

FOREIGN PLAYERS Dubai’s insurance arena has wooed several foreign premium pushers, including AIG, Allianz, and Swiss Re. The UAE Insurance Authority has imposed a number of stipulations to curb foreign participation, namely allowing just those companies to set up branches that had already secured a license to operate in the UAE. The foreign entity also may only supply those products not already available. In this light, the simplest route to the UAE market for overseas insurers is a stake acquisition in a domestic player (maximum upper limit of 25%). Alternatively, many foreign entities have pitched camp at the Dubai International Financial Centre (DIFC)—a free zone—enjoying 100% foreign ownership status and no currency restrictions while establishing a local presence. Civil and commercial laws applicable elsewhere in the country do not apply, as regulation comes courtesy of the Dubai Financial Services Authority (DFSA). DIFC tenants, while unable to purvey retail insurance products in the UAE beyond the free zone, may directly meet coverage needs within the DIFC or elsewhere in the GCC.

TAKAFUL Life insurance in the UAE is has ostensibly been the preserve of the expatriate, as a good number of locals shun life policy from religious conviction. This has ushered in a new wave of Shariah-compliant products, under the name of Takaful. “A major booster for us here in Dubai…” Takaful Emarat’s CEO Wael Al Sharif explained in conversation with TBY, “… is the announcement made by HH Sheikh Mohammed Bin Rashid Al Maktoum regarding Dubai being the capital of the Islamic Finance.” This will undoubtedly have a catalytic effect on halal products and services beyond the scope of Islamic banking, namely Takaful Insurance, among other sharia-compliant products. The industry forecasts sector CAGR of 23.0% between 2011 and 2016 to $1.2 billion. The UAE and Saudi Arabia together account for around 90% of MENA’s family Takaful sector. ✖

CHRISTIAN GREGOROWICZ CEO, NEXTCARE The UAE is one of the largest insurance markets in the region, with health insurance representing a significant segment due to mandatory health insurance laws. Being a health insurance management company makes our business interesting in this part of the world. Customer behavior should change as there is huge room for growth in most lines of insurance, especially personal lines. I would like to see more education and awareness, innovation, technical underwriting, new products, and wider coverage, which will increase the penetration rate.

Online portal is just a click away... Welcome to RAK Insurance online portal and experience... • Free online quote in less than a minute • Wide range of online insurance solutions • Information and updates on the new products • Quick delivery of policy documents through email • Exclusive client portal to access all the policy details • Utilities including policy servicing and claim registration We believe that a beautiful tomorrow begins with a wiser today.

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DUBAI 2015


customer FIRST TBY talks to Michel Khalaf, President of Europe, Middle East and Africa at MetLife, on being recognized at the Middle East Insurance Industry Awards, using technology, and the potential for takaful.

MetLife recently won the Life Insurance Company of the Year Award at the first Middle East Insurance Industry Awards. What is the significance of this award to MetLife?

We are pleased that MetLife was recognized as the Life Insurance Company of the Year in the Middle East. This is an important recognition from our industry peers, particularly as the award focuses on excellence. The award citation “Putting customers first, embracing best standards, making things easier, and succeeding together” are the values behind MetLife’s Life Insurance Company of the Year Award, capturing the essence of who we are as a company. The award also reflects our long presence and service in the region and our ongoing commitment to meeting the evolving needs of our customers through our broad product range, extensive distribution capability, and commitment to customer service—all backed by the dedication, energy, and passion of our employees. MetLife has been a pioneer of life insurance in the Middle East and Africa for more than 60 years and this recognition validates our strategy and reinforces our leadership position in the region. A recent E&Y report suggested that, in the Middle East, technology is going to shape the way insurance markets operate. How is MetLife implementing technology to continue its growth throughout the Middle East?

Technology plays a vital role in helping the industry drive growth, improve efficiency, and boost service delivery for customers as well as lower operating costs. Companies that are

able to take advantage of technological developments and use them to drive business innovations are gaining a significant advantage. MetLife is making a significant investment in technology in order to operate as efficiently and effectively as possible and to enhance the customer experience. We have clear objectives to break down geographic and organizational boundaries and take a global view to leverage scale, simplify how we operate, and create a differentiated customer experience. We’ve focused on innovation in products, distribution, and services, including digital communications, such as SMS and email, and the launch of online portals, as well as the optimization of back-end processes. We were first to launch an e-claims service here in the Gulf, an online claims application process designed by MetLife so that medical providers and claim administrators can undertake a range of claims-related functions online, easily and conveniently. It’s made an instant impact and helped us to reduce significantly the time taken for pre-approvals, claims receipt, and processing. Technological advances such as e-claims provide the foundation for achieving our customer-centric objectives and ensure that the experiences provided to all customers are of the highest standard. One of the visions of HH Sheikh Mohammed Bin Rashid Al Maktoum is to lead Dubai to the point of being the Islamic economy capital of the world. How is MetLife positioned to embrace Islamic finance?

The UAE is a dynamic market and we contin-

MetLife • serves approximately 100 million customers globally • awarded Life Insurance Company of the Year Award at Middle East Insurance Industry Awards



MetLife has a significant presence around the world, and has been in the UAE for over 50 years

Technology plays a vital role in helping the industry drive growth, improve efficiency, and boost service delivery for customers as well as lower operating costs. Companies that are able to take advantage of technological developments and use them to drive business innovations are gaining a significant advantage.

ue looking at takaful as a potential opportunity. In 2014 we conducted a preliminary analysis for the further assessment of the existing opportunities in the region, given the growth potential experienced in recent years in Islamic insurance. One of the benefits of being a global business is that we can draw on our Islamic insurance experience in other parts of the world, such as our joint venture with a leading Malaysian bank. How do you think recent legislation increasing capital adequacy requirements for insurance companies will affect the market?

We do not think the new capital framework introduced by the Insurance Authority will disproportionally affect smaller firms. Smaller firms write less volume of business and their capital requirements will be proportionate to that. What is important is that the new rules mean that all companies in the market will have to abide by the same rules. In our view, this creates a level playing field and ensures companies that serve customers are adequately capitalized. In the long run, this is good for the development of the insurance

market and ultimately good for the consumer. This is particularly important for the life insurance industry, where policies are designed for the long term. Can you comment on the Dubai Health Authority’s first phase of mandatory health insurance cover, which began at the end of October 2014?

MetLife has been operating in the UAE insurance market for more than 50 years, and we were pleased to be able to put our substantial experience at the disposal of Dubai Health Authority when it was formulating the new law. MetLife was one of only seven insurance companies to be granted Participating Insurer (PI) status by the Dubai Health Authority. Under the new law, which makes health insurance mandatory for all residents by 2016 in Dubai, we can provide basic health insurance benefits to employees with salaries under $1,088 per month. Dubai Health Authority estimates that around 2 million people fall into this low salary band bracket. We plan to play a leading role by leveraging our distribution reach and creating new and enhanced products. ✖

BIO Michel Khalaf has been a member of the company’s executive group since 2011. He has held a number of leadership roles in various markets around the world including the Caribbean, France, Italy, Egypt, Poland, Romania, the Baltics, the Philippines, and has been based in Dubai since 2008. He graduated from Syracuse University with a degree in Engineering and an MBA in Finance. He is a fellow of the Life Management Institute (FLMI).




DUBAI 2015


What are the main focuses in terms of products?

TBY talks to Andrew Smith, CEO of RAK National Insurance, on the company’s four-decade history in the UAE, fostering awareness, and the sector’s near future.

HERE TO help Ras Al Khaimah National Insurance Company (RAK Insurance) has been present in the UAE for almost 40 years. What are some of the recent milestones that the company has achieved this year?

BIO Andrew Smith graduated from the Institute of Islamic Banking while concurrently working on his Masters of Science in Development and Performance Management at the University of Leicester. He has worked for publicly listed multinational companies and privately owned businesses over his 30 years of professional experience.

In terms of what we have achieved this year, there are clearly a couple of highlights. We were selected as one of the seven participating insurers for Dubai’s mandatory health insurance scheme, which is a significant achievement for us as an organization. Another milestone going into 2015 was the planned majority share acquisition by National Bank of Ras Al Khaimah (RAK Bank). The UAE is a highly competitive market with over 60 insurers. Having a partner like RAK Bank will add value to RAK Insurance, allowing us to increase distribution capability and affording us the opportunity to move into new markets and offer new products. The third milestone this year has been to introduce a new online distribution channel. Clients will be able to go online and buy a range of insurance products and obtain valuable service offerings. On top of that, we have been going through a transitional period as an organization. We set a new strategy for the company in 2013, which runs through to 2017.

As a company, we are a composite insurer, which means that we sell both life, medical, and general insurance products to corporate and retail clients. Moving into 2015 and beyond, we will be looking to expand our footprint in the retail sector. In that respect, our product range will become more focused, specific to each and every need of a client, with an eye on simplifying the structure and pricing of the products. We are also making it easier for clients to shop for products. How would you describe the main pillars of your growth strategy, and how it will impact RAK Insurance?

The initial focus has been on adopting a multi-channel approach to distribution. We are working closely with brokers, looking at bancassurance, corporate, retail, and e-commerce, as well as building for the first time, our own direct sales force. We are beginning a multi-channel of distribution, repackaging or restructuring our product offerings, and making it easier for a client not only to buy the product, but for them to understand what they are buying. We went through a complete transformation in terms of our brand in May 2013. Our brand was the starting point because we want to be seen as a different insurer, appealing to a more affluent sector of the market. What impact do you believe mandatory health insurance will have on the health insurance industry as a whole?

As the population in Dubai continually increases, especially within the expatriate population, the need for health insurance is becoming more and more a necessity, not only from an employee’s perspective, but

1 of 7 selected insurance firms for the DHA mandatory healthcare coverage law

also from the perspectives of employers and the government. I think the Dubai Health Authority (DHA) has done a good job in developing the initial structure and putting in place what will be a world-class healthcare offering. The DHA and the Participating Insurers will now learn and adjust accordingly. What are your expectations for the insurance industry going forward?

I believe there is continuing opportunity and optimism in the foreseeable future, but again, as I mentioned, pricing is becoming a challenge, as well as profitability for some companies. I believe regulation has a major part to play as the insurance industry moves forward and becomes more mature. Unlike Saudi Arabia, which is well regulated by the Saudi Arabian Monetary Agency, the regulator in UAE is working through a number of challenges that the sector faces. Although there is significant market opportunity, I believe competition is very strong, while pricing is weak, and there is over capacity in the market as well. Companies that want to succeed will have to deliver better quality products and better quality services, and they are going to have to become much more consumer focused than they have been in the past. ✖





HOW ABOUT THIS? Within HH Sheikh Mohammed’s vision for Dubai to become the capital of the Islamic economy, an important pillar is also Dubai becoming the capital of Islamic finance. ONE OF THE KEY expected drivers of





represents less than



GCC countries contribute




growth in the insurance market is the continued development of the takaful insurance market. Takaful differs from conventional insurance as it adheres to the tenants of sharia law. Where conventional insurance is a buy and sell contract between insured and insurer, takaful is an arrangement whereby a group of individuals mutually insure each other, acting as both insured and insurer simultaneously.

According to the State of the Islamic Economy 2014-15 report, the global takaful market is worth $28 billion, with GCC countries contributing 62% of gross takaful premiums. According to the State of the Global Islamic Economy 2014-15 report, the global takaful market is worth $28 billion, with GCC countries contributing 62% of gross takaful premiums. However, if you compare this to the global conventional insurance values, it represents less than 1% of total volumes internationally. There have been numerous challenges identified within the takaful insurance market. One challenge is the lack of standardization via a certification body on what constitutes a permissible takaful product. In recognition of this, the UAE is poised to take one of the largest steps in 3Q2015 by establishing a federal sharia board composed of Muslim scholars that pass religious decrees on whether a financial product conforms with Islamic tenants. A second main challenge to the development of takaful is the low penetration rate across all lines of insurance in the Muslim world. This is attributed to the lack of education on insurance products, as well as the common belief that insurance products are not sharia compliant. Not only this, but localized takaful insurance companies have to compete with major international brands with much stronger market recognition and reputation. All in all, takaful insurance companies are facing an uphill battle in the development of this market. However, through education and standardization, there is plenty of opportunity to capitalize on this untapped market. ✖



DUBAI 2015


A SURE thing How would you describe the history of Chedid Re in Dubai and the UAE?

TBY talks to Joseph Faddoul, Executive Director at Chedid Capital Holding, on operations in Dubai, its growth strategy for the market, and the effects of new regulations.

For Chedid Re, the UAE is of great importance. It is a very dynamic and competitive market which makes it extremely challenging. At Chedid Re we see these parameters as very exciting and we tune our team mind accordingly. Therefore, we understand that to be successful we had to always anticipate our clients’ needs before it becomes obvious. On the other hand, since we are based in Lebanon we have the luxury of cost advantage where you can attract competent and committed human resources at relatively acceptable packages that give us a competitive edge. What is the main focus of business for Chedid Re in the UAE?

BIO Joseph Faddoul is Chedid Capital Holding’s Executive Director of the Facultative Division. He is responsible for a portfolio in excess of $180 million that consists of property, engineering, life, accident, marine, and casualty facultative reinsurance business. Prior to that, Joseph was the Business Development Manager for AIG in Saudi Arabia. He is also an Associate of the Chartered Insurance Institute of London.

The way we are structured as a company, we offer a complete solutions to our partners. We have two operations, the treaty operation and the facultative operations. Within both operations we service all lines of business through a team of expertise that provide a first class quality service. The major chunk of our UAE Facultative portfolio is property business because of the volatility of results and the market cycle is soft, insurance companies tend to cede the risk to reinsurers. Property business is an area of primary focus since we are aware that although, the premiums on the primary side are rising because of compulsory medical insurance, the reinsurance premiums are reduced, and the cessions are being decreased

Delivers comprehensive solutions to over 270 insurance companies

over the years. Mainly this is because of motor and medical business being retained. Having said that, over recent years we have seen considerable restructuring as far as the treaties are concerned, and the treaty reinsurers have imposed certain restrictions. This has affected primarily the property business hence the reason why we see this as an area for potential growth for facultative reinsurers. How would you describe your growth strategy for the UAE market?

Our growth strategy relies on the areas with unexploited opportunity, especially regarding the restrictions imposed by the reinsurers on the businesses shared between the insurance companies. Previously many mid-sized businesses and SMEs were not routed to the open market because that business used to be shared between the insurance companies locally. However, now with the restrictions imposed by treaty reinsurers, they cannot carry on with such arrangement. Consequently, we are seeing a great deal of growth in the SME business as

a result of the new applicable restrictions. We have to keep in mind that although the primary market is growing by double digits every year, the reinsurance market is shrinking because this premium is being retained, meaning that many proportional arrangements are shifting to excess of loss arrangements. A lot of premiums on the top-side are being retained by the companies, the potential growth lies in the business which used to be shared between the players, and this is what we are currently focusing on. Recently the UAE Insurance Authority announced new regulations that are expected to squeeze out small brokerage and advisory firms that have limited capital bases. How do you see these new regulations impacting the insurance industry in the UAE?

Introducing regulatory frameworks is always encouraging for professionals. Although we still believe they are not stringent enough. At least, however, there is a light at the end of the tunnel, and we look at it positively. People like us always have an impetus to be operating in a regulated environment in order to close doors on unregulated business dealings. In an unregulated market, a broker that pays far less in compliance does not have to take into consideration the cost that I am incurring to comply; and this is also true in many other areas. We have an internal self-regulation in terms quality of reinsurers, policies and procedures. In an unregulated environment this would put us at a disadvantage; therefore for us at Chedid Re, we would encourage regulators to incorporate more stringent requirements. ✖

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DUBAI 2015


AXA Insurance won in 2014, for the 5th consecutive year, Insurer of the Year at the MENA Insurance Awards, and was also awarded the prestigious Banker's Middle East product award for 2013 for the ‘Best SME Product.’ What is the significance of these two achievements?

crystal CLEAR TBY talks to Jerome Droesch, CEO Gulf and Middle East for AXA Insurance, on recognition and awards, SMEs, and mandatory health insurance.

These awards speak about our consistency to deliver worldclass insurance products and services in the MENA region. The selection of AXA Gulf as the Insurer of the Year recognized its commitment to customers, innovation and consistent delivery of high quality coverage, product diversity, technical expertise, leadership and a strong, persistent financial performance. The insurance industry has evolved over the years, and the need of the hour is to deliver the best insurance product customized to suit individual needs, in every sector. To have won the prestigious Insurer of the Year honour at the MENA Insurance Awards for five consecutive years speaks volumes about our company’s strategy and comprehensive product portfolio as well as our reputation to deliver consistent firstclass services. In this fiercely competitive sector, this is indeed a great achievement for us. Last but not the least, these awards recognize the work delivered by each and every AXA employee in the region, and I thank everyone for making this happen. Those awards reinforce our goal to become the preferred insurer across various markets and categories. Finally, it also reinforces the trust that distributors and clients have in the brand. This is gives us a 360-degree view of what we are doing and how we are perceived in the market as a whole. How important are SMEs to the client portfolio of AXA Gulf?

Almost every business starts as an SME and progressively grows larger, so it is natural for us to be rooted and connected to SMEs, because they constitute the future of the

IN NUMBERS Gulf and Middle East for AXA Insurance

More than


million clients in the GCC

No.1 non-life international insurer in GCC

economy. SMEs add a lot of innovation and energy to the economy, and their success gives a good measuring stick of the dynamism of the economy as a whole. It is important for us to be well connected to this part of the economy to understand what is going on. According to Dubai SME, an agency of the Department of Economic Development, SMEs represent 95% of companies in Dubai, contribute to 40% of the Emirate’s GDP and employs 42% of its workforce. This reflects the critical role that this sector plays in achieving and nurturing the overall development across diverse economic sectors. We have created a dedicated SME unit, the objective of which is to educate SME owners on risks through a specialized team of experts. This team will meet business owners in their offices and analyze their specific requirements to provide adequate prevention and protection measures. Finally, the team will regularly follow up with SME customers and monitor the evolution of their businesses to continuously verify their insurance needs.

In addition, AXA in the Gulf will enhance the support to SMEs during their first year and beyond, and this is will be achieved through a new dedicated hotline that business owners can access for advice and information. As one of the preferred insurers chosen to be part of the Dubai Heath Authority (DHA)’s mandatory health insurance initiative, what role do you think that this initiative will play in the development of Dubai?

Probably what is more important for me than the economic impact is the social impact of the DHA initiative. I see this as the real role of an insurance company and the insurance sector. You cannot develop the global economy of a country without providing the right level of protection to the citizens. There are many people that are not able to afford treatment locally. This means that either they will not get the treatment at all, or they will wait until they return to their home country, which might be every year or two, to get treatment. ✖

BIO Jerome Droesch has been in his current position since 2011. An industry veteran, he has been with the AXA Group for more than 20 years and has held several commercial, technical, operational, and managerial positions across France. In 2003 he was appointed P&C Insurance Organization Director in France before taking the Lead of Sales and Distribution Direction for the French West Region in 2005. He became the Regional Chief Executive Officer for AXA France, handling the south-west region in 2008. He has a vision to drive AXA Gulf growth to the next level and accelerate its expansion across the Middle East.






HE Saeed Mohammed Al Tayer, Managing Director and CEO of Dubai Electricity and Water Authority, on solar energy.

Ahmad M. Bin Shafar, CEO of Empower, on the district cooling business and the importance of the green economy.

Ahmed Bin Sulayem, Executive Chairman of Dubai Multi Commodities Centre (DMCC), on the diamond and gold trade.

Energy & Industry REVIEW ENERGY

With the Dubai Integrated Energy Strategy 2030 occupying the agenda, the Emirate’s authorities are looking to a more diversified and cleaner energy mix to drive growth forward.


t the end of 1H2014, the Dubai Statistics Center (DSC) estimated that the GDP contribution of the electricity, gas, and water sector was some 1.8%, well behind the big hitters in the Emirate’s economy, including retail, manufacturing, and construction. At the head of the Emirate’s energy sector is the Dubai Supreme Council of Energy (DSCE), a government body that functions as a policy development and governance maker for all key energy assets. In terms of energy policy, Dubai is seeking to balance its increasing dependence on imports, especially in terms of natural gas, by developing a more active renewables industry that will help take up the baton.

OIL & GAS The size of Dubai’s oil reserves is estimated by the US Energy Administration to be some 4 billion barrels. While crude oil production hit highs of 410,000 bpd in 1991, production has been wound back over the years, with the Emirate expected to sunset

The oil industry may have provided the initial working capital for the Emirate of Dubai’s rapid transformation into a global trading center, but its role in generating revenues is rapidly on the wane.

as an oil and gas producer by 2030. The onshore Margham field is the centerpiece of the Emirate’s ongoing production, while four offshore fields, Fateh, Southwest Fateh, Falah, and Rashid, contribute to the mix. In 2010, oil and gas was discovered at the Al Jalila field and brought in to bolster the estimated 100,000 bpd the Emirate produces. Dubai is estimated to hold 113.3 billion cubic meters (bcm) of natural gas reserves, though all of the production is devoted to serving the needs of Dubai’s growing population. In October 2014, the Dubai Petroleum Establishment (DPE) announced new gas discoveries at its offshore Fateh field. The field has been in production since 1966, and is one of the Emirate’s oldest production zones. Studies are to be conducted in 2015 to determine the size and viability of tapping this newly discovered sweet methane reservoir, unusual in an area more traditionally associated with sour gas formations. In total, Dubai’s fields are estimated to produce some 4 million cubic



DUBAI 2015

meters of natural gas per day. Despite Dubai’s reserves, in order to feed its need for natural gas and electricity generation, the Emirate is reliant on the Dolphin Energy pipeline, receiving on average 20.67 million cubic meters per day from Qatar, with other feedstock being contributed by the neighboring emirates of Abu Dhabi and Sharjah in more limited quantities. At the heart of Dubai’s oil and gas industry, whether for production or distribution, is the state-owned Emirates National Oil Company (ENOC). In 1999, it opened at 120,000-bpd capacity oil refinery near the port of Jebel Ali, which it expanded to 140,000 bpd in capacity in 2012. Its gas processing plant is capable of processing up to 235 million cubic feet per day, while its methyl-tertiary butyl ether (MTBE) plant, an additive to unleaded petrol, is rated at 500,000 ktpa, according to ENOC estimates from 2014. Through its Horizon terminal subsidiary, ENOC’s Jebel Ali facility has a 54,401 cubic meter capacity spread over 59 tanks. As well, EPPCO International Limited (EIL), a joint venture between Horizon and Chevron, offers a more substantial 936,755 cubic meters of storage capacity in Jebel Ali. However, ENOC also has extensive facilities in nearby Fujairah, as well as overseas in Saudi Arabia, South Korea, Djibouti, Morocco, and its flagship Singapore operations, which can store up to 1.25 million cubic meters of crude. This is not ENOC’s only foray internationally, with the company owning a 54% stake in Dragon Oil, whose prime asset is the Cheleken field in Turkmenistan. ENOC also plays a key role in Dubai’s fuel distribution sector, running a total of 99 gas stations within the Emirate at end-2014, as well as numerous convenience stores, food and beverage facilities, and auto repair and maintenance centers. Over the past few years, ENOC has been retreating from its retail operations in other markets in the UAE due to their limited profitability, though recent falls in global crude oil prices will act as a buffer for the company’s Dubai outlets. In March 2015, ENOC appointed a new CEO, Saif Humaid Al Falasi, who is looking to diversify the company’s revenue streams and increase its presence in the international market. However, Dubai’s exposure to the oil and gas industry is not limited to domestic interests alone. Over the years, the Emirate has grown to become a major regional and global player in the oil and gas services industry, with the Jebel Ali Free Zone (Jafza) being central to its prominence. In November 2014, some 830 foreign companies in the petrochemical, oil and gas, and related mechanical sectors had operations within Jafza’s facilities, with 43% covering oil equipment, 31% involved in chemical products, and 21% providing oil and gas services, while 5% were in the glass, plastics, and rubber category. Over 2013, Jafza estimated that these companies had generated over $14 billion in trade and services, making the city one of the go-to places in the Gulf region for foreign oil services providers.

ELECTRICITY & WATER Dubai Electricity and Water Authority (DEWA) has been working hard to both keep up with the growing demands of business and residents, and ensure that it acting in a responsible way toward the environment. At end-2014, DEWA reported 11 non-renewable power-generating facilities in the Emirate, with a combined installed generating capacity of 9,656 MW in the Jebel Ali and Aweer regions, as well as a 13 MW solar park. Of the installed capacity, 7,104 MW of capacity are from gas turbines, with the remaining 2,542 MW coming off of steam turbines. Peak demand was estimated at 7,233 MW over 2014, with the summer months requiring as much as 7,500 MW in generating capacity to keep consumers satisfied. While Dubai still has a considerable amount of unutilized generating capacity at present, should current usage growth rates continue it will need to construct more capacity to meet demand. Over 2014, DEWA reported a system energy requirement of 39,599 GWh, up 5.36% on the same figure for 2013. DEWA also acts as the main transmission and distribution company in Dubai, boasting over 28,000 substations and some 27,000km of cabling. On the retail side, DEWA reported that in terms of electricity consumption, commercial users came in first at 47.89%, residential users made up 28.2%, institutional and other users formed 8.47%, power stations and related desalination facilities used 8.45%, while industrial operations consumed the remaining 6.99%. As well as providing electricity, the 7,801 MW of installed generators located in the Jebel Ali area function as desalination plants, having the capacity to produce 470 million gallons per day (migd). In 2014, annual peak water demand came in at 216 migd, up 6.76% in YoY terms. In annual terms, desalination plants provided the

JENS NIELSEN CEO, World Climate Limited The focus of making the world more sustainable has moved very much to the international organization, the UN, and government level through the climate change debate. However, everybody knows that we need commercial green business development and we need participation between the technology sector, the finance sector, and the buyers. We think that Dubai is well positioned, mainly because it is in a position of wealth in the Gulf and has a leading trade dimension.

LEAN, GREEN MACHINE Dubai has recently tripled its target to increase the share of renewables to 15% of its energy mix by 2030 as part of the Dubai Integrated Energy Strategy 2030. Similarly, green initiatives are at the heart of the UAE Vision 2021 launched by HH Sheikh Mohammed Bin Rashid Al Maktoum. With the increasing importance of renewables, Dubai’s government has prioritized areas such as clean energy, retrofitting, green production processes, waste management, and public transport, which will provide new job opportunities in the economy. For this reason, Dubai Carbon Centre for Excellence has created the Green Jobs Programme, an initiative aimed at educating future green workers and spreading this knowledge to the public. CCE’s figures demonstrate this vision is tangible: the green employment sector was the only sector that grew in 2010-11 during the recession. Moreover, the energy efficiency sector is expected to be the highest generator of jobs within the UAE, projected to create more than 65,000 jobs by 2030. It is essential to ensure a smooth transition toward a regional green economy and to provide the human capital required to satisfy a growing demand in Dubai. In fact, the UAE Green Growth Strategy will create 160,000 new jobs and boost GDP by 4-5% by 2030, while the International Renewable Energy Agency estimates that globally around 16.7 million jobs will be in renewable energy by 2030. The Green Jobs Programme addresses the main requirements for the transformation toward a green economy, which is the demand for skilled, competent workers in all sectors.

The World’ s Largest District Cooling Provider EMPOWER, Emirates Central Cooling Systems Corporation, is created with the objective of providing world class District Cooling Services to Dubai and the region. Empower is determined to satisfy the critical needs of its customers and in the process develop its own distinctive competencies.

[email protected] I Tel: +971 4 375 5300 I



DUBAI 2015

Emirate with 106,184 million gallons of water, well above the 498 million gallons provided by underground aquifers. Residential users were responsible for 80.65% of water demand for 2014, with commercial enterprises taking the next largest slice at 18.64%, while industrial and non-commercial institutions represented just 0.71% of remaining water use. In 2014, the DSCE released the Dubai Integrated Energy Strategy (DIES) 2030 report, a detailed envisioning of the Emirate’s future power and water options. In terms of improving the generation mix, the report has targeted a move away from the current near total reliance on natural gas for generation. Overall, the report calls for natural gas generation to fall from some 95%-plus of generating capacity to 71%, for clean coal to make up 12%, while the remaining will be generated by nuclear energy (12%), and solar plants (5%). As well, the Emirate is targeting a fall in energy demand of 30% to ensure a higher level of environmental sustainability and meet carbon emission goals. The government is examining ways to reduce electricity consumption by all main users, with commercial and residential consumers key targets, while encouraging the use of installed solar panels to reduce the reliance of consumers on DEWA’s generation matrix. As such, solar is being pushed as the main potential source of renewable energy, with the 13 MW solar plant inaugurated in 2013 being just the first step.

In November 2014, a new 100 MW installment of the Mohammed bin Rashid Al Maktoum Solar Park was brought to tender, with DEWA accepting the bid of Saudi company ACWA Power to provide electricity at the lowest rate in the solar industry so far, at $5.98 per kWh. DEWA later doubled the size of the initial contract to 200 MW for installation by 2017, with ACWA Power tipped to be ready to take on this enormous challenge. The Mohammed bin Rashid Al Maktoum Solar Park is at the core of Dubai’s efforts to see solar energy take up to a 5% share of the Emirate’s generating capacity, and thus reduce its reliance on natural gas fired power plants. Once complete, the solar park will generate 1,000 MW of clean energy when completed in 2030. As well, the solar park will cover some 4.5 sqkm of desert, and form one of the largest facilities of its kind. By contrast, Emirates Gas (EMGAS), ENOC’s retail gas subsidiary, is looking to team up with Dubai Municipality to recover methane gas from sewage operations so as to provide compressed natural gas (CNG) to up to 15,000 vehicles per day in Dubai. EMGAS has been at the forefront of introducing CNG into the Emirate’s fuel mix, with fleet users such as Emirates Airlines, DP World, the Roads and Traffic Authority (RTA), and Dubai Municipality converting some of their vehicles over to the more environmentally friendly fuel. These initiatives mark a more sustainable ecological outlook for Dubai over the long term. ✖

The Mohammed Bin Rashid Al Maktoum Solar Park, expected to be completed by 2030, is at the core of Dubai’s efforts to see solar energy take up to a 5% share of the Emirate’s generating capacity, and thus reduce its reliance on natural gas fired power plants.

Energy & Industry




SUPPLY demanded TBY talks to HE Saeed Mohammed Al Tayer, Managing Director and CEO of Dubai Electricity and Water Authority (DEWA), on activities in the Emirate, solar energy, and the increased demand generated by the upcoming Expo. What role does DEWA play in Dubai today?

BIO HE Saeed Mohammed Al Tayer is a veteran of almost 30 years in the fields of telecommunications, energy, and water. During his tenure as DEWA’s Managing Director & CEO since 1991, he has focused on network and infrastructure expansion. He is also Vice-Chairman of the Dubai Supreme Council of Energy, a member of the Government of Dubai’s Executive Council, Dubai’s Economic Council, Chairman of the Dubai Infrastructure Committee, Chairman of Empower, Chairman of the Dubai Nuclear Committee, a member of the Higher Committee of the Emirates National Grid, Vice-Chairman of Dubal, Vice Chairman of Emirates Global Aluminium, Director on Emirates Aluminium's (EMAL) Board, Vice-Chairman of EGA, Founder and Chairman of WETEX—the Water, Energy, Technology, and Environment Exhibition, Chairman of the Dubai Global Energy Forum, and Vice Chairman of the High Committee for the World Energy Forum 2012, among other positions.

DEWA plays a major role in supporting Dubai’s economic, social, and environmental development. Obviously, electricity and water are the key enablers of the economy in any country. This is why DEWA is fully aligned to the Dubai Plan 2021 and the Dubai Integrated Energy Strategy 2030. Both of these strategies are working to develop and diversify Dubai’s energy economy, with a clear focus on sustainability and innovation, as demonstrated in our vision to become a sustainable and innovative world-class utility. DEWA is investing over $12 billion over the next five years on water and electricity infrastructure, renewable energy, smart grids, and transmission and distribution networks. DEWA has awarded a contract to build a new 400kV substation for the Mohammed bin Rashid Al Maktoum Solar Park. What is the significance of this for the Dubai Integrated Energy Strategy 2030 to diversify the energy mix by 2030?

The Mohammed Bin Rashid Al Maktoum Solar Park is one of the largest renewable energy projects in the region. It will cover an area of 40 sqkm and generate 3,000 MW of clean energy when completed in 2030. The project supports the Green Economy for Sustainable Development initiative launched by HH Sheikh Mohammed bin Rashid Al Maktoum, Vice-President and Prime Minister of the UAE, and Ruler of Dubai, and is led by the directives of His Highness to enhance R&D in renewable

IN NUMBERS Dubai Electricity and Water Authority (DEWA)

Investing over


billion in the next five years

energy. The Dubai Integrated Energy Strategy 2030 aims to diversify the energy mix by 2030 to include 15% from solar power by 2030, in addition to reducing energy demand by 30%. DEWA awarded the $123 million contract in the third quarter of 2014 to build a 400kV substation to integrate power from the Mohammed bin Rashid Al Maktoum solar park. The gas-insulated switchgear (GIS) substation will enhance transmission capacity, boost power supplies, and strengthen the reliability of the grid. The 200 MW second phase of the solar park in Seih Al Dahal, near Dubai, is scheduled to commence production in 2017. According to some experts, Dubai Expo 2020 will result in a growth in electricity demand of 4-6% per year. How is DEWA planning to face this growth of electricity demand?

In line with the vision of HH Sheikh Mohammed bin Rashid Al Maktoum, we have a clear strategy to support Dubai’s efforts to host Expo 2020. Our strategy is fully aligned with the theme of

World Expo 2020, which is “Connecting Minds, Creating the Future,” and the three sub-themes of sustainability, mobility, and opportunity. We are committed to fulfilling the promise of His Highness to host the best Expo the world has ever seen. DEWA is working hard to achieve this by focusing on preparing a distinguished infrastructure for energy that meets all the requirements for the sustainable development of Dubai. Expo 2020 is an opportunity to demonstrate to the world our competencies in the utility sector. DEWA is looking carefully at electricity demand growth and has a long-term plan in place to increase generation capacity and transmission infrastructure to manage future demand. The current system reserve margin is comfortable, with significant capacity demands also taken into consideration, especially in solar and clean coal, to achieve the Dubai Integrated Energy Strategy 2030 to diversify Dubai’s energy mix. We intend to use solar energy to produce electricity as a way to reduce the impact on the environment while also meeting the goals of the Dubai Integrated Energy Strategy 2030. Around 7% of Dubai’s total power output will be derived from solar power by 2020 and 15% by 2030. Over $707 million has been allocated to support electricity, water, and renewable energy infrastructure for Expo 2020. Projects include production, transmission, distribution, and smart grids. We are doing all of this so that Dubai will host the best Expo the world has ever seen. ✖



DUBAI 2015


What have been your main achievements of recent years?

COOL IT TBY talks to Ahmad M. Bin Shafar, CEO of Empower, on the district cooling business and the importance of the green economy.

The acquisition of Palm District Cooling was certainly one of our main achievements last year. The acquisition helped us to expand our operating zone, increase our domain, and improve the landscape of district cooling areas in Dubai. Through this acquisition, we now have representation in almost every major project in Dubai. When you look at the way Dubai is developing, we have very strong representation throughout the tourism and leisure market, shopping malls, and healthcare facilities. Of course the acquisition provided a boost to our market share and it also saw us increasing our net profit by 65%. Our revenue grew to AED1.5 billion in 2014, a growth of 76% over the previous year, thus solidifying us as one of the real blue-chip companies in terms of size and market share. What is the significance of the MoU you signed with Johnson Controls?

If you look at the district cooling industry, any leader in any industry should have initiatives and responsibilities when it comes to participating in R&D. Part of our commitment to the district cooling industry is that we signed an agreement with Johnson Controls in the US to develop a cooling tower so that applications can be used in water cooling and air cooling to save energy. Saving energy is not just Empower’s theme; it is a global theme. Everyone wants to save energy and have green buildings. By collaborating with the leading manufacturers in the world, it gives us the privilege to associate with them and it gives us an advantage in sharing a new technology that we are building for the Emirates.


Turnover of

AED1.5 billion

Provides more than


million tons of cooling, more than the entire continent of North America

Acquired Palm District Cooling for

$500 million

How does Empower play a role in developing a green economy for Dubai and the UAE?

District cooling is one of the main pillars of green buildings. District cooling is a new air conditioning technology that supplies cool air through an environmentally friendly application by using chilled water. District cooling is the main pillar of any green economy. Moreover, building owners are beginning to understand that the green aspect of green buildings isn’t simply the building materials, but involves the overall operational efficiency during construction and after completion. Construction only lasts a short time when you consider the overall lifespan of a building.

How do you see Empower evolving in the future?

If everything goes according to plan, this market will give us the opportunity to double our capacity by 2018. The US, Canada, and Mexico have a total district cooling capacity of 650,000 tons. Empower, as just one company, has more than 1 million tons. The entire continent of North America only has 650,000, and we alone in Dubai have more than 1 million. If I double that to more than 2 million, it will mean a huge amount of business. It’s really an opportunity for the manufacturers to develop their industry toward green products. ✖

BIO Ahmad M. Bin Shafar is the CEO of Empower, a position he has occupied since the company’s inception in 2004. He brings over 18 years of experience in senior management positions, including eight years with Standard Chartered Bank in the areas of corporate and retail banking, finance, marketing, and customer relations. He is also the Chairman of the Board of Directors of Empower Logstor Insulated Pipe Systems (ELIPS), a strategic joint venture between Empower and Logstor, a world leader in pre-insulated pipe systems. He was also the first UAE national to ever be nominated to the International District Energy Association (IDEA) Board of Directors, in June 2013. He is a graduate of California State University, where he obtained a BSc in Business Administration and Management.

Energy & Industry




PANEL SHOW When you get as much sun as Dubai does, developing solar energy infrastructure seems to be a logical step. DESPITE DUBAI’S economic successes and the reinvigoration of its economy over the past couple of years, one of the central challenges that the government has identified is energy sustainability. In 2012, HH Sheikh Mohammed Bin Rashid Al Maktoum launched the Green Economy for Sustainable Development initiative, which emphasizes diversification away from a dependence on fossil fuels and gearing its energy mix toward renewable resources. As laid out in the Dubai Integrated Energy Strategy, the goal is to generate at least 15% of total power capacity by 2030 via solar energy, indicating a so-called “solar revolution” in the Emirate. With this in mind, numerous solar power projects and initiatives have been announced to accomplish this goal. In March 2014, HH Sheikh Mohammed launched the Smart Dubai initiative, aimed at transforming Dubai into the smartest city in the world over the next three years. Government entities, such as the Dubai Water and Electricity Authority (DEWA), followed suit, announcing its first smart initiative called Shams Dubai. The Shams Dubai initiative encourages tenants and building owners to install photovoltaic solar panels to generate electricity and connect them to DEWA’s energy grid. The system will be using a net metering scheme, meaning that in case a tenant or user produces more energy than they consume, the excess energy will be injected into the DEWA distribution network. This surplus energy will be credited and used to offset the future consumption of electricity. The incentive is therefore savings bills as customers will be purchasing less to meet their needs. As one of the first instances of implementation of Shams Dubai, Dubai Airports announced that it has partnered with DEWA to build a 100-panel solar array at Al Maktoum International Airport at Dubai World Central (DWC). By tapping the sun’s energy, the 100-panel solar array aims to limit the power used by DWC’s employee gate facility. The array, which is located on the roof of the building, has a capacity of 30kW and generates about 48.8MWh of electricity per year, equal to about two-thirds of the power used by the building.

DEWA also recently announced, in January 2015, that the planned 100MW solar power park would be doubling its capacity. The new 200MW plant, valued at $330 million, is expected to begin supplying electricity from April 2017 and be the biggest such facility in the Middle East and North Africa. To put this in perspective, Dubai’s current largest solar plant is a 13 MW facility built in 2014. The new plant will be built and operated by ACWA Power, a Saudi Arabian power and water company. ACWA will finance and build the plant, receiving a fixed tariff for the electricity

As one of the first instances of implementation of Shams Dubai, Dubai Airports announced that it has partnered with DEWA to build a 100-panel solar array at Al Maktoum International Airport at Dubai World Central (DWC).

produced over a period of 25 years. The company’s initial offer was $5.98 cents per kilowatt hour (kWh) for the 100 MW plant. However, due to the scaled back tariff for the 200 MW plant of $5.84 per kWh, the Dubai authorities decided on the latter. At this rate, ACWA will sell electricity to DEWA at what will be the lowest price by far for solar power globally. Looking forward, Dubai plans to build 1,000 MW of solar capacity by 2030. Through these investments and smart initiatives, Dubai is aiming to address one of the most challenging obstacles on its path to continued development; energy sustainability. By investing in renewable resource generation like the 200 MW solar park, or developing smart initiatives like Shams Dubai, the city is taking concrete steps to diversify its production. Through this diversification, Dubai will safeguard economic progress and ensure sustainable growth going forward. ✖



DUBAI 2015


TBY talks to Benoit Dubarle, President of Schneider Electric in the UAE, Oman, and Pakistan, on the company’s main business segments, Dubai as a smart city, and working toward 2030 development goals.

everything connected Which of Schneider Electric’s business segments has the most importance in Dubai and the UAE?

We have seven targeted segments that bring us the strongest growth and where there is a strong differentiation in our offer to our customers. The first is oil and gas, where we have a dedicated team to follow the sector from the beginning of pre-fitting to the installation of our equipment in the field. The second one is water infrastructure. We provide not only the electricity needed to treat the water and run the desalination and wastewater plants, but also all the software needed to monitor these plants. The third segment is energy, and we focus on delivering equipment for electrical solutions and smart grid software that allows the utility providers to manage their energy supplies in the most efficient way possible. The fourth segment is real estate, especially hotels. There are many hotels in Dubai and across the UAE, and authorities are planning to expand the tourism industry. The fifth segment is healthcare, and the sixth is data centers. More and more data is needed all the time, and this is where we can provide a full turnkey data center for storing and securing data.

The last segment is the smart city concept itself. The point at the country level is to make all the component parts communicate together to have a layer of data control that manages the data, the water, and the grid as one. What is the potential for Dubai to become a smart city and how can Schneider Electric contribute to this goal?

Dubai is already a smart city to some extent, and there is a major focus moving on to the next level. Data and public services can be accessed through your smartphone, and for every public entity we do business with currently, such smart services are being rolled out. We provide a lot of training to these entities. Schneider Electric is well recognized in this field globally. We are one of the top three companies worldwide in terms of creating smart cities, along with Cisco and IBM. Dubai is developing an integrated energy strategy to improve its energy matrix by 2030. What are the main challenges that Dubai has to face in this sector?

The smart grid is something that Dubai should embrace, and we have high-level workshops with Dubai Electricity and Water Authority (DEWA)

and other authorities to work toward this. Demand is clearly rising in the Dubai energy sector, and there are several initiatives by the Dubai government to try to control this. One is being carried out by DEWA. It has a department called Etihad Energy Services (Etihad ESCO), which specializes in doing energy saving work on existing buildings. They encourage the private sector to save energy by retro-fitting their buildings with better technology that will allow their buildings to consume less. This is the demand side of the issue, where we can decrease the consumption of energy through existing infrastructure. Schneider Electric is the main provider of this type of technology for these buildings. In every country and city, there are certain seasons of greater consumption. It is important to monitor this consumption by data so that we can adapt production in real time. In the UAE, there is certainly some progress needed on smart grid implementation, and this is one of DEWA’s main priorities at the moment. We need to be able to produce just enough energy in accordance with what customers need in real time, while not overproducing and creating more of a carbon footprint. ✖

IN NUMBERS Schneider Electric UAE, Oman, and Pakistan

Employees in the region

1,500 Services department

450 people

Rate of sales invested in R&D

5% BIO

Benoit Dubarle is Country President for the UAE, Oman, and Pakistan for Schneider Electric. He joined Schneider Electric in 1997 and has held several managerial positions within the company in the past 16 years, living in different regions such as France, Hungary, Poland, Cameroon, and now in Dubai. Dubarle is a graduate in Engineering and also has a Business Management degree from INSEAD.

Energy & Industry



Manufacturing in both the mainstream economy and free zones is providing serious heft to the Emirate’s goal of diversifying its economic matrix.



HAPPILY GRINDING AWAY WHILE INDUSTRY may not be the first thought in the minds of many when looking at the many economic opportunities in Dubai, it is certainly gaining traction, being the third largest job generator in the Emirate. Although the UAE’s booming domestic marketplace attracts numerous investors, even more are being attracted by the combination of logistics, energy, and favorable operating terms in both the mainland economy and in Dubai’s many free zones. Industrial development is being formed with an eye to meeting the objectives of the Dubai Plan 2021, released in late 2014, which calls for the Emirate to become a smart and sustainable city. Increased economic diversification, and the encouragement of SMEs and an Islamic economy also lie at the heart of Dubai’s goals going forward. The continued roll out of the GCC rail network will also see industrial activity pick up, as manufacturers look for better bulk freight solutions with the UAE’s regional neighbors. Much of the industrial activity in the Emirate aims to support local growth, especially in the fields of construction, food and beverages, and consumer products, though as the economy shifts to becoming “smarter” in nature, pharmaceuticals producers are also beginning to show the way on the production side.

SIZE COUNTS In preliminary numbers released by the Dubai Statistics Center (DSC) in early 2015, manufacturing activity in the Emirate was estimated to have grown by 6.5%, the highest among all other

categories aside from the retail and services category, which saw growth of a whopping 28.2% over the year. The DSC estimated that the value-added from industry had risen from $6.08 billion in 2013 to $6.46 billion over 2014. In GDP terms, manufacturing represented 13.9% of the Emirate’s economic activity, and contributed a 0.9% share in the GDP growth rate for the year, which is estimated at up to 4.7%. And the number of workers involved in manufacturing has also shown healthy growth, with the Department of Economic Development (DED) estimating the presence of 340,735 workers at end-2012 (the last available statistics), up some 4.88% in YoY terms and becoming the third largest employer after wholesale, retail trade, and repair services (549,800) and construction (464,711). However, the same metric over the 2009-12 period was up a whopping 54.62%, demonstrating the growing strength of transformative industries in Dubai’s diversifying economic matrix. In trade terms, the strength of Dubai’s industrial sector really begins to shine. From 1Q2014 to 3Q2014, manufacturing trade accounted for 77.7% of the Emirate’s non-oil trade, or $205.67 billion. As Dubai is unusual in having so much of its manufacturing located in free zone areas, the export and re-export of manufactured products—hopefully with some value-adding on the way—amounted to $81.28 billion over the same reporting period according to Emirates NBD Research. Instructive in the total is the breakdown between the main export/re-export segments, with electrical and













DUBAI 2015

machinery at 41.7% of the total, followed by pearls, precious stones, and metals on 29.2%, base metals and products at 8.2%, chemicals and products at 5.2%, while processed food and beverages rounds out the top five on 4.9%. On the imports side, there is little change, with electrical and machinery dominating again on 40.5% of the $124.39 billion recorded over the January to September 2014 period. In second place came pearls, precious stones, and metals (29.9%), chemicals and products (7.8%), base metals and products (7.1%), and minerals and products (4.3%). Of note is the rise of the pearls, precious stones, and metals category for Dubai, with the rise of the Dubai Multiple Commodities Centre (DMCC) playing a major role in supplying a place for those looking to perform value adding, such as in diamond cutting and jewelry manufacturing. Credits supplied to the manufacturing sector are also on the rise, with Dubai-based lenders particularly conspicuous. Over 2014, lending to the manufacturing sector across the UAE reached $16.98 billion, up some 21.3% in YoY terms, and outpacing the 11.3% growth in loans for 2013, according to research generated by Emirates NDB. Dubai Islamic Bank represented 29.7% of all loans, putting it in first place at the federal level, while Emirates NBD supplied 12% of loans to the sector, coming in third. Still, in terms of overall licenses issued to new SMEs, manufacturing only represented 2.1% of the 132,288 licenses issued over 2014, according to the DED.

ZONES Dubai’s industrial areas can be broadly split into two types: “non-free” zones based in Dubai’s economy proper, and free zones. However, while this split affects ownership limits for foreign companies operating under UAE rules and regulations, in reality the interdependent nature of the facilities and activities between the two areas help create vital synergies that drive economic activity. The 5% duty levied on most good types “exported” into the UAE economy proper represents only a small impediment. Broadly speaking, foreign ownership in companies in the non-free-zone areas is capped at 49%, while in the free zones 100% foreign ownership is allowed. For companies looking to use the UAE as an entry point into the GCC customs-free zone, having operations in the nonfree zones is considered a key advantage. Some of the larger non-free-zone industrial areas include Al Quoz (1,838 ha), Al Awir Road (661 ha), Al Qusais (545 ha), Um Ramool (391 ha), Ras Al Khor (120 ha), and Al Khubaisi (102 ha). As well,

across from the Jebel Ali Free Zone (Jafza) lies the Jebel Ali Industrial Area, with many of the companies operating here taking advantage of the close presence of Jebel Ali’s port and infrastructure facilities. As well, Dubai Investments Park (DIP), located near both Al Maktoum International Airport and Jebel Ali, has seen the number of companies operating in area grow to over 3,500, according to DIP’s General Manager Omar Al Mesmar in December 2014. Another key player is Dubai Industrial City (DI), a part of the TECOM Investments group of companies. DI, also located near Jebel Ali, has attracted over 500 companies since it commenced operations in 2004, with the main emphasis being on light to medium industry. On the free zone side, while the DMCC is making strong strides, the flagship for both Dubai and the UAE as a whole is Jafza. In 2013 alone, Jafza has become the home of more than 7,100 companies across all categories, all looking to take advantage of not just its advantageous tax regime and world-class infrastructure, but also the cluster of other manufacturers across a broad range of industries. While big hitters in the oil and gas and metals sectors lie at the core of Jafza’s manufacturing matrix, food and healthcare has emerged as the third largest sector. In early 2015, Jafza announced that companies operating in the food and healthcare segment had grown from just 283 in 2004 to 829 by YE2014, with the volume of their trade reaching an estimated $2.72 billion. In 2014 alone, the number of food and beverage companies operating in Jafza had grown by 15%. Jafza’s parent company, Economic Zones World (EZW) is looking to double down on the Islamic food and beverage segment, with plans to develop two halal-specific zones for producers, one in Jafza and the other in TechnoPark, another initiative of EZW in Dubai.

SWING & A HIT Dubai Aluminium (DUBAL) is one of the heavy hitters in the Emirate’s industrial complex, having the capability of producing over 1 million tons per annum of aluminum products, including billet form, re-melt ingots, and high purity aluminum for use in aerospace and electronic products. As the second oldest aluminum producer in the GCC region, starting operations in 1979, DUBAL is considered to represent almost 4% of Dubai’s GDP, according to HSBC research, while the company reports that around 92% of its annual production is bound for export. DUBAL is now held as one of the main assets of Emirates Global Aluminium (EGA), which is a 50-50 joint venture between

ROY JAKOBS CEO, Philips Middle East and Turkey The government is putting serious effort into achieving smart city goals, and we are working with them closely on the digitalization of light in public spaces.












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DUBAI 2015

the Investment Corporation of Dubai and the Mubadala Development Company formed in 2013. DUBAL’s facilities also include a 2,350 MW power plant that has the capacity to produce 30 million gallons of desalinated water per day. However, DUBAL is just the start of where manufacturing can go. Its products are used to supply a host of downstream industries, such as Gulf Extrusions, a part of the Al Ghurair Group. Gulf Extrusions has an annual aluminum extrusion capacity of some 60,000 tons, with its products finding a host of applications, with construction materials for local use and export predominating. Royal Engineering Fabrication Company (REFCO), another Al Ghurair subsidiary based out of the Jebel Ali region. The company aimed to produce over 1.9 million parts for the automotive, non-automotive, and construction sectors over 2014. Another mainstay is Ducab, an electrical cable producing giant through its 590,000 sqm facilities located in Jebel Ali, featuring one of the world’s longest CCV lines, capable of producing medium and high-voltage cabling systems. As well, it hosts a PVC facility for the coating of cables, while Ducab HV, a joint venture between the Ducab Group (50%), the Dubai Electricity and Water Authority (DEWA) at 25%, and the remaining shares with the Abu Dhabi Water

and Electricity Authority (ADWEA), addresses the local need for high voltage and extremely high voltage cables. Ducab is looking beyond the GCC region for new investment and export possibilities, taking over AEI Cables in the UK to help expand its product range. Conares Steel, the second largest steel manufacturer in the UAE, also bases its operations out of Jafza. The company reported growth of around 40% for 2013, with it looking to up its annual capacity from 750,000 tons to 1 million tons over 2015. In terms of customers, the company estimates that 60% are from within the GCC area, with its output sent as far afield as the Far East and North America. And while the big players are certainly underpinning the Emirate’s manufacturing strength, the automotive sector is also wandering into the field of assembly. By end-2014, Dubai played host to four armored vehicle manufacturers, Saxon Armour, Shell Armoured Vehicles, Mezcal Security Vehicles, and Inkas Armoured Vehicle Manufacturing, which all told produced around 1,600 specialized vehicles over the year. The manufacturers, all located in DIP, are seeing strong growth, with Inkas looking to expand its facilities from 110,000 sqft to 269,700 sqft over 2015, thus boosting its annual production capacity from 1,000 units to 1,600. ✖






Energy & Industry





TBY talks to Ahmed Bin Sulayem, Executive Chairman of Dubai Multi Commodities Centre (DMCC), on the diamond and gold trade, the Burj 2020 Project, and new office space. How would you describe the top achievements for DMCC during 2014?

One of the greatest achievements for the DMCC was maintaining a fast-paced momentum. We have stayed hungry, and open to attracting new businesses. We have become a strong magnet for SMEs and now business incubators with the recently announced AstroLabs tech incubator. As far as diamonds and gold go, it is business as usual. The DMCC, with more than 1,000 diamond companies in our Almas Tower alone, has propelled Dubai into position among the top three diamond centers in the world. The same is true for gold. DMCC has helped Dubai become one of the leading gold trading hubs in the world. Something of equal importance to all this is

our information technology transformation project that is at the forefront of HH Sheikh Mohammed Bin Rashid Al Maktoum, UAE Vice-President and Prime Minister, and Ruler of Dubai’s e-government initiative. Two years ago, we provided a fully online portal for our members where they can do all of their services online, whether registering a businesses, applying for visas, and pretty much all matters. One of the large projects for DMCC is the Burj 2020 project. What impact do you think that will have on the overall operations of DMCC and Dubai furthering themselves as international trading hubs?

How people view DMCC is different today than it was five years ago. The contrast is even starker when you look

back 13 years to our inception in 2002. It is an influential community. I understand there is much conservatism in the market from other areas; however, entities that come to DMCC will never go to another area. The client that comes here is completely different. The fact that we registered between 6,000 and 7,000 companies in the last four years, which was when the world was still reeling from the global recession, is key. I do not get why we need to slow down. We are doing our best to provide a custom-made facility for our members. We asked members what we could provide that was not available. They want their top clients to be here. In that respect, I still feel that the multinational entities have not been serviced 100%. We have not pushed enough to attract them. What are your expectations for the year ahead?

We will be opening One JLT. It is a building with over 27,000 sqm of leasable area. Some may feel there is too much office space coming, but for me, the more offices, the better. The more companies we service, the better it is for DMCC. The unveiling of the Burj 2020 District is exciting. Putting in a nice target for the next decade would be interesting for me. Conservatively speaking, people expect us to reach 16,000 businesses. I would like to push that to 20,000. We are at more than 10,000 today. I would like the focus to be on doubling it. If we cannot get to it, at least I would have the satisfaction that we tried our best. I do not think it is completely unreasonable. The office space is available, and the appetite is there. ✖

BIO As the Executive Chairman of DMCC, Ahmed Bin Sulayem has and continues to play a key role in establishing and positioning DMCC as a major international commodities hub for trade. He joined DMCC in 2001 as a Director, and his responsibilities included overseeing the organization’s operations. Today, he is the Executive Chairman of DMCC, as well as the Director of Human Resources, Director of Dubai Shariah Asset Management (DSAM) and Dubai Commodity Asset Management (DCAM). He has played a leading role in reviving Dubai’s traditional pearling industry by launching the Dubai Pearl Exchange in 2007 and conceptualized the idea behind Almas Tower, the tallest commercial building in the Middle East. In July 2013, Bin Sulayem announced DMCC's plans to construct the tallest commercial tower in the world as part of its expansion plans for its the Burj 2020 District.



DUBAI 2015



IPPOCRATIS VROHIDIS Vice President for Middle East and Africa, 3M Gulf


moved here from Hong Kong, which is really a world city. I see a lot of parallels with Dubai. You see many people from other places, as well as a number of corporate business heads here. The environment is very conducive, and very open. It makes investment and business operations easier than other places. I think the government of the UAE has been visionary in creating an environment that nurtures companies that come here to set up operations and we look to continue that. We expect to increase our technical capability in this area. We see Dubai as a good place for investing and building regional capabilities. I think the efforts of the local government to create for example, airports that are easy to transfer through, have helped. It may not be an immediate thing that comes to mind, but it makes business easier if you can fly in and out easily. Not all countries have that capability.

Firms looking to build a regional presence look to Dubai as a site for regional expansion, as no other location offers the same level of human capital and infrastructure.




General Manager, DuPont United Arab Emirates

Chairman and CEO, Nestlé Middle East

Managing Director at BASF FZE and Head of Business Center Platform Middle East at BASF Middle East LLC


ubai is the hub for the Middle East, North Africa, and Pakistan [MENAP] region. DuPont is well positioned for accelerated and sustainable growth in the UAE, which represents one of the fastest-growing markets for the company. DuPont is committed to supporting and participating in the new economic, industrial and scientific developments in the UAE. The accessibility of Dubai also makes it easy to operate from. A lot of key decisions are made in Dubai. Over the last three years, we have tripled in our employee size in the UAE. With a strong and rich diverse team in the UAE, we are continuing to strengthen our capabilities on the ground that will help us better serve the local markets—a perfect example of our ambitious plans for growth. Dubai has been a great location for us to grow and expand due to its business-friendly environment. We see strong opportunities in the UAE and indeed throughout the GCC region.


irst, the UAE for us is kind of the hub of the Middle East, for several reasons. It is our regional head office, so all corporate functions are based here. It is also a hub from a logistics point of view—out of 18 factories you mentioned, 15 are for Nestlé Waters, the bulk of which are in Saudi Arabia. However for food and beverages we have one in Iran, and one here in the Dubai Techno Park, and one that is a new project we are currently building in Dubai World Central, which is an onshore factory. The UAE means ease of communication, of shipment, of attracting talents, favorable business conditions, and support of the authorities. The Middle East means growth, future potential, talent, and innovation. It also means business unusual is business as usual, when you think about what is happening in the region in Iraq, Syria, Yemen, and Lebanon with war, instability, and the difficulty to predict what tomorrow is going to be.


ince January last year there has been a huge difference in the activities that are going on just here in Dubai, and I’m not even talking about the new infrastructure projects. Like the bridges, that’s a lot of concrete and we love that. This is where we can fit in our products. I think we will see more and more projects finishing and happening in Dubai. There is a need for more infrastructure, more metro connections, more highways, and flyovers because the roundabouts cannot cope with the traffic. We have four focus countries. The first one is Saudi Arabia, where we are just about to establish a new legal entity with a JV with Kanoo. Saudi Arabia by far will be the biggest country in terms of sales. Then there are the UAE, Egypt, and Iran, but it’s on hold now. Egypt is also a massive market with some 82 million people, many of whom are young.

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DUBAI 2015


strength in NUMBERS Recently, Ducab broke ground on a $59 million new factory in Abu Dhabi. What kind of opportunity will this create for Ducab moving forward?

TBY talks to Andrew Shaw, Managing Director of Ducab, on its new $59 million factory, company acquisitions, and growth strategies.

The factory will produce aluminum, and it gives us several strands of opportunity. First of all it is going to be cost effective for the aluminum world, and we are going to be associated with the world’s single largest smelter. We will be taking hot metal and casting directly from that as well as specific alloy cables. We see a slow substitution of copper for aluminum in the cable business, which is what is happening elsewhere in the world. We also have a root in the market already through our existing copper cable customers. Almost all of our existing copper customers buy aluminum as well; therefore, we can go to our existing customers and offer them additionals product. It is a new business widening the market and addressing the fact that aluminum is growing in the Middle East. We are going to be substituting quite substantial imports of aluminum into the Middle East through our factory. Ducab also recently bought the UK-based AEI cables company. How will this acquisition positively affect export sales and domestic sales?

The AEI acquisition was all about opportunity. It was a small business but a specialized one. It makes niche cable products, and we are proud to be supplying cables for the UK Royal Navy’s aircraft carriers and for the submarine and underground programs. We are supplying specialty cables, and each of these specialty niches has to be custom designed and meet approvals. They also want to see track re-

Recently broke ground on $59 million aluminum factory in Abu Dhabi

Acquired UK-based AEI cables company

cords, and what AEI has given us are many more pages to our catalog of items that are already approved and have a proven track record that would have taken us years to develop. It also has its own compounding experience and plant where it manufactures the special rubber compounds used in these cables. It brought a lot of knowledge and experience, and we will continue to produce in the UK as well as in Abu Dhabi. It provides many opportunities to start selling cables that otherwise would have been imported, and it also allows us to enter other markets, such as rail. We now offer a full line of railroad products. How would you describe your domestic and international growth strategy in moving forward?

We want to first of all continue growing as the Middle East is growing. We want to capitalize on the growth we are getting and are seeing in the UAE and the GCC. Therefore, we will maintain our market

share in the UAE and growing our market share in the GCC. That is geographically the range of the expansion we want to continue domestically. You have to start at home, and we have seen tremendous growth in Dubai and Abu Dhabi. In Saudi Arabia, we are a lot smaller and see a tremendous opportunity for growth there. We are seeing an opportunity for taking even a small market share, which is huge because the Saudi market is quite large and still growing. The other strand to our growth strategy is not only expanding geographically, but also in our product lines, which is where AEI fits in. We want to have a broader product range, and this ties into what is happening elsewhere in the GCC in expanding outside of oil and gas. Industrial applications need industrial cables, and now we are able to offer the kinds of cables to meet those needs now as we did with railways. This will give us more opportunities to get into niche markets outside of construction. ✖

BIO Andrew Shaw serves as Managing Director at Dubai Cable Company. He has almost 20 years of expertise in the power cables industry. Previously, he served as the CEO-China for an Italian multi-national, Prysmian Cables and System. Prior to this, he served as Managing Director of Prysmian’s affiliate in Malaysia, based in Kuala Lumpur. He has extensive international experience having also worked in Thailand, the UK, and Korea in a variety of positions. He is a graduate of Imperial College of London and has an MBA from London Business School.

Energy & Industry




WHAT’S AT STEAK? With Dubai’s ambition to become the capital of the Islamic economy, collaboration between the public and private sector plays a pivotal role in the certification of halal products and creating an environment conducive to the growth of the industry. IN JANUARY 2013, HH Sheikh Mohammed Bin Rashid Al Maktoum announced his vision for Dubai to become the capital of the Islamic economy. The global value of the halal food market is a tremendous growth opportunity going forward, with the consumer spend in 2012 totaling $1.09 trillion, to be followed by an estimated $1.63 trillion in 2018 and $10 trillion in 2030. In recognition of this opportunity, the Dubai Islamic Economy Development Centre has outlined the development of the halal industry as one of the key pillars in its overall strategy. With this pillar identified, both government authorities as well as industry players have mobilized in order to standardize the halal certification process on both a domestic and an international level, creating facilities to attract halal industry investors and establishing an awareness campaign to integrate the label with the private sector. In a report published in 2013 by Thompson Reuters, one of the primary challenges to the development of the halal industry is a lack of standardization. In recognition of this, Dubai is in the midst of creating a halal certification stamp at both the domestic and international level. On a domestic level, Dubai Municipality and the Emirates Standardization and Metrology Authority (ESMA) announced at the 10th World Islamic Economic Forum that they will be working together to set up the Halal National Mark. Within this objective, Dubai Municipality will play the pivotal role in setting sharia compliance requirements and regulating the halal industry, while ESMA will grant the mark indicating that the product, service, and production system was in conformity with the approved requirements. On an international level, Dubai Municipality plans to launch a new international center for halal certification with the objective to be the first international reference in the food industry worldwide. Upon its establishment, the International Centre for Halal Products is aiming to take 10% of the global certification market within three years. The master plan for the center will consist of

two phases, with the first phase concerning certification of meat products and the second on non-food items. With both the international and domestic certifications in place, the next step is to integrate the certification with industry players. Dubai Industrial City (DIC), a member of TECOM Investments and a key player as the industrial Free Zone in Dubai, has announced an initiative to facilitate investment in the halal industry as well as to promote the use of the halal certification program. In February 2014, DIC announced the launch of a halal cluster in collaboration with the Dubai Islamic Economy Development Centre, ESMA, and Dubai Municipality. Covering an area of 6.7 million sqft, the halal cluster is expected to attract at least 15 companies, particularly from the GCC and MENA. The cluster will have a fully separated industrial block, warehouses, showrooms, and accommodation. With this, DIC aims to attract and create an environment conducive to investment in the halal industry. Along side the launch of the halal cluster, DIC also announced a strategic partnership with ESMA in March 2015 aimed at promoting the national halal mark within the UAE as well as the exchange of knowledge and expertise. The agreement sets out a framework for the preparation and implementation of an awareness campaign for the national brand of halal that will enable better communication with business partners in DIC. Under the terms of the agreement, ESMA will also gain access to all factories and business partners located in DIC that are interested in the halal label. The halal industry represents a tremendous opportunity for growth on both a domestic and international level for Dubai. Through its development of both a domestic and international certification program, Dubai is addressing one of the fundamental challenges to capitalizing on the industry’s growth. With certification in place, Dubai Industrial City aims to also create an attractive environment for industry players through both facilities and education. ✖


DUBAI 2015


TBY talks to Saleh Abdullah Lootah, Managing Director of Al Islami Foods, on recent performance, competition, and the meaning of halal on a global scale.

right to choose How is customer segmentation defined for Al Islami Foods?

How has Al Islami performed over the last year?

It is the second year since Dubai was named the capital of the Islamic economy. This is a hot topic everywhere we go and we see it getting even hotter day by day. I am happy to announce our business is growing and our company was used as a case study in January 2015 at Harvard as we presented our case for the agri-business school there. It is amazing to see how well the halal industry was received. More than 200 senior figures attended our agri-business course and they were highly engaged in the topic and what we believe in, which is Al Islami’s mission to become a leading brand in halal food. How would you describe your growth strategy?

We are taking some major steps. There are a lot of discussions going on with different parties and many of them want to be part of what we are doing, including global companies, international companies, and different investment firms. We are looking to develop in phases, first in the UAE, then the GCC, the wider Middle East, and then globally. These are the steps that we are taking right now, gradually.

In the UAE and other GCC countries, Al Islami is considered one of the premium brands in the market. Our pricing is a bit more expensive than the other brands as a result of the quality that we are trying to maintain, including everything from packaging to merchandising to distribution and R&D. We try to create a gap between us and our competitors. We are strong compared to our competitors in the halal segment. There are people who compete with us in the chicken segment, but for halal products we are ahead. There will always be consumer segmentation to a certain extent, as a minority want to go the extra mile to check that something is indeed halal, instead of simply believing the government. Where do you see the opportunity going forward?

We are looking to educate our consumers as to why we are better. We aim to really convert the masses. We are not just selling food, we are selling the philosophy that our founder embedded into our products. We want to show the bright side of Islam, as the media often shows the negative side. If you ask this number of Muslims what they see in the media about their religion, it is not positive. We are trying to give them an alternative, and it is about future, brightness, and accepting others.

How would you describe your vision and the evolution of what halal foods internationally?

I believe in consumer rights. At the end of the day, the consumers have rights. And they have to be educated to be able to use their rights. Halal standardizations are different in each part of the world. Turkey says it has real halal, as does Saudi Arabia and Dubai. There is no way we can get a unified standard to make everybody happy. We need to give the consumer the right education for them to decide what to eat. Islam will accept anyone as long as the person believes in it. In Islam, there are people who have to do it by the book, and then there are the people that are more neutral a they just believe. These are individual differences that we cannot standardize. We have variation, which is acceptable, like any religion. We have to give the consumers their right to decide what they want. At the same time, it has to be written on the packaging. Anyone can write “halal,” but we explain what our process was. There are many kinds of processes, and the consumer should be able to choose. If they want to eat machine-slaughtered chickens, then that is ok, and if they want to eat hand-slaughtered chickens then that is ok too. They should have the right to know and choose on their own. Most companies do not want to say how it was produced, so they just write “halal.” I think the day will come when the consumers demand the right to know. ✖

More than 200 senior figures attended agribusiness course

BIO Saleh Lootah boasts comprehensive experience across the board in various capacities within diverse companies. He currently holds the positions of Managing Director of Al Islami Foods, Founding Director of Souq Extra, Chairman of Al Farooj Restaurant, Board Member of Aman Insurance, and Chairman of Food & Beverage Manufacturing Group of Dubai Chamber. He received his Bachelor of Commerce degree with a focus on Marketing from California State University, Los Angeles and went on to complete his MBA at Harvard Business School.





HE Hamed Obaid Al Mansoori, Director General of the Telecommunications Regulatory Authority, on broadband.

Globally renowned tech companies have a chance to innovate in Dubai, with strong government support.

The provision of crucial hightech technological services keeps Dubai’s economic motor running.


Telecoms & IT REVIEW

Winner of the bid to host the World Expo 2020, Dubai continues to increase connectivity and advance knowledge through ICT expansion and smart city initiatives, including e-government implementation.


ubai is growing at a clip, and it remains the most populous city and Emirate in the UAE. In 2013 the population reached 2.1 million, and the Dubai Statistics Center estimates 5% growth in 2014. According to the 2013 UN-released World Urbanization Prospects report, the urban population in the UAE is expected to grow an average 2.3% per year, reaching 7.9 million by 2020. Dubai’s population is especially young and very tech savvy, with a large number of expatriate workers. Statistics show that two-thirds of Dubai is between the ages of 20 and 39, with the average age at 27. There also exists a great gender disparity, with men of the same age group exceeding the number of women by nearly 60%. The total ratio in Dubai of men to women is 313 males to 100 females. The latest statistics estimated Dubai’s overall market growth to be 15% in 2014, reaching $8 billion by 2015. The IT sector increased rev-


Known as “the Silicon Valley of Dubai,” Dubai Internet City is one of the largest ICT free zones in the Gulf and is home to more than 1,600 companies employing over 17,000 people.

enues by 6.57% from $7.45 billion in 2012 to $7.94 billion in 2013, according to the Telecommunications Regulatory Authority’s (TRA) Annual Sector Review (fifth edition). The sector is regulated by the TRA, which is the main player behind the development and promotion of the Emirates as an ICT hub. It is charged with the task of implementing executive orders of the 2003 UAE Telecom Law, as well as following guidelines of the UAE National Telecommunications Policy. Three deputy general directors lead the TRA’s ICT support sectors; the first involves itself in e-government sector development; the second is focused on support service; the third on telecoms. Under the realm of TRA, the ICT Fund was established to lend targeted support to UAE companies, organizations and individuals to support education, innovation, and entrepreneurship in the field. Over the last six years, the ICT Fund has invested more than $435 million in the sector.


DUBAI 2015

ABDULLAH AL ATRASH CEO, Eye Media Back in 2005, when Dubai was really booming, there was high demand for companies wanting to maximize their visibility along Sheikh Zayed Road. We created a sign for Abu Dhabi Commercial bank that was 400m in length and 12m in height, and this was the largest in the world at the time. Historically speaking our customer base was mainly real estate companies. However, due to the downturn in the economy in 2009 and the real estate market crash, we saw a massive change in our clientele to FMCGs, banks, and educational establishments.

Within telecommunications, the Emirate now has two operators. Etisalat’s 30-year monopoly came to an end when telecom opertator du launched its mobile network in 2007. The TRA has granted niche market licenses to other providers in the arena; Al Yah Satellite Services Company (2010), Al-Yah Advanced (2010), StarSatellite Communications (2010), Al-Maisan Satellite Communications (2011), Media Zone Intaj FZ LLC (2011), and Thuraya (2013). Dubai boasts having one of the highest mobile penetration rates worldwide at 192.9%, from over 16 million active subscribers, 13% of which are post-paid. According to the TRA Annual Sector Review, covering 201013, the fixed-line penetration rate reached 25% with 2.08 million subscribers, along with a 37% increase in international outgoing minutes from mobile lines, along with a 12% drop in international calls from fixed lines. In 2013 SMS messaging decreased by 13%, and MMS decreased 23%, likely reflecting increased internet messaging use. Telecommunications research manager at the International Data Corporation (IDC) Bhanu Chaddha told Telecompaper that mobile data is the “sweet spot for operators,” given the fact that most subscribers are on prepaid plans. The Emirate is also making significant leaps and bounds in ICT advancement far beyond increased mobile use. The Dubai Internet City (DIC) celebrated its 15th anniversary last year. Referred to as “the Silicon Valley of Dubai,” the city is one of the largest ICT free zones in the region and is home to more than 1,600 companies employing over 17,000 people. In May 2013, under the direction of HH Sheikh Majid bin Mohammed Bin Rashid Al Maktoum, the Majid bin Mohammed Innovation Center in5 was launched within the Internet City to promote innovation and technological advancement in the UAE. Most notably, through the initiative to transform Dubai into a Smart City, the TRA is leading the effort to increase hyper-connectivity under a three-track structure; Smart Life, Smart Economy, and Smart Tourism.

SMART CITY The Dubai Smart City (DSC) initiative was launched in 2014 by HH Sheikh Mohammed to turn Dubai into one of the world’s most connected cities within three years. An estimated $7-8 billion will be spent on smart city infrastructure. Through the use of smart sensors and devices, innovation would happen under the Smart Life track in educational, transport, communications, public utilities, and energy services. The Smart Economy track deals with the development of smart companies, port services, stock exchanges, and smart jobs, while Smart Tourism concerns itself with improving visitor services and ease of access. One of the main areas of focus of the DSC initiative is the implementation of e-gov-

ernment services. The Department of Dubai Smart Government (DSG), formerly the Dubai eGovernment (DEG), was established by the TRA when the March 2009 Law No. 7 merged the e-Services and Government Information Resource Planning department. The DSG is responsible for the integration of over 100 initiatives and over 1,000 governmental services into a single platform. “The Smart Government initiative aims to harness the power of smartphones and make way for all possible services on mobile platforms by May 2015,” said Ahmad Bin Humaidan, director-general of the DSG. The transformation to an e-government will mean many new governmental services will be available online and more accessible. Services will also be improved and more efficient at lower costs. Currently, there are around 1,800 government services available online. The national ID card (Emirates ID) already functions as an integrated smart gate, though the DSG envisions the expansion of its use as a single card for an increased number of services. The Dubai Electricity and Water Authority (DEWA) has commenced a project to install 250,000 smart meters across the Emirate over a five-year period. The Roads and Transport Authority will also work to improve parking systems by introducing an application that informs drivers on available parking. Traffic monitoring will also be part of the equation, as will be the installation of charging stations for electric cars. Another major goal of the smart city initiative is to offer free Wi-Fi in parks and on all public transport, including in taxis, leveraging the Internet of Things concept that “anything can be connected to anything.” “It’s no good having Wi-Fi across the whole city if all you are using it for is YouTube,” said Amr Salem, managing director for Cisco’s smart cities division. Dubai is leveraging Wi-Fi for traffic services, government services, utilities usage and more, thereby using the internet to its “full potential,” according to Salem. DEWA has also announced plans to install solar panels on all buildings, and through the Dubai Green Building Code is enforcing green construction in the Emirate. A climate-controlled residential city, by the name of Desert Rose, will be constructed on 14,000 ha between Al Ruwaya and Al Aweer in the shape of a desert flower. The project is expected to accommodate 20,000 Emirati families and will use solar power technology, to the tune of a $5.44 billion investment. Solar panels on roofs will supply 200 MW of electricity. An electronic train track will connect the city to the Dubai Metro. According to Dawood Al Hajiri, director of the Planning Department at Dubai Municipality, Desert Rose will be finished in multiple stages and completed by Expo 2020. The Dubai Health Authority (DHA) has embarked on a multi-phase project to upload all


DUBAI 2015

medical records to a computerized system, designed to increase access to medical information for patients and caregivers thereby better protecting patients from individual oversight. The DHA has also launched a new Customer Service Index (CSI), a live customer feedback system in hospitals and primary healthcare centers. The CSI records information on patients’ and visitors’ levels of satisfaction, the results of which are displayed on constantly refreshing screens. The Dubai Smart City initiative is also making its way into schools through the transformation of classrooms into “creative clusters,” as well as through the implementation of the Intel Teach program. According to Taha Khalifa, MENA Regional Director of Intel, “with a strong science and technology foundation with 21st century skills, students will be able to move into new jobs that are being created.” "Cisco applauds the way the Dubai Government has holistically embraced its Smart City vision,” said Rabih Dabboussi, General Manager of Cisco UAE. “Government and citizen services are already being revolutionized, putting them at the forefront of innovation and driving the initiatives to support this momentous change that will deliver His Highness' Smart City vision.” In reference to HH Sheikh Mohammed’s three-year deadline, Amr Salem’s view is that there can be no deadline for making a city smart. According to Salem, “Smart is not a state, it is a journey.”

SHARING THE KNOWLEDGE In November 2015, Dubai will host its annual Arab Future Cities Summit to bring together senior executives, sustainability experts, and city and government officials to discuss technological smart city solutions, innovation, and developments in the field. Cisco announced that Dubai will host the third edition of the Internet of Things World Forum (IoTWF) this December. The IoTWF will convene at the Dubai World Trade Center to discuss the Internet of Things (IoT) global industries, developments, emerging applications, and impacts on economies. Over 1,500 attendees and 49 sponsors attended last year’s forum in Chicago. The IoT encompasses over 14 billion devices (things), which provide the Internet of Everything’s (IoE) technology foundation. By 2020, it is estimated that the installed base of IoT will be about 212 billion, including 30 billion “connected (autonomous) things.” Dubai won the bid to host the six-month long World Expo 2020 under the theme of “Connecting Minds, Creating the Future.” The Expo is expected to create 277,000 new jobs, pour $40 billion into the economy, and bring 25 million visitors to the Emirate. Sub-

The latest statistics estimated Dubai’s overall market growth to be 15% in 2014, reaching $8 billion by 2015. The IT sector increased revenues by 6.57% from $7.45 billion in 2012 to $7.94 billion in 2013, according to the Telecommunications Regulatory Authority’s (TRA).

themes of the Expo will be Sustainability, Mobility, and Opportunity. In support of the bid HH Sheikh Mohammed said, “In today’s highly interconnected world, a renewed vision of progress and development based on shared purpose and commitment is key. While a single human mind, an individual country, or a specific community is both unique and remarkable, it is by working collaboratively that we truly advance.” The Expo will be a forum for many nations to exchange ideas around architecture, science, and technology. Kevin Kelley, of Wired magazine, told TBY: “One of the things we’ve seen, and which places like Dubai have shown us, is that cities are the main units of prosperity. […] I think every city has its own answer as to how it can and will make itself smart. After all, if you’re not a smart city in 2015, then you’re no city at all.”

LIFE ON MARS? In July 2014 the UAE announced plans to form a space agency to send an unmanned probe to Mars by 2021, making the UAE the ninth nation to establish a space program to go to the red planet. The UAE has heavily invested in its space program since the setting up of a $800 million Gulf space center and satellite program in Abu Dhabi, and the launch of DubaiSat-1, the nation’s first satellite, in 2009. The UAE has invested $5.44 billion in space technologies and two satellite communications companies. Satellite data and television broadcast company Al-Yah Satellite Communications, mobile satellite communication company Thuraya Satellite Telecommunications, and Dubai Sat, an Earth mapping and observation system, will supervise the mission and coordinate the sector. The journey to Mars would take nine months and would be the Arab world’s first space mission to another planet. “We have seven years to develop the knowledge, skills and infrastructure that we will need to reach Mars," said HH Sheikh Mohammed in a 2014 tweet. ✖

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DUBAI 2015


broad STROKES TBY talks to HE Hamed Obaid Al Mansoori, Director General of the Telecommunications Regulatory Authority (TRA), on the broadband landscape, bitstream, and the authority’s role in the Islamic economy.

The UAE is one of the most well connected countries in the world for broadband internet access but also has a relatively high cost. How would you describe the dynamic between broadband penetration, performance, and cost?

The UAE’s fiber broadband networks are very advanced and very fast by international standards. Such networks are expensive to build and maintain. Despite this, prices of broadband services in the UAE are not unreasonably high. They are low by Arab standards and similar to prices in other GCC countries. Furthermore, broadband services are generally purchased as a bundle with other fixed-line services. The price

BIO HE Hamed Obaid Al Mansoori previously served as the Director General of the UAE mGovernment initiative and was earlier the deputy director general of the TRA. He also held the post of Director General of Information and e-Government from May 2013 to April 2014. A graduate in Multimedia from Middlesex University in the UK, he has been a technical consultant in many government institutions.

of fixed-line services are very low in the UAE by international standards. This needs to be taken into account when considering the price of broadband. Broadband penetration levels in the UAE are relatively high. Around 90% of households have an internet connection. What are your expectations with TRA rolling out its Triple Play Services?

During 2015, we expect that bitstream will be launched. We would expect the resulting competition to exert downward pressure on prices for fixed-line services including triple play bundles. Given licensees will need to work harder both to acquire new subscribers and retain existing subscribers, we might also see increased activity in terms of time limited promotions, better quality services, increased focus on delivering excellence in customer service, and the emergence of increasingly innovative product structures as licensees seek to differentiate their services. The TRA will need to be vigilant in ensuring that the operators continue to compete fairly once bitstream is implemented. To facilitate this, the TRA has a comprehensive competition safeguards regulatory framework aimed at preventing anticompetitive conduct from occurring. The TRA will also

monitor bitstream carefully to ensure that consumers switching from one operator to another are switched efficiently, effectively, and without undue delay. What is the role that TRA plays in Dubai becoming the capital of the Islamic economy?

Without high-quality, highspeed, and reliable ICT services, businesses will not choose to establish a presence in Dubai. Therefore, the TRA and the UAE’s licensed operators have been working very hard to establish an ICT environment that meets or exceeds the expectations of businesses. Indeed, the TRA sees the UAE as a global leading country in ICT. In the second half of 2013, the TRA undertook an intensive survey of businesses in the UAE focusing on business usage of ICT services in order to better understand business perceptions on their usage of, and demands for, ICT services. This survey revealed that 93% of respondents were either satisfied or extremely satisfied with their fixed line services, 91% were either satisfied or extremely satisfied with their fixed internet services, and 93% were either satisfied or extremely satisfied with their mobile services. Overall, the TRA is very proud of the achievements of the sector to date; the telecommunications networks in

IN NUMBERS Telecommunications Regulatory Authority (TRA)

Bitstream expected to launch in



of UAE households have an internet connection

the UAE are among the fastest and most modern in the world and prices are reasonable by international standards. This will undoubtedly contribute to the UAE being a leading capital within the Islamic World. On March 5th, 2015, the Dubai Smart City initiative was launched. As part of this strategy, the public will be able to engage with government departments and undertake government services using their smartphones. ✖

Telecoms & IT




down to THE WIRE TBY talks to Kevin Kelly, Senior Maverick and Co-founder of Wired magazine, on e-government initiatives, the role of the private sector in developing public services, and the protection of citizens. How do you see smart technology and the internet transforming how governments operate in this day and age?

BIO Kevin Kelly co-founded Wired in 1993 and served as its Executive Editor from its inception until 1999. He has just finished a book called What Technology Wants, published in October 2010. His writing has appeared in many national and international publications such as The New York Times, The Economist, Harpers, GQ, Wall Street Journal, and Esquire. He is member of Global Business Network and a Member of the Board of The Long Now Foundation.

I think it changes how the government operates in two ways. Firstly, it’s creating new means of governance. That means new ways to interact with people, for example. People can deal with the government by email, telephone, fax, and so on, and so these new technologies allow citizens to get things done faster and more efficiently, and in the future there will be other innovations in communication modes. Secondly, technology creates and facilitates the ability to collaborate, as we see in things like Wikipedia, and governments can use these technologies in the same way so that people can participate directly in areas of government. Examples include New York, where if you see a pothole that needs being filled, say, you can let the authorities know about it. It’s at the point where the very structure of government and its institutions can be changed, with those institutions also benefiting from the effects of these new technologies. How important do you think it is for developing governments to invest in e-government initiatives?

There are opportunities and there are challenges. The opportunity is that developing countries might not have very much in place, so you don’t have much of a lega-

cy system, which means you can install a modern system off the bat. The challenge is that when you have fewer resources your tendency is to just get something that works in place, no matter how basic or elementary. It would take a great amount of wisdom for a cash-strapped government to decide to build something really well, but it’s possible, and there is that opportunity. What role do you think the private sector plays as a development partner for governments?

The government’s role is to set up new territories in which the markets can be set up. It can help establish a market, guarantee a market, and maybe even direct a market by suggesting or mandating decisions about where it wants to go. There can be partnerships with markets and the private sector can help a government overcome markets’ short attention span and give them more of a long-term focus. If the government and the market compete then the markets are going to be winning, so the government’s role should be to complement the market and facilitate an environment in which the market can succeed. So it is more a matter of creating new places for the markets to work. What role do you think governments like Dubai can take as leaders of innovation and strategy when it comes to ICT development?

One of the things we’ve seen,

and which places like Dubai have shown us, is that cities are the main units of prosperity. You can measure levels of prosperity and wealth a lot more accurately and truly based on the city you live in rather than the country. Cities are far more relevant, and they are the main unit for innovation and progress. I think there’s a lot more chance to have a smart city than a smart country. So it makes sense that Dubai has been doing this as a city, and I think every city has its own answer as to how it can and will make itself smart. After all, if you’re not a smart city in 2015, then you’re no city at all. Every city has to find a way to become a smart city somehow. How do you think governments can ensure that the citizenry is protected when it comes to utilizing these new technologies?

I think symmetrical accountability is crucial. Governments must have third-party accountability, and citizens have to have access to the information about them so they can verify that it’s correct. Ultimately, citizens have to be able to hold the government accountable, while also getting a direct and obvious benefit from whatever is being compiled. If you make accountability symmetrical so that citizens can in turn watch who is watching them, if it is made accountable to a third party, and if you make the benefits clear and direct, it will work well. ✖



DUBAI 2015



Through its emphasis on innovation and transforming into a smart city, Dubai has become a center for technological innovation through establishing tech centers to facilitate innovation, creativity, and entrepreneurship. DUBAI has one of the world’s highest penetration rates for internet access and mobile device usage, while the authorities have begun integrating smart government services to transform Dubai into a smart city. Crucial to the Emirate’s innovation initiatives are developing locally-based entrepreneurs and attracting leading multinational tech companies to develop local technology. In recognition of this opportunity, key players have developed tech centers to entice innovation. Dubai Silicon Oasis (DSO) has launched of its Dubai Technology Entrepreneurship Centre (DTEC), which upon completion, will be largest technology entrepreneur center in the region with 3,600sqm of space with 350 workstations. DTEC was conceptualized to provide existing and emerging high-tech entrepreneurs and start-ups with a highly motivating and positive work environment. There will be variable services available at DTEC with a “flexi desk” rental costing $1,600 a year, a “dedicated desk” for $3,000 a year, or an enclosed office starting at $800 per sqm. Importantly, DTEC follows under Dubai’s free zone model, which enables establishing businesses, obtaining commercial licenses, and renting spaces without an Emirati partner or sponsor. So far, DTEC has signed up 60 registered companies with even more applying. Locally based entrepreneurship platform AstroLabs has also recently announced that it has launched a new tech hub in partnership

with Google in Dubai, the first of its kind in the MENA region. The AstroLabs Dubai facility will be situated in Dubai Multi Commodities Centre Free Zone, is scheduled to open in 2015, and will help tech entrepreneurs from across the globe access high growth markets. AstroLabs has already successfully built one of the largest networks of high-growth startups in the MENA region, having trained founders of 100 startups and those alumni having raised over $20 million in funding. The Dubai 6,500sqf facility will feature an advanced mobile device development lab, co-designed by Google for Entrepreneurs, to enable startups to build apps for the highest smartphone penetration markets globally. AstroLabs Dubai will also feature free zone benefits, which incentivize investment and ease the processes involved with establishing a business for budding entrepreneurs. TECOM Investments unveiled, in November 2014, its strategy to support Dubai’s transformation into a global innovation center, and the launch of the new Innovation Hub, which will provide 1.6 million sqf of dedicated space to around 15,000 knowledge and creative workers. DIC’s Innovation Hub will focus on innovation across technology, new media, smart education, and sciences with Phase I being delivered in 1Q2017. It will offer companies of all sizes world-class facilities and services, robust and adaptable state-of-the-art infrastructure, and, most importantly, free zone classification. ✖

MASAHIKO MURATA General Manager, Kyocera The market has already matured in Europe, the US, and Japan, but here in the Middle East, and in Africa, there is still huge of potential. We are focusing on this potential. The biggest opportunities lie in Saudi Arabia and the UAE. The UAE is the most modern market in the Middle East and Africa. Other countries will follow the model of the UAE. We firmly believe the future lies in offering solutions that help companies solve their document workflow issues.



( D u b a i Te c h n o l o g y Entrepreneurship Centre)

Partnership with Launched by


DSO (Dubai Silicon Oasis)



entrepreneurship platform of its kind in the region

technology entrepreneur center in the region



350 workstations

I N N O VAT I O N HUB Launched by TECOM Investments

1.6 million sqf Capacity for 15,000 creative workers


Telecoms & IT







Managing Director, Cisco UAE

General Manager, Huawei UAE


here are so many areas on which Dubai and Cisco can collaborate. The most important one is data sovereignty in terms of who owns and protects it. Data, government, citizens, and business security are all important aspects of that as well. There are always the standard challenges that we are very familiar with that have to do with hardware and software integration. In addition certain practices and policies must be implemented to change the regulatory environment. The use and ability of data has to do with the governance of data, and that will become more prevalent and visible as we start hearing more of where we are in the initiative and as the government reveals new services and aspects of smart Dubai. Our overall strategy for the country is to do business, succeed, and grow, but more importantly to contribute in a longer-term fashion. We are striving to contribute to the digitization that is taking place in the country and to help the nation become more competitive.


uawei has enjoyed a presence in the UAE for over a decade. The country remains a significant one for Huawei as both a growth driver and a region where Huawei contributes to building a better-connected world. Furthermore, the role of ICT has never been more important to the fabric of the UAE’s national development vision. Huawei has established an end-to-end ICT solutions portfolio that gives customers competitive advantages in telecom and enterprise networks, devices, and cloud computing. All three of Huawei’s main business groups—carrier, enterprise, and consumer—are active in the UAE and serve both local customers and those across the wider Middle East. Last year we even launched a Smart City Center of Excellence in the Middle East to assist governing bodies and telecoms operators in driving smart city initiatives from concept to reality. Today, this center acts as a knowledge hub for industry professionals to share best practices that will prove fundamental in improving the quality-of-life of citizens in the UAE.

Globally renowned tech companies have a chance to innovate in Dubai, with strong government support and promising markets throughout the region.

SAMER RAMEZ ABU LTAIF Regional General Manager, Microsoft Gulf


would say that, in alignment with the government and the trends of the industry, the work that we have done in driving the adoption of cloud computing in the region has been phenomenal. While this trend has been growing in the Gulf at a rate of about 50%, our growth has been about 450% last year, which gives you an idea of our ability to outgrow the market and also the dominance of Microsoft’s activity, which is very important. This is the value that SMEs and government entities can have from us and also we built a partner ecosystem in the Gulf over 20 years so that today there are over 1,500 companies that cooperate within this ecosystem and we are taking them with us to the cloud. The second is the work we are doing in education. I am excited about the fact that Microsoft picked Dubai to host the Global Forum in Education. Microsoft has some large and strategic projects in education such as the Sheikh Mohammed Bin Rashid Smart Learning Program.

TAHA KHALIFA Regional Director MENA, Intel


ur strategy is simple: if it computes, it computes best with Intel. We are committed to innovate and shape computing in all its forms. Our product portfolio has changed to reflect that. For 45 years Intel has been pioneering microprocessor technology for the modern world, setting the wheels in motion for technology advancements every person on earth relies on every day. Today Intel provides the essential technologies to make all things smart and connected. Over the last few years, the opportunities have been primarily driven by the consumer. There has been a lot of growth in consumers that represents more than 60% of our business in the region. We have a very young population, with 50% of the MENA region below 30 years old. If I look to 2015 and beyond, we see high performance computing growth in the region.



DUBAI 2015


TBY talks to Andrew Horne, General Manager of Xerox Emirates, on promising growth, partnerships, and smart city initiatives.

set the TONE tomers being careful. That has obviously given us an opportunity. We are far from being where we would like to be in terms of market reach, so I think there is plenty of similar growth in the coming years. What are your plans for the expansion of these partnerships? What factors led to the 50% rise in Xerox Emirates’ channel partner business in 2014?

We approach the market at two primary segments: launch enterprises and SMEs. It’s very difficult for a company to cover the SME segment, which in many markets generally represents 40-50% of the market value for IT and the area that we are in. You need to find a way to get your product to this market. Our current channel strategy is the result of us understanding where customers choose to buy. Many SME customers choose to buy from channel partners, so it was a logical choice for us to try to create a robust channel strategy again. In doing this, we created a good value proposition. Our strategy was not to over distribute, but to make sure we cover the market. That program rolled out in mid-2013 and we made good progress in that year. In 2014, the growth was a fairly decent number, so we were happy with that. Apart from the value proposition, clearly the market is more active than it was a few years ago. I’d say that the period after the crisis in 2008 and 2009, a lot of capital purchases were put off, so now there is a certain amount of reaping the reward of cus-

It’s expansion of the partners that we have. If you are not going to have a policy of over-distribution, then you want to focus your expansion on the quality of the partners. We would be looking to invest in the existing partners and helping them to grow. The only ingredient you need to make that strategy successful is an aligned, mutual benefit. They have to want to grow so that there is no misalignment. That is often what happens in channel strategies that go wrong; there is a difference in the ambition of the partners versus the vendor. So, inevitably, when you want to grow, your partner might have a different agenda. Aligned partners are very important and they are not that difficult to find, but we have been very selective about choosing our partners. What opportunities are there for continued growth?

There are opportunities everywhere. The evolution of our value proposition to customers has changed dramatically in the last five years and we are now offering a lot of services, mainly around document work flows and so on. Obviously, we have our traditional technology business as well. The role of a multi-func-

Xerox Emirates Focusing on launch enterprises and SMEs

BIO Andrew Horne is an experienced manager with an international career spanning more than 25 years. He has a proven track record of achievement managing markets throughout Eastern Europe, the Middle East, and Asia Pacific. Previously at Xerox he held the position of Vice-President of Business Transformation Developing Markets East. He studied computing, accountancy, and management in London and held an HM Commission with the Royal Scots Dragoon Guards from 1978 to 1984.

tional device in customers is changing dramatically as well. It’s not just a printer; it’s also a portal to the digital world. I think this is still early days, but it’s definitely a trend that’s developing. In the context of pure document management and work flows, we are offering “next generation managed print services,” which is adding applications and process streamlining to help customers not just print less, but also have smarter work processes. As a result of the acquisition of ACS five years ago, a business process outsourcing company, we’ve developed quite a broad range of services. One extreme will be transportation solutions, where we are doing towing systems and smart parking. For smart city initiatives, there is something we are working on to provide clever technology to improve the mall so that people can drive around less to find a parking space. Mobile devices will allow them to see where parking spaces are. In the Dubai Mall there is an archaic light system, but you need directions to tell you how to get there. There’s also on- and off-street parking management. That goes even to large complexes where security needs to manage the flow of vehicles and the access of vehicles into large complexes, like construction sites or huge hotels. There are many solutions there. In the US, we are processing parking fines, speeding fines, and similar car incidents. We also have solutions for banking, HR, and insurance. ✖

Telecoms & IT




BEHIND THE SCENES The provision of crucial high-tech technological services keeps Dubai’s economic motor running.


SUNIL PAUL Co-Founder and COO, Finesse


esearch and development is very important globally, but in this region people do not invest heavily in it. Most of the companies in the IT sector operate in a sort of trading environment. They see what is happening elsewhere in Europe, the US, or India, and then they bring it here and provide it. But from the perspective of innovation and implementation, there is a lot happening recently here and I have seen that our region is very interested in adopting these innovations. Dubai has set several world

records, including the tallest tower, longest fully automated metro, among many others. We have also adopted cellular technologies that allow you to conduct financial transactions from your mobile, including paying for parking. We were one of the first countries with completely SMS-integrated parking. And now we are moving closer to creating the world’s first “Smart City.” At Finesse, we strive to bring in the innovative technologies into this region and we invest heavily in research, development, and training.

e are absolutely putting major efforts into Smart Government initiatives, not just today, but more importantly for Expo 2020, which is going to be automated and have state-of-the-art, machine-to-machine communications. When we look at the Middle East, Dubai and the UAE are the crown jewels in the Middle East in terms of government stability, currency stability, and maturity of infrastructure. The UAE has made it easy over the past few years in terms of foreign company presence here. When we look at each country, we look to identify the sectors that make up this set. In places like Saudi Arabia, the UAE, and Qatar, or across the Middle East or Africa, we look at the government, which includes the central government and ministries, local governments that focus on citizen services, municipalities, defense, and intelligence. Also, we look at the energy sector, as it fuels a lot of the growth in the region. We are looking at healthcare and education, and the financial and telecoms sectors, which are all essential to the economic engine.

CHERIF SLEIMAN General Manager, Infoblox UAE

ASIF KHAN General Manager, Tejari


ur global client base is diverse; however, we have a significant track record within the public sector that includes the government of Dubai, as well as other federal, central, and local governments around the world. Within the MENA region, we have additionally focused on the oil and gas industry, tele-

communications, and education sectors. Looking to the future we would like to capitalize on our successes in the UAE, Kuwait, and Oman, to expand our portfolio of solutions primarily within the oil and gas industry. We are all aware that the oil and gas industry contributes very heavily to the GDP of this region, and this is where

we genuinely feel there is the opportunity for the growth of our solutions, and also for us to deliver real tangible value to the clients that we work with. Data security is of paramount importance to this industry, Tejari has several operating models which fully cater to the needs of ensuring data security and integrity.



DUBAI 2015


In line with its Smart City ambitions, the authorities have unveiled revolutionary technology to transform the way that the Emirate’s inhabitants and visitors interact with government services.

BUREAUCRACY MADE EASY IN MARCH 2014, HH Sheikh Mohammed launched a strategy to transform Dubai into a smart city. The strategy features six key pillars and 100 initiatives on transport, communications, infrastructure, electricity, economic services, and urban planning. Under the strategy, 1,000 government services will go smart in the next three years. By doing so, Dubai aims to create a city that facilitates not only business, but creates an environment that fosters its residents’ and visitors’ happiness. Key government entities have recognized this mandate and have developed smart service applications accordingly with a common theme of facilitating interactions between government and residents and visitors. Thousands of residents have already downloaded the Roads and Transport Authority’s (RTA) new mobile applications to get taxis, top up Salik, pay parking, renew their licenses, and get live maps and instant traffic updates while driving around the city. In line with Dubai’s public transport system playing an ever-increasing role, the Wojhati application provides users a one-stop journey planner. Wojhati helps people to plan their journeys on buses, taxis, the metro, and waterbus. Once people feed in their location and their destination, the app gives the transport options, the journey time, and the total cost. It has also recently been integrated with the Dubai Tram. RTA has also added augmented reality to the app. If a user does not know where the bus stop is or in which direction, he or she can use their phone’s camera to scan the location and the app will show them where the bus stop is. The RTA has also developed a Smart Parking application that has only recently been implemented. The Dubai Mall is the first location where drivers are able to select which parking entrance they are considering to park in and the application will inform them the percentage of occupancy of that parking area. The Smart Parking application has even greater aspirations with overall the plan to integrate private parking in Dubai as well as street parking. With Dubai’s DXB airport recently being announced as “the busiest airport in the world”

this year, Dubai Customs unveiled, in March 2015, the new “Smart Customs Inspection System.” This system is being hailed as a first of its kind and will greatly facilitate customs inspectors’ functions. The system aims to improve the customs experience for air travelers, ensuring smooth and seamless airport procedures. The integrated, multi-function system is capable of recognizing its operator, identifying risk level, recommending the safety level for manual inspection referral, timing the inspection process, generating an inspection end statement (positive/negative), establishing a record of the manually inspected bags, as well as analyzing peak times for manual inspection and creating a passengers’ database. With this, Dubai Customs has underlined its commitment to maintaining its position as one of the top customs organizations in the world. The system is also being commended as a landmark achievement within the organization for being a concept wholly developed from within and a leading example of Dubai’s Innovation Strategy. Key to residents’ and visitors’ happiness, a fundamental objective of Dubai Plan 2021 is to facilitate the interaction between the government of Dubai and the city’s inhabitants. In recognition of this, Dubai Smart government has designed the Dubai application for both Android and Apple devices to act as a comprehensive solution for both residents and visitors to access all relevant government services in a one-stop application. Once installed, users are invited to create an account that they can link with their Emirates ID along with electronic payment methods. Users have the opportunity to pay their phone and DEWA bills, pay traffic fines, Salik tariff, plan child vaccination, access live accident information, find school ratings, track Empost shipments, find doctors or clinics, track flight arrivals, find pharmacies, and more. By boosting its status as a smart city, Dubai hopes to increase its inhabitants’ and visitors’ quality of life while maintaining its position as one of the most progressive cities in the world. ✖






HE Mattar Mohamed Al Tayer, Director General of the Roads & Transport Authority, on the PPP model, and new technology.

Mohammed Abdullah Al Jarman, General Manager of Emirates Transport, on collaboration with government entities.

HE Khalifa Al Zaffin, Executive Chairman of Dubai Aviation City Corporation, on developing Dubai World Central.

Transport & Logistics REVIEW

Around a third of the world’s population lives within a four-hour flight radius of Dubai. The Emirate is doing all it can to bring the rest of the world closer as well, and the results are already impressive.


ith the biggest and busiest airport in the world, and as one of the most important, and fastest growing, international logistics centers, the Emirate of Dubai is building still further on its foundations as a center for international trade and travel. With 11.95 million overnight visitors in 2014, Dubai is attracting ever-greater numbers of visitors—be they for business, pleasure, or stopovers— than ever before. Transportation is, it seems, keeping up with demand, through projects on a scale that, outside China, only Dubai can realize. Yet Dubai’s ambitions go further still. The UAE is now recognized as the world’s leading sea-toair transport hub—a method of delivery that is around 50% less expensive than airfreight alone. The Dubai government encourages businessand customs-friendly regulation, and this has created a logistics-friendly climate (more than 74% of all air cargo that passes through the Middle East is processed by

Dubai, a share that’s ever increasing). Dubai Airports, the government regulatory body that oversees their management, trumps Dubai as the gateway between east and west. As the fastest growing cargo hub in the world, it is hard to disagree.


Image: DP World

Hand-in-hand with a world-class transportation system go logistics, and nowhere more so than in Dubai. The business of moving things from A to B is now, more than ever, at the heart of its economy.

Aviation is, and always has been, one of the UAE’s core pillars of growth, for travelers and cargo, and Dubai’s rapid expansion has risen hand-inhand with that of its flag-carrier airline, Emirates. Such is the extent to which the city’s early aspirations hinged on its becoming a business and tourist destination of international clout. Emirates Airline alone flies around half of all passengers arriving in Dubai. The slogan for Dubai Airports is “Connecting the World.” A fair number of passengers never leave the airport, being only in transit, but Dubai is benefiting from positioning itself as the strategic hub not just for the Middle East region, but also Africa, SouthEast Asia, and Europe.



DUBAI 2015

The slogan for Dubai Airports, the government body charged with their administration, is “Connecting the World.” A good many passengers never leave the airport, but Dubai is benefiting from positioning itself as the strategic hub not just for the Middle East region, but also Africa, South-East Asia, and Europe.

The tri-terminal Dubai International Airport (DXB) is the world’s busiest by passenger traffic, and the sixth most active by cargo freight. In 2014, DXB welcomed 70.4 million passengers (its total capacity is around 74 million) and 2.37 million tons of cargo. As of January 2015, DXB registered more than 8,000 flights a week to over 270 destinations—every continent bar Antarctica. A measure of DXB’s importance domestically is the number of jobs it creates, directly employing 95,000 people and indirectly supporting some 400,000 jobs around the world, according to Dubai Airports. Terminal 3 is the largest building in the world by floor space. The giant Concourse D, due to open later in 2015, will boost overall capacity to 90 million travelers a year. This level of activity in the aviation sector makes up some 27% of Dubai’s GDP ($26.7 billion), a share forecast to rise to 37.5% by 2020. Yet with DXB now nearing full capacity, much of the future growth in air travel will be borne by the new—and colossal—Al Maktoum International Airport, located at the opposite end of Dubai, near the port of Jebel Ali in the new “airport city” of Dubai World Central (DWC). Al Maktoum has, in fact, been partially operational since 2008, yet is due to be fully operational only in 2027. When it does, with a planned capacity of a staggering 160 million passengers per annum, Al Maktoum will be the biggest and busiest airport on the planet, with no fewer than six runways. In 2014 it handled some 100,000 passengers, with most of its focus at present being operations relating to cargo. But these are modest beginnings for an airport that will soon take Dubai to the world-conquering heights it craves.

RAIL AND ROAD If Dubai was built for the car, like so many young cities before it, the Emirate cannot be accused failing to put its efforts into greener, more efficient means of transport. Indeed, many of the infrastructure projects unveiled over the past few years are now seen to have been only the beginning. Dubai Metro, lauded as a great success (and the first for the Arab world outside Cairo), is being ever extended and more integrated as part of a massive investment in public transport across the Emirate. Dubai Metro began operating in 2009, and the initial two lines (Red, running alongside the important Sheikh Zayed Road, and Green) are due to be joined to three more (Gold, Purple, and Blue), and the original lines both extended. In 2014 the network carried 138 million passengers, or 377,000 journeys a day. The Green Line is to be extended by 12 stations

(24km) and the Red Line by 15½km, bringing the Metro to the border with Abu Dhabi. By 2025, the network will extend to 221km, serving 69 stations. The system is modern, comfortable, and efficient: trains are automated, and driverless. Carriages are segregated for men and women—and be it standard or first class (Gold), all are air-conditioned. Thanks to heavy government subsidies, the metro’s standard-class tickets are among the cheapest anywhere in the world. In November 2014, the Dubai Tram started running along a 10-km, 11-station stretch of line that will ultimately connect with the monorail to the ritzy Palm Jumeirah and the much more extensive Dubai Metro. Nineteen tram stations should be operational by 2017, according to the energetic government regulator, the Roads and Transport Authority (RTA). All this emphasis on trains, though, does not disguise the fact that, in Dubai, the car is still king and will be for a long time to come. The central metro stations of Al-Rashidiya, Nakheel, and Etisalat each house multi-storey parking (free for metro users) for more than 2,500 vehicles. The country’s main (and, at 558km, the longest) artery is the E11, which becomes the infamous Sheikh Zayed Road in Dubai. Completed in 1980, the Dubai section was widened in 2006 to form a 12-lane super highway, six lanes in either direction. The road is an indispensable link in Dubai’s transport infrastructure, its traffic passing the World Trade Centre, the Dubai International Financial Centre (DIFC), and most of the city’s landmark hotels along its route. As such, it is one of the busiest in the Middle East, prone to speeding accidents by night, and paralyzing jams by day. The RTA is preparing to invest $12 billion in 500km of new roads by 2020, when it is feared the number of private cars in Dubai will be 5.3 million. The new highways will be better designed, with 120 multi-level traffic interchanges and built-in flyovers to reduce junctions and congestion. It is a measure, though, of the Sheikh Zayed Road’s continued importance to the city—and that city’s dependence on the car—that a 12-lane highway is also a bottleneck. Car ownership, at 541 per 1,000 head, is already higher than either London or New York, and the associated congestion is thought to harm the economy by some $4 billion a year. Around 8,000 taxis, a mix of private- and government-owned, operate in Dubai, and the ubiquitous cream-colored cabs are by far the most popular form of public transport in the city. The bus system, which, like the taxis,

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DUBAI 2015

is regulated by the RTA, operates 193 routes making up 30 million journeys a week which, with the Dubai Metro, goes some way to alleviating the city’s dependence on car and taxis. That said, the average commuting journey for professionals is stubbornly stuck at 1 hour and 45 minutes.

RAILED IT The $10.9 billion Etihad Rail’s network will extend 1,200km across the UAE from the border of Saudi Arabia to the border of Oman. Etihad Rail will have an extensive national network with freight terminals, distribution centers, and depots located close to major transport hubs, warehouses, and storage facilities across the UAE, including Mussafah, Khalifa Port, Jebel Ali Free Zone, Port of Fujairah, and Saqr Port. Upon total completion, Etihad Rail is slated to deliver fantastic economic returns. It will promote growth in various business sectors, provide jobs for the local work force, and expand the UAE’s logistics capabilities. Furthermore, the Etihad Rail project plays a fundamental role in the development of the industrial and trade sectors, a key pillar of the UAE’s future economy. According to Oxford Economics, the Economic Rate of return for the project is 15.5%, which is well over the standard rate of 10% recommended by the World Bank. Moreover, Etihad Rail is expected to bring an overall increase in national GDP of $1 billion by 2030. Phase I of the Etihad Rail project has been in the testing stage since 2013 and constitutes a 266km long rail network connecting Shah and Habshan to Ruwais. Phase I was financed by a loan arranged by the National Bank of Abu Dhabi, Abu Dhabi Commercial Bank, HSBC Holdings, and Bank of Tokyo Mitsubishi UFJ. Phase I’s construction was carried out by a consortium consisting of Italy’s Saipem and Maire Tecnicmont and UAE-based Dodsai Engineering and Construction. Etihad Rail then created a joint venture with Germany’s Deutsche Bahn and Etihad Rail DB to operate the Phase I railway. For the 628k Phase II, the UAE government has financed the $190 million project directly to expedite its construction. Now in the tendering phase, Phase II will connect the Phase I lines to Mustaffah and Khalifa Port in Abu Dhabi, Jebel Ali in Dubai, and to the Saudi and Omani Borders. Phase III will then link up the northern Emirates to complete the UAE network and is estimated for completion in 2017-18.

LOGISTICS Dubai’s growth in transportation and logistics over the past 10 years has been nothing short of spectacular. It is, with the Jebel Ali free trade zone at its heart, one of the five most important international shipping hubs in the world. The strategic location of the seaports—together with the world-beating cargo infrastructure of Dubai International Airport (DXB), now joined by Dubai World Central (DWC)—gives the city near-ideal advantages for logistics, with a relative dearth of local and regional competition. The numbers alone tell the story. In the summer of 2014, Dubai moved the lion’s share of its cargo operations from DXB to DWC, the new airport handling 243,284 tons of freight in 3Q2014, up a whopping 462% on the same period in 2013. Meanwhile, the shift to DWC saw freight volumes at DXB fall only 3.1%, to 2.3 million tons in 2014, from 2.4 million tons in 2013. This is now close to capacity—the 2.5 million-ton Cargo Mega Terminal was opened in 2008, at a cost of $200 million. Forming the other main link in Dubai’s logistics arm, Jebel Ali Port, constructed in the 1970s some 35km south of Dubai, is now home to over 6,000 companies, and is ranked as one of the three most important logistics hubs in the world. The long-term master plan for the port, to expand it in line with its cargo growth in turnover, was begun in 2001, and is being unrolled in 15 stages. The first phase increased storage and handling capacity to 2.2 million TEUs, and was completed in 2007. By the time the master plan reaches its conclusion in 2030, the port’s capacity will be an almost incalculable 55 million TEUs, easily eclipsing the Asian giants of Singapore and Shanghai to become, just like Dubai’s monumental airports, the largest in the world. ✖

Transport & Logistics



Logistics companies in Dubai have cut costs with the Emirate's seamless sea-to-air freight capabilities

Image: DP World


DUBAI 2015


PAVING the WAY TBY talks to HE Mattar Mohamed Al Tayer, Director General and Chairman of the Board of Executive Directors of the Roads & Transport Authority (RTA), on recent developments, the PPP model, and the use of technology in transport development.

How would you sum up the successes of RTA in the past year?

We had a number of successes last year, such as the inauguration of Dubai Tram on November 11th, which was rolled out on schedule. I am proud to say that public transport use topped 502 million passengers in 2014, with a 12.6% increase compared with 446 million in 2013. The public transport network in Dubai has become essential for serving the mobility and access needs of people across the Emirate. Our roads and transportation system underpins the framework of the city and supports the growth and development of Dubai. In supporting and contributing to the vision of HH Sheikh Mohammed Bin Rashid Al Maktoum, Vice-President and Prime Minister of the UAE and Ruler of Dubai, to transform Dubai into a smart city, RTA has developed a smart city program and launched several mobile applications with all its 173 public services being available on smartphones. RTA is focused on sustainability as part of its contribution to supporting Dubai’s transformation into a sustainable city. During 2014 RTA has carried out 32 energy conservation initiatives and eight green economy support initiatives. These initiatives are expected to achieve savings of about $4.63 million and to cover various RTA sectors and agencies. Other projects include the commencement of the Integrated Transportation Information Center (ITIC), which is a central management hub for

the enormous volume of data available through the different RTA transportation systems. RTA has also commenced work on the Enterprise Command Control Center project, known as EC3, which will monitor, coordinate, and manage all transportation systems in Dubai in coordination with the emergency services. How important is the PPP model to the success of RTA?

One of the strategic goals of the RTA is to promote the concept of partnering with the private sector to create transport infrastructure. This offers RTA the opportunity to focus on economic and social infrastructure programs while enabling the private sector to implement projects and incorporate the world’s best practices and innovations. Private sector involvement in RTA projects is not new. The RTA has implemented projects through private sector partnerships, and is planning to increase the involvement of the private sector going forward by implementing new medium to large projects. The RTA is preparing a PPP strategic plan that will include implementing a number of PPP projects. These include private sector participation in new projects such as bridges, roads, parking, bus stations, transit-oriented development (TOD), and marine services and infrastructure. With Dubai’s Smart City initiative high on the government’s agenda, how does RTA utilize technology and Smart Services to increase its capacity?

RTA already is a major user


RTA green initiatives expected to save


million through 32 separate initiatives


How important do you think additional investment in the transport sector is to Dubai’s aspirations of being a leading international transport and logistics hub?

In general, highly connected transport networks contribute significantly to increased levels of development, increased property values, as well as to the quality and vibrancy of a city. Our studies showed that the development and operation of the Dubai Metro system has led to a notable increase in the value of land and properties around the metro stations, ranging from 7-34%. ✖

increase in public transport usage from 2013 to 2014

BIO and developer of new technologies. It is committed to investing in new, smart technology as part of its contribution to making Dubai the world’s smartest city. Technologies such as the cloud, the Internet of Everything, data analytics, social networking, mobile, and other systems are being developed to this end. The RTA launched several smart applications in 2014, including the Smart Parking, Smart Drive, Smart Salik, Wojhati, the Smart Taxi, Drivers and Licensing, Public Transport, and the Corporate Services apps, with a total of 173 smart services launched as part of these programs. These applications allow customers to access RTA services from anywhere at any time, and to deliver a superior user experience.

HE Mattar Mohamed Al Tayer is the Chairman of the Board and Executive Director at the RTA. He has led the institution since its establishment in 2005. Before taking the helm at RTA, he worked at the Dubai Municipality, assuming several positions up to Deputy Director General. He is a professional Civil Engineer and holds an Honorary Fellowship of the British Institute of Civil Engineers (ICE). He is an active participant in a host of councils and committees in Dubai, including as a Member of the Executive Council of the Dubai Government, Vice-Chairman of the Dubai Sports Council, and Member of the Expo 2020 Preparatory Committee.

Transport & Logistics




How does Emirates Transport work with other government entities toward the overall development of the UAE?

Emirates Transport was established 34 years ago as a federal government corporation specializing in the provision of transport, rental, and auto maintenance services. From the start, the corporation adopted strategic investment plans that complement the overall development plans in the UAE, and support the aspirations and visions of the state, such as of the UAE Vision 2021. Emirates Transport implements these plans through key strategic and community partnerships with government ministries and agencies, at federal and local levels, as well as companies from the private sector. Some of these major partnerships are in the oil and gas sector, as well as companies in the sectors of transport, tourism, support services, and facilities management. Within this scope, the corporation has signed more than 50 MoUs with public and private sector entities, and lists some 430 clients who benefit from 38 services. It is important to emphasize that such initiatives are prepared, developed, and implemented in coordination and cooperation with the strategic partners of the corporation, the most important of which are the Ministry of the Interior, Abu Dhabi Education Council, and the Ministry of Education. What significant contributions is Emirates Transport making to the economic development of the UAE?

Over recent years, the economy of the UAE has become highly diversified with a rapid increase in businesses operating in the country. And for a commercial federal entity, such as Emirates Transport, change was not only necessary, it was inevitable. Many services were added to the portfolio of ET, including commercial transport and rent-

TBY talks to Mohammed Abdullah Al Jarman, General Manager of Emirates Transport, on collaboration with government entities, the use of technology, and expectations for the coming years.

GOOD JOURNEY How does Emirates Transport employ technology as part of the UAE Smart Government initiatives?

als, luxury transport, logistics, petroleum transport, facility management, security, transport technology, motorcycle and valet parking, and the conversion of vehicles to natural gas. The corporation grew drastically to become more than just a school transport service provider, and as our organization developed so did our level of quality. Emirates Transport’s own culture and roots are connected with its founding vision of providing quality service at competitive prices, and this has helped us to become a leading organization in the sector.

BIO Mohammed Abdullah Al Jarman has 20 years of professional experience in finance, investment, corporate leadership, and strategic planning. He joined Emirates Transport in 1988, having graduated with a BA in accounting from UAE University. In addition to his role as GM of Emirates Transport, he is chairman of the boards of directors of Emirates Transport Technology Solutions, Emirates National Facilities Management, Speed Trans, and Emirates Facilities Management.

As part of the UAE federal government, Emirates Transport is keen on consistently incorporating the Smart Government initiative into its projects, paving the road for superior service delivery to clients and the general public. Emirates Transport has developed a subsidiary company called Emirates Transport Technology Solutions (ETTS), which looks after designing, deploying, and operating transport technology solutions to serve key transport service providers across all operational domains: land, rail, aviation, and maritime. Among the core services offered by ETTS is the School Transport Asset Reporting System (STARS), which delivers a full command and control and communication platform to school bus operators. In addition, the company offers Emirates Asset Surveillance and Tracking (EAST), which provides a control and communications platform to all vehicle operators and fixed asset owners based upon traditional GPS tracking without video surveillance. ETTS also caters to R&D efforts in the transport technology field in order to provide better ways of doing business and consistently making EAST compatible with the Smart Government initiative and its innovative transport projects. What significant transport projects or partnerships do you envision in the next five years?

Emirates Transport is always on the lookout for any project or initiative that can enhance the transport sector in the state

IN NUMBERS Emirates Transport

Has signed more than

50 MoUs

430 clients using 38 services

and its own services. We are constantly improving and developing the services we provide to the school, government, and private sectors, introducing new technology and green solutions to achieve the best possible services while meeting environmental objectives. Over the past couple of years, we have launched a number of environmentally friendly projects, including the CNG Vehicle Conversion Centre, the Tyre Retreading Unit, and the Dry Car Wash Unit, and we plan to expand these projects and introduce similar initiatives in the near future. As one of the major transport companies in the UAE, and the region, Emirates Transport is looking forward to collaborating with different public and private sector establishments to contribute to the development of the sustainable transportation environment in the country. ✖

DUBAI 2015








80-120m wide



MALL (50,000sqm) Source: RTA

3km long


passengers expected per annum

ROUTE CANAL In the build up to World Expo 2020, Dubai has staged an ambitious set of infrastructure projects to increase its capacity to handle its expected 25 million visitors. The Dubai Water Canal is a $550 million initiative aimed at increasing marine passenger flow from downtown to the Arabian Sea as well as developing the surrounding land with marinas, shopping centers, and restaurants.


new restaurants

AS DUBAI gears up to host the World Expo 2020, the government has said that the Expo 2020 Master Plan remains on track with a target date for completion of all major construction activities on site by October 2019. It is expected that projects relating to World Expo 2020 will total over $5.5 billion in total investment in infrastructure-related projects with nearly 277,000 jobs being created. With the expectation that the event will draw more than 25 million visitors to the country, Dubai is aiming at ambitious and innovative ways to effectively manage visitor flow around the city. One such initiative is the Dubai Water Canal, unveiled in October 2013 by the Roads and Transport Authority (RTA). The Dubai Water Canal is an approximately $550 million initiative to connect Business Bay with the Arabian Gulf, passing through the heart of Dubai, and set for total completion by end of 2017. The Dubai Water Canal construction project is to last approximately four years and is divided up into three total phases. Phase I of the contract, valued at around $157 million, was awarded to Turkish firms Mapa and Gunal. It includes the construction of a bridge on Sheikh Zayed Road comprising eight lanes in each direction. Phase II of the contract was awarded to China State Construction and Engineering Corporation for an amount totaling just under $105 million. This part comprises construction of three-lane bridges on Jumeirah Beach Road

80,000sqm of public space

and two lanes on Al Wasl roads. This will allow the passage of up to 8.5 meters in height to pass underneath the bridge. Importantly, Phase II will provide a link between Dubai Creek and the Arabian Gulf via a water canal passing across Sheikh Zayed Road, Al Safa Park, Jumeirah 2, and up to the Arabian Gulf near the southern part of the Jumeirah Creek Park. It also includes the construction of a free multi-tier interchange to link the traffic movement between Al Wasl, Al Hadiqa, and Al Athar Roads to ensure smooth traffic flow. This phase also includes the construction of bridges linking with the proposed peninsula to the south of the Jumeirah Park, shifting utility lines via conduits passing beneath the Canal, and providing spare ducts for services under the Canal to meet anticipated future needs. Phase III has a contract value of just under $220 million. This contract was awarded to Belhasa Six Construct Company, a Belgium-based firm, which includes the construction of a water canal linking the Dubai Creek with the Arabian Gulf. Within the canal’s construction, a 3.2 km-long canal must be drilled and sides constructed for the canal, while three footbridges to link the two banks of the canal and four marine transit stations will be built. On top of that, filling works on an island will be carried out, and a sea wall around the island will be built to prepare a sand beach. A marina for boats and a waterbus will also be built, and finally three

Transport & Logistics






Operated by Turkish firms Mapa and Günal

16-lane Sheikh Zayed Road bridge


$105 million

Operated by China State Construction and Engineering Corporation

3-lane Jumeirah Beach Road bridge

2-lane Al Wasl Free multi-tier traffic Road bridge interchange


$220 million

Operated by Belgianbased Belhasa Six Construction Company

landmark pedestrian bridges will be constructed above the canal to link Jumeirah Beach Walk with Safa Park Walk. Once completed, the waterway will stretch 3 km in length with a width ranging from 80 to 120m. The canal will add 6km to Dubai’s waterfront, while the project will provide an area of over 80,000sqm dedicated to public places. The project comprises new shopping and entertainment centers linked by a uniquely designed bridge, over 450 new restaurants with a wide array of luxurious marinas for yachts,

Canal to link Dubai 3 4 marine Creek with the pedestrian transit Arabian Gulf bridges stations and four world-class hotels. At the entrance of the project from Sheikh Zayed Road, an iconic trade center will be constructed on four levels, including one underground level and three elevated levels linking Business Bay with the project zone in a total area of more than 50,000sqm. Importantly, Dubai Water Canal will drive marine transit modes for visitors and citizens with the expectation of more than 6 million passengers per annum. The canal will also boost the profile of Dubai as a leading destination of sea cruises. ✖

Artificial peninsula across Jumeirah Park NEW



DUBAI 2015


the node TBY talks to HE Khalifa Al Zaffin, Executive Chairman of Dubai Aviation City Corporation (DACC), on developing DWC, the World Expo 2020, and its legacy.

BIO HE Khalifa Al Zaffin is an expert on aviation and a leading figure in the aviation industry. He is specifically responsible for setting the strategic vision for Dubai World Central along with other major industry stakeholders. He is responsible for establishing the strategy and overlooking operations, maintenance, and businessrelated activities of the eight districts that comprise Dubai World Central (DWC) and position itself as a selfsustained economic zone. In addition to his role at DACC, he is also the Executive Chairman of Dubai Aviation Engineering Projects, the construction arm of the Dubai aviation sector dedicated to developing the infrastructure and enhancing the capacity of airports. Prior to his two decades of experience in aviation, he was a Senior Project Engineer at Dubai Aluminum Company. Currently, he serves as a board member of the Executive Council for Infrastructure Affairs, Dubai World Trade Center, Cleveland Bridge, and Deyaar. He is a graduate of Arizona State University and holds a Bachelor’s of Science degree in Chemical Engineering.

What would you consider as some of the top achievements in 2013 and 2014 that have helped shape Dubai World Central (DWC) into what it is today?

In 2013-14, DWC achieved several significant milestones in support of its objective of becoming a self-sustained urban destination. These were driven by key developments relevant to our project, including the commencement of the first commercial flight to Al Maktoum International Airport in October 2013, the announcement of Dubai winning the bid to host Expo 2020, and the expansion plan of Al Maktoum Airport, sanctioned by a $32 billion fund. The significance of these mean that DWC has focused on accelerating the development of infrastructure around the airport, anchoring its aviation and logistics offering both in terms of facilities and attracting partners, increasing the tenants in its free zones, beginning projects in the hospitality sector, and signing agreements with industry players. We also signed an agreement with Emaar to develop the DWC Golf high-end luxury residential area. All of this demonstrates our commitment to creating an optimal ecosystem that caters to the needs of the people and businesses that visit DWC or make it their home.

DWC is building a new city within a city. What is the rationale behind this?

DWC is not so much a new city within a city, but rather an extension of what Dubai is today and how it will look tomorrow. DWC has been designed and is seeking to create an urban ecosystem that aligns with the Dubai Strategic Plan 2021. In that same spirit, we are putting the people and businesses at the heart of our development. For businesses, this means ensuring connectivity and speed by channels like our single customs bonded logistics corridor. Businesses will also benefit from the ease of doing business to support their expansion and growth in the UAE and region through a comprehensive ecosystem and free zone offering. For individuals, DWC represents a development that is community driven around residential offerings that will integrate retail, community centers, education, and healthcare. This is ultimately about creating a city of tomorrow that will empower people and businesses to grow and prosper. What opportunities for investment will DWC create?

There are a number of key drivers that will create investment opportunities. Al Maktoum International Airport alone creates a massive opportunity from a passenger and cargo flow perspective. The airport, when complete, will facilitate an additional 16 million tons of cargo and over 200 million passengers per year. This obviously comes with a significant dividend. Second, by hosting World Expo 2020, there will be an increased need for hospitality, retail, business, and residential services for the 25 million expected incoming visitors. Estimates indicate that the economic impact generated by the Expo between now and 2021 will be

IN NUMBERS Dubai Aviation City Corporation


billion USD in funding toward Al Maktoum International Airport (AMIA)



rise in air passengers from 2012 to 2017

approximately $26.5 billion. Furthermore, over the next six years more than 275,000 jobs are estimated to be created in and around the UAE to service the Expo. Third, with the completion of DWC, this area is expected to support a population close to 1 million people. It naturally follows that this will attract considerable investments across its various offerings, including residential, commercial, aviation, logistics, retail, healthcare, and education. What will the focus be until 2020 and beyond?

Our focus is on delivering and ensuring that the development of the DWC ecosystem meets high benchmarks. We work closely with our partners to optimize Dubai’s significant investments in major land transportation projects to boost public transport usage through more advanced, connected bus, tram, metro, and regional rail options. Ultimately, we are working on creating the city of tomorrow that will ensure high quality of life, preservation of resources, and an environment that allows us to live and work more efficiently. ✖

Transport & Logistics




CONNECT ALL TBY talks to David J. Greer OBE, CEO of Serco Middle East, on the company’s operations in the Middle East, low oil prices, and the outlook for the future. How would you describe the significance of the Middle East to Serco’s global operations?

BIO David Greer OBE is an accomplished professional chartered engineer with over 35 years of experience in a wide range of engineering, commercial, and management positions in a variety of environments around the world. Prior to his assignment to Serco, he held the position of CEO of Al-Suwaidi Industrial Services Company in Saudi Arabia from October 2010 to November 2013. Earlier, he worked for Shell International Exploration and Production for 28 years in a number of senior positions in the Netherlands, the UK, Norway, Canada, Oman, Argentina, The Philippines, and Russia, and for Regal Petroleum plc in exploration and production activities in Ukraine, Romania, and Egypt.

Serco is a global public service provider, and we focus on five key pillars across the world; justice and immigration, defense, transport, citizen services, and health. These services are across four key regions: North America, the UK and Europe, the Middle East, and Australia and New Zealand. We are well established in the region, and are present in five countries here in the Middle East, namely the UAE, Iraq, Saudi Arabia, Bahrain, and Qatar. We have about 4,000 employees working for us at the moment with a diverse workforce of some 54 different nationalities. Within the global strategy of Serco, the Middle East remains a key pillar for the company’s global growth. Here in the Middle East, we are focused on rail transport and aviation, which makes up about 80% of our business. We are the leading rail operator here in the Middle East, and we operate and maintain the iconic Dubai Metro, the Al Sufouh Tram System, and Palm Jumeirah Monorail. Only recently, we signed an additional contract for the operation and maintenance of Emaar’s downtown trolley. Beyond these borders, we signed a new contract with Saudi Arabian Rail for the operation of the huge railroad that runs from Ras Al Khaimah in the northeast of Saudi all the way to Dammam. That rail network there is, of course, tying into a much broader network in Qatar, and eventually all the way

down to Oman. Basically, if it runs on rails in this part of the world, Serco either operates and maintains it on behalf of distinguished clients or is keen to do so. What impact will the drop in oil prices have on Serco’s operations in the Middle East?

I do feel that we are somewhat isolated from them. We are not involved in any capital development projects; we are operating and maintaining previously constructed facilities. Having said that, if the government’s budget is cut, it still has to service the public in terms of transportation and healthcare. Those are unlikely to be cut because of low oil prices. The work we have to do is unaffected because the nature of our work is service orientation, not capital development. If our contracts or services were dependent on new facilities being built, then it would impact us directly, but the nature of our contracts at the moment are not going that way. For that reason, we are not particularly concerned about the impact of oil prices on our portfolio or our growth prospects. What are your expectations for the year ahead?

We are continuing to pursue opportunities in all of our five key sectors, and we are continuing to be a superb provider of customer service to our customers around the region. We will continue to demonstrate that we are the best for business in our sector by doing four specific things: competing and winning good business, focusing on the

Serco Middle East Recently concluded a joint venture partnership with the Dr. Sulaiman Al-Habib Medical Group in Saudi Arabia

markets that we know, differentiating customer value propositions, and by carefully managing risk. We will execute what we do brilliantly by being prepared, focused on safety, on operational excellence, and delivering as advertised with a lean and simple organizational structure and efficient, high-quality services. We also have to be a place that people are proud to work, not just our international staff but also our Emiratis. We want to be seen as an organization chosen by talented people. Finally, we also must look to continue our success in profitability and sustainability. We have to be financially robust long term, delivering value to our shareholders with growing revenues and margins, but with appropriate risk-adjusted returns on capital. That is the strategy that we are setting up to deliver, and I think it is a bright future for Serco in this part of the world. ✖

DUBAI 2015




WITH DUBAI EXPECTING in excess of 25 million visitors for World Expo 2020 and the city’s continued success in attracting additional visitors YoY, increasing the capacity of Dubai’s transport infrastructure will be crucial to delivering a top-notch Expo and tourist experience. The Dubai Metro represents the backbone of the public transportation system in Dubai and the world’s largest driverless rail network. As ridership has been increasing YoY along with the metropolitan area continuing to expand, the Roads and Transport Authority (RTA) has developed plans for the expansion of the Dubai Metro, set to be completed before 2020.

If a city were considered only as good as its underground rail system, Dubai would be up there with the best and eager for more.
















all Du ba iM

rat es

lifa ha

Em i

rj K Bu

ee k



Ma ll o Fir f the st Em Gu lf B irate s an k

uta Ba tt Ib n



To we r


Sources: Dubai Metro, Emirates 24/7

40 KM from 22.5 KM 11 NEW STATIONS

ira Ce City nte r

75 KM





Transport & Logistics

Currently, Metro ridership hovers around 450,000-500,000 riders per day on its 75km network consisting of 47 stations spanning the Red and Green Lines. It has played a fundamental role in changing the perception of the public transport sector not only in Dubai, but across the GCC. In January 2015, Dubai Metro transported about 1.3 million more people than it did in the same month of the previous year, a 9.5% increase. The lines currently carry between 13,000 passengers per hour, and at peak capacity the Dubai Metro carries 26,000 passengers per hour. The number of stations from both lines combined is expected to increase to 70 from the current 47, with 11 new stations planned on the Green Line. Set for completion before World Expo 2020, the Green Line will almost double in length from the current 22.5km to about 40km. The extension plan of 20.6km from Jaddaf to Academic City has already been finalized. The extension will snake through Festival City, Lagoons, Ras Al Khor Industrial Area, International City, as well as Silicon Oasis and Dubai Academic City. According to the plans, the Green Line is also expected to pass via Meydan in Nad Al Sheba on its way to Academic City. As the route for the Green Line is being worked out, the Roads and Transportation Authority (RTA) engineers are studying the feasibility of a possible connection to the Meydan station of Etihad Rail, the country’s connecting rail line to the planned GCC rail network.



Also set for completion prior to World Expo 2020 is the expansion of the Red Line, which will include seven additional stations, with 4km and two of the stations being underground. The socalled “Route 2020” project will extend the Red Line from Nakheel Harbour and Tower Station to the site of Expo 2020, with construction set to begin 1Q2016. The project will serve the Gardens, Discovery Garden, Furjan, Jumeirah Golf Estate, and the Dubai Investment Park, project a 16-minute journey between Dubai Marina to the Expo site. The RTA announced that they would begin receiving requests for pre-qualifications the end of May, to select the shortlist of qualifying consortiums by June 30.The RTA will release tender documents in early July, and will start receiving proposals early December. A future plan is also in place to construct three additional stations to serve the new Al Maktoum International Airport. All in all, with simply the Green and Red Line extensions, the RTA will create the critical infrastructure necessary to shuttle visitors and residents to the city from World Expo 2020 and beyond. Dubai Metro expansion plans will not end with simply the Red and Green Lines—four further lines have also been proposed. The north-south Purple Line would connect the city’s two airports; the Gold Line would link Dubai Marina area, Arabian Ranches, and Deira. Both are due to open by 2025. The Blue Line would run north-south parallel to Dubai Bypass Road, and the Pink Line would run east-west from City of Arabia to Al Sufouh, due for completion by 2030. ✖


DUBAI 2015


RIGHT ON TIME The strategic position of the Emirate and its robust transportation network makes it an obvious choice for logistics providers, while Expo 2020 will provide yet more opportunities.



Managing Director, RSA Logistics

Vice President, Terminal and Cargo Operations, Dubai Airports

e initially built our facilities with no real industry in mind, but later modified them in order to offer tailored solutions to certain sectors, including automotive spare parts, petrochemicals and chemicals, lubricants, building materials, FMCG, and retail. Then, we moved into power generation and project logistics. All of our investments thereafter were catered toward a particular industry and to a particular type of customer. There is definite belief in the growth of volume that is going to come out of the region in the next few years. Dubai has won the right to host the World Expo 2020, so we aligned our goals with the Emirate’s 2020 vision and set out our own targets. One of our goals is to have operations in six countries by the big year. Kenya is definitely earmarked for development, and we have already started to build facilities there, as well as in Saudi Arabia. Southeast Asia is another area with potential.

n 2015 Al Maktoum International at Dubai World Central (DWC) firmly established itself as a key regional and global cargo hub, with freight volumes surging 262% to 758,371 tons for the full year 2014, up from 209,209 tons in 2013. The relocation of all dedicated freighters, including Emirates SkyCargo to DWC from Dubai International in May last year was a major driver behind the sharp rise in cargo volumes. To meet this growth Emirates SkyCargo opened a new state of the art cargo facility capable of accommodating 700,000 tons while the existing cargo facility is being expanded to 400,000 tons. A key attraction is that the airport located less than 10km from Jebel Ali Free Zone and linked via a bonded road to the region’s largest port—Jebel Ali Port. With a turnaround time of about 90 minutes between the ramp of the airport and the port, DWC offers highly convenient seato-air or air-to-sea service.



Transport & Logistics



General Manager, STORALL LLC

Country Manager UAE, DHL

ur customer base is quite varied, which differentiates us from other traditional storage companies. Because we offer a spectrum of storage solutions, our clients includes individuals that want to manage their own belongings as well as SMEs where the economies of scale dictate that it makes sense for them to outsource their inventory management, rather than invest themselves in leasing or building a facility and equip it with everything including covering operating costs and staffing. We already store a lot of display stands and items related to exhibitions throughout the year. On a yearly basis, we have a seasonal influx of such cargo, and with the Expo we expect it to spike. That said, a storage solution company like ours definitely has to be prepared. One has to note that the Expo is not going to affect all the sectors of the economy, but will nevertheless create a tangible demand for certain industries that will serve it. We are definitely on the right track for expansion.

he UAE has tremendous potential as an international hub for transport and logistics for three main reasons. First, if you consider the geographic positioning, we are geographically in a perfect spot between Europe, Asia, and the US. We are in the center of the GCC, and then if you look just at flight times, which is our business, in 3-4 hours you cover all of the Middle East and parts of the sub-continent and you can reach the east coast of Africa. Add another hour and you are in the CIS countries, all the way up to Moscow. The opportunity to service the Caucasus republics is often neglected so this is an important point of opportunity. Then if you add another two hours you are in Europe and halfway through Africa, and far beyond India. Thanks to its geographic location it is the perfect place for trade. The second reason Dubai is likely to continue flourishing is its development of free trade zones.





DAVID J. ROSS Regional President, FedEx Express Middle East, Indian Subcontinent & Africa he Middle East is an extremely important economic hub, and continues to be one of the key growth markets for FedEx. Dubai is growing at a faster pace than the global average. This growth is driven by the region’s accessibility and favorable geographic location. The Middle East serves as an ideal bridge between Eastern and Western economies, making it an essential multi-modal logistics hub for the world, connecting key manufacturing hubs in Asia with the demand in the Americas, Europe, and Africa. Our focus is always on ensuring that our logistics solutions match the needs of our customers and as the demand grows, so will our offerings, team, and fleet. Last year for example, we increased our FedEx flights through our Dubai hub to a total of 44 FedEx flights and 700 commercial flights a week, connecting the Middle East to global markets and providing our customers with speed-to-market. The Middle East’s airlines are growing rapidly, and the development of new airports will ease the congestion and avoid delays that may have an adverse effect on the movement of freight.



DUBAI 2015


ADAPT & CONQUER TBY talks to Raman Kumar, Managing Director of Al-Futtaim Logistics, on growth factors, customer solutions, and regional expansion. What factors contributed to your growth in 2014?

If you look at the growth of Al-Futtaim Logistics, we have moved both vertically and horizontally. In terms of our vertical growth, our fashion design services and solutions have expanded considerably. One solution we have developed for our customers ensures that their products do not stay in storage for a long time. The retailer orders the product, which is shipped out immediately to the store as soon as it arrives at the loading dock. With the assistance of advanced technology and software, we can reduce storage time through the ways that we configure the variables involved. This has been one of the major successes of 2014, and we expect the fashion design line of the business to grow from here. In this case, we add value to the services that we provide to the customer by developing an understanding of their real needs.

BIO Raman Kumar has been working for Al-Futtaim Logistics for just under 20 years as the Finance Manager and became the Acting Managing Director in June 2013. He was recently awarded the SCATA “Logistics Manager of the Year 2014” for the Middle East region, as well as being ranked the ninth most powerful logistics executive in the Middle East Logistics Power List.

How do you adapt your solutions to customers working in different countries?

Customers in different countries naturally have different requirements, which can present a challenge when you have shipments travelling to different regions of the world. For example, we have many customers shipping from Europe to the Middle East that require labels in Arabic, for which we have developed internal systems to simplify much of the process for the customer. Our solutions meet the principal’s, the customer’s, and the relevant government's requirements, as well as those of the end consumer. We aim to add value for all customers, whatever their requirements, by not only providing solutions, but by understanding the available technology and applying it to their needs. Recently Al-Futtaim Logistics opened a 50,000sqm warehouse, distribution, and office facility, which includes a 30,000sqm distribution center for your home delivery fleet. What has the impact of these developments been on your business?

These two developments were a part of our 2014 strategy, and we made these moves to meet our customers’ requirements in the fast moving retail division. Customers are looking for solutions dedicated to minimizing handling problems. These facilities have given our customers an advantage in a market in which lead times of over 10 days for delivery are not unusual, whereas in re-

ality we know that customers want no more than three days. Once you learn what the customer wants, you have to find new supply chain and logistics solutions to make it happen, which is what we have done. We have fine-tuned our operational efficiency to increase productivity, and we deliver on time to satisfy customers. These days, the end consumer is more vocal about their requirements, meaning that our customers, the retail companies, understand more clearly what they need to do to address them. We take our responsibility seriously to listen and to respond, and to go much further than simply delivering products, but to give them the best solution to fit their needs. How do you accommodate customers from a wide range of industries?

Whatever goods you are transporting, the customer wants to reduce the lead-time from the manufacturer to the end recipient. Each product sector has different service requirements. In the automotive industry you can store a car for a number of days, for example, but whereas the fashion industry operates seasonally, you cannot keep winter clothes for the summer. You have to look at all scenarios, and for each one you have to understand the product and the customer’s demands in order to meet their requirements. A team of experts within our management team reviews every aspect. By selecting our products and methods, they con-

IN NUMBERS Al-Futtaim Logistics

Global reach of over

80 countries


250k sqm of warehousing and 1 million sqm of open storage space

trol and adapt each solution to make sure that all possible scenarios are considered and prepared for. Al-Futtaim Logistics is the leading automotive logistics service provider in the UAE, and serves a range of other industry solutions such as retail, industrial, and project cargo. How do you see this dynamic going forward?

During 2014, we expanded our verticals in the fashion and home delivery sectors, and are now looking at market movements closely as we plan our expansion into food and other sectors. We foresee positive trends in the next few years leading up to Expo 2020 in the UAE. As an organization, we are well positioned in terms of starting sizeable projects and our expansion into new verticals. What is Al-Futtaim Logistics’ regional expansion strategy going forward?

We are looking for expansion and business growth as we expand geographically from our home market into new markets in the MENA region, including Qatar, Oman, Saudi Arabia, East and North Africa, and Egypt. ✖

Transport & Logistics




GET going Freightworks provides integration of various transportation modes such as sea, air, and road freight, as well as diversified logistics services. Which of these areas represents more relevance in terms of profit for the company?

Traditionally, Freightworks has been an airfreight company primarily because of where we are—situated adjacent to the airport. Our focus has shifted significantly from being an airfreight import company to more on air and sea-freight exports because our customers require additional solutions to suit their supply chains. Of course, this country is also very much a transshipment point. You have the Far East, the Middle East, and transshipments into Europe and Africa as well. We also see many companies coming in now looking for other regional or global distribution capability out of the Middle East. Of course, Dubai is clearly in a prime location for this particular operation.

TBY talks to Steen Hartwig, Managing Director of Freightworks, on integrated transport services, expansion plans, and transshipment.

with operational excellence, which we believe is the cornerstone of all service providers, and we deliver bespoke solutions to complex requirements in any given supply chain. Because of the structure we have within the company, we are capable of looking after our customers in a way that not all of our competitors can. We are set up with nine service delivery teams. Within each of those teams we have sales, customer service, sea freight, air freight, team leadership, and customs people, who can deliver a one-stop shop, which our customers appreciate. You have a network of established partnerships. How important are these for developing the business?

We are members of the World Air Cargo Organisation (WACO). This organization

What are you doing to develop sea-freight business?

We have developed a fiveyear strategic plan on the growth and expansion of our footprint as Freightworks. Africa plays a major role, as does the Middle East, as well as some overseas locations in the Far East, Europe, and North America. We are looking at establishing Freightworks branches overseas, which will enable us to capture the opportunities that come from there and beyond into Africa and other markets. What would you describe as the main strengths that differentiate Freightworks from its competitors?

We provide our customers

BIO Steen Hartwig was educated at Syddansk Erhvervsskole in Denmark, where he received his International Business Degree with a focus on technical studies, international business, and exports. He has over 20 years of management experience and has lived and worked abroad for most of his career. Before Freightworks he was the General Manager of the supply chain division of DAL Group.

was originally established to create a network of independent forwarding companies, and we are the representatives of this organization in the UAE. The principle of connecting independent freight forwarders is now distributed throughout the world. WACO just reached 100 member countries. We can reach all corners of the world as it is right now. I believe the future is going to move much more in the direction of smaller, more agile and capable companies, rather than toward larger multinational companies. This is exactly where customer service and customer experience really comes in. We deliver that, but not all multinationals can. What are your expectations for how you will finish the year?

We will finish strongly, and will be posting our third consecutive year of growth. We have had significant accumulated growth over the past three and a half years. What we have done differently since I started with the company is we have generated some leadership within business growth areas—sales and business development. We have tripled our sales force to really get out into the market. If you look at the growth numbers that similarly sized companies, or even larger companies in the UAE post, ours are unmatched. We are reporting excellent growth, and we are satisfied that we can continue this trend. Having said that, we are not getting complacent because there are still many business opportunities out there that we can pursue. We are pursuing some really interesting challenges right now. Things

are looking positive. We need to see how Dubai develops. However, there are going to be numerous exciting opportunities within the next two to four years. How would you assess the level of competition between logistics companies here in Dubai?

There is a lot of competition. I have heard numbers of anywhere from 3,000 to 6,000 registered freight-forwarding logistics companies, all the way from single-person briefcase operations, through to multinationals. This means that you can try to compete on the price, which is certainly what we are doing, but at the end of the day retaining the customer is linked much more to the customer’s experience rather than the cost at any given time. We are also looking at expansion, acquiring new warehouses or additional space, and value-added services. ✖

IN NUMBERS Freightworks


service delivery teams


consecutive year of growth





Amer Ali, Executive Director of the of Dubai Maritime City Authority, on recent projects, and cooperation with local entities.

Mohammed Al Muallem, Senior Vice-President and MD, UAE Region of DP World, on acquiring the Jebel Ali Free Zone.

Dubai is developing key infrastructure to contend for the top spot among the world’s leading maritime centers.


Maritime REVIEW

The dynamic Arabian Gulf shoreline is the Emirate’s economic and visual focal point; maritime infrastructure and industry is at the forefront of Dubai’s modernization plans, attracting global commerce and tourism.


n April 2014, the Dubai Maritime City Authority (DMCA)—the government authority regulating the maritime sector— launched its Dubai Maritime Vision 2030. While at once honoring Dubai’s deep historical roots as a global maritime hub and embracing bold modernization initiatives, the Vision aims to create a dynamic and safe environment for the sector in the coming decades. In terms of the Dubai’s broader economy, the Emirate is keen to reemphasize its transshipment and maritime potential. Among the key goals of the Vision is to establish Dubai as a leading global Islamic maritime economy by encouraging Islamic financing and Halal maritime tourism; consolidate Dubai’s position as the foremost international maritime center; elevate Dubai’s status as a prime international logistical gateway by rapidly increasing passenger and freight transport volumes and a multifaceted trade corridor; create a smart maritime sector with seamless integrated opera-


Image: Dry Docks World

tions in line with Dubai’s rapid transformation into a smart city; promote Dubai as an epicenter for Maritime education and training to produce a new level of excellence and leadership in line with the movement towards a knowledge-based economy; and position Dubai as an exemplary international “Green Maritime” body that minimally impacts the environment with its shipping and maritime-related activities. In March 2015, DMCA announced the launch of Dubai Maritime Day, to celebrate and provide support to public and private entities involved in the local industry. The day, set to take place in November, will feature events highlighting the maritime sector’s various niches and accomplishments.


In March 2015, DMCA announced the launch of Dubai Maritime Day, to celebrate and provide support to public and private entities involved in the local industry.

Jebel Ali Port—a multi-modal hub with extensive logistics facilities—is the largest marine terminal in the Middle East, the ninth largest container port in the world, the world’s largest manmade harbor, and one of the

DUBAI 2015


Massive port restructuring throughout the Emirate has transformed the sector

Image: Dry Docks World

most modern ports in the region. Operated by DP World—the Dubai-based marine terminal operator and one of the world’s largest marine terminal operators in the world—Jebel Ali Port is a premier gateway for over 90 weekly services connecting more that 140 ports globally, according to DP World. Currently undergoing expansions, the ports will increase its handling capacity to 19 million TEU in 2H2015. The current renovations will add three berths to its current 26 and 10 cranes to its current 87. By the end of the 2H2015 expansions, the Jebel Ali Port, along with the new Container Terminal 3, will be able to handle 10 of the giant new-generation vessels simultaneously, and will be the only

port in the region capable of doing so. The port’s location within the Jebel Ali Free Zone is another defining feature. According to DP World, the free zone, established in 1985, currently houses more than 6,400 companies active in various sectors such as manufacturing, trade, logistics, and a variety of industrial and service-oriented sectors. DP World operates the Emirate’s other port, Mina Rashid, as well, also known as Port Rashid. This multi-purpose port located on the southern coast of the Arabian Gulf is equipped to handle both cargo and passenger operations. It is the only port in the Middle East that has been awarded the ISO-9002 accreditation and the Security Certificate of


Excellence by International Maritime Security (IMS). Mina Rashid’s coastal berth facility is comprised of five berths, is 5m deep, and its quay length is 900m long; its general cargo and RoRo facility is comprised of 13 berths, is 10.5m deep, and its quay length is 2,350m long, according to DP World. Its operations consist of around the clock cargo operations and gate access for cargo movements, and the port has RoRo storage yard availability, as well as sheds and warehouses for short- or longterm lease. The logistics and warehouse facilities of Mina Rashid have prime accessibility to the region’s trading hubs, industrial areas, and free zones, and are in close proximity to customs and government authorities. Mina Rashid has already witnessed several milestones this year—the newly opened cruise terminal had its busiest month on record with 150,000 tourists arriving on more than 30 ships, reported The National. In 2014, Dubai received 358,000 passengers from 94 cruise ship calls, and the forecast for 2015 stands at 425,000 cruise tourists from 115 ship calls. DP World’s third cruise terminal in Dubai, the Hamdan bin Mohammed Cruise Terminal, has a capacity capable of welcoming 14,000 cruise passengers daily. The terminal is the largest covered cruise facility in the world. It is the latest addition to the Dubai Cruise Terminal facility at Mina Rashid, covering 28,000sqm, according to Arabian Business. The new terminal will increase Dubai’s total capacity between its three cruise terminals from two million tourists a year to seven million. It will enable Mina Rashid to serve up to seven cruise vessels simultaneously and more than 25,000 passengers across the three cruise terminals.

LEISURE AND REPAIR The man-made canal city Dubai Marina is being built along a 3km stretch of the Gulf shoreline between the Jebel Ali Port and the area hosting Dubai Internet City, Dubai Media City, and the American University in Dubai. The first phase of the megaproject, which has already been completed, is comprised of 10,000sqm acreage at a cost of approximately $326 million. Once completed, Dubai Marina will become the largest man-made marina in the world, including paved walkways, high-rise commercial/office space and apartments, beaches, waterside cafes and restau-

rants, and shopping malls. The marina provides sheltered berthing for over 500 yachts. Dubai Marina Yacht Club (DMYC), a regionally renowned private yacht club has built a clubhouse forming the centerpiece of four five-star quality marinas with state-of-the-art facilities. From casual to fine dining, the club offers restaurants and lounges for the yachting enthusiast, as well as a cruising club for DMYC members to have the opportunity to explore regional yachting destinations, and attend regular workshops and seminars. Dubai Maritime City, built on 2.27 million sqm of reclaimed land, is a multipurpose maritime zone offering the highest levels of ship repair, conversion, and ship building internationally. The city is comprised of six districts. The industrial precinct is a hub for ship repair facilities, yacht charter, repair and manufacturing, and workshop units; the area contains 19 ship repair plots and two ship lifts capable of lifting 3,000 and 6,000 tons each. Dubai Maritime City Campus, at the center of Dubai Maritime City, has the capability to provide marine engineering, marine transportation, and naval science courses to 1,300 students. The Maritime Center serves as a hub for global maritime businesses, while the Harbor Offices is the gateway to the city. The Marina District and Harbor Residences cater to yacht owners and included retail, residential, and commercial spaces. To date, the shipyard has repaired over 7,500 vessels, and has specialized in LNG handling capabilities. Neighboring Dubai Maritime City is the Emirate’s long-serving regional presence for ship repair Dubai’s Dry Docks World, having been operational for nearly four decades Dubai Creek is the Emirate’s oldest maritime infrastructure, having served as a natural port for dhows in the early 20th century, and dividing the city into two main sections. Despite its long history, Dubai Creek is not excluded from the sector’s advanced modernization plans, and construction is underway to extend the channel 2.2km from Jumeirah Beach Park crossing Sheikh Zayed Road. Phase three, at a cost of $220 million, will include the construction of four marine transit stations, in addition to digging the canal linking Dubai Creek with the Arabian Gulf, and building an artificial peninsula across Jumeirah Park. ✖



Jebel Ali Port—a multi-modal hub with extensive logistics facility—is the largest marine terminal in the Middle East, the ninth largest container port in the world, the world’s largest manmade harbor, and one of the most modern ports in the region.


DUBAI 2015


OPEN PORT What are the most important projects that the DMCA has embarked upon over the last year, and what were their impacts on the sector as a whole?

TBY talks to Amer Ali, Executive Director of the Dubai Maritime City Authority (DMCA), on recent projects and their impacts, cooperation with local entities, and the Vision 2021.

BIO Amer Ali supervises all management and implementation aspects of DMCA. He works to establish DMCA’s vision of a safe, vibrant, and sustainable maritime environment in Dubai. Amer Ali began his career as Manager of Promotions and Exhibitions at Dubai Ports Authority in 1999. He then held senior positions at other Dubai World companies, such as Jebel Ali Real Estate and Dubai Ports World. Among other qualifications, he holds a Bachelor’s degree in Communications Management and a diploma in Mass Communication. He also holds a degree from the Senior Executive Program at Harvard Business School.

We have had several key milestones in 2014 in line with the objectives of the Dubai Maritime Sector Strategy (MSS), which was established to organize, develop, and promote the local maritime sector and strengthen the Emirate’s position as a world-class global maritime hub. DMCA made significant progress toward improving maritime infrastructure and introducing new regulations and legislations to ensure the highest levels of operational efficiency and safety within local waters in accordance with the best international practices. Last year’s achievements helped strengthen Dubai’s competitive advantage at the regional and international levels. In 2014, DMCA launched the Emirates Maritime Arbitration Centre (EMAC) under the guidance of HH Sheikh Hamdan Bin Mohammed Bin Rashid Al Maktoum, Crown Prince of Dubai and Chairman of the Dubai Executive Council. EMAC is a pioneering initiative in the Middle East aimed at addressing and resolving maritime disputes via deliberations based on legal frameworks and set maritime regulatory guidelines and standards. How will the recently established cooperation between Dubai Chamber’s DIAC and the Emirates Maritime Arbitration Center enhance dispute resolution procedures for the maritime sector in the Middle East?

The partnership between the two organizations is highly crucial. Both share a common vision of contributing to Dubai’s economic development and promoting the Emirate as one of the world’s leading investment destinations. The new agreement

forms a nucleus for future cooperation between Dubai Chamber’s Dubai International Arbitration Centre (DIAC) and the Emirates Maritime Arbitration Center, a first-of-its-kind initiative that aims to settle maritime disputes in the Middle East. Disputes are resolved in accordance with independent legal and regulatory measures in line with the maritime sector’s strategic goals of improving, organizing, and enhancing Dubai’s competitiveness as a first-class global maritime hub. The maritime sector is an important pillar of Dubai’s economic growth as it directly supports the competitiveness of Dubai and its strategic location as well as its status as one of the top transshipment hubs in the world. This latest agreement will lead to a new phase of cooperation between the two parties and will take the maritime sector a step closer to making Dubai a first-class global maritime center. Under the new strategic partnership, the two sides agreed to enhance channels for transferring knowledge and exchanging information as well as beginning their bilateral cooperation in arbitration. They will also coordinate in building the maritime sector’s human resources capacity by jointly organizing interactive workshops and training courses, attending regional and international meetings, and conducting official visits. The partnership aims to contribute to enhancing Dubai’s presence on the global economic map. How is DMCA implementing technology as part of Dubai’s smart government initiative?

We will continue to develop more creative ideas to enhance the maritime sector’s competitiveness through the Maritime Innovation Center to further support the Dubai Innovation Strategy, which

aims to make the Emirate the world’s most innovative city. The Smart Marine Services Platform aims to build an informational and procedural interactive base by designing, developing, and maintaining a cutting-edge and smart system for maritime licensing and registration services. It will provide several channels offering services that meet the requirements and expectations of the government. DMCA will adopt the best international practices, the highest standards, and the latest smart technologies to ensure easy access to an integrated portfolio of high-quality services through various smart channels. This initiative represents a strong impetus toward improved performance. It will also advance DMCA’s contributions toward achieving the strategic objectives of Dubai Plan 2021 to build a proactive, innovative, and smart government that guarantees the welfare of all members of society. How does the strategy of DMCA play into the Dubai 2021 Vision?

Our numerous consecutive achievements have complemented efforts to develop a regulatory framework to create a conducive and sustainable maritime environment that responds proactively to rapid changes, keeps pace with emerging trends, and attracts leading regional and global investors. We will continue to come up with new leading initiatives in cooperation with our strategic partners. We aspire to organize, develop, and promote the local maritime sector and strengthen Dubai’s strategic position on the global maritime map. These goals are in line with the vision of Dubai 2021 of HH Sheikh Mohammed Bin Rashid Al Maktoum, Vice President and Prime Minister of the UAE, and Ruler of Dubai. ✖





TBY talks to Mohammed Al Muallem, Senior Vice-President and Managing Director, UAE Region of DP World, on acquiring the Jebel Ali Free Zone, improving Dubai’s connectivity, and the company’s future strategies.



What impact will the $2.6 billion acquisition of Jebel Ali Free Zone have on DP World’s growth?

The transaction was a unique opportunity to acquire a strategically located asset integral to Jebel Ali's continued success as the leading gateway port in the Middle East region. EZW has stable recurring revenues, healthy margins and strong cash generation delivered by an attractive business model. There are significant opportunities for growth from EZW and Jebel Ali Free Zone from increasing occupancy, increasing lease rates and developing new investment properties—underpinned by the continued growth of Dubai as a trading and logistics hub. DP World recently announced it plans to double its investments this year of up to $1.9 Billion in capacity upgrades in the Jebel Ali port. What is the strategy behind this decision?

The $850m Container Terminal 3 (T3) is operating with a capacity of 2 million TEUs. Once fully operational this year, T3 will add a further 2 million TEU capacity to serve customers at the state-of-theart facility. It is considered as one of the world’s most modern container terminal adding further capacity to the port enabling it to handle as many


million TEUs in 2014, representing

11.8% growth

as 10 of the new generation Ultra Large Container Ships (ULCS) at the same time. The terminal features 19 of the world’s largest and most modern quay cranes remotely operated from a sophisticated control room off the quayside largely by Emirati nationals, including females, who will also make up the majority of the 50 Automated Rail Mounted Gantry crane (ARMG) operations team. The sophisticated cranes along with latest technology, smart mobile applications, a 100% electronic transaction facility and an advanced Gate Automation system, all contribute to a cost effective terminal as part of the supply chain. What key capacity upgrades will be completed and what impact will they have on DP World’s operations?

The UAE delivered another strong performance handling 15.2 million TEU in 2014, representing growth of 11.8% for the year. Terminal 3 at Jebel Ali became operational in the third quarter, adding 2 million TEU and alleviating capacity

constraint. A further 2 million capacity is expected to come on line in 2H2015. How will DP World use the Jebel Ali acquisition to integrate its supply chain services via the Dubai Logistics Corridor and Dubai World Central?

The acquisition of EZW (Jebel Ali Free Zone) is consistent with our strategy of providing port-centric integrated logistics solutions at key gateway locations, such as Jebel Ali. Jebel Ali is the gateway to Middle East, Africa and Indian subcontinent. It is universally marketed as the model for port-centric integrated logistics solutions combining traditional port operations with free zones, intermodal logistic facilities, customs and other services. Ranked among the top ten container ports worldwide, Jebel Ali Port plays the role of a premier gateway for over 90 weekly services connecting the region to over 140 ports worldwide. The poly-functional terminal facilities are spread over 20km of quayside featuring 23 container berths and 78 quay cranes, geared to handle next generation vessels. Jebel Ali Port is an integrated multi-modal hub, offering sea, air and land connectivity complemented by logistics facilities which include coolport, container freight station and warehousing. How will this contribute to the continued success of Dubai as an international leader of port services and trade?

The integration of DP World and EZW will reinforce our leadership in the high-growth

Middle East region and enhance our integrated port and logistics offering to customers by optimizing investment. It is a compelling strategic move that will allow us to co-ordinate planned expansion, deliver an improved customer proposition, accelerate growth and enhance shareholder value. Jebel Ali is the heart of an integrated multi-modal hub, including Jebel Ali Free Zone, Dubai World Central, Dubai Industrial City and Dubai World Central (Al Maktoum Airport). This unique platform offers sea, air and land connectivity complemented by logistics facilities. ✖

BIO Mohammed Al Muallem became Senior Vice President and Managing Director of DP World UAE Region in 2005. He has spearheaded the development of the Jebel Ali Port, the flagship of DP World, ranked among the world’s top 10 ports. In 2003, Al Muallem pioneered the use of the Quad Lift Gantry, capable of lifting four 20 feet containers or two 40 feet containers simultaneously. Al Muallem was appointed Chairman of the Executive Merging Team of Dubai Ports Authority, Dubai Customs and the Free Zone in 2000 and, in May 2004, Executive Coordinator for the Terminal 2 development at Jebel Ali Port. Among numerous qualifications Mohammed Al Muallem holds a Bachelor of Science degree in Industrial Engineering.


DUBAI 2015


BY THE SEASHORE With the launch of Dubai Maritime Vision 2030 and the commencement of construction on the Dubai Maritime City project, Dubai is creating a holistic strategy as well as developing key infrastructure to contend for the top spot among the world’s leading international maritime centers. WITH DUBAI’S AIM to become one of the premiere trade and logistics hubs internationally, a key driver for growth is the maritime sector. Dubai already serves as a pivotal logistical trade hub due to its strategic geographic location. It is already considered not only as a gateway to the GCC due to its superior infrastructure and sea-to-land capabilities, but also as a gateway to Africa, as a key transit point between Asian exporters and growing African importers. Despite these achievements, Dubai authorities have recognized that further innovation and infrastructure development is key toward Dubai maintaining its leading position within the region and the world. The Dubai Maritime Vision 2030 was launched in 2014 with aims to make Dubai a leading global maritime hub within the next 20 years. With this, there are a number of key objectives to accomplish this goal. One of the key objectives is the establishment of Dubai as leading global Islamic Maritime Economy by encouraging Islamic financing and Halal marine tourism, thus capitalizing and contributing on HH Sheik Mohammed’s strategy of Dubai becoming the capital of the Islamic economy. The strategic plan also focuses on bringing smart services to the maritime industry in Dubai, in line with Dubai’s smart city initiative. The smart maritime industry will focus on comprehensive customer-focused e-services and security systems in order to better serve stakeholders. Finally, a major pillar is the emphasis put on developing human capital for the sector. The plan will promote Dubai as an epicenter for maritime education and training and provide the necessary fundamentals to locals and international students in the Emirate’s goal to become a knowledge-based economy. Dubai World established the Dubai Maritime City master plan with the aim of transforming the maritime sector within the Emirate. The project was first announced in 2003 as a 2.2 million sqm district including one of the largest marinas in Dubai, a 121-ha business district for maritime and offshore-related trade, as well

as offices, warehouses, academic buildings, hotels, homes, and shops. The project was originally expected to be fully operational by 2012. However, after completing a first phase of marina berths, the project was stalled by the global financial crisis. Since Dubai’s economy has fully rebounded from the crisis and is back into growth mode, project developers are latching onto the opportunity with ground breaking already in motion on one of the sites. At least 19 towers in Dubai Maritime City will be completed by 2019, with the 2.27 million sqm master development housing 53 mixed-use towers when completed. Infrastructure development for phase B of Dubai Maritime City has reached a very advanced stage, which will be housing 19 towers with developers of 11 towers either having secured or in the process of securing approvals. Each of the towers are expected to cost between $108 million and $190 million, which gives investors a sense of the grand scale the development is set to become. Damac Properties, the largest luxury real estate developer in the Middle East, was the first developer to commit to Dubai Maritime City. In 2013, Damac Properties announced that it has secured a sea-front plot of land at Dubai Maritime City, where a high-rise luxury tower of serviced hotel residences will be built. Deyaar Development, the second-largest Dubai-listed developer, recently signed a deal to buy a plot of land for the Dubai Maritime City megaproject. With this, Deyaar has said that it plans to build a beachside project on the plot in the Marina District. Omniyat Properties, another Dubaibased developer, broke ground on its $163 million “Anwa by Omniyat,” thus becoming the first private developer to commence construction in Dubai Maritime City. Omniyat plans to market the 225 off-plan apartments at its $163 million Anwa tower in Dubai Maritime City’s megaproject. Prices for the apartments will range between $462 and $598 per square foot. Contracts will be awarded in October and completion is scheduled for 2017. ✖




Source: Dubai Maritime City


3 8

interior parcels

The Landmark Tower The Creek Towers and Plaza

waterfront parcels

Waterfront Corporate Towers Mixed-use activity areas Charter and transit marina facility Dry boat storage




Ferry transit facilities

tower development plots

Commercially and residentially zoned buildings Courses in marine engineering, marine transportation, and naval science


room hotel

Fully-landscaped green spaces


student capacity story library Gateway to DMC

Unrestricted open sea access Ship repair and maintenance Yacht repair and manufacturing Workshop units

19 Multi-use pedestrian esplanade

Development Plots



DUBAI 2015


partner of CHOICE TBY talks to Mishal Hamed Kanoo, Deputy Chairman of the Kanoo Group, on the company’s philosophy, potential investment opportunities, and the outlook for the future.

How would you describe the overall objective of Kanoo Group going forward?

BIO Mishal Hamed Kanoo is the Deputy Chairman of the Kanoo Group, one of the largest independent, familyowned group of companies in the Gulf region. He is a UAE national, born in 1969. He finished his schooling in Dubai and holds an MBA in Finance from the University of St. Thomas, Houston, Texas and another from the American University of Sharjah. He started his professional experience at Kanoo Group in 1991 before going abroad to do his MBA. He rejoined the company in 1994, and then had a stint with Arthur Andersen in Dubai as an Auditor before taking up his current position in 1997. He also teaches part time at the American University of Sharjah on the subject of Family Business.

Our main concern as a business is to make profit, obviously. I am a business; I am not a charity. However, the point of making money is to safeguard and benefit the people working within the organization. At the end of the day, that is the important thing to focus on. I am only as good as my front people that are interacting with my customers. Therefore, I should ensure that they have a good, safe, and flourishing environment. When that happens, they will be the best ambassadors for the company. The second part is philosophical in that we want to give back to the community. This has nothing to do with public relations. For us, it is important to ensure the community benefits us, and I actually want to make sure that the people within my organization’s communities are served as well. The happier they are, the easier their lives and the better they get the job done. It is as simple as that. What room do you see for opportunity in the industrial sector?

As a business, the tendency we have is to look toward “dirty business,” as in things

to do with oil and grime. Not a lot of people go for it because it’s not a “sexy” business, but it is lucrative if you are willing to put in the time and energy. As a family, that is what we tend to move toward. I can’t see my family moving into IT, healthcare, or education, because there are many players trying to get into that market. When I see many people move toward a certain industry that is when I want out. I tend to go to businesses most people want to avoid. How does the Kanoo Group implement corporate governance practices in order to be a partner of choice for multinational investors?

We have had concepts of governance since the 1960s. We also do perpetual, ongoing auditing. For the longest time, we have also had a separate legal department. My uncle decided that if he was going to compete with the large multinationals from the UK in the 1960s, he might as well have an inhouse equivalent. Therefore, he brought in professional managers to do that and we created these splits for governance. This is something we have been doing for a long time and is nothing new for us.

IN NUMBERS Kanoo Group


years of history in the region



port calls every year

What is your outlook for Kanoo Group in the near term?

We are focused on whatever economy we are in, be it Bahrain, Saudi Arabia, the UAE, or Qatar. The question mark is not on the economical point of view, but the political. I am not worried about the internal politics in the region. I am more concerned with IS. I am interested to see what happens with it and how it will affect us, and the same goes for Syria and Yemen. I am also interested to see what happens between the US and Iran. All of this will either be positive or negative. There will be an immediate positive affect if something good happens between Iran and the US, a huge inflow of cash will come from Iran into Dubai. That is an immediate positive thing. The not so positive thing is that Iran might then start trying to influence the rest of the Gulf. That could be positive or negative, but these are the unknowns for us as a business. ✖






Yu Tao, President and CEO of China State Construction Engineering Corporation, on working on the Palm Jumeirah.

Rizwan Sajan, Founder and Chairman of Danube Group, on entering the Dubai market, branding, and the sector’s future.

Imad Dana, CEO of Al Zorah Development Company, on opportunities in the sector, and investor profiles.

Construction & Real Estate REVIEW CONSTRUCTION

The sound of Dubai’s bursting property bubble so rancorous back in 2009 is now a distant memory as vast Emirati and Dubai-specific construction and infrastructural schemes take elegant form in glass, steel, and concrete. In short, the familiar megaprojects remain in the limelight.



2014 IMF overview report on the UAE noted that the construction sector’s stake in the local economy was palpably lower in 2013 than in 2008 (8% vs. 14%, respectively) principally since economic growth now enjoys a more diversified base. And specific to Dubai, the report cited estimates of the Expo 2020 fueling Dubai’s economic growth, including employment, moreover; “…reinforcing the trend of returning confidence to the economy.” And, of course, extensive international attention to be reaped from World Expo 2020 has only added to the mood of general optimism, and will expedite the completion of core projects. Dubai’s construction market is effectively defined by 10 megaprojects worth up to $240 billion due for completion over the next six to 16 years.

MEGAPROJECTS THE BIG 5 With an estimated value of some $89.5 billion, Jumeirah Gardens crowns upcoming projects in Dubai. It foresees,

Image: China State Construction Engineering Corporation - CSCEC (Middle East)

Megaprojects are back on the menu as both domestic and international investors grow in confidence.

among other things, the construction of five skyscrapers, of which three are over 600m tall, a string of manmade islands, and the world’s most vertiginous Ferris wheel. A Meraas Development initiative, the scheme was, in retrospect, inauspiciously announced in October 2008 as global financial distress loomed. Yet the project, owned by the Dubai government, is forecast being completed by 2021. Dubai’s second most valuable project is Dubailand—a leading leisure, retail and residential hub, valued at $61 billion. First launched in 2003, part of the project has already been realized and is in action. Around 13 million people annually head for Dubailand’s Motor City, Sports City, and Outlet Mall. The scheme is scheduled for completion in 2020. Additions will include the City of Arabia, with a giant mall and entertainment park. In third place is Dubai World Central (DWC), aka Aviation City. Centered around the Al Maktoum International Airport, the $16.7 billion scheme comprises eight themed districts


DUBAI 2015

ranging from logistics and retail to humanitarian and aviation. One of the five scheduled runways became operational in 2014, with full completion of the project expected by 2030. The fourth scheme by value is Limitless’ $14.6 billion residential project Downtown Jebel Ali, which is followed by the Al Jadaf Area Development Culture Village [Arabian Bays] project of Dubai Holding. With a budget of $11.6bn, completion is due in 2023.

THE LANDMARKS CONTINUE The landmark projects include the ongoing Business Bay project, currently valued at $11.2 billion, which is expected to be fully completed in two years’ time; as well as Mohammed Bin Rashid City, which is being developed jointly by Dubai Holding, Emaar, and Meydan Sobha at a cost of $11 billion, and where completion is earmarked for 2023. On a budget of $10.9 billion Emaar’s Downtown Dubai development scheme is set for completion in 2020, when Meydan, too, intends to apply scissors to tape at its Meydan City project—price tag $7.3 billion. To this, one should also add the Dubai government’s Expo 2020 frenzy, which priced at $7 billion, should be shipshape by 2019.

SLIGHT DECELERATION According to industry data, Dubai’s property market has witnessed a slowdown in new launches following flat growth in property prices since mid-2014. Cited in Gulf News, real estate outfit Tasweek revealed an average drop in prices of 2% in January and February of 2015 from 4Q2014. Meanwhile, YoY transactions declined 20% in January and 17% in February. Another cited report forecast Dubai’s property prices in 2015 posting a flat performance, or else losing up to 10% for the year.

UNDER THE SKIN A project of any scale, much less the rethinking of an entire city requires adequate infrastruc-

ture that can be grown into as need arises. Back in February 2014, the Dubai Road and Transport Authority (RTA) signed off on a $1.9 billion budget for the construction and maintenance of roads. This step complied with the RTA’s FiveYear Plan (2012–16) and envisaged around 100 construction projects, among which are 50 new road, marine transport, and public transport projects. Close to 40% of the budget went to the RTA and just over 30% to RTA Rail. Dubai Metro today has two operational lines with another three to be constructed by 2020, 2025, and 2030. In conversation with TBY, President and CEO of China State Construction Engineering Corporation—CSCEC (Middle East), Yu Tao spoke of his firm’s longstanding involvement in meeting extensive infrastructural requirements. “Rapid population growth has created pressure on the existing infrastructure.” CSCEC (Middle East) has a proud infrastructure pedigree in the region spanning major highways, railways, and airport projects. “Hopefully, we are able to participate in Dubai’s Al Maktoum Airport as well,” he confided, adding that, “…with [our] proven track record of 40 airports around the world, we have a better chance to ensure the quality and timely handling of megaprojects.”


9.70% Glass & Mirrors

9% Marble & Natural Stone

8.80% Aggregates, Gravel & Sand

4% Ready Mix Concrete


1.90% Wires & Cables

The extraordinary global repositioning of Dubai, more specifically the construction that has underpinned is in its second decade, which as Jason Ruehland, Managing Director of facilities managers Emrill told TBY, has created a need for smarter maintenance solutions. “A smart city also means smart business, and one of our clients’ primary concerns today is predictive maintenance.” “Dubai’s landmark buildings,” he continued, “…are now about 15 years old and all of their assets are going to suffer failures and need repairs [and] through cloud-based technology we can monitor the performance and efficiency of their systems and assets.” Emrill has twice been named “Overall GCC FM Company of the Year” by FM Awards.

0.80% Bricks 0.00% Paints & Varnish -0.04% Proofing Products -0.40% Sanitary Ware -0.90% Pipes & Fittings -1.10% False Ceiling -1.20% Building Metal Products -1.90% Timber -1.90% Tiles & Flooring Materials -2.90% Cement & Gypsum

-5.80% Steel






Jumerihah Gardens

Meraas Holding




Dubai Holding



Dubai World Central

Dubai World Central



Downtown Jebel Ali




Al Jadaf Area Devel. Culture Village

Dubai Holding



Business Bay

Dubai Holding



Muhammed Bin Rashid City

Dubai H., Emaar, Meydan Sobha



Downtown Dubai




Meydan City




Expo 2020 Masterplan

Dubai Govt.




DUBAI 2015

PRICING THE PROJECTS Skyrocketing construction activity runs the gauntlet of spiking prices of construction materials and labor. Dubai is not alone in building the glittering cities of tomorrow, and competes for these resources with key regional power centers, such as the Qatari capital of Doha and the Saudi cities Riyadh, Mecca, and Jeddah, pursuing their own infrastructural ambitions. The 4Q2014 Construction Material Price Index (CMPI), a quarterly publication of the Dubai Chamber monitoring the price movements of 251 construction materials, shows that the price of steel and cement and gypsum had fallen YoY by 5.8% and 2.9%, respectively. In contrast, the respective prices of aggregates—gravel and sands and glass and mirrors—had risen steeply by 8.8% and 9.7%. The UAE is a substantial cement producer and exporter, yet the bulk of its labor is imported. And given the vast infrastructural projects the wider region is experiencing, workers are today brought in from beyond the familiar nations such as India and Nepal.

SAVE THE DATE On November 27, 2013, the Bureau International des Expositions (BIE) in Paris named Dubai as the host of the World Expo 2020. The main sectors to benefit from the event are the construction, hospitality, retail, and, to a degree, real estate sectors. Yet, there are broader economic ramifications. The transportation infrastructure that often materializes prior to a major international event like the World Expo or World Cup can yield the long term benefit of higher economic productivity. The IMF forecasts growth in 2021, in the wake of the Expo, declining from the 2020 peak, as experienced elsewhere after previous Expos. In the case of Dubai; “The decline would constitute a return to its long-term sustained growth of about 5-6% annually.” But first

of all, the Expo 2020 site itself will take shape in close proximity to the DWC and Al Maktoum International Airport. The site will feature roughly 700,000sqm of pavilions and 500,000sqm of permanent structures. Official data of the government of Dubai costs the site construction at around $6.9 billion. The event itself is estimated to generate revenues of $38 billion, as around 25 million visitors arrive to snap photos over a period of six months, with 70% hailing from beyond the UAE. To host them all, Dubai has to add 80,000 new rooms by 2020 to the current 65,000, according to Dubai Tourism and Commerce Marketing estimates. Key retail developments, such as the Mall of the World, will also be priority schemes that must be poised for action when the tape is cut on the big day. Asteco Property Management is one of the Middle East’s largest full-service real estate companies. Also touching on the theme of prioritizing, Managing Director John Stevens told TBY that “The market is maturing with more choice available.” He made an interesting distinction, however by stating that; “Whilst it is always nice to compare Dubai to London, New York, and Hong Kong, you are talking about cities that are hundreds of years old where land is at a premium. Meanwhile, Dubai continues to change and evolve.” And as Dubai grows into its new skin atop state of the art infrastructure, Stevens observes that; “While Expo 2020 is excellent for recognition and for the country as a whole, the new airport is going to be the key.” Construction remains big business. And as the population rises, not least with expansion of the expatriate community—itself swollen on greater confidence in the region—the sector will remain robust. Yet, successful economic diversification and the post-Expo 2020 landscape will see other sectors stand on its shoulders to make themselves better heard. ✖

BRIAN DAWES Regional Manager - Middle East, Applus Velosi What factors drove the bulk of your business in 2014? Our business is driven by projects, and the oil refinery is a nice example. The nuclear power projects ongoing in the Emirates are opportunities for us as well, and we do provide services there. In the last year or so, the number of new projects in the oil and gas business has fallen away slightly. There is more to come, of course, but when I look at the mix of investments and where capital is being spent, there are superb opportunities for us in infrastructure and construction, as well as the traditional oil and gas chain. How are you capitalizing on the opportunities which you see arising with various projects in the pipeline? One such opportunity is services in which we are already successful and well-established, such as lift equipment inspection. Every construction site

we see has huge tower cranes. They all need to be inspected and certified. It is very much the same service, and delivered by the same inspectors. The obvious thing to do is to take a successful service and replicate that success in another sector. The other thing we are doing is introducing new services, such as mechanical and electrical power systems. How do you view the level of regulations in the UAE? We have a thriving business here. The regulations, to some extent, are determined by ADNOC. They have their own standards. It doesn’t just come from government ministries, but the industry itself has regulations, which require that their operations comply with international standards. I believe it’s reasonably well advanced, which helps us. The accreditation authorities in the Emirates are keen on promoting international standards.

Construction & Real Estate




story-by-story What have been your major achievements over the past 10 years?

TBY talks to Yu Tao, President and CEO of China State Construction Engineering Corporation—CSCEC (Middle East) (L.L.C), on working on the Palm Jumeirah, targets for the future, and Expo 2020.

BIO Yu Tao has over 20 years of experience in the management of corporate affairs and construction projects. He is the Chairman of ASSAS, a special purpose vehicle between China State Construction Engineering Corporation CSCEC (Middle East) and SKAI Holdings. Under his leadership, CSCEC (Middle East) has developed a reputation as one of the leading and most respected construction companies in the region. He has led the successful diversification of the company from a conventional building contractor to a comprehensive total solutions provider. He holds a Master’s Degree in Project Management from the National University of Singapore and a Bachelor’s Degree in Civil Engineering from the Chongqing Civil Engineering Institute in China.

Around 10 years ago, we came to Dubai for the Palm Jumeirah, Villas-Garden Homes project. I still remember that when I looked at the master plan of Palm Jumeirah I felt it was like a dream, which really attracted me. By 2007, we had finished 65% villas on the Palm Jumeirah successfully. From there, we started to take large and more complex orders like Sheikh Khalifa Specialist Hospital and the Doha Tower in Qatar, which is considered one of the highest-quality construction projects in the world as the winning project of Best Tall Building Worldwide. And we are also delighted to see our involvement in Abu Dhabi New Airport Project as main contractor in the infrastructure and specialist in the steel structure and mechanical package. So far, we have completed over $4.3 billion in projects across the region and involved in the Viceroy Hotel project, which is our first instance as a developer in the region. We have been actively participating in GCC railway projects and major airport projects such as in Abu Dhabi and Kuwait. Hopefully, we will be able to participate in Dubai’s Al Maktoum Airport as well. We believe that as China State Construction, with its proven track record of 40 airports around the world, we have a better chance to ensure the quality and timely handing of megaprojects. What is the importance of your partnership with SKAI Holding?

It has certainly been a milestone. For our company, it is a transition to start investing in the Middle East, although it is nothing new to us as China State Construction, one of the biggest development and investment companies in the Chinese market. To further

diversify our business, it is important to shift our focus more toward development and investment. We take the Viceroy Hotel as the first step and we believe in the partnership with SKAI Holding. What are your expectations for the construction sector in the lead up to Expo 2020?

The Expo 2020 will definitely provide contractors with more opportunities. The government will increase its budget to further complete and improve infrastructure. Compared with the neighboring countries in the GCC, Dubai probably has the best infrastructure. Nevertheless, the population is increasing rapidly. Rapid population growth has created pressure on the existing infrastructure. With the Expo 2020 attracting tens of millions of visitors, infrastructure will become extremely crucial to Dubai. We have noticed that the authorities are also building more theme parks and other leisure facilities. Of course, Expo 2020 itself is a project similar to one we experienced in Shanghai at Expo 2010, where we have built dozen of pavilions for various countries. Also, we believe Expo 2020 will bring positive to the image of Dubai and bring more business opportunities in the hospitality sector. What are your expectations for the investment climate in Dubai over the next year or two?

We will all feel the effect of falling crude oil prices. Concern over its impact on the UAE will always be there, as it is one of the major oil-supplying countries. However, I don’t think it will have a major impact on the country’s spending. Dubai has not depended on oil for many years. After it further improves its infrastructure and assumes new projects to be built, we will see the market grow. The property market



years of history in the region



billion worth of projects in the region

Just made its first investment as a developer, worth


billion, with SKAI Holdings

was really booming in 2013 and made Dubai one of the world leading property markets. However, it has stabilized in 2014, which I read as a positive message for long-term, sustainable growth. Consolidation is always required if prices increase too quickly. Generally, it is good to see that Dubai is recovering from the last financial crisis and coming back on the right track. In the coming one to two years, we should see something more positive, especially with the improvement of the business environment in Iran, which I believe will probably bring in more business opportunities to the UAE. ✖


DUBAI 2015


square foot in the door

Danube Group expecting between 10% and 15% growth in 2015

TBY talks to Rizwan Sajan, Founder and Chairman of Danube Group, on entering the Dubai market, branding, and the sector’s future in the Emirate.

How would you describe the strategy behind Danube Group entering the property development market, and what is your strategy going forward?

Going into development was simply following the evolution of the company. It has given us an edge over the other competitors. We always work in places where we have good synergy as we become a developer. The brand name was already there. After Dubai won the right to host Expo 2020, the market stabilized unlike before, so we felt that this was a great time to begin developing. Looking forward, I want to go cautiously and not do too many projects at one time. I want to take one project at a time, sell that project, consolidate, and move forward. That’s what we’ve been doing in the last two projects. We bought some land, created a mass development, offered it in the market, sold it, and then went for the next property. How would you describe the theme of your developments along with the customer segments you are targeting?

We are always targeting the middle-income market of people with salaries of around $6,800. We never go for luxury. This middle-income bracket should be able to afford our projects, and there is also a vacuum in that segment.

How will the brand of Danube’s property development arm evolve over the years?

Emaar and DAMAC are good brands and have developed and done well in the past. After them, in my segment, there is not a single branded company that is available in the market. For example, the property that I recently sold, Glitz, was selling for $245/sqf, but my competition, which is a bigger brand, could sell the same thing at $340/sqf. They are able to get that higher price, but I am targeting the mid-segment market. In the mid-segment market, I cannot see any other brand that is evolving around us and therefore, we have a strong advantage in the market. We have a good reputation and credibility in the market. People know that we have been here for the last 20 years, and have been a building materials company for years. How does that reflect the market trends in the UAE as a whole?

At the moment, the market is a little slow compared to what we saw last year. The market went up after the Expo 2020 decision, then after Ramadan it dropped off. Property values fell, especially in the luxury segment, but it’s starting to pick up again and we can see some movement now. Hopefully

it should go up. In the long term, I believe that growth of 15% to 20% can be expected in the years to come.

$400 million in property development projects per year

What are your expectations for the real estate market in Dubai going forward?

There is definitely going to be demand for real estate in this market because of the number of people migrating to Dubai. Also, rentals have gone up by 50% in the past six months. This shows that there is a shortage of supply of real estate in the market. Not many developments are coming onto

BIO Rizwan Sajan is the Founder and Chairman of the Danube Group. The head office and logistics facilities are at the Jebel Ali Free Zone (JAFZA). Danube has transformed from only one shop with three employees to over 40 locations in nine countries worldwide, including the UAE, Oman, Bahrain, Saudi Arabia, Qatar, Africa, and India, in addition to procurement offices in China with an employee strength of over 2,200 people. He is supported in the business by his brother Anis Sajan and son Adel Sajan.

the market. There are some buildings, but that does not really satisfy the demand in the market. I predict that in the next three or four years, the market will be busy for real estate. What does your success say about Dubai and the UAE as an investment climate?

Dubai is always a land of opportunity. If you are doing your business in the right way and have the right product to offer in the market, Dubai will provide you that opportunity. For example, we have been in Jebel Ali for many years. For any problem, we just have to walk into the CEO’s office, explain our problem, and they will find a solution for us. They do not make you feel like you are a private company. They let you work freely and allow you to grow within the country. That is part of our business plan in the Middle East and other places also, so the way Dubai helps business people is impressive. That is the reason for our success in this country. ✖

Construction & Real Estate



The rising population of Dubai is producing a new set of problems for the Emirate and its population, as the government looks at different ways to provide ample affordable housing for its citizens and workers.



A RISING PHOENIX The current slump in oil prices is likely to slow down investment in the short term; however, due to the diversification of Dubai's economy it is unlikely to dramatically affect the real estate market, as it is less vulnerable to oil price fluctuations. The outlook for 2015 is positive, largely because of increased government spending, which saw planned spending and revenues increase by 9% and 11%, respectively. This boost in spending is predicted to spur business activity in the sector. Still, while the future looks rather rosy, after a number of uncertain and cloudy years, a few people are still wary that pressures on the cost of living as inflation tops 4% in November 2014—in addition to the rising house prices and utility costs—could slow the market, making it harder for a family to find that extra cash to buy a new home. Another problem for 2015 is the 15% reduction in infrastructure spending, which will likely slow down the construction sector. Yet, while there are some possible bumps on the road, the general atmosphere in Dubai is positive, with new megaprojects under way and stabile period forecast.

RESIDENTIAL The residential sector ended 2014 on a quiet note overall, with rental and sale prices stabilizing recently. The price of sales and rentals stayed flat at 0% from 3Q2014 to 4Q2014 for an apartment, while between 4Q2013 and 4Q2014 sales prices rose by 23% and rental prices by 18% according to JLL. In terms of villas, again rental prices remained flat

at 0% while sale prices fell slightly by 1% between 3Q2014 and 4Q2014 according to JLL. In YoY terms, however, sale prices rose by 12% and rental prices by 5%. In terms of current supply, there are 377,000 residential units in Dubai as of 4Q2014. In 2015, a further 25,000 units are expected to come online with 13,000 more in 2016 and 12,000 more in 2017. In 2Q2014, occupancy rates in Dubai stood at 85% according to Colliers International, which represents a healthy market. Yet, high demand and a falling supply over the next few years is likely to lead to an undersupplied residential market. Steady prices and an increase in supply will come as a relief to some, as the Emirate is looking to address the situation of a lack of affordable housing for the middle and lower classes. According to Colliers International, 50% of households in Dubai earn between $2,450 and $4,100 per month, which means they would be able to afford an apartment in range of $8,700 to $14,700 per annum. The average household spends 30% of its income on housing; however, this is likely to rise as rental prices increase. In the US and Australia, the governments have set the affordable housing benchmark at 30% of income, while in the UK this is lower at 25%. In areas where affordable housing exists, such as Jumeirah Lake Towers, Discovery Garden, International City, and Deira, according to Colliers International rental prices have increased by some of the highest rates of 30-35% between 2Q2013 and 2Q2014, somewhat above

There is a considerable amount of new real estate in works across all fields as the Emirate leaves the consequences of the financial crisis behind.

DUBAI 2015



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the average for that period of 22%. Ironically, the high demand for affordable housing is making it more expensive and putting it out of reach for some. Currently, those earning around $3,200 a month are not only limited by location, mainly International City, Deira, Qusais, and Al Nahda, but also by size according to Colliers International. It is only International City where a someone could afford something larger than a studio; however, if someone were to earn $6,800 a month, then their options become much more open in both the size of apartment and its location.

tween 4Q2013 and 4Q2014 from $503 to $509 representing a 1% rise in YoY terms. With the predicted arrival of 1.2 million sqm of further stock throughout 2015, demand is expected to remain strong, especially for single-owned buildings in already established locations where rental prices and occupancy levels will remain stable. However, the influx of new office space will likely apply a down force on rental prices overall as tenants seek to consolidate there operations and optimize their use of space in one location. In addition, across the CBD vacancy levels will most likely rise as more Grade A stock comes online. Still, one of the main trends in the market currently is that pre-leasing interest is strong as upcoming projects, such as the Dubai Trade Center District and the Dubai Design District, edge closer to becoming fully operational. This shows a willingness of tenants to commit and hold out for high quality, Grade A office space despite the existence of secondary offices on the market. Key sectors that are likely to affect the market are IT and technology. The Dubai Multi Commodities Center (DMCC), masterminded by Astro Labs and Dubai Investment Development Agency, is a new hub that is specifically targeting new technology start-ups. Average monthly rental prices per sqm are between $400 and $800. The DMCC

OFFICE SPACE Dubai is a globally known for being one of the business centers of the world; hence, when it comes to office space there is ample. As of 2014, there was 7.6 million sqm of office stock in the Emirate of Dubai, up slightly on 2013 when there was 7.2 million sqm of office space according to JLL. Over 2015, there is expected to be a significant jump in the total capacity as a further 1.2 million sqm of stock will come online; however, over 2016 and 2017 this drops considerably as an only 455,000 sqm of space will open up over the two years. This massive upcoming of new office space is likely to affect vacancy rates and in turn rental prices. In 4Q2014, vacancy rates in the Central Business District (CBD) stood at 29% and fell slightly to 24% in 4Q2014 according to JLL. The rental price per sqm remained steady over the year be-

REZA BIJANI Managing Director, RBA Real Estate The laws in this country are strict. That is why we will not do sales or introduce a project unless it has proceeded to at least 50% of completion. That way, we are sure that we can deliver the project. It has been a successful model because most of the developers that enter the market wanting to sell off-plan are sacrificing profit. They are putting their prices down to secure future construction, which is wrong because you don’t make enough money, and if the market crashes, then you won’t have enough money to complete your projects.

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provides new business with all the required modern amenities for a new company as well as guidance and a close proximity to Jumeriah Lakes Towers, located less than 10 minutes away. The free zone is already home to over 9,800 businesses from SMEs to large corporate entities and looks set to continue rising.

RETAIL Dubai is world renown for its retail sector and the figures look strong for 2014. In 2014, there was 2.9 million sqm of gross leasable area (GLA) in Dubai, a figure that is set to continue to rise over the next few years. In 2015, a further 267,000sqm of GLA will come online, while in 2016 more than 330,000sqm of GLA is set to hit the market. This trend continues in 2017 with a predicted 219,000sqm of GLA opening, which will bring the total to an expected 3.7 million sqm of GLA according to JLL. Vacancy rates in the Emirate have fallen recently from 12% in 4Q2013 to 8% in 4Q2014. This relative lack of supply has forced rental prices up quite considerably over the same period from an average $1,080 per sqm per month for Grade A rental space in 4Q2013 to $1,377 in 4Q2014, which represents a 28% increase. The same can be seen in Grade B rental where prices rose from an average $470 in 3Q2013 to $605 in 4Q2014, again representing an increase of around 29% according to JLL. However, market experts predict that because of the increased supply planned over 2015, rental prices will likely remain stable.


This trend can already be seen in the fact that rental prices between 3Q2014 and 4Q2014 did not show significant increase and nothing like the rise seen over the year. Vacancy rates will also likely remain stable even though there is a considerable amount of stock entering the market. The demand for space is strong and set to remain this way as a number of foreign brands look to enter the market. Any new stock will be snapped up as shops reorganize and new companies enter the market allowing the vacancy rate to remain around its current 8%. When people think of Dubai, they naturally think of its megaprojects and iconic skyline. There is a considerable amount of new real estate in works across all fields as the Emirate leaves the consequences of the financial crisis behind it. A testament to this is the fact that the Emirate currently has $240 billion worth of megaprojects set for completion over the next six to 12 years. The largest of these projects is Meraas Holding’s Jumeirah Garden City, which is estimated to cost an eye watering $89.5 billion. The new city will regenerate 9 million sqm of land and was developed during the Dubai Strategic Plan 2015. Once complete, the development will consist of 12 districts and a built-up area spanning 14 million sqm. The city will have a population of between 50,000 and 60,000, who will be able to travel to Dubai central via a new light-rail system. Projects such as this are key indicators that Dubai’s real estate sector is back on track. ✖

While there are a number of new projects coming online over the next few years, demand for office and retail is set to remain strong and stabilize prices in the short term.


DUBAI 2015


extended STAY What are the main benefits and advantages for investors wanting to invest in the area?

TBY talks to Imad Dana, CEO of Al Zorah Development Company, on opportunities in the sector, investor profiles, and his outlook for the future.

BIO Imad Dana has been acting, since 2007, as CEO of Al Zorah Development Company. Earlier, he worked with Solidere Lebanon for over 12 years as Senior Project Director. A professional Civil Engineer, he holds two Master’s degrees in Environmental Engineering and Construction Management from the State University of New York.

Al Zorah was established by a joint venture between the government of Ajman and Solidere International. The government brought the free zones and Solidere brought all its expertise in making cities. After these master plans, the investors are going to enjoy both Ajman as an emerging Emirate and Al Zorah as an integrated project, also emerging as a community with a good lifestyle and a lot of attributes that investors like. Apart from starting a business and getting the reputation and residency associated with that as a free zone area, you can get a package deal as a free zone area and all the properties. The mixed-use aspect is catering to many investors. There are land investors that can build their own projects. Also, Al Zorah makes a lot of sense business wise. It is masterfully crafted, so it is something that will sustain itself over time. It’s not something that you just come in and come out of; real estate is about value creation. As time passes, the value will become higher and higher. What kind of investors are investing in Al Zorah?

We started with the big investors interested in buying land to develop. Now, we are offering villas in a limited number with the best scenery, like on the Gulf. In Phase II, we will offer apartments by the beach or around the marine and townhouses on the Gulf. This is a free zone, so the profile of the investors is people who are

IN NUMBERS Al Zorah Development Company

Phase I expected to be finished


42 residences

looking to come to Al Zorah to have 100% ownership over the land. Once a business is established, you get residency. The Al Zorah Free Zone Authority issues trade licenses, in that respect. Once you get your trade license, you can get residency and bring in employees and enjoy zero taxation. From a business point of view, it’s not just that the quality is amazing, but also that it makes so much sense because of zero taxation, and because it’s an easy place to establish a business and operate. Investors that work with us are more worried about value than anything else, so we create the right value for their money and we are committed to continuing this job at the right place so we don’t overdo or underdo it. We want to present value for people. We have done it elsewhere in

the world. That’s why here we don’t over build; we have just the right amount. If things slow down in the future, I think Al Zorah will be in the right position to sustain the changes in the market. What is the current status of the master plan?

The master plan is well advanced and Phase I should be completed by the beginning of 2016. It will include all of the main infrastructure, while an 18-hole golf course, villas, two five-star resorts on the beach, and four marinas have already been completed. One of the marinas will be ready to receive boats during Phase I. The best part of this project is the nature. We have natural mango trees that are second to none. You can bring your kids and go kayaking. You can see pelicans and 52 species of birds. You are in touch with nature. That’s a big asset that doesn’t exist in many places in the UAE. What are your future plans of expansion?

We build places for life. We are really passionate about our business. In the last 25 years we have taken the business from Lebanon and made it international. Apart from the locations we are already in Saudi Arabia, the UAE, and Lebanon, we are now looking into three new international destinations. Our investors like those destinations and they are very promising. We are now very strong regionally and we will become more international in the coming years. ✖

Construction & Real Estate





ISEEB REHMAN CEO, Sherwoods International Property


he consumer here is looking for assurance and comfort in their securities rather than their returns. Security has topped the agenda for investments, and so our research has gotten us up to speed. We have tied up as an exclusive agent in the Middle East with a developer from one of the richest families in Frankfurt, and in London we have added additional strength with our team on the ground. We are working with a number of financial institutions to serve key investors in Europe and Spain in particular. In established markets the realtors are happy with an 18-21% profit. Here, unless they get 200% profit they wonder what is going on, but the approach has to be reasonable. The challenge ahead will be for people to be realistic in the price that they offer, and the terms of consumer expectations is going to be higher. The transaction volumes will dictate the price as well as the payment plan regardless of the project.

NICHOLAS MACLEAN Managing Director, CBRE Middle East


ver the last two years, corporate institutional and family investors from the GCC have been improving the diversity of their real estate investment holdings. This has meant that we have seen, and in my view will continue to see, an increase in the amount of capital flowing to overseas markets, particularly the UK. This should, in due course, increase the liquidity of the Dubai market by freeing up investment opportunities held by local companies. At the moment, a key weakness in the Dubai real estate sector is the lack of availability of product, particularly income producing, to foreign investors. One of the most important differences that we see in this market from the previous cycle is the interest shown by overseas investors, particularly seeking to spend capital originating in Asia Pacific. Dubai’s commercial and residential sectors are at different positions in their respective cycles and the strong rental and capital growth that the residential markets experienced in 2013 has now stopped as the market adjusts itself to unsustainable levels of growth. We expect to see a decline in rental values in the middle tier residential locations.

Firms involved in the sector are considering ways to deal with changes in property values, as falling oil prices transform the local economy.




Managing Director, Asteco Property Management


roperty prices in Dubai have had a lot of publicity, mainly around residential prices, because we have seen a great deal of growth in the last two years. The rate of growth stabilized in mid-2014, which is a good thing. Growth rates of 30% per annum are just not sustainable. The measures taken by the government and Central Bank have had the desired effect and the danger of overheating has been taken out of the market to a large extent. We now see the market as active with a sustainable growth pattern. In terms of actual property prices, although they have risen considerably, they have only come back to where they were in 2007-08. In terms of property prices, especially in the office market, Dubai’s are favorably low compared with most similar cities around the world. This is beneficial because it makes Dubai that much more attractive as a place for companies to come and for people to live.


n terms of the cost of living, one thing we are seeing this year with the supply coming into the market is stabilization, if not a decrease in pricing. If you were at Cityscape last year, most of the properties were high-end, very expensive luxury apartments and villas. This year it was all about affordability. If you look at the market as a whole, our report said there was actually a slight contraction in prices over the last quarter, but YoY there is still phenomenal growth. In terms of the rental side, with the rent caps, we may be seeing rents come down slightly. Everybody thinks this means their rent is going to be cheaper, but that is not really the case. If you have been in a property for 10 years, you are caught by the rent cap, and are probably paying 50% less than what the landlord could get if you moved out. The market rent may have come down by 1%, but the majority of tenants are still paying considerably less.


DUBAI 2015


ALL THE WORLD A city within a city, Mohammed Bin Rashid City aims to attract visitors and residents with its use of green space, attractions, and luxurious residences. The development is currently ongoing with construction and sales beginning in District One, Dubai Hills Estate, and Dubai Creek Harbour.

MBRC hopes to add a new feather to Dubai's already impressive cap

IN LINE WITH Dubai’s aspirations to become a world-class tourist destination along with maintaining top-notch residential accommodation for its inhabitants, Mohammed Bin Rashid City (MBR City) is set to accomplish both. Located between Sheikh Zayed Road, Emirates Road, and Al Khail road, MBR City will contain sprawling parklands, the largest shopping mall in the world, Mall of the World, and will include more than 100 hotels, golf courses, a hub for the arts, and centers to develop small businesses. The concept was originally launched in 2008 and looked as though it was going to be another victim of the real estate market collapse due to the financial crisis. However, since the exit of the financial crisis in 2013 and Dubai’s rapid economic rebound, the project is back on track with construction already in progress on District One, Dubai Hills Estate, and Dubai Creek Harbor projects. In late January 2014, HH Sheikh Mohammed Bin Rashid Al Maktoum inaugurated the District One development of MBR City, an urban, mixed-used, leisure, and sports development. District One is being developed by an equally split joint venture between Meydan, an Emirati project developer, and Sobha, a leading Indian real estate player. Alongside Al Khail Road, adjacent to Meydan Racecourse, and less than 3 km from Dubai’s downtown, it will be a community that will be considered one of the world’s lowest density residential

villa projects. About 65% of the project’s land area will be made up of parks and waterways. Attraction points feature a 350,000sqm water park, the largest crystal lagoon body of water in the world with 7km of lagoons, and manmade beaches alongside retail zones, leisure, and sports attractions. District One is set for construction in four overlapping three-year phases. The first three-year phase includes the construction of 375 villas, features a water lagoon, park, and show village that will serve as a prototype for the residential area. The first phase of the project is set wrap up in 2016 with total completion before World Expo 2020. One of the world’s largest project developers, Emaar Properties, together in a joint venture with Meraas Holding, has also recently unveiled a new collection of residential apartments in Dubai Hills Estate, an integrated master-planned community that marks the first phase of MBR City. Set on prime land, spanning over 11 million sqm, Dubai Hills Estate features vast stretches of landscaped parks and gardens, winding walkways, and extensive open areas. At the heart of Dubai Hills Estate neighborhood will be an 18-hole championship golf course, an iconic commercial center, high-end retail centers, as well as low-rise and mid-rise residences, hotels, and service apartments. At the end of February 2015, following a strong investor response to the earlier introduction of Mulberry at Park Heights, Emaar Properties has launched sales at its newest residential development in Dubai, Acacia at Parks Heights. Alongside its Dubai Hills Estate development, Emaar Properties is also launching the Dubai Creek Harbour project within MBR City in partnership with Dubai Holding. The grand master plan will be three times the size of Downtown Dubai and has been designed to accommodate 39,000 hotels and 22 hotels. The Dubai Twin Towers, an iconic mixed-use development billed to be the tallest twin towers in the world, will be at the center of the development. This project will be developed in phases and the first phase, called Dubai Creek Residences, will be a cluster of six towers. The towers will stand at 40 stories with apartments ranging from 900sqft to over 2,150, with one, two, and three bedroom residences. The first phase will also include retail elements along with three hotels, including Vida and Manzil branded properties. The first phase is scheduled for completion and sales began last year, although there has been no word when the construction is set to begin or a completion date for the Dubai Twin Towers. ✖

Construction & Real Estate




BEHIND the scenes Finding a market originally unprepared for the long-term maintenance of Dubai’s multitude of buildings, FM firms are making solid progress in the Emirate.

JASON RUEHLAND Managing Director, Emrill


he market is not just residential or corporate as there are schools and healthcare providers to consider. A smart city also means smart business and one of our clients’ primary concerns is predictive maintenance. They ask us to predict an asset failure, rather than deal with a real one, which we are fully equipped to do. Traditionally, your service provider fixed a vroken asset. Now, Emrill can predict and address problems before anyone knows that there was one. We have brought much technology and innovation to the market including temperature, vibration, and flooding sensors. Dubai’s landmark buildings are now about 15 years old and are going to suffer failures and need repair. Through cloud-based technology we can monitor the performance and efficiency of their systems and assets.


e are moving forward with 4,500 employees, which is not an ideal model. I am sure we could use a lot more technology to reduce the number of staff. We are considering creating a much larger control room as well. This would mean that before we send any teams to check on a building we have all the necessary information from the remote system. This kind of technology will help the future of facilities management. The Middle East Facility Management Association (MEFMA) LEED certification program will also add value to the company and the industry. We aim to have categories for facility management that will be four or five star, which will make it easier for clients to select the right facilities management services and company. As with hotels, there should be a list of requirements to fulfill, a certain level of certification, and a minimum number of services being provided for a business to obtain a particular facilities management rating.





ubai is far ahead of the regional market, but unless that market recognizes the need for intrinsic values—cost of resources required to provide a definitive output— they will remain under pressure to build a sustainable FM services industry. Our focus has been on creating a brand that reflects a strong value system. The core values are transparency, delivery, and sustainability. We have large, multinational clients, and within that, different industries—banking, oil and gas, integrated workplace, and so on. In addition to this diverse portfolio, I also work with large local businesses with government and non-governmental companies. We have continued to outperform the market average compound annual growth of 22% on growth of 25%. While there have been challenges in the Middle East, we have seen growth in the Indian subcontinent. We have been able to expand to Sri Lanka and have grown 50% in India over the past year.

CEO, Ejadah


f we go back to the very beginning Ejadah’s founders had the foresight into Dubai’s real estate industry and identified a fundamental gap in the sector at the onset. This was the sustainability of buildings, infrastructure and communities. Since our establishment, we preserved this as the essence of the group and cemented our core competencies in delivering this value to industry stakeholders. Dubai’s real estate industry quickly became an international marvel as developers started breaking ground with spectacular buildings, putting the city on the world map and driving the establishment of

the facilities management sector. We take the UAE’s vision very seriously and embed systems and processes in our business to support this vision. Technology, marketing orientation, supply chain management and sustainability are key business focus areas. It’s important to understand where our business is today. We manage more than 115 million sqft of commercial, residential, public and leisure communities. While we do this, we impact all community stakeholders whom we consider to be all our customers, including developers, government bodies, investors, landlords, individual owners, tenants, and visitors.


DUBAI 2015



Shifts in the dynamics of the property market are evident in new client profiles for the sector’s major companies.



Chairman, Pacific Ventures

CEO, Azizi Developments


he outlook for Dubai is extremely positive, but the critics are never satisfied. One moment it’s a property bubble, when the market is experiencing growth, and the next the market is down, when it’s stable. Dubai is the best property development market in the world right now. Market values are solid and investments continue to flow. To succeed in the real estate market it is essential to have a five to 10 year vision, and to be able to look ahead with a keen eye on opportunities for growth and development. Our company is steadily growing and diversifying into boutique hotels, malls, and affordable housing. We have concrete plans for the next five years and Expo 2020 will impact our business too. My aim is to promote different areas of Dubai that link to the Metro, which will be very conveniently located near to the Expo 2020 venue and the airport. The government is currently establishing a viable, clean, and transparent environment for real estate development. Most of our current projects will conclude in 2016, so I am currently focusing on new projects and acquisitions with commencement dates of 2017 and 2018.


he demand for housing is high. Rental prices are going up, and all this helps investors decide to come here. Lower oil prices will not affect individuals, only the government and its spending, while individual’s salaries stay the same. The governments might change their programs or tap into their savings, but we haven’t seen any changes in terms of salaries or people being affected. Even though Europe is an attractive place for investment, the UAE, and specifically Dubai, is considered a good investment destination in terms of tourism and construction and other activities going on here. Prices have dropped down in terms of real estate, meaning that many have decided to buy, rather than rent. That helps us a lot in terms of getting investors. We do have some international investors that want to tap into real estate in Dubai, but mainly our residents either live in Dubai or the GCC. Mainly these people come here a lot to do business in Dubai, so they don’t mind having a unit here as a home. The prices for hotels are high, so it’s a win-win situation. Time sharing doesn’t exist here yet, so that also helps a lot.



ur main business is property development. We decided to develop Bay Gate because Dubai is a business and a tourism hub, so there are two directions to take. At the time of deciding what to develop, we noticed significant demand for a stand-alone, single owner, office towers. We chose the location because it is downtown, which is the heart of the Dubai business community coupled with the close proximity to the metro station. The project is expected to be completed in 2Q2015, and for us this is a grand achievement. At the moment, we are reviewing and studying other developments in Dubai, which could include the hospitality sector. The most important thing is that international partners have to be aware of the local market. The Dubai market is a tough one for those just beginning to enter. However, provided that you know your business, it can become quite comfortable. With this, it is important for international investors to have a local partner. We have all the multi-national companies from all over the world, but this is based on demand and evaluation. Whenever there is a slowdown in one area, then people will go to another, and we have seen different nationalities from all the continent.






HE Dr. Raja Al Gurg, ViceChairperson of the Dubai Healthcare City Authority, on a sustainable healthcare model.

The first phase in the grand transformation of Rashid Hospital is scheduled for completion in 2Q2015.

Dubai is attractive to medical tourists from around the world, but more opportunity exists for offering high-quality services.


The Emirate’s healthcare sector is thriving amid new hospital construction, a focus on preventative care, a burgeoning medical tourist sector, and noticeable patient satisfaction.


ealthcare in Dubai is closely connected with the Dubai Health Authority’s (DHA) strategic 12-year plan centered on initiatives to support Dubai’s growth as a wellness hub for residents and medical tourists. DHA launched the Dubai Health Strategy 2013-25 under the approval of HH Sheikh Mohammed Bin Rashid Al Maktoum, Vice-President and Prime Minister of the UAE and Ruler of Dubai. The strategy aligns itself with HH Sheikh Mohammed’s Dubai Strategic Plan 2015. The Dubai Health Strategy has a special focus on providing the Dubai population and the Emirate’s visitors access to internationally-recognized healthcare. It also lends particular attention to increasing medical tourism in Dubai, improving customer service and making strides in preventative care. Director-General of the DHA, HE Engineer Essa Al Haj Al Maidoor, outlined the Dubai Health Strategy’s vision in a 2013 address to


Image: GulfDrug

Compulsory health insurance comes to the Dubai as the DHA’s 12-year strategy moves steadily forward.

DHA employees at the Rashid Medical Library, at which he stated, “Medicine is a noble profession, and we are all lucky to be in a position where we can, through our individual roles, take care of the health of our community members. For us all, going forward, customer care has to be priority.” In attendance were HH Sheikh Mohammed Bin Rashid Al Maktoum, HH Sheikh Maktoum Bin Mohammad Bin Rashid Al Maktoum, Deputy Ruler of Dubai, and HH Sheikh Hamdan Bin Mohammad Bin Rashid Al Maktoum, Crown Prince of Dubai. “Patients and their families need our outmost care and compassion,” said Al Maidoor. “Excellence in healthcare services and customer care must go hand-inhand.” The Dubai Health Strategy’s main objective is to meet the World Health Organization’s motto of the twenty-first century: “Healthcare is for everyone.” According to the DHA, this will be obtained through 17 operational goals and the delivery of 43 initia-


DUBAI 2015

There are about 20 health centers and peripheral clinics throughout the Emirate, providing a ratio of one center or clinic for every 30,000 individuals. One of the DHA’s top priorities is to increase hospital capacity, achieved through the construction of three new hospitals and 40 additional primary healthcare centers. tives supported by an enhanced control plan and Key Performance Indicators (KPI). There are five main pillars of the strategy: raising awareness and prevention; increasing access to services; enhancing quality of care; growing investment; and increasing competitiveness. There are about 20 health centers and peripheral clinics throughout the Emirate, providing a ratio of one center or clinic for every 30,000 individuals. One of the DHA’s top priorities is to increase hospital capacity, achieved through the construction of three new hospitals and 40 additional primary healthcare centers. In addition, the strategy aims to increase hospital catchment areas to a 12km radius and to have all healthcare centers within a 5km radius. In March 2014 the DHA announced that it plans to build 22 hospitals in order to attract 500,000 medical tourists per year. In 2012, 107,000 medical tourists visited Dubai, and numbers are expected to increase in 2016 to 170,000. The UAE’s Ministry of Health has predicted that by 2020 over a million medical tourists will visit the country every year. In order to support this influx, the DHA has embarked on long-term collaborations with the Department of Tourism and Commerce Marketing, the Department of Economic Development, and the General Directorate of Residency and Foreigners' Affairs in order to provide visitors with visas, accommodations, and city tours.

The DHA has also found a valuable partner with Dubai Healthcare City (DHCC). Launched in 2002 by HH Sheikh Mohammed to meet Dubai’s demands for patient-centered, high-quality healthcare, DHCC is the largest healthcare free zone in the world. It is home to two hospitals and more than 120 outpatient medical centers and diagnostic laboratories, as well as the Mohammed Bin Rashid Academic Medical Center. DHCC received a record 1.2 million patient visits in 2014, up 20% from 1 million visits in 2013. Patients included 15% medical tourists out of which 45% came from the GCC, 32% from the wider Arab World, 26% from Eastern and Western Europe, and 23% from Asia. The most popular procedures were infertility treatments, cosmetic treatments, and dental procedures. Last year the DHCC recorded 748 new licensed healthcare professionals bringing the total number of healthcare professionals working in the City to 4,534. Nine new healthcare facilities became operational.

INCREASING ACCESS In line with the goals of the Dubai Health Strategy 2013-25 to increase hospital catchment areas, the DHA will build three new hospitals; Sheikh Mohammed Bin Rashid Hospital on Sheikh Mohammed Bin Zayed Road, Al Maktoum Hospital in Jebel Ali’s Al Maktour Airport area, and Al Khanwaneej Hospital. The DHA has already embarked on the $800,000 million (AED3 billion) expansion of the 100,000sqm Rashid Hospital, with the first phase scheduled for completion in 2Q2015. Rashid Hospital will offer 24/7 services. The expansion, focusing on green technology utilization and sustainability, will also triple capacity. Initiatives include the opening of six new specialized health centers, including centers for day-care surgery, oncology, ophthalmology, and hematology. The project will also include expansion of Rashid Hospital’s Trauma and Emergency Center with the addition of 160 beds and 116 treatment rooms. Develop-

MARWAN ABDULAZIZ JANAHI Executive Director, DuBiotech and EnPark What role do DuBiotech and EnPark play in creating a platform to stimulate R&D? The UAE has a special story to tell. We are a young country and although we have achieved great things in a short time, there are still elements that we need to improve. For example, we have traditionally been import reliant, especially when it comes to pharmaceuticals. Current levels of imported drugs are at around 85-90%, which is an expensive way for us to procure medication for our residents. However, there are many generic drugs that could be produced locally, especially as the sector is currently facing a “patent cliff,” and, therefore, the potential for even more to be produced

here is rising. In addition, the population of the UAE is rising and access to the GCC is becoming easier. How are DuBiotech and EnPark bringing academia and industry together? We play an active role in this; we realized that there is a gap between industry and academia. As part of my ambition to bridge this gap in January 2014, we held a panel discussion, including experts from across the life science industry, where a key outcome was the need to create a platform for these two sections to meet, discuss, and network. This resulted in an internship and career fair.


DUBAI 2015

ment will be based on the concept of a pre-engineered building where the center can continue to function as usual, while expansion work is underway. In addition, the hospital has opened a new gastrointestinal and oncologic surgery outpatient clinic focused on providing effective treatment of benign and cancerous gastrointestinal conditions. Expansion at Rashid Hospital will also include the building of two hotels on either side of a 500bed rehabilitation center to accommodate patients’ visitors, numerous amenities including green, open spaces for families, as well as staff housing. Lastly, there will be the addition of a dedicated outpatient building with a floor dedicated to dentistry. Under new legislation signed in November 2013 by HH Sheikh Mohammed, health insurance has become compulsory for all Dubai residents. The law went into effect in February 2014, and implementation will happen in phases through mid-2016. The first phase, implemented October 2014, requires companies with 1,000 or more employees to provide healthcare to employees. According to DHA Director of Health Funding Dr. Haider Al Yousuf, this phase affected over 200 companies in Dubai, including those within the free zone, and more than 1,000 employees. In phase two, smaller companies (with 100-999 employees) will have until the end of July 2015 to provide insurance. The final phase will be completed by the end of June 2016, by which companies with fewer than 100 employees have to comply with the law. “Overall there has been a lot of cooperation,” explained Dr. Haidar Al Yousuf. “Dubai is looking to have one of the best health insurance systems out there.” Known as the Insurance System for Advancing Healthcare in Dubai, or Isahd, meaning “happiness” in Arabic, mandatory health insurance will both increase access to services for Dubai residents and draw in medical tourists. “Health insurance is a big issue because it is a vital mechanism which will keep this big engine that we have moving,” says Director-General Al Maidoor.

CUSTOMER SATISFACTION In line with the Dubai Health Strategy to make substantial improvements in customer satisfaction, last year the DHA launched the new Customer Service Index (CSI). The CSI is a live mechanism based on customer feedback, which measures patient and visitor levels of satisfaction. As customers depart health centers and hospitals, they press a “happy” or “unhappy” button, whereby the results are calculated denoting levels of satisfaction or dissatisfaction with services received. The ratings appear in the form of two bars, green for “happy” and red for “unhappy”, displayed on screens refreshing every 30 seconds. Sheikha Al Rahoomi, DHA Director of the Customer

Relations Department said, “Having a robust customer feedback mechanism and a clear focus on customer satisfaction, helps to raise the bar in health service delivery and helps us implement better and effective systems, as feedback is an invaluable resource for any organization.” The annual patient satisfaction survey has indicated that people are generally leaving DHCC happy with services. The most recent survey, conducted by independent external consultant AC Nielsen, showed patient satisfaction at a level of 89%. As Nielsen explains, 70 is the set target score for High Customer Satisfaction, thus a score of 89 demonstrates that the DHCC has exceeded objectives for providing quality patient care and is achieving high levels of customer satisfaction. The DHA Call Center became operational 24 hours a day, 365 days a year as of March 1, 2015, significantly increasing customer access to information. Since its inception in December 2011, the center has answered over 450,000 calls. Agents are fluent in multiple languages, including English, Arabic, Urdu, Hindi, Farsi, and French. The DHA has also been in the multi-phase process of uploading all medical records to a completely computerized system. According to Director-General Al Maidoor, electronic medical records will better protect the patient from individual mistakes, and increase patient control over his/her treatment.

INTERNATIONAL RECOGNITION Over the last year the UAE has gained special international recognition for efforts made in the areas of professional training and development. Attention has also been paid to the Emirates’ efforts to increase public access to testing and services, provide effective treatments, and raise public awareness regarding

IBRAHIM ABU-GHARBIEH Managing Director, Salamatak Healthcare Management If doctors want to come to Dubai, it can be a challenge for them because they have an attachment to their local patients. Many healthcare providers are offering allocated practice ties for those to come and practice here twice a year for four weeks each time. They can arrange for patients to have a oneor two-month window in which to be seen. Furthermore, the UAE has good experience at bringing in the practice itself.


the dangers of tobacco use. Specifically in Dubai, health professionals and institutions have gained international recognition through their focus on trauma training and care, and intensive energy towards preventative care and education. Significant steps have been taken to educate the public on the importance of exercise and a healthy diet for wellness. The prevalence of cardiovascular illness and diabetes remains a major problem in the Emirates. According to latest figures by the International Diabetes Federation (IDF), almost 19% of the UAE population and an average of 20% of the total GCC population live with diabetes, with a marked increase in type 2 diabetes diagnoses. Dubai hosted the largest ever diabetes screening campaign on May 25, 2014, making it into the Guinness Book of World Records. Over the course of eight hours, 8,675 diabetes screenings were conducted in the Dubai Mall by a team of 80 nurses. In conjunction with the One Heart Healthy Community project, the campaign was intended to educate Dubai residents about the risk of diabetes and heart disease,



the importance of early case detection, and to promote a healthy, more active lifestyles. In accordance with the strategy’s goals of offering access to internationally recognized healthcare, the DHA signed a historic agreement with Berlin last September. The agreement is part of a collaboration with Germany to provide Dubai's doctors and health care professionals with trauma and orthopedic surgery training. “This is a moment of pride for us,” said Director-General Al Maidoor at the signing. “This is the first time the German Board has signed such an agreement with an international health entity.” The agreement provides a way for resident doctors in Dubai to complete their six-year German board residency training without moving abroad for the first five years. Recently the DHA’s Trauma and Emergency Center at Rashid Hospital was featured on a top ten list in Germany’s polytrauma registry. The German registry, the largest in the world, lists over 300 trauma centers. In 2011, Dubai became the first country in the Middle East to be included in this registry. ✖


DUBAI 2015

INTERVIEW TBY talks to HE Dr. Raja Al Gurg, Vice-Chairperson and Executive Director of the Dubai Healthcare City Authority (DHCA), on building a sustainable healthcare model, offering quality care, and research facilitation.

some much NEEDED R&R How does DHCC build a sustainable model for healthcare in Dubai?

DHCC • World’s largest healthcare free zone occupying 27 million sqft • March 2015 launched the 22 million sqft Phase II expansion

BIO Raja Easa Al Gurg is a well-known businesswoman in the Middle East whose counsel and insight has contributed to many sectors of industry. While holding the position of Vice-Chairperson for the DHCC, she also serves as Managing Director of Easa Saleh Al Gurg Group LLCC. She plays a leading role in philanthropic efforts, most notably in the Easa Saleh Al Gurg Charity Foundation and Al Jalila Foundation. Additionally, she is the President of the Dubai Business Women’s Council.

In 2002, during the launch of DHCC, our founder HH Sheikh Mohammed Bin Rashid Al Maktoum, Vice-President and Prime Minister of the UAE and Ruler of Dubai, said, “The growth and development of any successful economy depends heavily on the health of its citizens.” In harmony with this early—and realistic—outlook, DHCC has expanded healthcare capacity and improved healthcare quality. Over the past 12 years, we have increased specialties and addressed capacity gaps in a regulated environment. We have increased the number of training programs for medical education, and we are facilitating much-needed research into regional health issues. In tangible terms, DHCC is today recognized as the world’s largest healthcare free zone, occupying 27 million sqft. In 2014, we recorded 1.2 million patient visits, and our healthcare community has 4,500 healthcare professionals, 90 specialties, and 320 clinical and non-clinical facilities. In March 2015, we announced plans to build water-facing rehabilitation and wellness facilities covering 3.3 million sqft. Our Phase II expansion implements our founding vision, and is in line with the UAE Vision 2021 and Dubai Plan 2021. Phase II will build DHCC’s position as an internationally recognized location of choice for quality healthcare and wellness, medical education, and research. How would you describe the role that healthcare plays in the growth of the UAE?

Economic stability and citi-

zens’ wellbeing are linked in quantifiable ways. Healthcare is one of the pillars of the UAE’s economic growth, offering a great deal of opportunity for investment and economic diversification. An increasing and aging population, increasing income levels, insurance penetration, and incidence of lifestyle diseases such as diabetes and obesity, are driving the demand for healthcare and pushing costs upwards. To cope, the healthcare model has to build a strong foundation of soft and hard infrastructure to sustain growth. Dubai is building its reputation as the preferred healthcare investment destination and reversing the trend of outbound medical tourism. And while the DHCC is enabling better access to high quality healthcare, the rollout of compulsory healthcare insurance will boost the sector overall. What regulations has DHCC implemented to further invest in the development of the healthcare industry?

Attracting investment, a skilled workforce, and patients requires a strong, comprehensive regulatory framework comprising tools such as accreditation and quality standards. Without this framework expansion would be at the cost of quality. Regulation and licensing of all healthcare professionals and healthcare operators together with the handling of any complaints arising from the provision of clinical services is overseen and handled by the DHCC Authority, the governing body and regulator of DHCC. In January 2015, DHCC added 34 countries to its licensing

framework for its healthcare and complementary and alternative medicine (CAM) professionals, totaling 63 countries. DHCC also introduced a policy for visiting physicians to ensure that only physicians with high qualifications and competencies in their respective clinical areas can practice, and in 2014, we introduced an independent appeals board. To drive quality in healthcare delivery, apart from regulations, medical education avenues from certification and training to academic programs are required. How important is developing and furthering local talent and research?

Education is a key pillar supporting our nation’s sustainable growth and knowledge-based economy. The Mohammed Bin Rashid University of Medicine and Health Sciences (MBR-UMHS), DHCC’s first medical university, will help develop a sustainable workforce in the UAE and the region. The Hamdan Bin Mohammed College of Dental Medicine is the first college established under the MBR-UMHS, and has six postgraduate programs, accredited by the Ministry of Higher Education and Scientific Research (MoHESR) in collaboration with the UKbased Royal College of Surgeons of Edinburgh (RCSEd). As of January 2015, 60 residents have enrolled. The second is the College of Medicine for undergraduate medical students, which will receive its first students in September 2016. DHCC entities such as the Khalaf Ahmad Al Habtoor Medical Simulation Center continue to develop technical and non-technical skills, have trained close to 3,000 multidisciplinary healthcare professionals to date. In Phase II, we have the Swiss International Scientific School Dubai, the first UAE-based private school to offer multi-lingual education. ✖





MUNA TAHLAK CEO, Latifa Hospital

DR. ABDULRAHMAN MOHAMMED SALEH AL JASSMI CEO, Dubai Hospital How does your hospital fit into Dubai’s broader healthcare sector? MUNA TAHLAK The objective of Latifa Hospital, as a specialized hospital for women and children, is to provide the comprehensive and best care for this category of the population in Dubai. We want to be able to provide what our clients need in terms of healthcare and to be center for referral. It is well known that high-risk cases and difficult cases require more resources and expertise and also costs a lot more. As we are generally a tertiary center, we get all of these referrals from all the UAE, whereas the private clinics usually take care of the lower-risk cases. We see ourselves complementing each other in relation to the public and private sector. DR. ABUDULRAHMAN MOHAMMAD SALEH AL JASSMI Dubai Hospital is a tertiary medical care provider, which is unique for Dubai and we want to remain like that. Medical care in Dubai has been available for the past 40 years and it was developing in all aspects, but development in tertiary care is not to the optimum level. We still have a group of patients who are traveling aboard for certain kinds of treatment and we at Dubai Hospital are

there is A LIGHT Hospitals in Dubai look to focus on specific treatments and services to differentiate their businesses from competitors. targeting that group and are continuously enhancing tertiary care and developing several fields of healthcare with a focus on super-specialty in those fields. Our objective is to provide a variety of advanced care in different specialties. What are your expectations and plans for the coming period? MT I see a bright future with many new things happening. One is that with the insurance legislation coming through we will see a positive impact on how we manage our hospital. It will provide everyone with access to healthcare, promote positive competition in the health sector, and help investment in healthcare. We expect to see an increase in the number of patients we serve. With more people being insured, we expect more people seeking treatment that otherwise would not. We have plans to expand and to add new services. We have just finished our master plan for the region, and there is a lot of development in infrastructure and human capital. EMR, the electronic medical record system, and the health record is another great project that we are looking forward to. I can see that we are getting closer to where we can transform healthcare in Dubai.

AMSAJ We intend to develop at least one center of excellence per year and this year the Dubai Kidney Center will be the first. It currently holds 48 beds and we provide care for about 260 patients in terms of dialysis. Once the new center is operational it will have an enhanced capacity to treat 350 patients and in 2016 we aim to carry out our first kidney transplant. In terms of cancer treatment, we already specialize in several services but we want to become a center of excellence in this field and therefore in the next few years, the aim is to continue to enhance our services, add new oncological services and ensure we can provide the highest quality care. Our hospital currently receives approximately 50% of pediatric cancer cases in the UAE and therefore the aim is to continue focusing on this service and eventually provide super specialization in this field. We want to concentrate on certain specialties; we have to concentrate on the quantity of care and the quality of it, too. Our central concentration is on tackling diabetes because of its high prevalence. We are also focusing on cancer treatments, cardiac disease, kidney disease, orthopedic and joint diseases, pediatric service facilities, and fetal medicine. These areas are our targets for the next five years and we are working on these programs. ✖


DUBAI 2015


SUSTAINABLY HEALTHY The first phase in the grand transformation of Rashid Hospital is scheduled for completion in 2Q2015. While also addressing the city’s healthcare needs, Rashid Hospital’s reconstruction will be an emblem of sustainability and green technology utilization.



new hospitals


new primary healthcare centers


AS DUBAI CONTINUES along the path of population expansion through attracting additional visitors and residents to the city, the Dubai Health Authority (DHA) has identified increasing the capacity of its hospitals as a number one objective. A key part of DHA’s health strategy for 2013-25 is the $800 million expansion of Rashid Hospital, which will not only triple its capacity, but also represent a significant step forward in sustainability and green initiatives. Open 24 hours a day, seven days a week, Rashid Hospital stands out as one of the most prominent and reputable emergency centers in the Gulf region and internationally, providing medical facilities for emergency, trauma, critical, and ambulatory care. In 2014, it was featured on the top 10 list of Germany’s polytrauma registry, the largest polytrauma registry worldwide consisting of more than 300 trauma centers. Since its operational beginning in 2006, Rashid Hospital has seen its patient intake per annum almost double from 86,000 in 2006 to 166,000 in 2013. Currently, Rashid Hospital works at 100% capacity, meaning medical staff at the center treat between 480 and 550 patients a day on average. In recognition of the impending capacity overload, the DHA has decided to adopt a multi-step plan designed by Goodby Silverstein

& Partners (GS&P). The plan is designed to utilize pre-engineering concepts to keep the hospital functional while expansion is underway. The first step of the Rashid Hospital expansion is the $44 million, 160-bed expansion to the Trauma Centre scheduled for completion by 2Q2015. This also includes an expansion of an additional 116 beds in its outpatient facility. The $800 million master plan, scheduled for completion in time for World Expo 2020, has been developed to provide state-of-the-art services to locals and medical tourists alike. This includes six new specialized health centers, one four-star and another five-star hotel, villas for consulting physicians, accommodation for 5,400 members of staff and their families, a mosque with a capacity for 150 worshippers, and landscaping and open spaces for children and families. The existing hospital will be demolished and each seven-story tower replacing it will have 300 beds with a total capacity of 900 beds. Rashid Hospital’s complex design will collect and process rainwater. Green roofs will improve energy efficiency by absorbing the sun’s heat, while rooftop solar panels will generate energy. The GS&P design minimizes heat gain though the use of geothermal systems to provide indoor cooling. ✖


$800 million 100k sqm specialized +6 health centers bed 900 capacity PHASE 1

$44 million +160 +110 beds in Trauma Centre

beds in outpatient facility


DUBAI 2015


more than mere talent TBY talks to Dr. Reem Osman, CEO of Saudi German Hospital-Dubai, on expansion in the Emirate, standing out in a saturated market, and how SGH attracts medical tourists from the UAE and abroad. At last year's WEF Saudi German Hospital was awarded the Global Growth Award. What impact does this have on the objectives of Saudi German Hospital going forward?

International recognition from the WEF always gives a positive push. International recognition by a platform such as the WEF gives reassurance that we are on the right track. Our group vision 28 years ago was to establish a successful healthcare organization, and we began by building hospitals in cities throughout the GCC. To expand in the healthcare industry is complicated, and successful implementation is very difficult. Considering SGH’s aggressive rate of expansion, recognition is therefore rewarding and will only propel our efforts forward. What is the objective of SGH here in Dubai?

After establishing ourselves in Yemen, we expanded to Dubai with the same objectives; it was a strategic move. We want SGH in Dubai to be a successful part of the Group and also to be part of HH Sheikh Mohammed Bin Rashid Al Maktoum’s vision for healthcare within the Emirate itself. Dubai is a healthy environment for investment with much potential. We have given a tremendous level of importance to developing our hospitals from scratch, and we have a unique vision for how we will grow in Dubai. Phase I of our establishment is complete; a 300-bed tertiary hospital. Our

IN NUMBERS Saudi German Hospital

Growing at

16% YoY



employees per year

long-term plan is to create a Saudi German Healthcare City in Dubai, which will consist of a general hospital, main hospital, and six sub-specialty hospitals, along with a medical tower. We are already in Phase II of our plan, which includes adding three specialty hospitals. Our hope is to have the Phase II completed by World Expo 2020. In Dubai’s competitive healthcare landscape, what strategic advantage does Saudi German Hospital possess?

Of course it is very difficult to enter a market that is already saturated. We have had to prove ourselves in a very short amount of time in order to capture and keep a customer

segment; this has been a driving factor for establishing our reputation. To enter a market already dominated by private and public-sector players and establish ourselves, we had to put a tremendous amount of energy into building a management team and a base of skilled, world-class physicians. We used this combination of talent and experience to identify market needs and work closely with government regulators and players. We feel that we are all partners in the development of a world-class healthcare city. How does SGH see medical tourism as an opportunity for growth?

The UAE in itself represents a great opportunity for growth. Due to our reputation and expertise, we are able to attract what we call domestic medical tourists, meaning those living in other Emirates who travel to our hospital for treatment. Within this segment of customers, we are able to attract referrals from other hospitals within the UAE whose patients need advanced or specialized procedures. With the growing population of Emiratis travelling abroad, we have also seen an influx of what we call reverse medical tourists; those patients returning from abroad to have medical operations done here or continue their treatment plans. Finally, we see a tremendous opportunity in the traditional medical tourism segment coming from the GCC, Africa, and Asia.

Recently the Dubai Health Authority (DHA) imposed a pricecap on the increased cost of healthcare services at 4.22%. Looking forward, how will this affect operations at SGH?

We understand the rationale behind the DHA’s decision. However, we want to underscore the importance of twoway communication between hospitals and the authorities, to ensure that the price-cap is implemented in a way that benefits everyone. Insurance companies and other players as well will be affected. Due to the recent announcement of these regulations, the healthcare investment climate has chilled slightly because investors are concerned about their returns; the same goes for SGH. While there are many concerns about these regulations, ultimately we are confident that through free-flowing communication between all industry stakeholders, we can ensure that the sector continues to be both profitable and socially beneficial. ✖

BIO Dr. Reem Osman graduated from Tishreen University in Syria and continued her medical education at the same university, obtaining a Master’s in Eye Diseases and Surgery. She later gained an MBA from Sydney Business School at Wollongong University and became a member of the International Council of Opthalmology. She is currently the CEO of Saudi German Hospital in Dubai, and has over 12 years of experience in the healthcare industry.






MARIANO GONZALEZ Managing Director, Moorfields Eye Hospital Dubai


he Dubai healthcare sector is maturing with regards to healthcare tourism. We are helping Dubai become an international medical tourism hub. If you think of international medical hubs all over the world, they basically compete on price, quality, and customer service. This is a real challenge, but I think Dubai is doing an excellent job in responding to it. The main reason Moorfields is here in Dubai is because of the demand for the quality of service that we are able to provide. Quality is non-negotiable and is 100% aligned with our clinical practice and standards in London. I believe this is our competitive advantage in the market and we have built a medium to longterm strategy based on it. Dubai cannot compete on pricing. We need to compete on quality. If our pricing structure is going to be controlled to help control internal costs, the quality of the healthcare services we all offer must still be competitive. People are coming from abroad to Dubai because of the brand name, because of the healthcare reputation, and because of the medical outcomes achieved.

Dubai is attractive to medical tourists from around the world, but more opportunity exists for offering high-quality services to visitors and Emirati citizens.



CEO, Mediclinic Middle East

Managing Director, hearLIFE Clinic


e as well as other hospitals in the region are trying to attract top talent from all over the world to practice at our facilities. It will obviously be a challenge for us to pay these doctors a competitive wage if we are put under unrealistic pricing constraints. We actually have no problem with the regulation of price increases— we think it is a good initiative to keep inflation in check—as long as the methodology used to establish the cap is properly debated and based on real medical inflation. What we appreciate about the Dubai Health Authority (DHA) is that it has realized the decision was sudden and has now set up working groups to discuss how we are going to take this forward. The key thing is that in healthcare you cannot just look at CPI inflation. There is a shortage of doctors and nurses, and that is our biggest cost. We are building a 267,000sqft new wing of Mediclinic City Hospital, which will house a fully integrated oncology center, the first all-inclusive oncology center in the GCC. The project also includes a new day surgery, a centralized laboratory and rehabilitation unit for the group.


e definitely need to become more competitive price-wise, because patients are obviously not only looking at Dubai as a very attractive medical tourism destination. Southeast Asia has become very popular, and Eastern Europe as well. Therefore, I think it is good that we look at regulating prices, but at the same time we also need to look at what is happening in other aspects of pricing, such as increasing general costs. If you cap costs at one end, then you should cap the other end as well, otherwise healthcare facilities cannot be profitable anymore nor will there be the opportunity to invest in well-educated staff or in good equipment. In order to attract medical tourism, the quality needs to be superior, and if it is superior, then patients are willing to pay that extra money that Dubai will charge. At the same time we need to look at the expenses that clinics are facing, and I think that here we still have some potential. All of our surgeons come from Europe and of course there is a high level of trust here in the GCC countries in expertise from Europe.

DR. RAZA SIDDIQUI CEO, Arabian Healthcare Group


he cost of a hospital bed is $500,000 upward and there will be a demand for 5,000 more hospital beds during the next five years to match the local supply demand situation alone. We are also interested in taking part in medical tourism, which is a $100 billion worldwide industry. In the region it is worth $20 billion, and Dubai is the number one preferred tourism destination due to its top of the line infrastructure and the best hotels as well as safety and security considerations. Approximately 35,000 people come every day, creating huge opportunity. Top-of-the-line healthcare and hospitality create the perfect environment for tourism. The return on investment in medical tourism is five times the return of even a five-star hotel. There are not enough people involved in the healthcare business. An investment in even one hospital bed can give you a tremendous return. The bottom line is 10-15% on the return of your investment. If you take out the emotional element of healthcare provision in order to showcase see the business opportunity you attract investors.


DUBAI 2015

FOCUS MEDICAL RESEARCH Further development of the healthcare sector is vital for Dubai’s ambition of becoming a leading health service provider and research center.


DUBAI HAS BEEN BUSY OVERHAULING its healthcare facilities to redirect the outflow of residents seeking medical treatment and capture part of the medical tourism market travelling to Asia as part of plans to become a major medical tourism hub. Last year, Dubai set an ambitious target to attract 500,000 medical tourists by 2020. Similarly, Dubai’s leadership has also recognized a fundamental opportunity in the health sector to further develop the field of medical research. In recognition of this, local players, NGOs, and educational institutions are developing projects and initiatives to facilitate medical services, research, and innovation in Dubai. At the end of March 2015, Prime Minister and Dubai ruler HH Sheikh Mohammed Bin Rashid Al Maktoum formally launched Phase II of Dubai Healthcare City. The project will be carried out over 22 million sqft at a cost of AED3 billion to AED5 billion. Almost 25% of the new phase will consist of medical and healthcare services, while another 25% will be dedicated to hospitality and retail, along with a focus on education. Approximately 35km has been allocated for pedestrian crossings and bicycle and jogging tracks to ensure the availability of a healthy environment for daily activities and sports. Phase II will also include the Nashami project that will stretch over a space of 2.4 million sqft with the capacity to receive 20,000 people. It will include retail stores, hospitality, and leisure facilities, as well as 3.3 million sqf of rehabilitation facilities that will overlook the waterfront. With this, Dubai Healthcare City has reaffirmed its commitment to continually develop its capacity for hosting top-tier healthcare providers. Non-profit organizations like the Al Jalila Foundation are also answering the call to develop medical research locally. The Al Jalila Foundation is a global philanthropic organization dedicated to transforming lives through medical education and research founded by HH Sheikh Mohammed Bin Rashid Al Maktoum. The purpose of the foundation is to position Dubai and the UAE at

the forefront of medical innovation. The AED200 million Al Jalila Foundation Research Centre is set to be completed by the end of 2016 and will play a significant role in putting the UAE on the map of medical innovation, as it will be the first independent, multi-disciplinary medical research center in the UAE. Harvard Medical School (HMS) and Dubai Healthcare City Authority (DHCC) have jointly announced the opening of the Harvard Medical School Centre for Global Health Delivery, the world’s first center of its kind to be based at the Mohammad Bin Rashid Academic Medical Centre at DHCC. The new center will allow HMS, working with researchers and care providers from the health authorities in the UAE, to stimulate research and education focused on improving the delivery of high-quality healthcare. Using innovative and multidisciplinary approaches, the center will study ways to improve outcomes for patients undergoing surgery and for patients receiving care for diabetes and obesity, infectious diseases such as tuberculosis and hepatitis C, and mental health disorders. With an undisclosed amount of funding for the center to be provided by the Dubai Harvard Foundation for Medical Research over the next four years, this center aims to turn Dubai into a global hub for scientific and policy discussions related to healthcare delivery. Eventually, the center will establish academic best practices for research into tuberculosis and hepatitis C and mental illnesses and other areas that would help scholars come together and share a platform that would not just benefit the GCC and MENA region, but create an international pool of academic research. The opportunities for development in the healthcare sector in Dubai are vast. Major developments in the sector including Dubai Healh Care City’s Phase II expansion will continue to create a hospitable environment for healthcare investors, while Al Jalila Foundation and Harvard Medical School are committing to further medical research innovation. ✖





A STRONG PORTFOLIO TBY talks to Zeyad Hassan Al Moosa, Managing Director and Partner of GulfDrug, on cutting-edge innovation, pharmaceutical product development, and compulsory health insurance’s impact on the segment. What have been the main achievements of GulfDrug over the past year?

We have had some good results, and business has picked up since last year’s major growth in retail pharmacies. Many hospitals are being built, or undergoing expansions, as the government has been investing more in infrastructure. GulfDrug has been able to sync up with these positive developments. Being in the healthcare sector, we always have to be able to service the current and growing needs of the economy. How has GulfDrug’s portfolio evolved in line with last year’s growth?

One of the major portfolios that we have streamlined with GulfDrug over the past two years has been imaging; we sell CT scanners, MRIs, and ultrasound machines from Toshiba. We have been able to place these within many private and public hospital projects. We work with a company called Carestream, which is the former Kodak, that provides larger solutions for clients to meet imaging requirements. We have expanded our portfolio for disposable and invasive products, and we have launched new products in the gastro and IVF segment. In addition to pharmaceuticals, many cutting-edge oncology products from Pfizer have come out, and major pharmaceutical players are developing more niche products for the harder-to-treat diseases.

How important is innovation for a company like GulfDrug?

Innovation comes from new and better products. In terms of distribution, it is important to be able to smoothly introduce these and upgrade products. With the CRM module and other tools we introduced in 2013, we can better track our interactions with customers. Considering our expanding portfolio, this is important for each product. We value internal innovation in regard to tools and technologies and managing new challenges with our current products. How has the introduction of compulsory health insurance impacted your operations?

It was an important missing piece of the puzzle to offering sustainable healthcare services in the UAE. Prior to this development, only a small percentage of people had access to the best hospitals and medicines. People were moving from the Emirate to seek healthcare elsewhere, and as such, the UAE was losing economic productivity. More of the middle class, the driving engine of the economy, are now covered. As a result of the new system, healthcare business volumes have grown, the long-term viability of hospitals has increased, and the sector has become more sustainable. We have seen growth in treatments and the utilization of pharmaceuticals, which has motivated the companies that own the hospitals to expand.



international branches

Foundation of GulfDrug


BIO Zeyad Hassan Al Moosa took over the management of the company in 1996. He was appointed by the Board of Directors as Managing Director following the performance of each department and his implementation of strategies for the future. He received a degree in Pharmacy from Massachusetts College of Pharmacy, Boston, and a Bachelor’s degree in Business Administration from Western Connecticut State (US).

What potential does Dubai hold to become a world medical hub, and how can GulfDrug contribute to this goal?

As is usually the case in Dubai, or the UAE, the issue is not one of building construction or creating the infrastructure. The challenge will be to attract high-quality doctors. When it comes to sophisticated medical treatment, patients will go where the quality doctors are. Work volumes for doctors have increased with the new insurance system, giving them more reason to be here; thus the number of medical tourists coming to Dubai will grow. With this in mind, and with governmental support, Dubai can become a hub; everything indicates that we are moving in this direction. The investment environment has improved dramatically over the past two years, and hospitals are competing on price and quality. On our part, GulfDrug has continued to provide a solid portfolio in many segments; hence, we stand to benefit from an upsurge in the sector by servicing in specialized areas, such as gastro, dialysis, and intensive care. We are also filling needs in terms of imaging and hospital equipment. How would you evaluate your financial performance for 2014, and what are your expectations for 2015?

In terms of volume, growth has been recorded in the double digits. There is a high level of financial confidence in this sector because payments are reliable. Insurance guarantees payments to hospitals, thus hospitals are able to pay the suppliers and their doctors. The government has been continually reducing the margins for distributors and reducing the prices of medications. Hence, the drive of the UAE is to standardize and continue reducing prices, which presents a challenge for providers as costs increase. We have managed our growth carefully. ✖


DUBAI 2015

INTERVIEW ownership at will. No one else in the market can offer this, which gives Amanat access to businesses that would not conventionally entertain private equity capital.

the CONDUIT TBY talks to Faisal Bin Juma Belhoul, Chairman of Amanat Holdings PJSC, on recovering from the oil price drop, new acquisitions, and deploying capital strategically. How would you evaluate the performance of the IPO of Amanat Holdings?

The IPO of Amanat Holdings was established at the end of 2014, a year that brought an upbeat trend and a lot of optimism in the capital markets, and in the region as a whole. To that extent, it was the right time to launch a company the size and profile of Amanat into the market. After we were approved for listing in 3Q2014, we pursued that opportunity. The Amanat IPO was 10 times over-subscribed, which is a sign of the confidence and faith from the investment community and our backers in the company. Amanat is an investment company that only makes promises it can fulfill. How did the impact of the oil price drop affect the trading value of Amanat Holdings post IPO?

The price drop was not foreseen by anyone. Given the dependence upon oil in this part of the world, sentiment has further exceeded the reality of what implications this will have; whether that price adjustment is short term or longer term, the sentiment has surpassed the potential implications. As a result, the capital markets have had weak performance. We have witnessed around 35-40% contraction from the pre-oil adjustment to where we stand today in terms of the stock market as a whole.

IN NUMBERS Amanat Holdings PJSC


of raised capital goes toward investment in platform companies



million via IPO on the Dubai Financial Market

Anything of that magnitude is somehow deemed a crisis, and so in relative terms, the share price of Amanat Holdings has dropped to below the original IPO value, covering between a 10-15% discount. Now, obviously, any negative performance is something that we do not want to see, but relative to overall performance, our share price has outperformed the market. What acquisitions is Amanat considering, and how do they fit into the company’s long-term objectives?

In the strategy document of

our prospectus, it states that Amanat's strategy will have a significant emphasis on acquisitions; around 70% of our capital goes to what we define as platform companies. This remains very much our approach. We anticipate announcing one or two investments in 2Q this year, based on current progress. At this time we are quite optimistic that this is achievable. We are choosing the best opportunities we see in the market, and there are actually more deals than we can accommodate. It is really about selecting the ones that fit in terms of profile and appeal. How does Amanat Holdings’ overall strategy reflect the current investment environment within the GCC?

We are fortunate that Amanat Holding was a company that was built from the bottom up. It was a strategy to test on the market and one based on transactable opportunities we could see on the ground; Amanat was created to be the conduit to facilitate those transactions. Our management team comes from a private equity-model background, which is a medium-term partnership model. The team migrated to an outfit like Amanat because the health and education sectors seek long-term partners. Amanat is a company where shareholders have the option to buy or sell, reduce, or increase their

What are your expectations for the coming year?

The current landscape is promising both in terms of supply/ demand dynamics, and by the availability to good candidate investment companies. As it stands, the coming three years will be a compelling time for Amanat to deploy its capital in building a quality portfolio. On the back of this, Amanat can move from a phase of active deployment, to a phase of business development for its portfolio companies. Our first phase of investing is through partnering with champion companies. Once we have established these partnerships, the next phase of capital deployment will involve funding the expansion opportunities of partners, both locally and in neighboring markets. ✖

BIO Faisal Bin Juma Belhoul is a UAE national and the Chairman of Amanat Holdings PJSC and Founder of Ithmar Capital. He was also chairman of a number of business groups and associations, including the UAE Private Hospitals Council, the UAE Private Schools Council, and the Pharmaceutical and Healthcare Equipment Business Group of the Dubai Chamber of Commerce and Industry (DCCI). He is currently a board member of the DCCI by decree from the ruler of Dubai as well as being a member of the Young Presidents Organization (YPO). In 2007, he was recognized as one of the top 100 Executives in the Gulf region. He was educated in the US, where he studied Manufacturing Engineering at Boston University.






Anant Agarwal, CEO of edX, on the importance of an educated civic body, and closing the skills gap.

Prof. Muthanna G. Abdul Razzaq, President and CEO of the American University in the Emirates, on market demand.

Leadership from two important healthcare institutions in Dubai discuss the social dynamics of the Emirates.

Education REVIEW

Dubai’s educational system is the pith of a complex story of development and change. The latest statistics show that the Emirate is the entrenched regional leader in higher education and didactic diversity.


en years ago, catching a cab ride from the Georgetown University lecture halls to Middlesex University’s research library would have struck anyone as futuristic, and would have required suspension of the laws of physics. At the heart of the Gulf, Dubai has eliminated the time and space separating these prestigious centers of learning, by establishing satellite campuses for both schools that are just minutes apart—and the year is 2015. This remarkable achievement occurred due to a state of constant flux that has characterized the Emirate’s demographic and physical state. As millions of expatriates come and go, they bring with them changing demands and progressing skill sets that require constant tweaking of policies and options. This trend is especially pronounced in Dubai, where, a decade ago, the central role of construction and energy demanded craftsmen and technical skills. But as the service sec-


Image: The University of Manchester Business School

Private educators have proven their ability to respond to the needs of Dubai’s constantly changing demographics.

tor eclipses these traditional economic bulwarks, universities have agglomerated around education incentives and free zones to train the next generation of lawyers, doctors, and scientists. As the Emirate has grown over the last two decades, the demand for private education has grown in tandem, driven by large numbers of expatriates who arrived to staff a wide spectrum of jobs. Labor migrants, who constitute at least 87% of the local population, tend to skew towards young, and male. That said, many still come with families, or start one upon arrival meaning that, sooner or later, these expatriates start looking at educational options for themselves or their offspring. According to a recent World Bank publication, 88% of all students attend private schools, which are able to respond to their client’s evolving needs in real time. The surge in demand around the turn of the century was so significant that authorities created the Knowledge and Human De-


DUBAI 2015

While enrollment has steadily risen over the last decade, its pace quickened in 2011. Between 2010, and 2013, enrollment in universities shot up from 39,127 to 52,585 representing a 34% increase in just three years. Last year’s increase showed that students are still fighting for desk space, with an impressive 9.4% increase.

velopment Authority (KHDA) in 2007 to oversee the sector’s expansion. In order to support KHDA’s educational development activities, the Executive Council established the School Agency within the KHDA, with the mandate to develop the school sector by determining targeted outcomes for the school system, supervising teaching, and monitoring performance to ensure compliance with quality standards. The agency was also tasked with improving the teaching profession and elevating the position of teachers in society. In addition, governmental schools were granted more authority and provided with new administrative support services. Today, the KHDA is responsible for the growth, direction, and quality of private education and learning in Dubai. It is the regulatory authority for the Government of Dubai, whose primary mission is to support the improvement of schools, universities, training institutes, and other human resource sectors. The KHDA describes its mission as being, “to assure quality and to improve accessibility to education, learning, and human development, with the engagement of the community.” The authority also acts as a regulator of the sector, for example curtailing unauthorized fee hikes at private schools in early 2015 that overwhelmingly hurt lower-income expatriate families.

PRIVATE SCHOOLS According to the most recent KHDA data, 158 private schools are currently operating in Dubai, with an additional 10 having opened their doors during the 2013/14 school year. Enrollment in private schools was up during this time by 8.3%, or 18,616 students. These additional pupils pushed total enrollment in private schools up to 243,715—30,994 of whom were Emirati nationals. Emirati national students were also up, but by a smaller margin of 3.2%, or 950 students. These numbers mirror the Emirate’s demographic trends, where expatriate residents are growing faster than locals, especially as the region regains its luster in the wake of the 2008-2009 economic malaise. Future growth in student enrolment is expected to grow, and reflect the underlying economic conditions of the region. Enrollment by nationality is another interesting reflection of the Emirate’s demographic composition. During the early years of the oil boom, the majority of guest workers

in the Gulf region hailed from other, less resource-blessed parts of the Arab world, like Egypt and Yemen. Their cultural and linguistic similarities made these labor migrants well suited to handle the initial development projects. Over time, however, political transformations, like the demise of pan-Arabism, and economic shifts, such as the viability of east Asian labor saw millions of Indians, Pakistanis, and other workers from the east arrive to start their lives in the Gulf. Now, there are students from 184 different nationalities attending Dubai’s private schools, underscoring the diversity that comes with Dubai’s location at the nexus of major markets, regions, and cultures. These recent immigrants place a premium on educational attainment, and schools in Dubai reflect this. Indian students make up the largest bloc, representing 34.5% of students in private schools alone. The next largest group is UAE nationals, at 12.7%, followed by Pakistanis with 9%. Private schools also reflect the prevalence of Indians in the region, with 30.8% classified as Indian schools by the KHDA. However, American and British schools are also popular, representing 20.9% and 32.2%, respectively. Only 6.5% of schools on the other hand are run by the Ministry of Education (MOE), which reflects a top-down push for private-sector solutions to social needs like education and healthcare in the Emirate.

HIGHER EDUCATION There are 57 higher education institutions established in Dubai, which are broken down into three federal, 26 international, 25 local, and three vocational institutions. These four categorizations are differentiated as follows. Federal institutions are funded by the UAE government, and as of 2013, fall under regulatory jurisdiction of the KHDA. These universities include the likes of Zayed University, a bilingual English/Arabic institution that offers globally recognized bachelor degrees in the arts and sciences, business, education, IT, and media. The International University category consists of Degree-awarding institutions that instruct with an international institutional quality assurance and accreditation. These institutions include the aforementioned famous international schools that have flocked to the emirate to capitalize on a rapidly growing student body; their local counterparts are ‘Local Universities,’ which are accredited by the CAA, but do not have


international institutional quality assurance and accreditation. Finally, vocational schools are the minority, and do not award degrees, but rather train students in technical skills that are in demand.

THE BREAK DOWN The 2013/14 school year was the first time that private universities established in the Free Zone provided the KHDA with electronic student data. As a result, the administration was able to provide a detailed analysis of the student population, which showed how developed higher education has become over the last decade. While enrollment has steadily risen over the last decade, its pace quickened in 2011. Between 2010, and 2013, enrollment in universities shot up from 39,127 to 52,585 representing a 34% increase in just three years.

Last year’s increase showed that students are still fighting for desk space, with an impressive 9.4% increase. Emirati’s are also better represented in higher education, where they make up 43.2% of the student body. Unlike college enrollment at the western campuses of Dubai’s international universities, males make up a clear majority of the student population, or 56%. However, educational opportunities for women are strongly backed by the government, and this disparity is quickly fading. Just as importantly, in the Gulf region, women comprise 60% of engineering students in universities, compared with 30% in the US and Europe, according to UNESCO. As the regions educational leader, the enrollment numbers in Dubai define this trend. Once again, Indian students are the most prominent international attendees of these



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30.000 2008



universities at 16%; however, especially with the foundation of traditional western institutions in Dubai, more and more American and European students are finding their way to the region thanks to increasingly popular exchange programs. A final note on the makeup of attendance for the Emirate’s schools underscores the changing nature of the region’s economy. For Dubai, which was the first in the region to launch ambitious diversification programs, these trends are playing out in career ambitions that have been nurtured throughout the educational tenures of its graduates. The service sector is king. 44% of students enrolled in 2013/2014 were pursuing business degrees, outpacing the runner up—media and design—by more than fourfold. At 10%, media and design, which are also in the services sec-




tor, show that students are responding to job market incentives for intellectual skills that have universal application. This development stems from the 1996– 2000 Strategic Development Plan, where human resource development was featured as a prerequisite to achieving sustainable economic and social development. The development focus shifted from an almost exclusive emphasis on the industrial sector, towards developing human capital, advancing the workforce, and increasing the participation of nationals in the labor market. This became the basis of a knowledge-based, skill-intensive economy. Decades ago, Dubai’s students had ambitions of steady employment and growth in the energy sector, but now they would rather open a design firm, or try their hand in the financial sector. The world is their oyster. ✖

DINO VARKEY Group Executive Director and Board Member, GEMS Education In the UAE, what percentage of your students are nationals? We anticipate that the number of UAE national students in our schools will double by 2020, to reach at least 20% of enrollment. And over the next five years, we intend to develop dedicated schools and programs with local authorities, which play a vital role in our success, and create more educational experiences and systems that are specifically optimized for UAE nationals and Arab expatriates. As a UAE-based company, how is GEMS Education supporting Arabic language learning and

Islamic studies? As a UAE-based brand, we want to emphasize our commitment to the region by strengthening our Arabic language and Islamic studies programs. The UAE Vision 2021 National Agenda has set a target for students to have a strong knowledge of the Arabic language, and therefore GEMS Education has placed a significant emphasis on the inclusion of language studies that will aid in achieving this goal. GEMS Education also believes in promoting local culture, including language and Islamic studies, and developing an understanding of regional and global philosophies.





education is HAPPINESS TBY talks to Anant Agarwal, CEO of edX, on the importance of an educated civic body, closing the skills gap, and creating partnerships between the public and private sector. What are the education-related obligations a government must fulfill?

Education is a foundational part of the duties of any government. Education is a right and it should be available to the entire population like air or water. It is the absolute fundamental job of a government to provide broad access to education. In fact, if the government does a good job of fostering education, this positively affects a lot of the other things that they care about. Take economic prosperity, for example. If you have a well-educated population then they will go and find jobs and innovate. In particular, if you teach how to innovate, a good education system can be the basis of a prosperous society as well. Education leads to happiness. It is also the root of public health. Many of today’s health issues correlate with education or lack there of, so any investment in education by a government can be effectively leveraged because it will pay back 10 fold as an investment. What are some of the key strategies that developing economies should be employing in order to facilitate investment in education?

The developed world has centuries worth of history developing an education system and developing content, particularly in the US, where

the education system at the tertiary level is very strong. In developing countries, the higher education system needs a lot of work. In India, for example, there are many universities opening up but they do not have enough teachers. In the Middle East, many people are graduating, but when they search for jobs, there are skills gaps. One approach to addressing all of these issues in developing countries is to do what India did, which was to skip the land-line generation and go straight to wireless, cellular technology in the communications area. I think developing countries can apply the same tactic to their education systems, where they invest in online learning. Today’s online learning is high quality, and is a very effective investment where the government can invest in devices and bandwidths for its people, and then provide education online. In the UAE in particular, the connectivity is remarkable, whether it is wireless, cellular, or broadband. They could easily make online content available and then through nonprofits like edX, where we have free content on our site from some of the best universities in the world like MIT and Harvard, content can be made available to an entire nation very effectively through licensing or other means.

edX recently established partnerships with both Jordan and Saudi Arabia

In what ways do you see both private companies, non-profits, and the government working together to form a comprehensive approach to educational development?

The key to these partnerships is public-private partnerships, and I can give you an example. EdX has already partnered with Saudi Arabia’s Ministry of Labor, and we launched a Massive Open Online Course (MOOC) platform in partnership with them. They used the open edX platform to launch their national platform infrastructure for online education. Similarly in Jordan, the Queen Rania Foundation launched Edraak, an education initiative of the Queen Rania Foundation for Education and Development. We would be delighted to partner with the UAE to create a similar online infrastructure. It is very inexpensive in comparison to all the other investments the government might make and it can be effectively leveraged on a massive scale.

How does edX play a role in assisting the government to fill the skill gaps in the ever-evolving labor market?

It is the job of the government to create foundational infrastructure. For example, in regards to transportation, governments will create highway systems and then private industry will drive the trucks to deliver goods around the country. Similarly, the government can create a national infrastructure for online education by using a platform like open edX, and then private companies can leverage this online infrastructure to create content for it. ✖

BIO Anant Agarwal is the CEO of edX, an online learning destination founded by Harvard and MIT. He has served as the director of CSAIL, MIT’s Computer Science and Artificial Intelligence Laboratory, and is a professor of electrical engineering and computer science at MIT. He won the Maurice Wilkes prize for computer architecture, and MIT’s Smullin and Jamieson prizes for teaching. He holds a Guinness World Record for the largest microphone array, and is an author of the textbook “Foundations of Analog and Digital Electronic Circuits.” He holds a PhD from Stanford and a Bachelor’s degree from IIT Madras.



DUBAI 2015



RANDA BESSISO Director, Middle East, The University of Manchester Business School


ith the rapid pace of Dubai's economic growth, the talent gap is inevitably a moving target and success presents its own challenges in attracting and retaining the right talent. The number and scale of initiatives that have been launched over the last few months in the UAE generally, as well as in Dubai, also affect the economy. For example, Expo 2020 demands a certain set of skills that are quite different from those related to the creation of a hub for the Islamic Economy. Dubai and the UAE have put the development of a knowledge-based economy at the top of the agenda. Based on our own experience, we believe collaborations are key and we need higher education institutes. We know what some of those gaps are and higher education providers can help meet needs, but we also need vocational training and short-term training providers to focus on the skill requirements.

DR. YOUSEF ALASSAF President, Rochester Institute of Technology (RIT) Dubai


very student has to spend time in the field during their co-op program. Engineering is nine months, business is five months, and networking and computing students spend seven months. As part of the curriculum for graduation, this requirement incorporates different companies from various industries across the globe. These companies usually prefer to build longterm relationships; however, if it is short-term, as happens with other universities, they do it solely out of courtesy. Currently, we have about 60 students working in approximately 25 companies such as Dubai Silicon Oasis, Emerson, Coca Cola, Schinder, and Dubai Aluminum (Dubal). Fractal Systems, an innovative technology providing company, is housed on RIT Dubai’s campus. Among the projects it currently has students working on are the development of the largest drone with the longest flight time and new state-of-theart display systems. The co-op program is very important for us, and we are fortunate to have such companies that believe in our students, our faculty, and our ideas.



President, American University in Dubai (AUD)

Executive Director, HULT International Business School


think the establishment of the Knowledge and Human Development Authority (KHDA), and the Dubai Education Council (DEC) has had an enormous impact on education at the primary and secondary levels, which is of great importance to universities. Those are the institutions that feed students to the universities, which are at the third tier of that process. Naturally, the better the quality of students at those two first tiers, the better quality we receive at universities such as ours. There are also other initiatives regarding technology in primary and secondary schools that HH Sheikh Mohammed has personally spearheaded. These will all have far-reaching effects on future generations. Our mission focuses on students as vehicles for the advancement of society. We provide counseling, and we are training 60 members of the UAE government, which will lead to a diploma in Government Services. Rubbing shoulders and keeping contact with those various entities helps us in terms of the relevance of what we teach.


ne of the innovations at Hult is our campus rotation model. Students start their program at one of our five campus locations and then for the last two modules have the option to rotate to one or two other campuses for their electives and action projects. Another thing that differentiates us from other business schools in the UAE is our global presence. We have a policy of bringing in professors from around the world to provide relevant subject matter. Our professors are noted for their academic credentials, talent for teaching, and practical business experience. We also do business simulation activities, constructing scenarios in the classroom and applying them to real life business, allowing us to work with a number of corporate organizations in solving their day-today business challenges. HULT is about to merge with Ashridge Business School, which is the biggest business school merger to date. Our partnerships are almost exclusively from the private sector, representing around 90%. We are working on both fronts, domestically and internationally, with clients.




The numerous universities now based in Dubai are striving to attract the best in teaching staff from around the world, while simultaneously ensuring their students get the opportunity to sample global business practices.

MOHAMED SALEM Acting President, University of Wollongong in Dubai (UOWD)


here are a number of private and public sector partnerships that we are fostering in order to bridge the gap between academia and industry. As a general standard, this process starts with the University advisory boards, which include key members who are at the forefront of industry. It is their role to advise the University on economic trends, new government policies, developments in the private sector, and so on. Our students are required to spend three months on a work experience placement in a relevant industry to their studies. We have noticed that when students complete their internship, they often come back with a clearer idea of what they’d like to specialize in. Internship programs are extremely important components of our students’ education as they bridge the gap between academic theory and industry practice. We will be rolling compulsory internships out to the Faculty of Business soon. We have seen a 60% rise in employment opportunities being offered to our graduates over the past year.



Academic Director, Head of Dubai Campus & Murdoch University Senior VP of Institutional Dubai Development, S P Jain School of Global Management


randing Dubai as a global educational hub will probably be the number one priority. Dubai has everything, the infrastructure, the brand name, the connectivity, the proximity, and of course, the greatest advantage, the visionary leadership of His Highness. It is just a question of time before they take it to the next level and showcase Dubai as a brand of choice for education. In terms of recent initiatives that I think are particularly effective, I believe one was the establishment of the Knowledge Village, and the other was the Dubai International Academic City, as well as the representation of Dubai as an educational hub in international forums and conferences in 2014. During 2015 Dubai is hosting the Gulf Education Conference, which is coming to the region for the first time. The event is normally held in London and this is in of itself an interesting idea that has come of age. KHDA, the licensing and Quality Assurance body of the Government of Dubai, has also played a crucial role in streamlining the quality of education in Dubai.


e try to partner with both local and multinational companies to allow our students to work on real life cases. In that respect, we have partnered with numerous banks and some large MMCs to have our students develop, for example, marketing plans or future strategies. In one particular case, the result was sufficiently good that the organization decided to implement the idea that some of our Master’s students had developed. Similarly, we run a unit on entrepreneurship and, in at least two cases, students have taken a project that they developed as part of the entrepreneurship unit, launched it as a business, and are now successfully running that business. We make a point in all of our teaching to contextualize for the UAE so that our students are aware of how things operate here, the nature of the business climate, and so that they are well prepared such that when they go out they are not going to run into a situation where what they were taught out of the book is radically different from reality.

DR. LOIS SMITH Director, Middlesex University Dubai


he objective of the Center for Innovation in Management (CIM) is to establish links with industry, particularly for our Master’s programs. Our biggest Master’s program is the MBA, and we have five different pathways within that. We also have popular Masters programs in Marketing and Communication and in Human Resource Management, which is CIPD accredited in the UK. Middlesex University Dubai has quite a strong business presence in undergraduate and postgraduate programs. CIM is geared toward building up those industry links, for example, we have a distinguished lecture series in which we have various guest speakers coming from industry to talk to the students. We organize events on campus, particularly for business leaders in the market, so they can come and interact and meet our students. We actively develop links with employers to get internship experience for our students. One of the aims of the Dubai government is to develop the Emirate as an educational hub, which is how Knowledge Village and Dubai International Academic City came about.


DUBAI 2015


With so many expatriates looking to give their kids the kind of education they’d get back home, private schools in Dubai are rising to the challenge.

SCHOOL IN THE CROWN DUBAI IS EXPERIENCING exponential growth in its population due to the return of the family-based expatriate community and expected economic opportunity throughout the region. This means that more and more primary and secondary schools are needed. With the surge in pupils expected to grow from 243,000 in 2014 to 400,000 by 2020, many private schools are entering Dubai to capitalize on this opportunity. In the past three years, 26 private schools have opened with the expected figure of 169 in total reaching 250 by 2020. The Knowledge and Human Development Authority (KHDA) has recognized this trend and ensured that these private schools will contribute to the overall goals and objectives of the UAE’s National Agenda. One of the highly anticipated school openings is Chinese International School, Dubai’s first private school teaching a curriculum in Mandarin. The project was announced during the Chinese New Year celebration at the Dubai’s Chinese Learning Centre, and has attracted investment from both China and Dubai and is expected to reach about $32.7 million. Another language focused school opening in Autumn 2015 is the Swiss International Scientific School. The school will have space for 1,400 pupils aged 3 to 11 with a secondary school with 1,000 extra spaces and is expected to open in 2017, and its boarding facilities to open a year or two after that. One of India’s oldest and most reputed educational groups, CMI Rajagiri, runs more than 500 educational institutions and has launched a new school in Dubai, the Amled School, which will be located in the Al Khail area of Dubai. The school will initially offer classes from Kindegarten to Grade 5 in the 2015-16 academic year. CMI Rajagiri plans on increasing its footprint in the region with future schools in Abu Dhabi and Sharjah. Within this expected growth, the Knowledge and Human Development Authority (KHDA) is playing a key role in ensuring the quality of the education by imposing strict guidelines school’s management. In 2014, HH Sheikh Mohammed set the National Agenda in the form of guidelines that will help in the implantation of

the UAE Vision 2021. The National Agenda has two main objectives in relation to the UAE’s ranking in international assessments in 2021: to be among the 20 highest performing countries in Programme for International Student Assessment (PISA) and to be among the top-15 highest performing countries in the Trends in International Mathematics and Science Study (TIMSS). Due to these aspirations, and Dubai’s current position below average in both categories, the KHDA will evaluate all prospective candidates for their knowledge of these international assessments and plans to successfully integrate the expectations in the school’s curriculum. Only after the prospective principal undergoes and passes the evaluation process, they are able to be appointed to the position. With the large amount of upcoming schools and the necessity for delivering on the objectives of the UAE’s National Agenda, the KHDA has developed the Education Cost Index (ECI) initiative. The ECI is calculated annually by the Dubai Statistic Centre, which takes into account the consumer price index and school operation costs including salaries, rent, and utilities. Based on the new ECI, schools rated “outstanding” in the next inspection results will be able to increase their fees 5.84%, double the established ECI of 2.92%. Schools rated “good” can increase their fees by 4.38%, 1.5x the ECI, while schools in the “acceptable” or “unacceptable” category can increase their fees by 2.92%. By doing so, the KHDA has recognized the importance of balancing the profitability of the school with its quality of education. In sum, private school investment is expected to continue its growth trend as Dubai’s economy continues to accelerate and demand for seats increases. However, the KHDA has recognized that while schools seek profits, the emphasis must be on the quality of education. In light of this, the KHDA will play a fundamental role in appointing the leadership as well as financially rewarding the performance of private schools. With this, the KHDA aims to ensure the success of the educational benchmarks of the UAE National Agenda. ✖





uncommon QUALITY TBY talks to Prof. Muthanna G. Abdul Razzaq, President and CEO of the American University in the Emirates (AUE), on identifying market demand, increasing graduates’ employability, and closing the gap between theory and practice. What are the most pressing needs that currently divide the higher education sector, and what is American University’s strategy to close that gap?

BIO Prof. Muthanna G. Abdul Razzaq has served as the President of the American University in the Emirates (AUE) since its inception in 2006. He completed his Bachelor’s in Business Administration and Accounting in 1976 from Al Mustansirya University and went on to receive his post graduate diploma in Cost Accounting in 1979 from Baghdad University. He finished his PhD in Management Accounting from the University of Manchester Intitute and Technology (UK). His passion for educational excellence led him to the establishment of Abu Dhabi University in 2000 as a founder and one of the owners. Prof. Muthanna also served in various capacities such as Chairman of Academic Committee, Member of the Board of Trustees, Vice President for Scientific Research, Member of the Board of Governors, and Vice Chancellor for Administrative Financial Affairs at Abu Dhabi University.

With the announcement of World EXPO 2020, Dubai has some ambitious plans indeed. The vision of the leaders in Dubai is always to be number one. At AUE we support the national agenda by assessing the market needs and developing the required academic program. We have established highly active advisory boards of people from the industry who advise academics on the demands of the market. These boards support the objectives of the program, making it more relevant to the market and enhancing graduates’ employability. In other words, they help us in the development and improvement of our current programs by teaching our graduates the skills they need. The challenge is to strategically form the kind of programs that will help our graduates compete in the market. We need to get away from the concept that universities only concentrate on theory. A university should bridge the gap between theory and practice. At this university, we have also added a third dimension of soft skills. Graduates with knowledge, experience, and skills should be initiative takers. When a student graduates, he or she should have a solid conceptual framework plus the right skills and experience. They should be creative, critical, and persuasive communicators. In summary, we are identifying market de-

• Six colleges offering Bachelor’s and Master’s programs • Programs focus on theory, practice, and soft skills

mand on a yearly basis to offer programs that really meet those demands. How does this strategy work day to day?

The university intends to provide the the students a taste of the real world from day one of their joining through experiential learning. The teaching pedagogy and the program delivery incorporates lab sessions, field trips, and mandatory participation in extensive seminars and workshops. However, we are also noticing that the onsite training for some students is not very useful. For example, law students were sent to Dubai court to complete internships. They were not involved with real cases because they were not trusted with confidential matters. Instead, they observed and did menial tasks. The students were not given onthe-job training, so we started offering the internship in two parts, internally and external-

ly. At AUE we have established a mock court. We signed an agreement with Dubai court and many renowned legal firms. We choose closed cases and remove the names of the parties. Students take the cases, then present and defend them in simulated conditions against a real prosecutor. As you know, the law in this country is in Arabic, and we also offer courses to improve public speaking and pronunciation. What are some of AUE’s programs that employ a critical-thinking based approach with students?

We offer unique programs that are in high demand in the market, such as digital forensics, used to solve cyber crimes; network security; and Information Technology Management (ITM), useful to counter the issue of people’s lack of skills to manage IT resources. We also offer a Master’s degree in Diplomacy and another in International Relations, the first of its kind in the region. Most of these graduates assume high profile leading postions. We have Bachelor’s and Master’s degrees in Security and Strategic Studies, which is unique in nature and not offered commonly. We work hard to deliver quality programs; this will keep us in the market. Quality is necessary for survival. What are your expectations for the coming year?

Our goal over the coming year is to continue to strive to be one of the top universitites through offering quality, unique, multi-disciplinary programs. In addition, we want to contribute to society through the pursuit of education, learning, training, and research. ✖


DUBAI 2015


getting THE PULSE THUMBAY MOIDEEN Founder and President, Thumbay Group

DR. ABDULKAREEM SULTAN AL OLAMA CEO, Al Jalila Foundation What are your organizations doing to develop the medical sector in Dubai? THUMBAY MOIDEEN Being a teaching hospital, we have lots of patients enter the hospital because the prices are cheaper in our hospitals, yet we manage to maintain our superior quality nonetheless. We make our services affordable, allowing more patients to receive treatment. Directly, every Emirate wants us to come, including Abu Dhabi, and the insurance companies want us to come, too. Affordable healthcare makes a huge impact on the community. In our case, our new strategic plan is to ensure that our university is fully research based in the next five years. We are working towards that, and right now we are raising funding through our own company. Our foundation is currently funding our research department with over 10 million dirhams, but we are hoping in the future that more funds will come in. We are taking a lot of initiatives in the private sector, and we aim to actively collaborate with the government on this. DR ABDULKAREEM SULTAN AL OLAMA We believe that supporting homegrown medical talent is just as important as developing state-of-the-art infrastructure, and we are proactively doing this with a number of scholarships, grants, and fellowships. Scientists can re-

Leadership from two important healthcare institutions in Dubai discuss the social dynamics of the Emirates evolving healthcare system.

ceive up to AED 300,000 in seed grants to fund medical research projects; our fellowships support Emirati medical students to train at some of the most prestigious medical institutions around the world to bring global best practice back to the UAE; and our scholarships enable Emirati healthcare professionals to further their specializations. While we invest in the future health of the UAE, we value the importance of supporting those in need today. Our A’awen (“support” in Arabic) program provides access to quality healthcare for those who cannot afford it, and we have helped many patients reach their true potential by funding life-changing treatments. Meanwhile our Ta’alouf (“harmony” in Arabic) program trains the parents and teachers of children with special needs to understand their children better and act as therapists themselves, a model which is highly sustainable. How do you see the sector developing in the years ahead? TM The government’s strategic plan for Dubai aims to turn the Emirate into a hub for medical tourism. Being in the private sector, we were the first business to take this initiative. We started five years ago, and we were planning on being an example for other countries, to bring in their people for medical tourism. Today, we are bringing in people

from over 20 countries, and right now we are targeting countries with a shortage of healthcare, for example on the African continent or Afghanistan. Medical tourism does not only mean good healthcare, it also means good prices. India is a fantastic country for healthcare, but the issue there is the lack of strong supportive infrastructure, such as we have in the Gulf. AO Developing effective medical research and sustainable healthcare is a long-term process that requires significant resources. We are grateful for the support we have received from generous corporates and individuals so far. As a Foundation that is fully funded by donations, we are thrilled to see more philanthropists and business leaders eager to join Majlis Al Ata’a, a national movement launched in 2014 to support the sustainable development of a thriving medical research sector in the UAE. Visionary leaders are lending their financial capabilities and influence to support medical research for the long-term. This continued support will enable Al Jalila Foundation to facilitate cutting-edge research. Looking ahead, we are optimistic about the future. Our rulers have named 2015 the “Year of Innovation,” and we will help to make this happen by driving innovation and progress in healthcare to benefit current and future generations. ✖





HE Helal Saeed Al Marri, Director General of the Dubai Department of Tourism & Commerce Marketing, on emerging markets.

The Dubailand project is back on track and is under development by international project developers and financiers.

Dubai has become a foodlover’s paradise and an international heartland for the taste-seeker.


Tourism & Retail REVIEW

Dubai plans to double the number of yearly visitors by 2020 to 20 million. The Emirate’s target is at the heart of its 2020 strategy, and efforts are being made to attract more families and increase the number of midrange hotels.


ourism is big business in Dubai, contributing 20% of the Emirate’s GDP. Total hotel revenues came in at $5.95 billion in 2013, up 16.1% on 2012. Between 2003 and 2014, visitor numbers grew 7.5% YoY. World Expo 2020 will coincide with the culmination of Dubai Vision 2020, aiming to draw 20 million visitors a year, generating $85 billion for the tourism industry. Attracting families is at the heart of this effort, and Dubai is developing a multitude of attractions with this in mind. Theme parks, safaris, and holiday villas have replaced the traditional emphasis on top-of-the-range hotels and the luxury sector. The Emirate is now striving to present itself as a “destination of choice,” offering something for everyone, and adding diversity to its mainstay tourist attractions of hotels, shopping, and sun, sea, and sand. The renewed strategy of encouraging travellers to see Dubai as a destination in it-


Responding to a growing number of visitors from across the Arab world, especially Saudi Arabia, Dubai is increasing its offering of villa and serviced apartment short-term accommodation, shifting its traditional emphasis from high-end hotels.

self, and not merely a stopover, appears to be working. The average length of stay is increasing and the greater range of more affordable accommodation is encouraging this effort. According to Deloitte, the average length of stay at Dubai hotels has risen from 2.2 days in 2002 to 3.5 days in 2014, while the length of stay at hotel apartments has increased even more, from 3.1 days in 2002 to 5.7 days in 2013, adding significantly to the demand for guest accommodation. Around 80% of visitors come from 10 countries: Saudi Arabia, India, the UK, America, Russia, Kuwait, Germany, Oman, Iran, and China. The importance of the sector is reflected in the leviathan structures of the ubiquitous Department of Tourism (DoT). In its wide-ranging role of “Welcoming the World to Dubai,” the DoT is the well-funded body responsible for meeting some big targets. It does this through its sub-division partner, the Dubai Corporation for Tourism and Com-


DUBAI 2015


merce Marketing (DCTCM), a newly established body overseeing Dubai’s branding, promotion, and marketing strategies. The Department’s second arm, the longer-established and more visible (yet confusingly similar) Department for Tourism and Commerce Marketing (DTCM), operates out of 12 offices around the world in addition to its headquarters in Dubai. DTCM markets and promotes the Emirate’s tourism sector, and also issues licenses and generally regulates the industry. DTCM’s published goal is nothing less than to make Dubai “the leading destination for global travel, business, and events by 2020.” Its impressive aim is to double the number of visitors from 10 million in 2012 to 20 million by 2020. A less well-defined mission to “strengthen the Dubai economy by attracting tourists and inward investment into the Emirate” accompanies this vision. There is, then, a lot resting on tourism’s success, and the DCTDM and DTCM are working to foster PPPs across the economy to promote the Emirate to the widest possible market. This strategy marks a break with Dubai’s traditional focus on high-end clients and the luxury sector. Across the board, tourism is becoming an all-embracing affair, with a particular effort to encourage families and middle-income tourists. More three- and four-star hotels, and budget accommodation, in the form of self-catering villas and apartments are opening alongside a plethora of family-friendly attractions.

A FAMILY AFFAIR The tallest (for now) building in the world, the Burj Khalifa, the sail-inspired Burj al-Arab, and many of the biggest shopping malls are now headline attractions, famous the world over for their iconic designs and vast proportions, and are rapidly being joined by a growing list of family attractions. The usual hotel pools, restaurants and beaches now vie with Dubai Mall’s shark-filled aquarium, skiing in the Mall of the Emirates, Dubai Zoo, the roller-coaster style Wild Wadi Water Park, and, opening in 2016, Legoland. Dubai’s food and shopping festivals are now firm fixtures on the calendar, as is Art Dubai. Amid all this dizzying development, Dubai Creek is the area that represents old Dubai— the traditional abra boats chugging back and forth take passengers (for AED1, or $0.27 a crossing) to the gold souq, the spice souqs of Bur Dubai, and the cafes and traditional courtyard houses on the waterfront. The Dubai Museum tells the story of the city’s beginnings as a village of pearl fishing and trading, with boats up and down the Creek laden with wares for home or overseas. Much of this area, and in particular the historic quarter known as the Bastakiya, was made up of fishing and pearling villages which, in the 19th century, was colonized by Persian trade merchants who developed the area’s distinctive housing, complete with cooling “windtowers,” and at the same time began in earnest the development of Dubai and its trading waterfront. The Creek, the

The Middle East is considered the new China in terms of being a growth market, hence the timing is good for the Dubai market at the moment. Also, Dubai is doing well, and the retail market is very good in the shopping center industry. We want our product to differ from what is available in the direct market place, and at the same time play a role in corporate responsibility. We also want to continue to be a major destination when it comes to tourism as well. Currently, some 30% of our business comes from tourism.

AHMED RAMDAN Group CEO, Róya International How is the current economic climate affecting Roya International’s overall strategy? There is no doubt that Dubai has slowed down due to the combination of sanctions on Russia, which was quite a lucrative market for Dubai, followed by geopolitical issues with oil prices. The drop in oil prices and the euro has also affected us. In this environment, we are recommending that the hotels under our control tighten their belts, look at the different segments, and become a little bit more creative because, when one market goes down, another market rises. I believe that 2015-16 will be challenging, but that the situation will begin to reverse in 2017 as the country gears up for the Expo in 2020.

How are you coordinating with the public sector to streamline these initiatives? We have a regular meetings with the public and private sectors’ major developers. By default, because this is a merchant city, the people of Dubai are highly resilient to these kinds of situations. So for 2015, we will slow down on opening new hotels, and the same in the real estate market. Do not forget that Dubai has been lucky for a long time. It will rebound very quickly from this because of our reputation, our global interconnectivity, and our infrastructure, especially tourism infrastructure, which is unparalleled in the region.


DUBAI 2015

DTCM’s published goal is nothing less than to make Dubai “the leading destination for global travel, business, and events by 2020.” Its impressive aim is to double the number of visitors from 10 million in 2012 to 20 million by 2020. A less well-defined mission to “strengthen the Dubai economy by attracting tourists and inward investment into the Emirate” accompanies this vision.

crease by 16.7% in 2015. This positive trend is partly due to greater efficiency in the hospitality industry, and also a big drive to expand the sector. By 2016, DTCM expects to add a further 20,000 rooms—taking the Emirate closer to its 2020 target of 155,000 rooms— fully doubling its room capacity. According to Deloitte, Dubai needs to build an additional 283 hotels between 2015 and 2020 if it is to meet its target. And in the immediate region, Dubai is facing stiff competition. From within the UAE, Abu Dhabi is opening ever more hotels and is competing with Dubai for its draw of foreign visitors to the new museums, sporting events and shopping malls. And neighboring Qatar and Oman are both seeking to increase their tourism industries, making the sector a priority target for growth. Dubai is the most expensive city in the Middle East, and the 22nd priciest in the world

SPORTS city’s historic waterway, dates from 1896 and is at the center of the city’s trade to this day.

TOP DIRHAM There remain stiff challenges to overcome if these aims of expansion and diversification are to be fully realized. Dubai is the most expensive city in the Middle East, and the 22nd priciest in the world. Only the Swiss resort of Geneva has more expensive hotel rooms. From 2013 to 2014, the occupancy rate declined marginally, from 79 to 78%, while the average daily room rate rose from $235 in 2013 to $238 in 2014. However, the city’s hotels are set to experience double-digit growth, with operating profit per room forecast to in-

Straddling the coast, and with some spectacular backdrops to offer sports enthusiasts, Dubai is capitalizing on its reputation to develop world-class sporting events and facilities. The Dubai World Cup is perhaps the most prestigious horseracing event anywhere in the world. The Dubai Classic Golf and the Barclays Dubai Tennis tournaments are both firm fixtures on the international sports calendar. Adventure sports are also gathering momentum. Skydive Dubai affords unique views of the city from unique perspectives— during the course of a 26,000-sqm drop zone area taking in the soaring Burj Khalifa, the Burj Al Arab, the Dubai Marina, and Palm Jumeira. Indoor skiing, polo (played on camels), and jet skiing are also increasingly popular. ✖


DUBAI 2015


remarkable GROWTH TBY talks to HE Helal Saeed Al Marri, Director General of the Dubai Department of Tourism & Commerce Marketing (DTCM), on emerging markets, diversifying the hotel sector, and establishing Dubai as a business and tourism hub. How would you describe the performance of Dubai’s tourism sector last year?

Dubai’s hotel establishments welcomed more than 11.6 million guests in 2014, representing a 5.6% increase on 2013. The year’s figures also revealed significant increases in hotel establishment revenues (up 9.8%), guest nights (up 7.4%), and average length of stay (up from 3.78 to 3.84 days). The growth in revenue is particularly notable considering the 9.2% increase in available rooms. Overall, figures indicate that our hospitality industry is in a healthy state and, most importantly, that growth is sustainable. The emirate’s top ten hotel guest source markets remained almost unchanged in 2014, with China registering the largest growth (a 24.9% YoY rise in hotel guests), with India and the UK also showing significant increases, growing by 12.2% and 11.3% respectively. The devaluation of the Russian ruble resulted in a general global drop in the number of Russian overseas travellers, though Dubai was able to offset the decline with increases in guests from East Africa and CIS countries. In 2014, Emirates and Flydubai opened up new routes and expanded capacity on existing ones. At the end of the year, Dubai International surpassed London Heathrow to become the world’s busiest airport for international passengers—an achievement that is all the more remarkable given that the airport underwent an upgrade project that resulted in an 80-day runway

Dubai International the world’s busiest airport for international passengers at year-end 2014

closure over the summer. Dubai made significant progress in further diversifying its hotel sector, increasing development of three- and four-star properties, as well as a number of five-star properties. In 2014, a range of attractions opened, such as The Beach at JBR and Jumeirah Corniche. Dubai has also added to its festival calendar with the launch of Dubai Food Festival and RedFest. What are the primary source countries of visitors?

Dubai benefits from its strategic position between East and West, and its source markets are spread widely across the world. A key focus for us in 2015 is attracting first-time visitors from emerging markets, as well as new and repeat visitors from our established markets such as Saudi Arabia and India. Dubai is leveraging its geographic location to become a business and tourism hub for emerging markets in Africa and CIS countries. We expect to see increased visitor numbers, driven by the recent launch and upgrades of Flydubai and Emirates routes

to these regions, as well as Emirates’ plan to increase operations in Africa by over 40% over the next decade. Recent legislation in the UAE is also making it easier for tourists to visit. In March 2014, a UAE federal ruling exempted citizens of 13 EU member states from requiring pre-entry visas. This has already contributed to a 17% increase in hotel guests from these countries, and we expect this trend to continue. What projects or developments will drive tourism market growth going forward?

In 2014 a range of new projects was announced, including the Dubai Parks & Resorts’ plan to build three theme parks, with the first phase ready in 2016. The project will go towards realizing our goal of transforming Dubai into one of the world’s leading family destinations. It will be accompanied by other upcoming projects such as Dubai Safari Project, Wire World Meydan Adventure Park, IMG Worlds of Adventure, and the recently announced Dubai Historical District. Besides hotel openings in 2015 and beyond, development of Dubai’s events calendar will also foster progress. We will soon be announcing the addition of a new festival modelled after the Dubai Shopping Festival. Closely linked to this is the continued rollout of DTCM’s new e-Ticketing platform, which aims to expand event ticket distribution channels, enable more in-depth analysis of the events industry, and ensure customer protection and satisfaction.

What are your expectations for the year ahead?

For long-term growth and to achieve our Tourism Vision for 2020 targets, we need to increase the number of hotel rooms in Dubai, while balancing the planned increase in supply with demand. We need to ensure that Dubai maintains its high occupancy rates and avoids room rates that are too high or low. We are continuing to work closely with our hotel and other partners to guarantee that Dubai remains an attractive destination for every type of traveller, while aiming to foster growth from emerging markets and diversify Dubai’s source markets. ✖

BIO His Excellency Helal Saeed Al Marri is the Director General of Dubai’s Department of Tourism and Commerce Marketing (DTCM), the principal authority responsible for strengthening Dubai’s position as a world-leading tourism destination and commercial hub. He was also a Higher Committee Member for the successful Dubai Expo 2020 bid organization and is Chairman of the Sheikh Hamdan Bin Mohammed Bin Rashid Sports Complex. He concurrently serves on the boards of government and UAE-based private sector entities including Dubai Chamber of Commerce and Industry, Dubai Events and Promotions Establishment, International Humanitarian City, ARAMEX, and Taaleem Education among others. Having previously been a consultant with McKinsey & Company and KPMG, his experience spans a diverse portfolio of industries across geographies. He holds an MBA from the London Business School, and is a Chartered Accountant from the Institute of Chartered Accountants in England and Wales.

Tourism & Retail




SUITS ALL TBY talks to Gerald Lawless, President and CEO of Jumeirah Group, on the new Venu brand, the impact of new threeand four-star hotels, and expectations for the future.

BIO Gerald Lawless is a graduate of Shannon College of Hotel Management in Ireland, holds an Honorary Doctorate of Business Administration in Hospitality Management from the Johnson & Wales University, Rhode Island, and an Honorary Doctorate in Law from the National University of Ireland, Galway. He is a Member of the Executive Committee and Vice-Chairman of Corporate Governance of the WTTC. He is also a Member of the Global Agenda Council for Aviation, Travel, and Tourism of the WEF, a Fellow of the Institute of Hospitality, a Member of the Advisory Group of the Global Irish Forum, a Member of the International Advisory Board of the Ecole Hôtelière de Lausanne, a Member of the Dubai Holding Executive Committee, and a Member of the Board of Trustees of the Emirates National Development Programme. He is also Chairman of the Board of Governors of the Emirates Academy of Hospitality Management, a former Non-Executive Director, and Member of the Board of NASDAQ Dubai and Travelodge.

widespread—and we are continuing to expand the franchise. Regional and international expansion is of high importance to the Jumeirah Group, which now has representation throughout North Africa, the Middle East, Europe, and Asia. Which international markets present the greatest opportunity for growth?

How would you describe the dynamic between the traditional Jumeirah Hotels brand and the new Venu brand?

Stay Different, the original Jumeirah brand, has always been the foundation of the Group, which we are continuing to develop regionally and internationally. Venu, our newest hotel brand, is a contemporary lifestyle brand aimed at competing within the lucrative lifestyle segment. We are more flexible on room size with the Venu brand depending on the style and feel of the hotel; we would consider, for example, a room size of 32-35sqm for this brand. Jumeirah hotels usually have a 50sqm minimum room requirement. The target audience for the Venu brand is also slightly different, though not necessarily younger or more budget-conscious than that of Stay Different; the two brands complement each other. What is the strategy behind your food and beverage division?

Our dedicated food and beverage division, which is essentially a separate company, is composed of 32 restaurants located in our hotels in Dubai. They rent space within our hotels and operate outlets as standalone restaurants. We wanted to give our hotel guests the feel of dining at a restaurant that is not part of a hotel operation. We offer them exceptional cuisine, a dedicated service team, as well as a distinctive concept and theme unique to that particular restaurant. We have a large portfolio of brands—the Noodle House being the most

Asia continues to be a very interesting source of business for potential hotel development. There are still opportunities to expand our Venu portfolio in China, and we are not yet present in Beijing, Dalian, or Tianjin. We would like to open another hotel in Shanghai in addition to the already successful Jumeirah Himalayas Hotel. Likewise, Vietnam and Cambodia have good potential; we already have a resort under development in Bali, and Indonesia offers attractive opportunities. We aim to be in Malaysia as well. The Middle East is of prime importance, particularly the UAE and Saudi Arabia. There is great potential in Africa, especially for Venu. We have already signed an MoU for a project in Angola, and we are looking at South Africa and West Africa. In East Africa, there are opportunities in places such as Kenya and the Seychelles, in addition to Mauritius, in which there is already a Jumeirah resort under development. Considering the expected influx of three- and four-star hotel investments, how do you see Dubai’s hotel industry evolving over the next couple of years?

Any mature market needs to have a complete range of products in terms of the styles and types of hotels. As Dubai expands and develops its tourism products, including theme parks and other activities for families, a budget hotel may suit visitors’ needs better. With the growth in numbers of travellers coming to Dubai, there will be a great need for more affordable hotel options. Dubai has always maintained

IN NUMBERS Jumeirah Group


hotels in operation in 11 destinations



restaurants and bars

a very high-quality, high-class image, and it will continue to do so in its budget offerings. Dubai has lofty targets for the buildup to the World Expo 2020; however, there is also a lot of concern for 2021. What are the industry’s expectations given the climate right now?

We are feeling confident given the status of Dubai’s current hotel development pipeline. In addition to hotels, we are also taking into account the number of serviced apartments coming online. In order to sustain an organic growth pattern, we have set a target to achieve 20 million visitors prior to the World Expo 2020. We also expect there will be a considerable demand increase coming out of 2020. We do not anticipate having to turn guests away, but hotels will be at capacity with roughly 25 million people coming per year. Dubai’s tourism market already has strength and depth, and it will be able to continue its evolution and growth subsequent to 2020. In addition, the continued growth and expansion of the Emirates airline will support this. Having said this, the industry cannot be complacent, and we will work hard to promote Dubai and continue stimulating demand. ✖


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BEYOND the HOTEL experience

How would you describe Emaar Hospitality’s primary focus?

Emaar Hospitality Group fulfils a key function in the integrated community development approach of global property developer Emaar Properties PJSC. The primary focus of Emaar Hospitality Group is to create, develop, and manage prime hospitality and leisure assets within Emaar’s developments not only in the UAE, but in key global markets. These assets play a significant role in adding to the lifestyle choices of resident and visitors. Over the years, we have developed several iconic hotel brands in Dubai including our flagship The Address Hotels + Resorts in addition to Vida Hotels and Resorts, as well as Arabian Ranches Golf Club, Dubai Polo & Equestrian Club, Dubai Marina Yacht Club, and serviced residences. We also

BIO As Chief Operating Officer for Emaar Hospitality Group, Philippe Zuber brings with him over 20 years of experience in the hospitality industry. Mr. Zuber joined The Address Hotels & Resorts in 2011 as General Manager of Emaar Hospitality Group’s flagship hotel, the Address Downtown Dubai. Prior to becoming COO, he served as the Regional General Manager of The Address Hotels & Resorts, in addition to providing his expertise as General Manager. He studied Hotel Management in France, and is a postgraduate in Finance and Management in the Hotel Industry. Prior to joining Emaar, He worked with a number of internationally renowned hotel brands in Hong Kong, South Korea, France, Germany, Morocco, and the US.

TBY talks to Philippe Zuber, COO of Emaar Hospitality Group, on the importance of offering varied choices to visitors, entertainment, and engaging service. manage Emaar’s portfolio in Dubai and other markets such as Turkey, Egypt, and Nigeria. We are expanding our capabilities to develop and operate new hotel concepts; currently, we are rolling out a new hotel brand for the joint venture between Emaar Properties and Meraas Holding. In Nigeria, The Address Hotels + Resorts is managing the first phase of residential and hospitality development in the Abuja Centenary City, developed by a private investment and real estate development company. What will the brands of Vida Hotels and Resorts and others add to the portfolio of Emaar Hospitality?

With each of our hotel brands, we have a very niche and distinctive positioning. For example, The Address Hotels and Resorts is a five-star premium brand, and with Vida Hotels and Resorts we offer lifestyle boutique hotels that appeal to the new generation of tech-savvy youth and entrepreneurs. Vida Hotels and Resorts is also managing our upcoming property Manzil Downtown Dubai. Manzil offers a stylized hub with an engaging service based on Arab hospitality assuring memorable experiences for the urban traveller. Drawing inspiration from both Dubai’s heritage and its remarkable leaps of achievement, the properties

serve as smart, tech-savvy, social, and cultural hubs for international explorers. Ultimately, we aim to deliver refreshing, innovative, stylish, and exquisite experiences for our guests across different touch-points. What is Emaar’s growth strategy over the next two years?

Our growth strategy is to further consolidate our presence in Dubai’s hospitality sector with a diverse portfolio of elegant lifestyle properties, as well as explore management contracts in fast-growing international markets. In Dubai, we complement the Tourism Vision 2020 announced by His Highness Sheikh Mohammed bin Rashid Al Maktoum, UAE Vice President and Prime Minister and Ruler of Dubai, to welcome over 20 million annual visitors by the turn of the decade. Our development strategy will also support the preparations for the World Expo 2020. There is a lot of news lately regarding three- and four-star hotel chains like Starwood and Marriot developing hotels in Dubai. How will these affect the hospitality industry?

With the city serving as a strategic hub, only four hours away by flight to over 2.5 billion people, developing a diverse hospitality sector that offers varied choices for visi-

Launching Rove Hotels, Emaar’s midmarket hotel brand

tors will contribute to the robust growth of the sector and the economy as a whole. The development pipeline of the value segment no doubt holds tremendous potential and will complement the portfolio of five-star and ultra-luxury hotels. In fact, we are creating our own niche in the value sector through our new hotel brands. Some hotel brands are shifting from single unit hotels to hotels based around entertainment areas. How is this industry evolving in Dubai?

Location is of strategic importance for the success of a hotel brand and individual properties. Each of The Address Hotels and Resorts five properties in Dubai is located in unique lifestyle destinations that offer more than the “hotel experience” to guests. For example, The Address Downtown Dubai is located centrally in “The Centre of Now,” next door to Burj Khalifa, the world’s tallest building. This trend is now taking further roots in Dubai with several new hotels being part of dynamic locations that offer easy access to a wide range of leisure and entertainment. ✖

Tourism & Retail






General Manager, Tamani Marina Hotel

General Manager, Marina View Hotel Apartments

How does your hotel stand out in Dubai’s saturated hotel industry, and what amenities do you offer guests?

associates, and society in general. It is easy to work here, and we have a fantastic employee environment. This is our approach; our philosophy differs from other hotels.

WALID AL-AWA We have a mission and vision that comes firstly from our religion; everyone here is equal. Our approach is that once you enter the hotel, you feel safe and calm—like you have come home, and whenever there is feedback from our guests, we act immediately on it. The building Tamani Marina Hotel is housed in was originally intended to be a residential tower. We offer huge rooms with a fantastic view of the Palm, in a great location. Throughout the hotel, we display Islamic art, which is one way in which we stand out from Western hotels. Tamani supports charities, and we host charity events every month with the participation of our employees. In order to show our responsibility to the community, we participate in events ranging from cleaning up the city to sponsoring yearly Ramadan activities. We have hosted an art auction, from which all profits went to charitable organizations. We not only respect our guests, but our employees, owners, suppliers,

SAMIR MOUSSA From 2013 to 2014 we saw significant changes around our property, starting with the main hotel lobby. We have refurbished the entrance, choosing marble tiles in soothing earth tones. Dubai Marina View Hotel Apartments is primarily a family-oriented hotel, and the idea was to make this a home-away-from-home for all guests from the moment they step inside. The second set of notable changes is in the poolside area. Some landscaping was incorporated, and we updated the swimming pool tiles. We organize games and activities daily for our guests to participate in, such as water volleyball. Accordingly, it was important for us to create an aesthetically pleasing as well as practical area for visitors to enjoy. We also expanded our family restaurant, building a terrace for the spill over of diners we receive. The terrace is a relaxing area with two large screens, four TVs, and an impressive audio system, airing internation-

HOME from home Serviced apartment hotels are offering visitors a comfortable stay in Dubai, providing much-needed rooms and amenities to support the thriving sector. al sports. The terrace seating area was very popular during the 2014 FIFA World Cup. In our experience, not many hotel apartments within our category can honestly match the number of onsite amenities we offer. For example, we have an electronic shop that sells mobile phones and accessories. Here, guests do not need to go far to pick up any gadget they may need during their stay. The gentlemen’s spa and ladies’ salon are other unique features not typically found at hotel apartments. These subtle differences appear to have positively impacted on the hotel’s popularity. How will new infrastructure and investments in Dubai help the Emirate become a top tourism destination? WA Dubai has come a long way over the last 15 years or so; you can see what it looks like now compared to the early 1990s. When the metro was built people questioned its usefulness

as everyone drives cars, but is has been incredibly successful. The new Marina Tram will likely see similar results. With an increasing number of hotels, it is becoming easier for tourists to come to Dubai. We will need even more hotels to support the sector. Dubai is now competing with major cities around the world, like Istanbul and London. SM With the upcoming Expo, Dubai is expected to receive 20 million visitors annually over the next few years, almost doubling 2014 figures. Additionally, over 100 new competitors are set to enter the market considering the new developments in the pipeline, such as the Mall of the World that is expected to feature at least 100 new hotels alone. As a brand, Dubai should be positioned as a futuristic city, the world’s main business and leisure hub, and a safe haven for travellers. These points are crucial to the Emirate’s development. ✖


DUBAI 2015


HOST TO MUCH The delayed Dubailand project is back on track and is under development by international project developers and financiers. WITH DUBAI POSITIONING itself as a tourism and leisure hub with a target of 20 million tourists in the build up to World Expo 2020, developers are looking to expand the Emirate’s tourism offerings to appeal to different customer segments. Since the 2008 financial crisis, many tourism projects have been put on hold, including Dubai Properties Group’s Dubailand project. Originally launched in 2003, by Dubai’s ruler HH Sheikh Mohammed Bin Rashid Al Maktoum, the project was delayed due to the fall out of the real estate market and financing challenges. However, due to the resiliency of Dubai’s economy, the development of Dubailand is picking up speed and on track for completion prior to World Expo 2020. Envisioned as a regional and global tourism hub, Dubailand is spread over 3 billion sqft and hosts a number of sports, leisure, entertainment, and shopping attractions that are either operational or under development. Currently, Dubailand attracts over 13 million visitors a year from the UAE and overseas. Dubailand is a growing district of Dubai with sporting, entertainment, and shopping, and residential communities. The destination will continue to draw and host diverse attractions scheduled to open in the coming years to reinforce Dubai’s position as an international hub for family tourism. It is 25 minutes from Dubai International Airport, 20 minutes from the newly opened Al Maktoum International Airport, and 60 minutes from Abu Dhabi, the capital of the UAE. Dubailand is managed by Dubai Properties Group (DPG) and offers investor management, destination management, and infrastructure development services, in addition to developing its own portfolio of properties within the district. Dubailand is also attracting developers and investors in the aforementioned sectors to develop tourism, leisure, and residential projects that will benefit both residents and visitors to Dubai. Currently, international investors are beginning to develop the key aspects of the project. Saudi Al Hokair Group has revealed that the Al Sahara Kingdom hotel and entertainment

project in Dubailand should open in 2016. The Al Sahara Kingdom has been master-planned over a 50 million sqft area in Dubailand. The project was to include two four-star hotels to be run by Al Hokair-owned MENA Hotels & Resorts, an indoor theme park, restaurants, residential areas, and a retail souk. Tanmiyat Global, the developers behind Living Legends, a $1.9 billion mixed-use property development spanning 14.4 million sqft, say that 88% of villas in the development are now sold, while 33% of the apartments are still available. Tanmiyat Global said its landmark Dubai project is buoyant following the Dubai Property Show in London, where Living Legends confirmed that most of the villas in the development are now sold, while two-thirds of apartments have also been snapped up by investors. The development will include 500 villas and 12 apartment towers, along with a community clubhouse, 9-hole golf course, shopping mall, boutique hotel, schools, and clinics. Gulf Finance House (GFH), the Bahrain-based Islamic investment bank, has signed a land sale agreement with Dubai Properties Group (DPG) to establish a new mixed-use residential development in its Dubailand district. The land sale agreement, which involves the purchase of a total area of approximately 1.2 million sqft, aims to establish a high standard of residential, commercial, and retail space and facilities within Dubailand. The new development includes both separate and adjacent villas and housing groups on some 830,000 sqft in addition to integrated-services residential apartments on another 75,000 sqft. The development is slated to be complete by 2019. Dubailand will play a crucial role in the development of the tourism sector in Dubai and will help the Emirate achieve its goal of 20 million visitors by 2020. It is very encouraging that property developers and investors have been engaging Dubailand post-financial crisis and there has been demand for the developments by buyers and investors. With its continued success, Dubailand will make a tremendous impact on the tourism market and continue to transform Dubai into an international tourism hub. ✖


Situated on the prestigious Sheikh Zayed Road and minutes away from some of Dubai’s key locations. Offering elegantly styled rooms with unrivalled views accompanied by modern facilities, inimitable hospitality and outstanding service. PO Box 191055, Dubai, United Arab Emirates, T: +971 (0)4 387 7777 F: +971 (0)4 438 7778,


DUBAI 2015


be our GUEST

What are some of the landmarks and achievements of the Oberoi Hotel?

The Oberoi is a luxury fivestar brand that started 87 years ago. The Oberoi group is present in India, Bali, Mauritius, Saudi Arabia, and Egypt. The Oberoi, Dubai is our first milestone here in the UAE and officially opened on November 4th, 2013. Since then we have been recognized as Middle East’s Leading Luxury City Hotel by the World Travel Awards for two consecutive years and Best New Business Hotel by Readers of Business Traveller Middle East in 2014, and what really puts a smile on my face is the number one position we have been awarded in service by ReviewPro, which ranks your hotel based on an aggregate of reviews from social media websites like TripAdvisor, Booking. com, and other similar platforms. What were the factors that contributed to these achievements?

The hotel is extremely well designed and has one of the largest rooms in the city, expansive meeting venues, and panoramic views of the Burj Khalifa and Downtown Dubai skyline. But the real key to our success is our team. Our service is the secret of our success, and that is with any successful hospitality business. At Oberoi Hotels and Resorts, we invest a lot in our colleagues and follow a rigorous recruitment process. We have our own hospitality management school, The Oberoi Center for Learning and Development, which was established in 1966 in New

TBY talks to Karim Bizid, General Manager of The Oberoi, on the evolution of Dubai’s hospitality industry, catering to customers, and setting the bar high. Delhi. Most of the group’s team members are trained there. Additionally, the group has a legacy of caring for the communities and leverages our people, our brands, our relationships, and our global reach because we are uniquely equipped to help our associates and guests create a better world to experience. Environmental stewardship and social responsibility are core to the way the Oberoi Group does business We care about our associates, guests, owners, and communities, and commit to doing the right thing for all our stakeholders. For every guest that enters our hotel, we try to discretely find out their preferences. We aim to completely personalize our service. Every team member in the hotel is empowered to take decisions in order to deliver exceptional levels of service to guests at all times. Since the opening of The Oberoi in Dubai, how would you describe your customer base?

Middle East and Europe are our key source market. India undoubtedly remains strong given our brand presence

across the peninsula. We have a strong network of sales offices across the globe. Weekend travel is from neighboring Emirates. How would you assess the level of competition for hotels in Dubai?

I believe the level of competition here in Dubai is very healthy. There is a clear difference between luxury fivestar properties and three- and four-star hotels, which all complement each other to position Dubai on global tourism and commercial maps. I am very happy that several great hospitality brands have opened here. What are your expectations for the year ahead?

We aim to be the hotel of choice for those visiting Dubai and to have a comfortable stay and an enjoyable time in Dubai. Since opening we have maintained our positioning of being amongst the top 5 on TripAdvisor out of 481 hotels in Dubai, by guest reviews. We aim to build on what we have achieved over the last two years. ✖

BIO Karim Bizid has over 26 years of experience in the hotel industry, including in the UAE, Italy, the Dominican Republic, Austria, Greece, Switzerland, and Tunisia. He is a graduate of the Swiss School of Hotel and Tourism Management and studied at Cornell University in Ithaca, New York. He also has an MBA from the University of Economy and Management.

Tourism & Retail




Image: Paul Saad


Through its remarkable economic growth, Dubai has become a worldclass city that attracts visitors and residents from across the entire world. Because of this, Dubai has become a food-lover’s paradise and an international heartland for the taste-seeker. DUE TO ITS LARGE EXPATRIATE community and geographic location, foodies can find some of the best cuisines from Asia, Europe, and the Middle East all in one place. Moreover, due to Dubai’s up-market attractiveness, fine dining options are in high supply. One of the many resident segments of Dubai’s population are those from India and, with them, came their food in its many varieties. Indian cuisine comprises a variety of regional cuisines given the diversity of the country’s climate, occupations, and availability of spices. In Dubai, one has access to a plethora of Indian food choices from these different regions. However, what truly sets this segment apart is the opportunity for “fine-dining” Indian cuisine, whereby customers can go to truly experience gourmet Indian food.

While its southern neighbor, India, has certainly spread its cuisine globally with great success, Dubai represents one of the best places in the world to try Pakistani food. As with India, Dubai represents a major destination for Pakistani workers who too have brought their food along with them. The salient differences between the two cuisines can be attributed to the focus that Pakistanis have on meat compared to the more vegetarian-oriented Indian cuisine. That being the case, the spices will differ slightly based upon the restaurant in question. That being said, if you’re a meat lover and looking for a South Asian vibe, be sure to search out a Pakistani restaurant in Dubai. Dubai is also called home to a massive amount of expatriates from Europe, especial-


Turkish, Lebanese, and Egyptian cuisines have established themselves very well in Dubai

The traditional kebab restaurants remain scarce outside of the Deira district

DUBAI 2015

Image: Lisa Murray

ly from the UK. Restaurateurs quickly latched on to this trend and developed a slew of European-style eateries that serve anything from a traditional English breakfast to Belgian beer. There are many pub-style eateries established throughout Dubai for those Europeans looking for a taste of home. Similarly, if a visitor is looking for a more refined experience, Dubai plays host to dozens of exquisite and gourmet European venues. One cannot discuss the food scene in Dubai without underscoring the opportunity for some of the best cuisine from the Levant region you’ve ever had. Famous in their own right, Turkish, Lebanese, and Egyptian cuisines have established themselves very well, and one cannot walk a couple blocks without seeing a restaurant. While the traditional kebab restaurants remain scarce outside of the Deira, interested customers can find a variety of mid-market to upscale Middle Eastern dining options throughout the city. The epitome of Dubai’s food scene can be described as a food-lovers destination. Not only are there many varieties of ethnic cuisines, those from outside the western world will have the opportunity to visit just about every major brand restaurant known to man. If one would like to go for coffee and feel like they’re in the UK or find a BBQ joint fromTexas, or a New York City Long Island bagel, the options for those hungry for a slice of home or wanting to visit a new restaurant, Dubai simply has something for everyone. ✖

Image: Martin

Make it your perfect choice!! With stunning views of Palm Jumeirah, Dubai Marina and the city, our hotel and hotel apartments are a stylish selection of 245 comfortable accommodations. Designed for families and business travelers looking for short and long stays in Dubai, the warm and relaxed atmosphere of each room and apartment embraces the distinctiveness of Dubai’s rich culture, evident from the original works of art and décor depicting Arabic calligraphy, to the heartfelt friendliness from every member of our multi lingual staff. Combined with the variety of services offered, it is easy to create your own unique, memorable experiences during your stay. Located in one of Dubai’s most enviable neighborhoods, Dubai Marina, our towering 55-storey

skyscraper is close to many world famous attractions. From fashion to art, culture to extreme sports, the choices of things to do when in the city are endless and every day there is something new to discover and experience. Connecting to other parts of the city is easy. The nearest metro station is within walking distance of the hotel whilst Dubai taxis can be flagged down from the hotel’s front steps by our uniformed security. Currently under construction is the marina tramline due for completion in 2014, which will run right to TAMANI Marina Hotel & Hotel Apartment, providing you with further convenient access to the surrounding marina area and Jumeirah Beach Residences.

P.O.Box 215855 – Dubai Marina – Al Sofouh Road T +971 4 318 3888 F +971 4 318 3889 [email protected]


DUBAI 2015


MARK MCCARTHY General Manager, Arjaan by Rotana

FIT the BILL Two professionals from the hospitality industry talk about catering to a diverse market, and the challenges and opportunities presented by the upcoming Expo.

ROCHELLE LOBO General Manager, HAS Hospitality What is the main profile of your typical guest? MARK MCCARTHY There are a variety of reasons why people choose to stay at Arjaan by Rotana. We have a good mix of guests visiting both for business and leisure, and we are very popular with corporate customers visiting nearby offices. We have also seen increased demand from companies that regularly hire people for short-term projects lasting one or two months. We host families visiting Dubai from the GCC area and many other countries looking to stay in a family-friendly environment. We also have guests who keep an apartment here on a long-term basis who work regularly between Abu Dhabi and Dubai. All of our guests, both leisure and corporate, find great comfort staying in serviced apartments where they have all of the hotel services, along with extra space and the freedom to relax, cook, invite friends over— all the comforts one could find in one’s own home. ROCHELLE LOBO We cater mainly to customers that want to spend a night in Dubai who are looking for a home away from home, coupled with luxury and convenience. We have corporates coming to stay with us as well as companies choosing to use the hotel as guest-

houses for their executives. A typical customer looks at metro connectivity; almost all of our properties are close to a metro station. The presence of a mall nearby is also an added advantage, and we offer shuttle service and other auxiliary services, like airport transfers; these are things customers look for. Dubai generally has a specific trend for every season, and people from different countries visit the emirate at different times throughout the year. For example, Eid brings in more of the GCC nationals to Dubai, while the Dubai Shopping Festival brings in a mix. As for the rest of the year, when other parts of the world are getting colder, Europeans and people from East Asia come to Dubai to enjoy the warm weather. What is your general outlook for Dubai’s tourism sector considering the upcoming World Expo 2020? MM Everyone in the industry is anticipating World Expo 2020 and what effects it will have on the hospitality sector. We have already experienced a large increase in hotels, and this is going to continue. Already in 2014, compared to the same time in 2013, the supply of hotel rooms has increased by about 7%. All of these hotels were already in the pipeline before the announce-

ment of the Expo; however, this strong growth trend is now likely to continue at a very rapid pace. Fortunately, Dubai has also shown the ability to increase demand quite effectively through tourism department promotions, growth of Emirates Airline routes, new exhibitions, sporting events, and recreational activities. However, we are now starting to feel the pinch of the additional supply. Our primary strategy has been, and will continue over the coming years, to enhance our services and property to maintain our competitive advantage against all of the new hotels. Our first priority will be to retain our guests. RL The Expo 2020 provides us with a ray of hope and high expectations. We anticipate an inflow of visitors, looking to participate in the 2020 exhibition. Dubai has become and is becoming one of the central tourist destinations in the world. The luxury sector is going to pick up with the addition of four- and five-star hotels to the portfolio. Beyond the introduction of new properties, our hoteliers are working to give customers much more than just a luxury hotel experience. With the announcement of the Royal Palm and similar prestigious projects, Dubai could easily be referred to as the world’s next luxury hotel destination. ✖


DUBAI 2015


Dubai’s retail sector—unrivalled in the region and the envy of the world for its awe-inspiring megamalls and diamond-studded, gold-encrusted luxury brand offerings—is the Emirate’s economic powerhouse, and only getting stronger.

VALLEY OF THE MALLS Attracting regular shoppers from across the GCC and indeed from all over the world, it should come as no surprise that the wholesale and retail trade sector is the largest in Dubai’s economy. Surpassed only by London, the city earned the position as the second most popular retail destination globally in 2014 by CBRE. A.T. Kearney also ranks the UAE as the fourth most suitable market for expansion among international retailers, an environment defined by a strong and growing population, sustained economic growth, and continued political stability—all of which contribute to increased consumer and investor confidence and create a favorable retail development market, making it one of the most lucrative sectors for foreign investment. Dubai’s robust economic indicators in other sectors and Emirati disposable incomes funnel directly back into retail. The tourism and hospitality industry enjoys high hotel occupancy rates (80% in 2013), with the anticipated influx of shoppers entering the Emirate ahead of the Dubai 2020 Expo is expected to be a further boon for retail; meanwhile, 66.4 million passengers passed through Dubai International Airport in 2013, up 14.6% YoY, along with a 6.3% YoY increase in freight volumes, contributing to a significant impact on duty free shopping; Dubai Duty Free is already the largest in the world in terms of sales, which exceeded $1.8 billion in 2013 showing a 11.4% YoY increase. A strong transportation sector with state-of-the-art logistics infrastructure ensure growing interest among trade firms to establish operations in the Emirate, evidenced by an increase in wholesale and retail trade license issuance by approximately 10% YoY in 2013, while new trade license issuance increased at an average of almost 8% per year between 2010 and 2013. Bank credit to the wholesale and retail trade sector jumped to

22.4% YoY in 2013 from 0.8% in 2012, with the sector accounting for 11.6% of total bank loans in 2013. The fact that Dubai is also home to 70% of the UAE’s population in the 20-39 year age bracket is another promising factor for retails trade sector growth, as is the rising GDP per capita. According to Emirates NBD, the sector recorded a share of 29.2% of total GDP in 2013, employing roughly 23% of Dubai’s workforce. In the same year, the retail sales turnover was estimated at $39.6 billion by A.T. Kearney. Conservative estimates by Emirates NBD forecast that the retail sales turnover will reach $55.7 billion over the next seven years, given an average 4.5-5.5% annual GDP growth through 2020.

MALL MADNESS When it comes to international luxury brands, Dubai has it covered. Dubai Mall in Downtown Dubai is the world’s largest shopping mall in terms of GLA (350,000sqm), and boasts over 200 food and beverage outlets and 1,200 shops—just about every brand in the world— from couture labels like Chanel, Givenchy, Dior, Gucci, Alexander McQueen, Burberry, and Fendi, to young adult ready-to-wear like Guess and Diesel. Dubai Mall doesn’t stop with its sartorial offerings on the 440,000sqf fashion avenue—there are art galleries, cinemas, an ice rink, Dubai Aquarium and Underwater Zoo, an indoor traditional souq, and more. In 2013 the mall welcomed more than 75 million visitors, and is now undergoing another massive expansion, to increase the mall’s area by 1 million sqft in its first phase, paving the way for more than 100 million visitors annually. Dubai’s second largest mall is the Mall of the Emirates, with a GLA 234,470sqm and total area of 600,000sqm. Located in Al Barsha, the decade-old multi-level mall is home to 560 international brands, more than 700 stores, 11

ABDULLA AJMAL General Manager, Ajmal Perfumes Community malls are doing better because they are marketed toward local customers. Overall, there was a dip in the performance in 1Q2015. We are still hopeful, however, because the second quarter is critical for us due to Ramadan, which is our peak season.

Dubai Mall in Downtown Dubai is the world’s largest shopping mall in terms of GLA at

350,000 sqm

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Under Constcution 251sqm








ASHISH NANDA Senior General Manager, Shift Car Rental & Leasing





anchor stores, and the Middle East’s first indoor ski resort and snow park Ski Dubai. Mall of the Emirates retail offering includes Carrefour hypermarket, Centrepoint, Debenhams, Harvey Nichols, Home Centre, Jashanmal, Marks & Spencer’s, and outlets for fashion, books, stationery, toys, gifts, art, accessories, electronics, jewelry, watches, furniture, cosmetics, perfumes, and financial services. Mall of the Emirates is completing a major redevelopment project this year undertaken by owners Majid Al Futtaim Holding, which will introduce the UAE’s largest cinema ever built—a 24-screen VOX Cinemas entertainment complex, an additional 25,000sqm retail space, a new dining area for 10 restaurants and cafes, and 30 new stores including Italian leather brand Braccialini, the chic Parisian label Maje, and Molton Brown of London.

HIDDEN TREASURES For shoppers searching for a bargain or something completely unique, venturing off the beaten path to Dubai’s winding traditional souks and hip boutiques is must. Vintage finds, oneof-a-kind textiles, jewelry, and crafts, as well as cutting edge local and Arab designers keep the retail market interesting for residents and visitors alike. Inspired by “Dubai’s hidden industrial areas,” fashion label KBT Koncept blurs the line between contemporary alternative trends and the traditional abaya, while Emirati designer Bint Thani embodies the fashion-forward it-girl popular with the city’s indie scene—just two examples of homegrown Arab fashion talent. For the foodie in Dubai, an alternative to the numerous supermarkets and hypermarkets is the Deira Fish Market—by far the cheapest place in Dubai to buy fresh fish. At Diera you can find hundreds of traders offering a huge variety of seafood and produce—freshly caught red snapper and whole squid is sold by the kilo, while sun-ripened tomatoes and juicy nectar-





ines beckon from the farmers market. During the month of Ramadan, Ramadan Night Market at the Dubai World Trade Center offers a rich cultural experience for everyone, and a family fun environment for those breaking their fasts. Specialty items such as festive sweets, clothes, handicrafts, perfumes, and beauty products can be found in the vibrant atmosphere teaming with jugglers, balloon blowers, face painting, henna tattoos, Arabic coffee, and dates.

WHAT’S NEW? With an already overwhelming array of shopping experiences fit for every consumer, Dubai is showing no signs of slowing down its retail development plans. According to Trade Arabia, leading developer Nahkeel issued its first tender for the new 3.6 million-sqf retail, dining, and entertainment hub at Al Khail Avenue in the Jumeirah Village Traingle. Scheduled to open in 2018, the project will be comprised of 350 shops including a supermarket, department stores, specialty outlets, a multi-screen cinema, entertainment zone, cafes and restaurants, and a 2 million sqft car park capable of accommodating 4,400 vehicles. Nakheel’s current and future retail projects boast over 10 million sqf of total gross leasable space, between its upcoming malls and souks in Palm Jumeirah, Deira Islands, Jumeirah Village, and Warsan Village, and its existing Dragon Mart and Ibn Battuta malls, as well as six neighborhood retail centers and communities across the Emirate. Dubai Holding also recently announced plans to build a temperature-controlled shopping zone called Mall of the World, which will dwarf the Emirate’s existing largest malls Dubai Mall and Mall of the Emirates, with its planned 4.5 million sqm and 743,000 sqm devoted to pedestrian shopping streets. The behemoth retail space will include hotels, a theme park, wellness district, and entertainment venues, planned for a 2020 opening. ✖

What challenges do you face in the market, and what are your plans for the future? The market is competitive in terms of pricing, and undercutting is rampant. In addition, customers expect us to give unlimited mileage contracts. Some maturity is required both from our competitors and from the customers. The collection of fines from customers can also be difficult, while qualifying new customers is a challenge in the absence of credit ratings for companies or individuals. The legal framework for this industry needs to be made stronger. We will focus on improving our market share in the B2C rental business in the near future, and would also like to expand our footprint to cover Fujairah. Why is leasing a vehicle preferable to buying? When leasing, clients pay for what they use. It requires a lower monthly payment, which allows companies to maintain a better cash flow and the opportunity to upgrade to a better car. We assume the resale value of the car; therefore, clients are buffered against the vagaries of the used car market. We include interest, insurance, and maintenance costs including tires for the entire period that is contracted. This is better than having to pay surprise costs for your own car. During servicing, we loan another vehicle to clients, allowing them to stay mobile despite breakdowns or accidents. We manage claims, fines, and registrations for renewals to save customers time.

Tourism & Retail




the CUSTOMER is always RIGHT

How does the Paris Gallery Group work towards understanding the customer better and ensuring their satisfaction in Dubai’s highly competitive luxury retail sector?

Customer satisfaction is one of the most challenging and demanding areas for all service providers. In the luxury segment of the market where we operate, expectations are even higher. We follow our customers closely on the floor to learn about their needs and how we may or may not be meeting them. We conduct research through an internal team using the services of an external agency. We regularly host focus groups and take corrective actions when needed to fix elements that can improve our service, which could be individual sales teams or supervisors, the services and products available, promotions, or the ambiance of the shop. Last year we made intensive changes to enhance the ambiance in our stores and improve our services. We pay close attention to the floor, the lighting, and the flow, the merchandising and list of products, our employees and their interaction with customers and understanding of different cultures, and our customers’ expectations when they walk into Paris Gallery stores. We launched a loyalty program in January 2014 to help us understand our customers’ preferences, habits, and behavior, thus allowing us to be better prepared to inter-

TBY talks to HE Mohammed Abdul Rahim Al Fahim, CEO of Paris Gallery Group of Companies, on understanding customers, international expansion, and attracting partners. act with and serve them. The program has attracted over 300,000 members. We have also firmly established our presence on different social media platforms. We utilize customer input and reply to comments, positive and negative, and if something does not fit our customers’ needs, we remove it from our portfolio. How would you describe your overall international expansion strategy?

We have a presence in many locations across the region, and our strategy has not changed. We want to be the pioneers in countries in which other retail companies are hesitant to move. We have made progress towards opening our new store in Oman, and we are close to opening in Baghdad and Baku. In Morocco, we are studying the

market and looking for the right strategic partner. Many shopping malls are being built in this area, and we hope that the momentum of these positive changes will somehow be amplified. In Egypt, when the situation was unclear after the elections a few years ago, quite a few real estate developments happened, which helped the luxury retail business. Huge shopping malls in Cairo plus many new projects increased the purchasing power of the population, which primed the environment for others to do business. Many companies had not foreseen this, and failed to gain an early presence. We are talking with many new shopping mall managements and developers, and Egypt is an integral part of our expansion plans as it is the country with the most potential in the region. Looking beyond the region, our ambition is to have businesses in London, Paris, or Milan; we are just looking for the right opportunities. In which ways are you attracting foreign companies to enter into strategic partnerships with Paris Gallery Group in the UAE and beyond?

We are always on the lookout for strong and reliable partners. In the case of foreign companies, we explain to them how the UAE, and Dubai in particular, could become a good platform for their businesses. The experience I have

had with potential partners is that many aspects of the services available here are unknown to them. We educate them and give them tours occasionally so that they can see for themselves how beneficial a partnership can be. Some companies already have ambitions to be in Dubai because it is the capital of luxury retail. ✖

BIO HE Mohammed Abdul Rahim Al Fahim, CEO of the Paris Gallery Group of Companies, is a member of the Al Fahim family, the founders and owners of Paris Gallery Group of Companies that now operates a network of retails stores and distribution channels throughout the UAE and the GCC region. Al Fahim joined the family business in 1996 soon after graduating from the University of Kentucky, when he moved to the Kingdom of Saudi Arabia and got deeply involved in the family business. He played an active role in developing the Group’s overall strategic plans, helping it take its first steps into the luxury retail sector. He was instrumental in restructuring the management and rewriting company policies, resulting in high employee satisfaction levels.


DUBAI 2015




President & Chairman of the Board, BinHendi

CEO, Ahmed Seddiqi & Sons

What role will your company play in helping to realize the 2020 vision and its legacy beyond?

service—these elements are extremely important and are ongoing projects, because if Dubai is to welcome the world in 2020, service level and customer experience need to impress people as much as the Expo does. Stepping up the quality of service in general is something that needs to be improved and strengthened, and I believe that the government has understood that because they are making a significant effort to promote performance and excellence at all levels; the private sector should be inspired by what is happening.

MOHI-DIN BINHENDI We plan to become the supporting factor to everything the UAE wants to achieve. Tourism needs retail and restaurants. Cities with many good quality restaurants are attractive. It brings more and more people to enjoy the food factor here. Like many retailers, we are getting brands that are very much glamorous and have an effect on improving the quality of the retail sector in this part of the world. We have done a lot of investment in our ERP, in restructuring and training, and getting people ready for the challenges that His Highness is going to attract to this part of the world. Here, the operations and the philosophy of His Highness go hand-in-hand. When he initiates a project, it is supported by different kinds of hotels, airlines, airports, shopping experiences, and so on. It completes the whole equation of a very successful destination, Dubai. I think today Dubai is the result of fantastic leadership and is a land of opportunity. CHRISTOPHE NICAISE The training of our sales team in the store, the training of our technicians in the after sales

Where do you see the primary area for opportunity for growth? MDB As tourism is improving and growing in this part of the world, retail is another part of the backbone of industry. People love the ocean and the sun, but they also want to enjoy shopping. That opportunity has now been made possible on a world-class level in Dubai. We are blessed with big numbers of wealthy people around us. Nevertheless, we need tourists to come here and enjoy themselves. These satisfied people become return visitors. The journey has to be a great experience from the time you land to the time you take off. It makes the journey pleasant and beautiful.

open UP Tourism and retail go hand-in-hand, meaning many brands in Dubai are benefitting from the Emirates new found glory as a tourism destination.

CN We have witnessed over the past decade a complete switch of the luxury good market distribution strategy and distribution channel format. In 2007, wholesale used to account for as much as 79% of the luxury good market revenues against 21% for retail. As of end of 2014 the wholesale share has come down to 68% whereas retail has grown up to 32%. Considering this trend, it will only be natural for our company to seize any opportunity to grow our mono-brand boutique retail portfolio. How important is it to continue attracting these premium partners for the expansion of BinHendi? MDB For any corporation, growth is important. When we look around us, there are great potential opportunities in the MENA region, GCC, and beyond, such as India, Pakistan, and Iran. These are all highly populated cities with a desire to have what we have. Dubai has become a showcase for people that come here. Therefore, we are looking at opportunities to

franchise our brands to these people. Hence we restructured ourselves to see that we have the right footing to enter that part of the world. How do you envision your strategy playing out? CN When the situation is tough and you are lucky enough to be in a corporate environment where you are still financially strong, I firmly believe that this is the best period to invest, gain market share, and, therefore, strengthen your market position. How do I envision the fact that we are just renovating and will continue renovating our stores in 2015? Although the circumstances are not positive, I believe this is the best way to maintain our leadership position. Economic crises are cyclical, meaning if your company is well positioned and continues to invest sensibly during difficult and challenging times, then you can take full advantage of any potential rebound and accordingly accelerate your growth to outperform the market growth rate. ✖

Tourism & Retail





What have been Al-Habtoor Motors most notable achievements?

We have hit record sales rates and growth in our product lines. We are punching well above our weight because we have great products and a fantastic team. BMI predicted 12% growth in the automotive industry in 2014. AHM achieved 38% YoY growth for Mitsubishi and Mitsubishi Fuso—the highest enjoyed by any Japanese manufacturer in the year. We hold about 50% market share of all Mitsubishi cars sold in the GCC for 2014. AHM is also recognized as No. 1 dealer in the GCC and in the forefront of the global automotive industry. We represent some of the best-known brands in the industry; Bentley, McLaren, Bugatti, Mitsubishi, Mitsubishi Fuso Trucks and Buses, and our new Chinese brands JAC and Chery. Our company is unique in that our products range from ultra-luxury cars to budget vehicles. What new markets would AlHabtoor like to move into?

The most exciting markets are the GCC and Middle East, in general; markets we know very well. In the words of our Chairman, Mr. Khalaf Ahmad Al Habtoor, “We like to invest in what we know.” We would

BIO Karl Hamer is the Managing Director of Al-Habtoor Motors (AHM). He joined the company in 2008, after gaining over 30 years experience in the global auto industry. He started his career in the UK on the showroom floor and quickly climbed the ranks to the board room holding several key positions, including Chief Executive of a Toyota and Ford family dealer group. In 2013 he ranked amongst one of the most influential Brits in the UAE.

TBY talks to Karl Hamer, Managing Director of Al Habtoor Motors, on selling luxury cars, providing fast solutions for customers, and the auto industry’s evolution in the UAE. also consider expansion into Europe and other markets. In November last year we opened the world’s largest Mitsubishi 3S facility, with a total area of 230,000 square feet. On top of that, we have developed a tire and battery business brand called SpeedFit in collaboration with a major supermarket chain; we are in the process of developing fast-fit clinics in the supermarket parking lots, where the customer can receive vehicle service while they shop. We have been acquiring new aftermarket brands against stiff competition, and we recently became the UAE distributor for Lukoil automotive oils and lubricants. What differentiates Al-Habtoor from its competitors in terms of customer service and after sales?

Last year, we put more emphasis on customer care. We launched our new customer charter to all employees, called ‘Miles of Smiles.’ It is based on five pillars: relationship, safety, investment, time, and feedback. We have moved our logistics operations to Dubai Industrial City (DIC), a 6 million square foot state-of the-art service facility. It is the largest workshop, storage, and parts distribution center in the world, offering first-class facilities to provide customers with the best service possible. What is your outlook for 2015 and the next few years?

In 2015 we will take our Bent-

ley’s franchise to another level; this will be helped by the arrival of the brand new Bentley SUV hitting the market in the first quarter of 2016. It is called the ‘Bentayga,’ and we have already taken deposits for 174 units. There will be over 18 Bentley products available by 2017. Our volume business and Prestige division are growing. Construction is underway on the ‘World of Bentley’ on Sheikh Zayed Road, a new Bentley landmark in the UAE and the first and largest of Bentley’s global iconic showrooms. This stateof-the-art facility, one of 10 worldwide, is due for completion at the end of 2015 to early 2016. It will be an iconic landmark for the region. How do you think the auto industry will evolve over the next couple of years?

In 2015, the auto industry is predicted to grow by 9.6% and 7.8% in 2016; however, we aim to surpass that with 21% growth. Oil prices are falling, making fuel, transportation, and logistics more affordable, meaning that people will generally have more disposable income. The dollar has also been strong against the yen, which has been a big plus for the region. There is considerable investment going into the market ahead of Expo 2020. With more governance and corporate responsibility, and in line with the government’s long-term vision, UAE-based businesses are getting stronger and leading the region.

Good sale growth is expected to continue for the next few years, and the UAE offers positive growth potential both in volume and high-end vehicle segments. Consumer spending is expected to continue in the short to medium-term, and AHM must be prepared if we are going to bring about returns. ✖

IN NUMBERS Al-Habtoor Motors

New Car Market predicted to be


USD billion in 2015


Expected Automobile Industry Growth


Market Share of GCC in Commercial Vehicles


DUBAI 2015


The Dubai Design District project aims to foster local creativity in fashion through a 21 million sqf complex that embodies Dubai’s objectives of becoming a smart city as well as decreasing its energy consumption.

SMART FASHION AS DUBAI CONTINUES to position its economy around tourism, the city has already achieved a strong position in terms of its retail sector and has become a prominent shopping destination on the world map. Dubai has been able to capitalize on its strategic location and has combined this with a strong investment climate that is able to lure the biggest brands on earth. In 2014, Dubai was ranked only second after London in terms of the presence of international retail brands. With this, Dubai has become a vibrant shopping destination that is only expected to broaden its appeal. In 2014, Dubai retail sales were approximately $41.5 billion with the expectation that this will grow 5% in 2015 to reach $43.7 billion and, over the next seven years, reach $55.7 billion. Despite these achievements, Dubai is looking not only to capitalize on the creativity of international designers, but also facilitate creativity within the city itself with its Dubai Design District (D3) project. Unveiled by TECOM Investments in September 2014 at Cityscape Global, D3 aims to become the cornerstone of creativity in the Emirate through the its established free zone model. The 21 million square foot master plan with a 1.8km waterfront destination will offer an ecosystem for global design and creative minds by bringing local talent and international luxury brands together. D3 will offer a vibrant business zone featuring office space for the design, fashion, and luxury sectors with capacity for over 10,000 workers and host a dedicated creative community of 4,000 designers, craftspeople, and innovators. It will also facilitate visitors by offering more than 4,000 hotel rooms including luxury, four-star boutique hotels, as well as furnished apartments. D3 also aims to become a shopping experience for visitors with over 2.5 million sqf of retail space. Importantly, the entire atmosphere of D3 focuses on Dubai’s art scene through a fusion of high-end galleries, pop-up showcases, and open-air installation spaces, workshops, and studios.

Reduction of energy consumption is one of the key pillars in the Dubai Integrated Energy Strategy 2030, and d3’s utilization of energy efficient district cooling falls in line with this goal. Empower, the world’s largest district cooling services provider, formalized an agreement in May 2014 with D3 to provide district cooling to the d3 developments in a contract worth just over $204 million. As of March 2015, Empower has thus completed Phase I of the network, which commenced operation in November 2014 and will provide the d3 project with 10,000 refrigeration tons (RT). Upon total completion, Empower’s network will include a 120,000 RT capacity for the complex and will represent approximately 12% of the company’s total cooling portfolio. Launched in 2014, Dubai aims to become a smart city and a leader in the utilization and integration of ICT services throughout the city. With this, D3 represents the greenfield pilot site of Dubai’s smart city project. Upon D3’s completion, the community will showcase a range of cutting-edge ICT elements designed to enhance the user experience. It was recently revealed, in March 2015, that IT firm Cisco was awarded the contract to provide advisory and consultancy-led services for the D3 project. Under the deal, Cisco will provide an ICT master plan for the district utilizing the company’s smart and connected city solutions. Through its development, D3 expects to launch 130 initiatives. D3 is an important step in more than one direction. The D3 project aims to facilitate the interaction between international designers and local talent in order to foster local creativity. Through this objective, D3 will also be implementing ICT technologies in line with Dubai’s smart city initiative. The D3 project embodies the importance of the utilization of energy-efficient cooling in order to be a key contributor to targets of reducing energy consumption. ✖






DUBAI 2015


BEST OF THE BEST Dubai’s wealth provides ample opportunities for the luxury car market.





General Manager MENA, Aston Martin

CEO, Al Nabooda Automobiles

Managing Director, Infiniti Middle East

CEO, Al Ghandi Auto Group


would say that in the UAE there is a much larger expatriate population, and this can sometimes drive different expectations. We do see some differences within the region. Generally in the UAE, the customer base is willing to be more experimental with different colors and different Q designs, which means it is bespoke for the customer. They want the car to be one of a kind, with their signature on it. No other car is produced like this in terms of the selection of colors, and the accessories within the car, such as a gold or platinum finishing. They all want something special and they are prepared to take the time to get the product that they really want. They may come to us with a color for example, from a material or any type of object, and ask for that to be used for their car, and we can deliver this. We are expanding in the region. In 2015, we are looking to open four new showrooms regionally, as well as three new service centers. Planned investment across the region in terms of infrastructure is about $11 million.


ustomer service is crucial. A great number of our clients are repeat customers, and it is usually at least the second Porsche that they are buying. I guess a large part of this is customer satisfaction. We are the largest Porsche dealership in the world because Dubai has an abundance of millionaires. All of that is a consequence of our increase in sales for Porsche, because Porsche is a dream car to many people. Growth simply comes from customer satisfaction. The market is saturated; everybody is here so you have to distinguish yourself and the only way this can be done is through customer satisfaction. Most products are virtually identical, with excellent cars and no difference in quality. We have worked hard to build an extraordinary buying experience for our customers, and we are trying to replicate this across all of our brands to give customers a standard service during their purchase and after sales experience that they cannot find anywhere else.


his market is very much driven by SUVs, primarily because of the landscape in addition to the average family size being a bit larger than what you see for example in Europe. With our SUV range that spans the QX50, QX60, QX70, and QX80 we have something on offer from midsize to full-size SUVs. This is a good contributor here for the region. Simultaneously, we must not forget that the market is starting to evolve and develop segments that have not been as popular before—Sedans being a good example. This is because the region is also changing and we are seeing more expatriates move into the region, especially in the UAE, causing the trend in automotive purchasing behavior to adapt accordingly. The UAE has the highest premium market percentage in the region, so by default, this must be the most important market for all the major brands. I believe that for any automotive brand to be successful, having the right products is a necessity.


ur client base is constantly evolving, which is what makes the UAE market unique. The UAE is comprised of 90% expatriates, with the other 10% of the population being Emirati. This creates some interesting challenges in an ever-changing market; people stay here on average from three to six years. New people are always bringing with them a vision of products they see in their own countries. In terms of conducting retail sales, we use a network of showrooms for our cars within the UAE. Basically, we are a service industry and no matter which company you look at, we are providing a continuously increasing range of trucks, cars, car-based services, testing services, and so on. We do not attempt what we do not know or understand, and as a result the organizational model we have means that we can “bolt on” new countries and franchises quickly onto a central operating core of finance, HR, and planning. With little manufacturing taking place here in the UAE, all products are imported, so we purchase vehicles directly from manufacturer. Locally, we differentiate ourselves with our services: how our trucks are maintained, the services we provide, and our transparency.

Tourism & Retail




in ALIGNMENT How would you describe your product offering and their respective market shares?

TBY talks to Michel Ayat, CEO of AWR Automotive, on growing faster than the market, building customer trust, and how Dubai’s 2021 vision inspires the company.

BIO Michel Ayat is a seasoned automotive industry professional, with over 25 years of experience in managing both volume and luxury automotive brands from Japan and Europe in the Middle Eastern region. Under Ayat’s leadership, AWR Automotive expanded operations regionally, employs over 2,500 people, and generates turnover in excess of $2 billion. Ayat holds a PhD in Political Science and Administration and is a founding member of the Automobile Sector Committee at the Dubai Chamber of Commerce and Industry.

We have Nissan, Renault, and Infiniti. Nissan’s offering covers 90% of the market, starting from the segment B of small or subcompact cars, to the large and luxury segment. With Infiniti we have 57% of the market, and we still have to expand the lineup for Renault. We anticipate that Infiniti sales will triple growth, because Infiniti’s strategy is to produce more passenger car models as well as SUVs. Going beyond four or five years, China will play a significant role in the market. What is the AWR’s main customer base?

Through our offering we have an extremely wide client base. Our customers looking for quality and peace of mind buy the smaller cars, and those that prefer adventures in the desert buy the Patrol or one of our SUVs. For luxury, we have the Infiniti models. We specialize in light commercial vehicles that sell mainly to the SMEs and construction companies. Our leasing company has a fleet of around 5,000 units, which caters to different types of companies on the market. Considering the fierce competition among automobile retailers in Dubai, how do you differentiate yourself from your competitors?

In a market with great leaders,

and we were the first UAE automotive distributor to win the Dubai Quality Award. How does AWR build trust with its future clients?


It is important to note that our customers are buying cars here, whereas in mature markets, they are still leasing cars. Buying a car is like buying a home, and the customer has to feel that they have selected the right partner. Today our job is not simply to sell the car; we work on communicating with customers in a personal way in order to build long-term and friendly relationships based on trust.


Can you expand on your strategy to turn first-time car buyers into long-term customers?


Awarded Palladium Balanced Scorecard


of market share in the UAE for Nissan Vehicles

we have the opportunity to compete with the best. We are growing faster than the market and improving our market share in two ways; firstly through our product, which has to meet the expectations of the customer in terms of style, quality, and technology. Secondly, we run the business using the latest and best processes in the world. We also invest in customer service training. Through all of these elements, we are able to maintain our status as the No. 1 company in terms of quality awards. We were the only private company in the UAE to be awarded the Palladium Hall of Fame award,

We have strategies to sell to three types of customers—single adults buying first cars, those buying replacement cars, and married adults buying family cars. In terms of selling first cars to new customers, we work on clear communication and advertising. If we have built their trust and confidence, those customers buying replacement cars or additional family cars will choose us. What are your expectations for the automobile industry in the next few years?

Our expectations are high for the coming six years. Dubai is still a center for family tourism and a business hub, despite the oil price drop. The Dubai 2021 vision inspires our company, and our pillars of growth match those of Dubai’s. We are aligned with Dubai. We anticipate opportunities for positive growth; we know our market and know how to overcome upcoming challenges. ✖


DUBAI 2015


OPERATION UNWIND A large expatriate population has given rise to a multitude of distractions, whether it be retail therapy, a round of golf, or relaxation at an exclusive club.

Capital Club Capital Club is the pinnacle of exclusivity, with membership by invitation only and decided upon by the Board of Governors. Opened in 2008, it has over 1,500 members who include top business leaders and other significant figures. “It’s a good mix of industries and people, Emiratis and expatriates, men and women,” says General Manager Emma Cullen. The club boasts 13 meeting rooms, a fitness center, and large, comfortable bedrooms. The management will also run members’ social and business events,

helping to facilitate networking opportunities. Capital Club also likes to add a personal touch, getting to know its members’ drinks, smoking, and food preferences and also how they wish to be addressed. Cullen, speaking to TBY, also highlighted the significance of a diverse membership; “We really look for a spread of industries as well, making sure we don’t have 1,500 people just from the real estate or banking sectors.” And in 2014, the Club focused on women in business, helping to boost female membership.

Virgin Megastore Virgin Megastore is a giant in retail entertainment in the Middle East, and has sought to project the brand across the entertainment industry in Dubai. Speaking to TBY, Nisreen Shocair, President of the MENA region for Virgin Megastore, commented that, “The brand has built its strength creatively, organically, and by directing its attention toward causes that are meaningful,” adding that it is “the best community marketing that a brand can be associated with.” And in one of the world’s prime retail hubs, Virgin has thrived. “Every year we project double-digit growth and we have been beating those targets and I think what applies to us applies to a lot of other retailers that have a strong concept and solid brand positioning,” Shocair went on. “Dubai is a capital of shopping and what is very interesting is seeing the Dubai effect across regional markets in MENA,” continued Shocair, concluding that, “everybody is aspiring toward a much higher standard, which makes it much easier for the retailers to operate.”

Dubai Golf Dubai has overcome its dry climate to become a prime golf destination, with Dubai Golf at the heart of the sport. Owned by wasl Asset Management Group, Dubai Golf manages the two leading clubs; Dubai Emirates Golf Club, which just celebrated its 25th anniversary, and Dubai Creek Golf and Yacht Club its 20th. And in 2014, it was behind the 25th Omega Dubai Desert Classic, which brought back past champions and some of the world’s greatest golfers, including Tiger Woods, Henrik Stenson, and Rory McIlroy. Dubai Golf is looking abroad, opening its first non-UAE club in Oman in 2012. “That, in particular, was a great fit for us, because it was a partnership between the government of Oman and the wasl Group,” commented Christopher May, CEO at Dubai Golf, in an interview with TBY. May also spoke of Dubai’s rise as a tourism destination, tying it to the rise of the sport in the Emirate. He shed light on the impact golf itself has had, suggesting that its courses “were both important parts of the initial growth and still remain relevant today by hosting tournaments,and maintaining world class facilities that bring tourists here.”






An overview of the ins and outs of taxation in Dubai and the UAE.

With a number of events upcoming and the Vision 2021, the hotel sector in Dubai is preparing for increased capacity.

When in Dubai: A list of the best hotels and most helpful hints for a comfortable stay.


THE LAY OF THE LAND Merali’s provides all the key information you’ll need to know when doing business in the Emirate.

GENERAL INFORMATION ABOUT BUSINESS REGISTRATION Prior to operating any business in Dubai, the steps outlined below must be undertaken in order to meet the legal requirements of all concerned government authorities and to guarantee maximum commercial benefit for the business owner: • Determine, in the beginning, the category/ categories (commercial, industrial and/or professional) and type of business activity/activities to be practiced. Please determine all the related business activities that can be included within each business license, subject to a maximum of 10 activities per license. For more details, please go to Activities Search e-service. • Determine the appropriate business legal form for your business taking into consideration the desired business activity/activities and the number and nationalities of the business owners. For more details, please refer to Legal Business Structures. • Confirm all the requirements of the license to be issued. For more details, please refer to New Business Registration. • Determine the trade name of the business. To review the terms and conditions for the selection and approval of trade names, please go to Trade Name Reservation e-service. • Submit an application to the department for an initial approval and register the trade name, either by a personal visit to the department offices and its external branches or through the internet services that are available on the website. • After getting the initial approval you can lease premises and contact the counter of the Planning Department of Dubai Municipality in order to verify that this said premise is suitable for the business. • Prepare all required documents and submit an application to the department or one of its external branches to pay the required fees to ob-

tain a final license. • Submit an application to one of the department’s external branches for a signboard permit for a business trade name as required by the economic regulations. Terms & Conditions on Operating Economic Activities in the Emirate of Dubai - UAE Nationals: UAE nationals may operate all commercial, professional, and industrial activities when they fulfill all Terms and Conditions. They may carry on activities through any of the following legal forms: • Individual Establishment. • Limited/Joint Liability Company. • Private/Public Shareholding Company. • Civil Business Company. Nationals of Gulf Cooperation Council Countries (GCCC): GCCC nationals may carry on most commercial, professional, and industrial activities when they fulfill all Terms and Conditions (except for activities of Hajj and Umrah, trade agencies, houses of disabled and old people, community service, and journals and magazine publishing and printing houses as they are limited only to UAE nationals). They may carry on activities through any of the following legal forms: • Individual Establishment • Limited Liability Company: two or more GCCC nationals may establish a Limited Liability Company to practice a specific commercial activity. However, if there are one or more partners who are not GCCC nationals, in this case one or more UAE national partners are required, with a shareholding of no less than 51% of the paid-up capital. • Private/Public Shareholding Company: three or more GCCC nationals may establish a private shareholding company to practice a spe-


DUBAI 2015

cific commercial activity. However, if there are one or more partners who are not GCCC nationals, in this case one or more UAE national partners are required, with a shareholding of no less than 51% of the paid-up capital. (For Example: GCCC partner, foreign partner, it is a must to have a partner of UAE nationality). • Civil Business Company: two or more GCCC nationals may establish a civil business company to practice a specific profession without a Local Services Agent. However, if there are one or more partners who are not GCCC nationals, a Local Services Agent who is a UAE national shall be appointed or included as a partner. Nationals of Other Countries: Nationals of other Arab or foreign countries may carry on economic activities through any of the following forms: • Individual Establishment: it may be established to practice any professional activity, only by appointing a Local Services Agent who shall be a UAE national. • Limited Liability Company: this kind of company shall be established to carry on any commercial or industrial activity, including one or more UAE partners whose shareholding shall not be less than 51% of the paid-up capital. • Private Shareholding Company: this kind of company shall be established to carry on any commercial or industrial activity, including one or more UAE national partners whose shareholding shall not be less than 51% of the paid-up capital. • Civil Business Company: two or more persons may establish a civil business company to practice a profession, provided that a Local Services Agent who must be a UAE national is appointed or included as a partner. Foreign Companies: Any company incorporated outside the UAE may operate any commercial, industrial, or professional activity through one of the following legal forms: • Branch of a Foreign Company • Limited Liability Company: this kind of company shall be established to operate any commercial or industrial activity, including one or more UAE national partner whose shareholding shall not be less than 51% of the paid-up capital. • Private/Public Shareholding Company: this kind of company shall be established to operate any commercial or industrial activity, including one or more UAE national partner whose shareholding shall not be less than 51% of the paid-up capital.

ANNUAL FILINGS Under the UAE Commercial Companies Law, most companies or branches are required to have their accounts audited locally, and these accounts will then need to be filed with the appropriate Emirate-level authorities on an annual basis as part of the license renewal filing process. There is also an annual license renewal fees to be paid that is based on the type of license, entity,

and its activities. Similar requirements exist for free trade zone entities, although the requirements and fees vary and need to be considered based on the legal entity set up and its location.

AUDIT AND ACCOUNTANCY Joint stock and limited liability companies must appoint one or more auditors. All legally incorporated companies have to file their audited financial statements with the Ministry of Economy or relevant authority in order to renew their trade licenses. There are no exceptions available or restrictions on appointment of auditors. Companies generally prepare their accounts on a calendar year basis and banks are specifically required to do so by the Central Bank of the UAE. Listed companies (including banks) are required to file quarterly reviewed financial statements and annual audited financial statements in both English and Arabic with the Securities and Commodities Authority (SCA), which publishes the quarterly and annual financial statements on its website. Banks, including branches of foreign banks, are also required to file audited annual financial statements and regulatory returns with the Central Bank of the UAE and publish them in a local newspaper. There is no specific language requirement for the purpose of maintaining books and records, although books are generally maintained in English. International Financial Reporting Standards are mandated by SCA and the Central Bank of the UAE and adopted as the default GAAP by all other companies.

LEGAL BUSINESS STRUCTURES Individual Establishment: This is an establishment owned by a sole proprietor to operate an economic activity (commercial, professional, industrial, agricultural, or real property). An establishment’s financial liability is linked to the proprietor, who shall be responsible for all its financial obligations. Civil Companies: • A Civil Company is each company that undertakes directly a specific profession as its target and partners depend, for their earnings, on the practicing of activities that involve the use or investment of intellectual faculties more than depending on speculation, materials, or others' work. • Under Dubai Local Order No. 63 of 1991 on licensing professionals and tradesmen in the Emirate of Dubai, it is allowed for a number of normal individuals to practices a service or professional activity as distinct form, a commercial one, the business takes the form of a “Business Partnership” in accordance with the provisions of the rules (from 683 to 690) of the Federal Civil Dealings Law. Professional companies may be 100% foreign owned. However, it is necessary to appoint a "Local Service Agent." • The obligations of the local service agent toward his principal and third parties shall be restricted to render the usual experience in order to enable him to practice the professional

ABDULLA GALADARI Managing Director, Galadari Advocates & Legal Consultants Where do you see the growth opportunity going forward? Our average increase in turnover has been 22% since 2009. And so, in that period alone our turnover has doubled. We are recruiting on average, two senior people per month. Today, corporate and commercial front-end work represents 50% of our turnover. And because of how the market is moving, we have to grow our transactional side further so that a couple of years before Expo 2020, our transactional work will be more voluminous than our disputes work. Since business is hot today, and because margins are settled more easily, money in the market is paid quicker, people are letting go of their bad history, and they are trying to settle old debt. The World Bank’s Ease of Doing Business ranking has the UAE at 22nd place despite its contract enforcement ranking at 121st. What are your thoughts on contract enforcement in the UAE and this ranking? Given the multitude of multinational investors, you can certainly assume many them do not go through the right channels to ensure their contracts are applicable. If you are going to draft a contract that you would like to be enforced in a court of law in the UAE, make sure you have asked a local lawyer to read it, because all can be lost simply on a point of law.

Executive Guide

or craftsmanship work without holding any responsibility or financial commitment in respect of his principle’s business or activity inside the Emirate or abroad. The relations between the two parties shall be regulated by any agency agreement. Legal Forms of Commercial Companies: Legal forms of commercial companies, pursuant to Federal Law No. 8 of 1984 as amended, is summarized below. General Partnership: • A general partnership is an arrangement between two or more partners whereby each of the partners is jointly and severally liable to the extent of all their assets for the company's liabilities. • Only UAE nationals are allowed to be partners in a general partnership. • The name of the company shall be made up of the name of all partners, and its name might be limited to the name of one or more partners with the addition of a word to modify the presence of the company. In addition to that, the company may have a special commercial name if the name of a person other than the partners was mentioned in the name. If aware of that mention, the said person shall be responsible in partnership for the company's obligations. • All partners shall be considered a dealer, and the bankruptcy of any partner leads to the bankruptcy of all partners. • The company shares may not be represented in negotiable certificates. • Partners are severally responsible in all their money for the company's obligations and any agreement to the contrary might not be made against Third Parties. • The company administration shall be undertaken by all partners, unless the company contract or an independent contract assigns the administration to a partner or to a non-partner party. Simple Limited Partnership: • A simple limited partnership is a company formed by one or more general partners liable for the company liabilities to the extent of all their assets, and one or more limited partners liable for the company liabilities to the extent of their respective shares in the capital only. • Only UAE nationals are allowed to be general partners. • The name of the company shall be made up of the name of one or more of the limited partners, adding a word to modify the presence of the company. In addition to that the company may have a special commercial name. • The name of the limited partner may not be mentioned in the company name. If it was mentioned with his knowledge, he shall be considered a partner for Third Parties in good faith. • The simple limited partnership shall be a partnership for all partners and shall be subject to all the rules of partnerships, based on the following: 1. The simple liability contract shall include,

in addition to the other data, the name of each limited partner, his surname, nationality, date of birth, country, capital share, and the part paid of it. 2. The limited partner is only liable toward the company's debtors with his capital share. 3. A limited partner may not intervene in the company administration-related issues related to others even if upon authorization. He may rather require a copy of the loss/profit accounts and the balance sheet and check the validity of the data by reviewing the company's records and documents by himself or by a representative from any of the partners or others provided that this does not harm the company. 4. If the limited partner violates the above-mentioned ban, he shall be responsible in all businesses for all the obligations resulting from his business. 5. The limited partner may be held responsible in all his money for all company's obligations if the business administration he carried out leads others to believe that he is one of the ultimate actual partners, in which case the rules and regulations of the actual partners shall apply to the limited partner. 6. If the limited partners carried out any of the banned administration business based upon an explicit or implicit authorization from the partners, such partners shall be held responsible with him for the obligations resulting from such acts. 7. Limited partnership shall issue resolutions in consensus of all partners and limited partners, unless the contract states a majority, and the majority in number shall be considered, unless otherwise stated. 8. Resolutions to amend the company contract shall not be passed unless duly approved in consensus of all partners and limited partners. Private Joint Stock Company: • A number of founders, not less than three, may establish a Private Joint Stock Company. • The shares of a Private Joint stock Company cannot be offered to the public or for the Public Subscription. • The founders must subscribe all capital and minimum requirement for such capital is AED2 million. • A Private Joint stock Company is subject to all rules and regulations pertaining Private Joint stock Companies, except for rules and regulations of the Public Subscription. • A Private Joint Stock Company may be converted into a Public Joint Stock Company, in order to do so the following conditions must be satisfied: 1. The nominal value of the issued shares is fully paid up. 2. A period of not less than two financial years has expired. 3. During the two years preceding the application for conversion, the company has achieved net profits, distributable to the shareholders whose average is not less than 10% of the capital. 4. A resolution of the extraordinary assembly




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for the conversion of the company is adopted by a majority of three-quarters of the company capital. Limited Liability Company (LLC): • A Limited Liability Company is one with limited liability, where the number of partners may not exceed 50 and should not be less than two. Each of the partners shall only be liable to the extent of his share in the capital. The partners’ participation should not be represented by negotiable certificates. • The name of the Limited Liability Company shall be taken from its purpose or from one or more of the names of partners, the statement Limited Liability Company shall be added to the company's name, stating the company's capital. • Other than the insurance, banking, and investment businesses for others, the Limited Liability Company shall be entitled to practice any legal business. • The company may not resort to Public Subscription to make up its capital or to increase it or to get the necessary loans, and it may not issue any negotiable stocks or shares. • The minimum share capital shall be AED300,000 divided into equal shares with a minimum face value of AED1,000 per share. • Shares may not be divided, and if several people owned it, they shall choose one to be an individual owner against the company, and it may fix for the share owners a time for such selection, provided that, after that date, the share may be sold to its owners, in which case partners shall enjoy a priority in purchase. • Losses and profits shall be divided equally among shares unless otherwise herein stated. • The share of each partner shall be transferred to his heirs and the ones mentioned in the will shall be treated as heirs. • A Limited Liability Company can be managed by manager/managers that may be selected from among the partners or any other parties providing that they do not exceed a total of five persons. • The manager/managers shall be appointed by memorandum of association or by a separate management contract for limited/unlimited terms. If the manager/managers are not appointed as stated in the above paragraph, the General Assembly of the partners will appoint them. • Unless otherwise stated in the MOA, the company manager shall enjoy full powers of administration, and his acts shall be binding to the Company, provided that it is supported with stating the capacity he enjoys. • The manager's resolution shall be as responsible as that of the company board, and all conditions in the company contract contrary to that shall be invalid. Partnership Limited with Shares (PLS): • A Partnership Limited with Shares is a company formed by general partners who are jointly liable to the extent of all their shares for the company liabilities and participating partners, who are liable only to the extent of their shares in the

capital. • For the general partners, the company shall be a general partnership, and the general partner shall be a dealer even if he did not enjoy such capacity before entering the company. All general partners must be nationals. • The capital of Partnerships Limited with Shares shall be divided into negotiable equal shares. • The company shall be named after the name of one or more of the general partners. Its name may be added to another innovative name or a name derived from its purpose. • The rules related to the incorporation of limited liability partnerships shall apply to Partnerships Limited with Shares, according to the following: • All general partners and other founding parties shall sign the MOA and its regulations, and their resolutions shall be as effective and valid as the founders of the limited liability companies. • Names of the general partners, their surnames, nationalities, and countries shall be stated in the company contract and its regulations. • The minimum share capital requirement for limited partnership is AED500.000. • The documents issued by Partnerships Limited with Shares shall be subject to the same rules of the documents issued by the Limited Liability Partnerships. Foreign Companies: • Excluding the foreign countries licensed to practice its business in the country free zones, foreign countries may not practice its main business in the state, and may not establish branches unless licensed to do that by the Ministry of Economy after obtaining the approval of the concerned authorities, the license of which shall specify the business it is licensed to practice, provided that such license may not be issued unless the company has a national agent. And if the agent was a company, it shall hold the state's nationality and all its partners shall be nationals. • The obligations of the agent toward his company and third parties shall be limited to rendering the services required for the company without holding any responsibility or financial commitment in respect of his company's branch or office business or activity inside the Emirate or abroad. • Foreign companies licensed to work in the state based on the provisions of the above paragraph may not start their business in the state unless they are registered in the Foreign Companies Register in the Ministry of Economy. • The offices of the foreign companies shall be the headquarters of its business and its business shall be subject to the provisions of the law. • The foreign companies, its offices, and branches shall have independent profit/loss accounts, and shall have an auditor. • If the foreign companies practiced their business inside the state without the abovementioned provisions, the persons practicing such business shall be personally responsible. ✖

FREE TRADE ZONES Investors also have a choice to set up operations in one of the free trade zones in the UAE. A free trade zone is a geographical area within the UAE that has been established by the UAE government to generally encourage FDI into the UAE and, as such, there are generally no foreign ownership restrictions, unlike onshore entities. That is, foreign investors can set up 100% fully owned entities in the free trade zones. The principle drawback of a free trade zone is that, strictly, entities registered in the free trade zone are not permitted to conduct commercial activities in the UAE, outside of the free trade zone. Currently, there are over 25 established free trade zones in the UAE, of which the majority are in the Emirate of Dubai. The free trade zones also provide a choice of establishing either a company or a branch.

Executive Guide




NUMBER CRUNCH An overview of the ins and outs of taxation in Dubai and the UAE.

MERALI’S PROVIDES DETAILS OF THE TAX SYSTEM IN THE UAE The federal government of the UAE has not promulgated any tax laws. Most of the individual Emirates have issued corporate tax decrees, but, in practice, taxes are only imposed on oil and gas-producing companies at rates set forth in their government concession agreements, and on branches of foreign banks at rates set out in specific tax decrees or fixed in agreements with the Rulers of the Emirates in which the branches operate. The income tax decrees that have been enacted in each Emirate provide for tax to be imposed on the taxable income of all bodies corporate wherever incorporated, and their branches that carry on trade or business, at any time during the taxable year through a permanent establishment in the relevant Emirates. Bodies corporate are taxed if they carry on trade or business directly in the Emirate or indirectly through the agency of another body corporate. Taxation in Dubai According to the Dubai income tax decree, all companies carrying on trade or business in Dubai are required to pay tax on their earnings. The rates of tax are on a sliding scale up to a maximum of 55%. In practice, however, only: a) Oil and gas-producing companies pay tax at rates specified in the relevant concession agreement. Oil companies also pay royalties on production; b) Branches of foreign banks pay tax at a flat rate of 20% on annual profits. The taxable income of banks is calculated by reference to their audited financial statements. The Dubai Income Tax Ordinance of 1969 and Dubai income tax decree (and its amendment 1970) specifies that an organization that conducts trade or business in Dubai shall be subject to taxation as follows:

Taxable income EXCEEDING AED





















A “chargeable person” means a body corporate wherever incorporated, or each and every branch thereof, carrying on trade or business at any type during an income tax year through a permanent establishment situated in the Emirate whether directly or through the agency of another body corporate, (and not entitled under an agreement with the Ruler to an exemption from liability to income tax). Two or more such branches of a body corporate so carrying on trade shall each be treated as separate chargeable persons. The fact that a body corporate has a secondary body corporate carrying on trade or business through a permanent establishment in the Emirate shall not in itself constitute that parent body corporate as a chargeable person. “Carrying on trade or business” means: a) Selling goods or rights in such good in the Emirate; b) Operating any manufacturing, industrial, or commercial enterprise in the Emirate; c) Letting any property located in the Emirate; or d) Rendering services in the Emirate, (excluding the mere purchasing of goods, or rights in such goods in the Emirate.)


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A chargeable person in Dubai shall be charged taxes on a sliding scale as described above except that the tax so charged shall be reduced by the credit aggregate of oil dealt in for that fiscal year so long as the total of all reductions granted to all chargeable persons in that fiscal year shall not exceed the credit aggregate of oil dealt in for that fiscal year. Taxable income is computed after the deduction of all costs and expenses incurred by a chargeable person earning such income. Deductible costs and expenses include acquisition cost of goods, the expenses of operating the business, allowances for depreciation, obsolescence, and exhaustion of both tangible and intangible assets and losses sustained by the chargeable person in connection with the business. Investment Incentives Dubai has free zones, which offer tax and business incentives aimed at making the Dubai a global business and commercial center. The incentives usually include tax holidays for a guaranteed period (most free zones offer a tax holiday of 50 years), 100% foreign ownership, no customs duty within the free zone, and “one-stop shop” administrative services. Withholding Tax There are no withholding taxes in the UAE. Personal Income Tax No personal taxation currently exists in the UAE.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances. TBY would like to thank Merali's for compiling this analysis.

Capital Gains There is no capital gains tax in the UAE. For taxpaying entities, capital gains are taxed as part of business profits. Customs duty Customs duties are very low and there are many exemptions and levied generally at the rate of 5%. Goods imported and intended for re-export often benefit from customs duty as do manufacturers on the import of their machinery, raw materials, and spare parts used for industrial purposes. Value Added Tax There is no value added tax in the UAE at present.

Social Security The UAE does not impose social security taxes on expatriates. UAE-national employees contribute to retirement and pension funds in accordance with specific regulations. Municipal Tax and Property Tax Municipal taxes are imposed on hotel services and cinema shows. Service charge percentages vary among the Emirates. A service charge of 5 to 10% is charged on food purchased in restaurants. Hotels charge a 10 to 15% service charge per night on room rates. These charges are usually included in the customer’s bill, which the municipality will collect from restaurants and hotels. Hotels also charge an additional 15% service charge on the services they provide. In most of the Emirates, property tax is payable by residential and commercial tenants by reference to the annual rent of residential property, generally at a rate of 5% and for commercial property at a rate of 5 to 10% payable to the local Municipality. Real Estate Sale/Purchase fee A sale registration fee of 1% of the value of the sale is imposed on the seller, payable to the Dubai Land Department. A purchase registration fee of 1% of the value of the sale is payable by the buyer of the property. The rate can differ in other Emirates. Foreign-Exchange Controls There are no exchange controls on the remittance of profits or repatriation of capital and there are virtually no restrictions on foreign trade. Tax treaties The UAE has entered into tax treaties with several countries, including Algeria, Armenia, Austria, Belarus, Belgium, Bulgaria, Canada, China, the Czech Republic, Egypt, Finland, France, Germany, India, Indonesia, Italy, Lebanon, Malaysia, Mauritius, Morocco, Mozambique, New Zealand, Pakistan, Poland, Romania, Singapore, South Korea, Spain, Sri Lanka, Syria, Tajikistan, Thailand, Turkey, Ukraine, and Yemen. Treaties have been concluded with Bosnia-Herzegovina, Jordan, Luxembourg, Malta, Mongolia, the Netherlands, Philippines, Seychelles, Sudan, Tunisia, and Uzbekistan but they have not formally entered into force. ✖



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ARE YOU BEING SERVED? With a number of events upcoming and the Vision 2021, the tourism and hotel sector in Dubai is preparing for upgrades and increased capacity.

TOLGA S. LACIN General Manager, The Westin Dubai & Le Meridien Mina Seyahi Beach Resort & Marina


ypically, hotels always treat food and beverage as a minority, but in our establishment it’s 50-50. In the past, hotels would treat their restaurants as hotel restaurants. They would assume that people staying at their hotels have no other option than to eat at the hotel; therefore, they would kind of take the restaurants for granted. We approach all this from a totally different angle. Food and service are important, but experience is the most important factor, in the sense that people want to go out and have an experience. People want to have a good time and be in a place that is happening. We are constantly looking for new ideas and continually trying to create new concepts to keep the food and beverage business thriving. In this market, there’s enough for everyone. Increasing the number of three- and four-star hotels will be healthy for Dubai’s tourism sector overall. Dubai has recently become an expensive destination. Flights are expensive, hotels are expensive, and dining out is expensive. What the Dubai government is doing now is escalating the number of medium-range hotel options to attract different kinds of clients from different parts of the world. It will bring new tourists and visitors to Dubai.

ALESSANDRO REDAELLI General Manager, Kempinski Palm Jumeirahlines


he impact of the exchange between the euro and the ruble has affected the amount of customers we have coming in from the CIS. In general, we have around 40-45% of customers coming in from the GCC, about 35% from the CIS, and the rest from elsewhere. Now, the euro is 20% more valuable, and we see the impact but the high-level clientele we still see coming. To replace the market coming in from the CIS is difficult because it was large. We are working hard to make the difference, and with a product like ours at the Palm that is a leisure and beach hotel, we are looking to attract new clients from African countries. There are wealthy people that are coming in and want a clean and well-organized environment. Nigerians travel a lot of with large families, and they need large units. We have a strong percentage of Nigerian businessmen. We also have a market coming in from Brazil. However, the Chinese are looking for a different product because they do not have large families. The European market still remains crucial to our business as well. A positive point is that the government is always working on events and things taking place in the city to keep people busy and draw people in, which benefits our business. It helps us to create more business opportunities and will help our yearly average.

DANIEL MATHEW General Manager, Millennium Plaza Hotel


he hotel industry in Dubai is greatly expanding, there is a larger inventory on hand, meaning there is more competition. On this stretch alone, there are 12 properties and over 5,000 rooms. Competition is tough because everybody fights for the same piece of the pie, and the slices become smaller and smaller. People would say cutting the price is the best way to do it, but I beg to differ. The most important thing is to offer and ensure your customers that they receive great value for money on their stay. If you can convince your customers that what they are spending their money on is worth it, then you have done your job. For us, we have large rooms on this stretch, with our smallest rooms being about 40 sqm and our largest being up to 101 sqm. Our products are comparable and provide great service. That is how we create great value for money. The lead up to World Expo 2020 looks promising. I believe there will be a drop in occupancies compared to 2013-14, because of the number of hotels opening, and everybody’s competing for the same business. The new mid-market hotel establishments such as the three- and four-star boutique hotels open up a larger spectrum of tourists from various locations across the globe that can come and visit Dubai on a variety of budgets.

Executive Guide





General Manager, Shangri-La Hotel Dubai

General Manager, Tamani Marina Hotel

General Manager, Marina View Hotel Apartments


t the end of the day, any additional room that opens up is good, whether it is three, four, or five star. If you look at serviced apartments and hotels, there are something like 650 right now. If you look at different districts you have different products and there are a tremendous amount of serviced apartments. There is a lot planned for the future, and personally I’m waiting to see what actually happens. The growth of room inventory in the city has grown tremendously and there are many more hotel and service apartment projects on the horizon to be opened before 2020. If my information is correct, there are presently 650 hotels and service apartments in Dubai and another 100 are under planning or construction at present. This massive growth does increase competiveness and in turn challenges rates and occupancy levels of the existing hotels unless the visitor stream increases equally to fill the new properties as well. Approximately 50% of our customer base comes from GCC countries and the other markets are the UK, Australia, the US, and other European countries. There is continued growth, but region wide you also see a lot of opportunities to move to other places.


f you had come to Dubai in the early 1990s, you would have seen a remote area. But you can see what it looks like now. When the metro was built, people questioned its use as everyone has cars; however, now you can see how successful it has been. I believe it will be the same for the tram. It will be similar for other projects that have built the future of the city. When there are so many hotels, it is easier for others to come to Dubai. I am not just thinking about my own pockets, but about what will come to everyone in Dubai. It is not just hotels, but we do need more hotels here. Dubai is competing with major cities around the world, such as Istanbul and London. It is easy to work here; we have a fantastic employee environment. Whenever there is feedback from our guests, we act immediately on it. Wherever you go in the hotel, you will see Islamic art everywhere. Everywhere else in the city, you see hotels with modern art. Our approach is to always support charity; this comes from our religion. As hotel managers, every month we have charity projects and all our employees are part of this. It shows our responsibility to the community.



ith the upcoming Expo, Dubai is expected to reach 20 million visitors annually over the next few years, almost doubling 2014 figures. Additionally, over 100 new competitors are set to enter the market considering the new developments in the pipeline, such as the Mall of the World that is expected to feature at least 100 new hotels alone. As a brand, Dubai should be positioned as a futuristic city, the world’s main business and leisure hub, and a safe haven for travellers. These points are crucial to the Emirate’s development. Our current guest portfolio is primarily made up of Russian, French, British, and Saudi guests either travelling as couples or as families. Our European guests tend to favor visits to the nearby public Jumeirah Beach and all nationalities are keen to visit Marina Walk. The Global Village and Miracle Gardens are also high on the list of city attractions, and we offer guests shuttle services to these locations. For any first-time traveller to Dubai, a desert safari, city tour, or dhow cruise down the creek appears to be high on the list of favorite tours, and we have an in-house travel desk located within the lobby to arrange these excursions.


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01 The Ritz-Carlton JBR Walk T +971 4 399 4000

Rooms 55 spacious deluxe rooms, 60 club rooms, 10 executive suites, 7 junior suites, 3 club suites, & 2 Ritz-Carlton suites Guest Services Private balconies & patios, guaranteed sea view, flat-screen, meeting rooms with audio-visual services Dining The Library Bar offers leather sofas & a cigar menu, while the Lobby Lounge serves morning pastries & afternoon tea. The Splendido Restaurant serves Italian food.  tlantis The Palm Dubai A Crescent Road, Palm Jumeirah T + 971 4 426 1000 02


Rooms Each hotel room and suite is beautifully designed with subtle oceanic and Arabic influences Guest Services Meeting & conference facilities, marine & waterpark, spa Dining 23 restaurants, bars, & lounges serving over 28 different cuisines.  empinski Hotel, Mall of the K Emirates Sheikh Zayed Road in Al Barsha district T + 971 4 341 0000 03


Rooms 15 stunning ski chalets offering views of the Arabian Gulf on one side & the snow covered slopes of Ski Dubai on the other, 393 deluxe rooms & suites Guest Services Meeting rooms, conferences, spa, swimming pool, & room service Dining Specialty grills at K Grill, salads & freshly baked bread and afternoon tea at Aspen by Kempinski, or Spanish cuisine & beverage experiences at Salero Tapas & Bodega.  ilton Dubai Jumeirah H Resort Jumeirah Walk T +971 4 399 1111 04

Rooms A selection of deluxe, executive, & suite rooms Guest

Services Business center & services, recreation facilities & spa, barber shop & beauty salon, car rental, shopping, concierge, multi-lingual staff, room service, tour desk, & beach & water sports Dining 12 restaurants & bars including Axis Lobby Lounge, Bice, Bice Sky Bar, Cuban Bar, H20 Poolbar & Restaurant, Hartisan, Oceana, Pachanga, Studio One, & Wavebreaker. 05 JW Marriott Marquis Sheikh Zayed Road, Business Bay T +971 4 414 0000

Rooms 684 rooms including 120 suites on 82 floors Guest Services 28 meeting rooms, 55,488 sqf of total meeting space, one concierge level, fitness recreation & spa facilities Dining A selection of 13 restaurants & lounges. 06 Sofitel

Jumeirah Beach Residence Dubai Marina T +971 4 448 4848/432 8456 Rooms 398 rooms & 40 suites12 prestige & one imperial Guest Services Sea views from every room, fitness center, beach access, & treatment room Dining Five bars & restaurants including Planatation, AOC French Brasserie, Infiniti Pool Lounge, and The Hub. 07 The Oberoi Hotel The Oberoi Centre, Al Amal St. T +971 4 444 1444

Rooms 252 air-conditioned guestrooms Guest Services Full-service spa, outdoor pool, steam room, 24-hour business center, small meeting rooms, limo/town car service, tour/ticket assistance, wedding services, 24-hour fitness center Dining Nine7One has a multitude of Arabic, Asian, & Western culinary options. Umai offers the most popular cuisines of the East, & Ananta offers Indian cuisine.

Executive Guide





08 Arjaan by Rotana Media City Concorde Tower, Al Sufouh Road T +971 4 436 0000

10 Media One Hotel Al Falak Street T +971 4 427 1000

Rooms 167 hotel apartments Guest Services Gymnasium, towel service, refreshments, DVD rentals, outdoor childfriendly swimming pool, meeting, conference, and event facilities Dining Veranda and Arabesque Café.

Rooms: 260 hotel rooms Guest Services Events facilities Dining The Z:ONE lounge bar and terrace for lunches, light snacks, and evening drinks, THE MED, our signature Mediterranean restaurant and terrace, and THE DEK on 8, a chillout lounge by the pool deck.

09 Tamani Marina Hotel Al Sufouh Road T +971 4 318 3888

11 Marina View Hotel Apartments Al Marsa Street, Sheikh Zayed Rd, Dubai Marina T +971 4 457 1000

Rooms single rooms, two and three bedroom apartments, and penthouses Guest Services Conference rooms, fitness and health club Dining Nar& Hail Restaurant, in-room dining.

Rooms studio, one, and two bedroom apartments Guest Services 24-hour room service, on-site sports terrace, fully

equipped gym and personal trainer, outdoor swimming pool and children’s pool, male and female steam room and sauna, and more Dining restaurant, banquet hall. 12 Ivory Hotel Apartments 9th Street, Sheikh Zayed, Tourist Club Area T +971 2 613 8500 Rooms 1 & 2 bedroom apartments and 4-bedroom penthouse Guest services Fitness, business center, concierge, coffee shop, spa Dining Well-equipped, full kitchens. 13 Millenium Plaza Hotel Sheikh Zayed Rd T +971 4 387 7777

Rooms Superior twin, family room, superior king, club premium double



or twin rooms Guest services Child-friendly facilities, business center, high-speed internet, health club & spa Dining Breakfast in the room, restaurant (à la carte), restaurant (buffet), special diet menus (on request). 14 Dunes Hotel Apartments Oud Metha, Al Barsha, Al Muhaisnah T +971 4 358 3333/323 6333/254 0000

Rooms Extra-spacious accommodation Guest Services Dunes Hotel Apartments combines luxury, comfort, and bespoke hospitality in a bouquet offering of modern amenities, value-added services and bespoke tailor-made packages Dining Apartments include cooking facilities and many more conveniences.


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GOVERNMENT A typical visitor’s visa is good for 30 days with a 10-day grace period. After that there is a AED100 fine per day.

Take the newly opened Dubai Tram to easily navigate the Marina area.

Plan to visit the Burj Khalifa during sunrise or sunset for the best views.




Download the mDubai application for iOS and Android devices to book taxis, get metro maps, and many others.

For car rentals, expect to pay extra for the many road tolls via Dubai’s Salik system.

For expats, reserve your Friday for Dubai’s famous brunch, all you can eat and drink for a set fee.


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000 000 000



Use for access to all of Dubai’s restaurant delivery services.

When renting an apartment for a year, the landlord typically expects payment to be made in just one or two lump sums.

Local Time in the UAE is GMT+4


Executive Guide




UAE National Day is held on December 2, and the festivities can extend over a few days.

Pink-topped taxis are only for women and children, and can be specially reserved.


Alcohol should only be consumed in designated zones, typically in areas attached to hotels and resorts.




Dubai is home to approximately 200 nationalities, so be prepared for a true multicultural experience.

Although the official language is Arabic, English is widely spoken in Dubai.

The working week is from Sunday to Thursday, although there are some companies that are open on Saturdays.

Three-pronged British-style 220 V plugs are used in Dubai. Adapters are widely available.

Men should wait for local women to initiate a handshake, never making the first move.

Only wear beach clothing at the beach or in resort areas. It may cause offense in other public areas.


Inviting Possibilities Together we can transform our potential into Dubai’s reality

Independent courts and unique independent legislative system consistent with English common law

2014 Saw the upgrading of Dubai’s stock exchange to ‘emerging market’ status

An international stock exchange with primary and secondary listing of debt and equity instruments

A wide network of double taxation treaties available to UAE incorporated entities


Email: [email protected] Twitter:@dubaifdi