meed-logo

line1 line2 line3
SIGN IN / REGISTER

The road ahead for UAE manufacturing

28 October 2022

This article is the first in a series that captures key highlights from the MEED-Mashreq Manufacturing Business Leaders Club held on 29 September in Dubai, discussing the way forward for UAE manufacturing and the role of Operation 300bn in advancing the sector.

Participants at the closed-door event included 30+ manufacturing stakeholders based in the UAE, such as the Ministry of Industry and Advanced Technology, Ducab and Global Food Industries.

Enabling a flourishing local industrial and manufacturing economy has long been a strategic priority for the UAE.

Since the formation of the federation, the country has successfully built its base in key focus sectors, including metals, petrochemicals, building materials, pharmaceuticals, and high-value downstream processing sectors.

But arguably, the challenges of recent years and the effects of the Covid-19 pandemic have driven home the need to further reduce reliance on imports and to enhance the UAE’s manufacturing competitiveness.

“Fundamentally, many of the things happening in the world are in favour of the UAE’s industries and present many opportunities for success,” said Abdullah Alshamsi, assistant undersecretary, Industry Growth Sector, Ministry of Industry and Advanced Technology (MOIAT).

Speaking at the first MEED-Mashreq Manufacturing Business Leaders Club on 29 September, Alshamsi emphasised the UAE government’s seriousness to bolster its manufacturing sector.

“We have embarked on several changes to make the UAE a more attractive place to do business. Operation 300bn is one such example,” he said. “There is more to come, because industry has become a number one priority for our leadership.”

WATCH: Highlights from the MEED-Mashreq Manufacturing Business Leaders Club

Strategic focus

Introduced in March 2021 as the UAE’s national industrial strategy, Operation 300bn aims to expand the contribution of the sector to the GDP from AED133bn currently to AED300bn by 2031 – by no means an easy feat.

Spearheaded by the MOIAT, the programme will see a greater incorporation of advanced technologies, sustainability, and investments in talent to achieve the overarching goal.

The ministry is working closely with the Emirates Development Bank, which has allocated AED30bn to support priority industrial sectors and finance 13,500 large firms and SMEs over a period of five years.

The ministry is further introducing 17 initiatives – including a national in-country value programme, an updated industrial law, a unified digital platform, and establishing an ecosystem for research and development.

More specifically, the programme will target both established industrial sectors in the UAE, such as plastics, metals and petrochemicals, as well as industries of the future including aerospace and biotechnology; and strategic sectors such as food and healthcare.

“Some of the things we are doing through Operation 300bn include the opening of new markets, made possible through the free trade agreements signed with India, Indonesia and Israel recently,” said Alshamsi. “The UAE’s industries can build on this competitive advantage and enter high-growth markets.”

A crucial part of the programme is ensuring its reputation precedes itself. One way the MOIAT is doing this is through the ‘Make It in The Emirates’ campaign, a comprehensive promotional strategy that invites contributions from investors, innovators and developers to Operation 300bn, and highlights the strengths of the programme.

“The government is open to hearing from industries and to learn how we can make business better,” said Alshamsi. “Open dialogue will help us achieve our goals and ambitions.”

The national in-country value (ICV) scheme meanwhile aims to boost the growth of UAE-based industries by redirecting half of government spending on procurements and tender contracts into the national economy by 2031. In 2021, it redirected more than AED41bn of spend into the national economy.

A concern, however, raised by representatives at the Business Leaders Club is that the ICV scheme hasn’t fully created a level-playing field in many cases because the cheapest bid still wins.

“What you’ve seen of ICV so far was just the first phase,” said Alshamsi. “In the next phase, we’ll relaunch it as ICV, which we hope will be more aggressive and impactful, and will address concerns currently raised by industry players.”

By 2025, the ICV scheme aims to increase the number of ICV-certified companies and spend towards Emirati products and services to AED55bn, from AED33bn in 2020.

Making a case

A question to be raised is – why manufacturing?

Since the oil price crash of 2015-2016, the UAE has increased its efforts to counter economic fluctuations by reducing dependence on oil export revenues.

Manufacturing and industrial growth was quickly recognised as a growth driver. As a sector with easy links to several others – skills, transport, research, services – manufacturing supports a broader segment of the economy.

With the rise of Industry 4.0, manufacturing is benefitting from advancement in technology and innovation, areas that the UAE readily compliments with its own strategic visions.

Several factors are already working in favour of the UAE, many of which have been introduced in recent years. These include 100 per cent foreign ownership of specific businesses; favourable tax environment; long-term visa reforms; dual licensing; and a complementary legal system.

Further supporting the business environment is overall political stability; positive credit outlook; favourable bilateral relations and free trade agreements; and strong infrastructure in areas such as transport, logistics and telecommunications.

But that does not mean the manufacturing landscape is bereft of challenges. Rising competition in the region, especially from neighbouring GCC states has meant that manufacturers in the UAE’s ‘open waters’ have had to reassess their strategic priorities.

At the same time, macroeconomic challenges such as inflation, supply chain delays, rising commodity prices and surging fuel rates are hurting producers and their margins.

“Moving forward, the UAE manufacturing industry can differentiate itself from regional players by being recognised for sustainability, quality and advanced technology,” said Alshamsi. “It’s something in our DNA, something so many other countries lack. This can become a true differentiator for us.”

https://image.digitalinsightresearch.in/uploads/NewsArticle/10141933/main2159.jpg
Mehak Srivastava

Register for MEED's guest program now to access this article.

Click here to register
Exclusive from Meed
Related Articles
  • Dubai approves metro extension to Al-Maktoum airport

    10 November 2026

    Dubai’s Executive Council has approved a project to extend the Dubai Metro’s Route 2020 to Al-Maktoum International Airport City, with passenger services scheduled to begin operations in 2031.

    Sheikh Hamdan bin Mohammed bin Rashid Al-Maktoum, Crown Prince of Dubai, announced the decision following a council meeting held during the UAE Government Annual Meetings 2026.

    The rail project forms part of a package of strategic schemes worth over AED11bn ($3bn) approved by the council.

    The wider approvals include a comprehensive framework to upgrade community facilities and public services by 2040, with priority given to residential communities for UAE citizens.

    The project approval follows the procurement of detailed design work for the rail link. MEED exclusively reported in September that Dubai’s Roads & Transport Authority (RTA) had awarded US-based engineering consultancy Aecom the design contract for the Route 2020 extension.

    The planned extension will run for about 3 kilometres from the existing Expo 2020 terminus station to connect directly with the West Terminal of Al-Maktoum International airport. The scheme will add two new stations to the network.

    The existing Route 2020 corridor is a 15km spur that branches off the Dubai Metro Red Line at Jebel Ali station. It comprises 11.8km of elevated viaduct and 3.2km of underground track, serving five elevated and two underground stations.

    https://image.digitalinsightresearch.in/uploads/NewsArticle/21301168/main.png
    Yasir Iqbal
  • Egypt seeks to accelerate gas pipeline project with Libya

    10 November 2026

    Egypt aims to accelerate a range of energy projects with Libya, including gas pipeline links, according to a statement from the Egyptian Foreign Minister Badr Abdelatty.

    Other projects include a scheme to refine Libyan crude in Egypt and an electricity interconnection.

    Abdelatty’s comments came in a ministry statement after a meeting with Libya’s acting oil and gas minister, Khalifa Abdulsadek, in the Libyan capital of Tripoli.

    Egypt is currently trying to address an energy squeeze that has escalated ​due to elevated global liquefied natural gas (LNG) prices since the ​start of the US-Israeli war on Iran in February of this year.

    In his statement, Abdelatty called ‌for ⁠cooperation on petroleum products and the completion of projects to refine Libyan oil in Egypt and re-export ​it.

    He also said that Abdulsadek would ​visit ⁠Cairo soon to continue technical talks with Egypt’s petroleum and electricity ministers.

    The ⁠statement ​did not provide ​details on costs or the status of the projects.

    Plans for new gas pipeline links with Libya are just one of several ambitious gas pipeline plans Egypt is pursuing.

    In October, the Italian oil and gas company Eni signed the main engineering, procurement, construction and drilling contracts for a project to export gas from reserves in Cyprus using a major pipeline to Egypt.

    The project includes contracts with several companies that will develop infrastructure in both Egypt and Cyprus.

    The awards included a $170m contract won by Egypt’s Petrojet for a new onshore gas pipeline in Egypt that will help transport gas to Egypt’s Damietta LNG facility.

    https://image.digitalinsightresearch.in/uploads/NewsArticle/21273777/main.jpg
    Wil Crisp
  • Omani company signs Kuwait drilling contract

    10 November 2026

    Oman’s MBPS has signed a drilling rig contract worth $127.3m with state-owned upstream operator Kuwait Oil Company (KOC).

    Under the terms of the deal, MBPS will supply and operate three newly built 1,000-horsepower land rigs for drilling and workover operations, according to a company statement.

    The UAE-based oil field services company Adnoc Drilling is a majority shareholder in MBPS.

    The chief executive of MBPS, Salim Al-Harthy, said: “This is another important milestone for MBPS and a strong reflection of KOC’s confidence in our capabilities.

    “It further strengthens our presence in Kuwait and our commitment to delivering safe, reliable and efficient drilling and workover services across the region.”

    He : “My sincere appreciation to KOC for their continued trust, and to our MBPS team for their hard work and dedication in making this possible.”

    In October last year, KOC said it planned to spend KD1.2bn ($3.92bn) on its exploration drilling programme through 2030.

    The spending was part of a KD9.8bn budget, the company’s biggest ever, allocated for drilling and maintenance of up to 6,193 wells by the end of this decade.

    https://image.digitalinsightresearch.in/uploads/NewsArticle/21273731/main.png
    Wil Crisp
  • Adnoc Drilling wins $315m Kuwait offshore rig deals

    10 November 2026

    Register for MEED’s 14-day trial access 

    Abu Dhabi National Oil Company (Adnoc Group) subsidiary, Adnoc Drilling, has been selected for two offshore drilling rig contracts in Kuwait with a combined maximum value of KD96.55m ($315m), according to documents published by Kuwait’s Official Gazette.

    The Higher Purchasing Committee of state-owned Kuwait Petroleum Corporation (KPC) has given approval for its subsidiary Kuwait Oil Company (KOC) to award the contracts to the Abu Dhabi-listed drilling contractor after Adnoc Drilling submitted the lowest compliant bids.

    While the maximum combined contract value has been confirmed as KD96.55m ($315m), the individual contract values, rig identities, durations and expected commencement dates have not been disclosed.

    The approval comes as Kuwait moves to expand offshore exploration and development following a series of discoveries in its territorial waters.

    It is currently unclear how Kuwait will provide security for its planned offshore oil and gas projects in the Gulf, adding uncertainty to the outlook for these plans.

    On 5 October, KPC chief executive Shaikh Nawaf Al-Sabah reiterated the company’s commitment to developing three major offshore oil discoveries in the region.

    KPC initially launched the Al-Seef project to develop the three fields in February, just weeks before the US and Israel attacked Iran, triggering a regional war that has sparked a crisis in Kuwait’s oil and gas sector.

    The regional conflict has seriously disrupted shipping through the Strait of Hormuz, a key export route for Kuwaiti oil.

    The war has also led to dozens of attacks on Kuwaiti oil and gas infrastructure, with at least one causing damage to a Kuwaiti offshore platform.

    This attack took place on 12 July, when a drone struck a KOC offshore drilling platform in Kuwaiti territorial waters, causing damage to the platform and injuring one worker.

    https://image.digitalinsightresearch.in/uploads/NewsArticle/21273678/main2430.jpg
    Wil Crisp
  • Aramco-backed firm tenders logistics hub expansion

    9 November 2026

     

    Asmo, the logistics joint venture of Saudi Aramco and DHL Supply Chain, has set a 15 November deadline for a contract to expand the logistics complex at King Salman Energy Park (Spark) in Saudi Arabia’s Eastern Province.

    The logistics hub will add over 124,000 square metres (sq m) at Spark.

    Al-Khobar-based engineering firm House of Consulting Office is the project consultant.

    The tender for the expansion works comes shortly after Asmo awarded an estimated SR820m ($218m) contract to build the logistics complex’s first phase in May this year.

    The overall project will feature a 43,000 sq m, temperature-controlled Grade A warehouse; more than 3,000 sq m of offices and staff amenities; 5,300 sq m dedicated to chemicals storage; and an open yard covering about 1.2 million sq m.

    Asmo signed an agreement with Bahrain‑headquartered Arcapita Group Holdings in February to deliver the project at Spark.

    Planned for large-scale industrial use, the site is expected to incorporate advanced warehouse and building management systems, end-to-end digital connectivity, automation and robotics.

    It will also be developed in line with internationally recognised sustainability standards, featuring solar photovoltaic readiness, electric-vehicle charging infrastructure and a target of Leed Gold certification.

    The development aims to support the next stage of Saudi Arabia’s logistics and supply chain expansion.

    Under the deal structure, Arcapita will provide funding and retain ownership of the asset, while Asmo will develop the facility and then lease and operate it under a 22-year occupational lease.

    According to a statement, “the scheme will be executed via a forward-funding model, underscoring a long-term commitment to national infrastructure”.

    Asmo added that this will be its first purpose-built logistics centre and one of four strategic locations planned to anchor its nationwide logistics network, aligned with the National Transport and Logistics Strategy under Saudi Vision 2030.

    https://image.digitalinsightresearch.in/uploads/NewsArticle/21267403/main.gif
    Yasir Iqbal