United Arab Emirates

Industry

Downtown Dubayy, capital of the amirate of Dubayy
Courtesy Embassy of the United Arab Emirates, Washington

Non-oil industries have had a checkered history. On the positive side, federal and local governments have initiated many industrial projects that have aided in the development of the UAE. Local and foreign private capital found numerous opportunities in the friendly business climate of the amirates, with the result that by 1987 manufacturing contributed 9 percent to GDP (see table 28, Appendix). However, because of the lack of a unified planning mechanism and outright competition among amirates, redundancy has been a recurring problem. For example, there are nine cement factories in the UAE with a total capacity of 8.5 million tons per year. Local demand was estimated in 1986 atonly 2 million tons. In addition, out of five steel rolling mills, three have had to close. Plastics and certain foods are overproduced. A 1988 study by the Ministry of Economy and Industry reported that local industry suffered from low wage levels, a lack of new technology, and a low level of value added in many industries. In 1983 the Emirates Industrial Bank was established; one of its roles is to assist ailing industries financially.

Dubayy, with its long history of entrepôt trading, has the most developed non-oil industrial sector. Abu Dhabi, however, has focused on using its oil resources in downstream (see Glossary) facilities. Some of the northern amirates are developing their mineral resources. By 1990 total manufacturing output had a value of about US$2.6 billion, with 80 percent of the UAE's factories located in Abu Dhabi, Dubayy, and Sharjah.

Data as of January 1993