Hamriyah Free Zone Authority director general on the challenges of creating a multi-billion dollar industry from scratch
While the world seems wracked with financial crises and Europe struggles to come to terms with its sovereign debt problems, Sharjah’s Hamriyah Free Zone seems to be doing alright, thanks very much.
As the UAE’s fastest-growing free zone, Hamriyah now has close to 5,500 registered companies representing 138 nations operating in its two sites – not bad for a company that has continued to grow exponentially, despite the recent international financial turmoil. And, according to its director general, Dr. Rashid Al Leem, there are no signs of that growth abating just yet. Situated 20km north-east of the Sharjah city centre, the Hamriyah Free Zone was established by Emiri decree in November 1995, and centres around the Hamriyah Port (not to be confused with Dubai’s Al Hamriyah port), its deep-water harbour and shallower inner harbour.
The free zone is split into two areas: the main 220ha zone (Phase 1) that includes the port, and Phase 2, a 120ha development on the opposite side of the E11 main road, designed to attract large industry, and supporting small- to medium-sized enterprises (SMEs). The two areas were linked together with the opening of a $32.6m interchange late last year that cut travel time between the areas by at least 30 minutes, and transformed the lives of those operating at the free zone.
It is the latest in a long line of developments that have seen HFZA grow from 76 companies in March 2000, when Al Leem joined the company, to close to 5,500 by February 2012. That growth, in the main, has been down to Al Leem’s leadership, that of his management team – and the support they have received from local government and international businesses. It has not come easy: Al Leem and his team has had to forge its business ties traditionally – by meeting people face-to-face, and developing a bond of trust and reliance that only comes with time.
“Do not get me wrong: we have had companies leave us over the last year – but they have been smaller businesses, micro-businesses, a majority of which are offices. This is part of the business life,” said Dr. Al Leem.
Hamriyah is a multi-billion dollar enterprise. Al Leem would not talk financials, but has been quoted as saying the free zone has attracted over $20bn in foreign investment since it was established in 1995. While he is unable to reveal annual turnover, Dr. Al Leem is happy to illustrate the success of the free zone with other statistics.
“We announced in January 2011 that we expected 700 to 800 companies to join HFZA. And, yes, we had companies leave – but the facts are that we have penetrated new markets, we have done more marketing, and that saw 1,327 new companies join last year,” he said. “There is no way I could have dreamed of that.”
Dr. Al Leem admits to being a little green under the collar when he was approached by H.H. Sultan bin Mohamed Al-Qasimi, Sharjah’s ruler, to explore the future potential of the free zone. Dr. Al Leem had been working for AMOCO at its Sajaa gas plant as a production superintendent, and says the remote location of the work certainly helped get him acquainted with the fledgling free zone in 2000. “I never knew about free zones, what they did, or what their businesses were all about. I knew that His Highness had a vision, so the first day I came here I decided to drive through the area. There was nothing but water on one side and desert on the other,” he explained. “We did not even have an office. Everything was done out of Portacabins,” said Dr. Al Leem.
H.H. Al-Qasimi’s idea was to create an industrial heart for Sharjah that would attract and retain foreign investment which, in turn, brings jobs and economic prosperity to the wider region. It is a relatively straightforward concept, but it is not a plan that came together overnight.
“To build industries, you need the upstream industries and downstream businesses to come together, so you need the facilities. You also need to have offices to support the sales and everything. So, we started to work on that – but, as they say, the road is full of bumps. It is not that easy,” said Dr. Al Leem.
As a logistics hub, Hamriyah has a lot going for it. It is not only situated in the only emirate with ports on both the Arabian Gulf and Indian Ocean coasts, it also has tremendous links with the Sharjah International Airport Free Zone and wider UAE. It is 11-hours closer, in sailing time, to the Strait of Hormuz than Dubai’s Jebel Ali.
The 14.5m deep-water harbour was developed in 2002-05 by Halcrow to replace the original pontoon dock. The port facility now has a berth for LPG tankers and another for grain and general cargo ships. The grain berth also has a rail-mounted vacuvator, while specialist equipment can be brought in to cater for other cargo. There is one 3,500HP tug-boat stationed at the port, while others are called in from Sharjah’s Port Khalid as required.
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