UAE free zones must adapt to survive, says Fujairah trade chief

Free zones have failed to match their brands to new economic realities, says Sharief Habib Al Awadhi

GAME PLAN: The UAE's free zones will need to adapt their marketing strategies

GAME PLAN: The UAE's free zones will need to adapt their marketing strategies

The UAE’s free zones must brand themselves more aggressively if they are to survive in a post-recession climate, the director general of Fujairah Free Zone said.

The state-backed trade zones, which offer incentives including 100 percent ownership to foreign firms, will need to match their selling points closely to the new economic realities, Sharief Habib Al Awadhi told Arabian Business.

“What we have failed at in the last few years, with respect to all the zones, including Fujairah Free Zone, is that we did not develop our [zone’s] brands,” he said.

“People nowadays know the available facilities, you don’t need to go anywhere in the world and say, ‘Come to the UAE.’ You need to say, ‘why should you come to the UAE in particular? What can we provide your industry?’” he said.

Incentives used previously, such as offering cash and government partnerships to companies establishing offices in free zones, had no place in the new climate, Al Awadhi said.

“Though some companies talk about offering some kind of direct support or some kind of finance, it seems, to be frank, dishonest,” he said.

“To offer finance you have to have a lot of securities, a lot of support… it’s not easy, and in the current scenario, I don’t see any zones wanting to indulge [in it].”

Trade through the UAE’s free zones hit $78bn in 2009. Fujairah, located on the east coast of the UAE, opened one of the country’s first free zones in 1987.

The emirate is expecting significant foreign direct investment in its petrochemical industry in 2011, and is eyeing $100m of investment by year-end, Al Awadhi said.

 Investment is expected to be divided amongst local and foreign investors, in a rough 60-40 percent split, he said.

“Many people think that’s a very small number, but we’re not just talking about trading and representative offices, we’re talking about people coming to put up a proper base in the UAE, a proper office, a proper existence,” he said.

“People talk of very big numbers and that’s what has hurt us over the last few years. They talk a lot of crazy numbers, crazy figures, but when it comes down to realities, there’s not much there.”

 

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Posted by: Haseeb

Free Zones if cannot provide any further benefit at least come down to the level of pre-crisis fees level to retain customers in new post-crisis situation that will be beneficial if companies grows
more business will come and beneficial for UAE.

Posted by: Giorgio

small numbers makes the big ones...very true!!

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