Efforts to promote standard labeling for UAE-manufactured products

 

In June 2017 the UAE’s ruling Cabinet, chaired by Sheikh Mohammed bin Rashid Al Maktoum, ruler of Dubai and vice-president and prime minister of the UAE, approved the standardisation of the “Made in UAE” label, with the aim of strengthening the country’s manufacturing sector. The move forms part of a larger push to promote manufacturing in the UAE, heralded by developments like the Dubai Industrial Strategy 2030, launched in June 2016 with the aim of boosting Dubai’s GDP by Dh165bn ($44.9bn) by 2030 through industrial development. Promotion of the “Made in UAE” label is intended to create a globally recognised and respected national brand, thus serving to further raise the country’s profile as a centre for manufacturing within the region.

Positive Views

The move to create a standardised “Made in UAE” label, with all the necessary criteria in place for its usage, registration and permits, is seen as an important move by industry leaders. “I am a strong advocate of this policy,” Mahmood Daylami, secretary-general of the Dubai-based Gulf Aluminium Council, told OBG. “The UAE now competes with the best in the world, and we need to match it with a high standard of quality products, not only for export, but also for what it allows in. This will involve implementation of strict policies of safety, environment and people management, not to mention quality of the product.”

Details on the exact criteria and permit process will play an important part in the effective rollout of the initiative. In addition, creating the right association for consumers will take time and strong and long-term strategic thinking. Some for example have questioned what Made in UAE will stand for, in the same way that “Made in Germany” brings to mind high-end technology, “Made in China” mass production and “Made in Japan” advanced electronics. Significant effort will therefore need to be put into targeting the right sectors and overall message.

Many brands already exist that promote the UAE, either indirectly through their own reputations or explicitly by saying that they are produced in the UAE. Ras Al Khaimah-based RAK Ceramics is one of the largest ceramics brands in the world, with a strong regional reputation and posting revenues of Dh2.8bn ($762.2m) in 2016, down 9.3% on the previous year. Another example is Abu Dhabi-based Al Foah, the largest date receiving and processing business in the world, which currently exports 90% of the 113,000 tonnes of dates it produces every year to over 48 countries worldwide. In Dubai brands like Damas, a jewellery maker, and Al Nassma, a manufacturer of high-end camel milk chocolate, are helping to grow the reputation of Made in UAE products. Strata Manufacturing, based in Abu Dhabi and established in 2009, has been supplying aviation parts to companies like Boeing and Airbus for a number of years under the slogan “Made with Pride in the UAE”. Meanwhile, in other industrial segments, the UAE has a strong reputation for steel and aluminium production through companies like Emirates Global Aluminium and Conares.

Partnerships

A key part of the Made in UAE initiative is to facilitate sustained and successful partnerships with international manufacturers in order to stimulate investments within industry and manufacturing. This means that government bodies, like the recently established UAE-wide Industrial Coordination Council, and the Dubai Free Zone Council, which held its first meeting in October 2015, could play important roles going forward.

In December 2017 the UAE held a conference to promote manufacturing, bringing together regional leaders for a Made in UAE Summit. The annual gathering is expected to provide insight to help shape the future of manufacturing in the UAE, and assist efforts to reach out to consumers around the world in today’s rapidly changing global marketplaces.

Workforce

By pushing for a more prominent and well known Made in UAE label, with the increase in manufacturing that goes along with it, Dubai and the other emirates are hoping to see a corresponding uptick in employment opportunities. However, this comes with its own set of obstacles. “UAE-made by UAE hands is a challenge, as you need to have the skills to create the right environment, while preparing them with the right programmes,” Saif Al Hajeri, CEO of Tawazun Holding, told participants at the Global Manufacturing and Industrialisation Summit held in Abu Dhabi in March 2017.

Al Hajeri pointed out that the UAE, as well as the region as a whole, needs to be ready for life after oil, with manufacturing a key area to promote and focus on. However, he also added that it was still difficult for manufacturers to compete for skilled technicians with oil and energy companies in the region. To bridge the human capital gap, Tawazun has created its own training centre and is working with universities to build its workforce. A number of other companies may see a need to follow a similar path over the coming years.

Further incentives may be needed to entice more manufacturers to set up in Dubai and market their products as Made in UAE. “The government needs to promote and create incentives to help companies manufacture locally, such as by providing loans and grace periods,” Abboud Bejjani, regional vice-president for the Middle East, Africa and Pakistan at AbbVie Biopharmaceutical, told OBG. “There needs to be more university hospitals as well, with initiatives established to foster a local research culture.”

Factory Centre

The manufacturing sector has shown strong growth in recent years, with UAE-manufactured exports rising from Dh30.5bn ($8.3bn) in 2000 to over Dh290bn ($78.9bn) by 2014. As of December 2016 Dubai Investments, the leading diversified investment company listed on the Dubai Financial Market, had total manufacturing assets of Dh3.1bn ($843.8m), 19% of the company’s total assets, with manufacturing activity income growing from Dh1.4bn ($381.1m) in 2015 to Dh1.6bn ($435.5m) in 2016, a rise of 15%. The company currently owns over 40 subsidiaries and joint ventures across a wide array of industries, including in real estate and financial investments. According to Khalid bin Kalban, managing director and CEO of Dubai Investments, speaking at the Manufacturing Expo 2017 held in Abu Dhabi in March 2017, the company is now also prioritising some of the industries earmarked in the UAE Vision 2021 and Dubai Industrial Strategy 2030, with these forming the main pillars of its sustainable growth plans.

Meanwhile, in December 2016 Unilever opened the largest personal care products manufacturing plant in the Middle East in Dubai, which at full capacity will produce 500m items a year. Located within the Dubai Industrial Park, the $272m plant will produce a wide range of products labelled Made in UAE, primarily for export to Europe and the MENA region, including popular Unilever brands such as Dove, Lifebuoy, Vaseline and TRES emmé. In another sign of the times, a quarter of the energy needed to power the plant will come from solar power.

Local firms are also striking out into new areas of manufacturing. In March 2017 it was announced that the UAE’s first micro-factories will be established in Abu Dhabi and Dubai, focusing on new manufacturing technologies like 3D printing. According to media reports, the goal is to build an Abu Dhabi-based facility focused on serving industrial companies, alongside a Dubai-based one focused on consumer goods and services companies. These projects are expected to play a crucial role in revolutionising the design and manufacturing capabilities of the UAE, which could in turn play a significant role in promoting more Made in UAE brands. The project will be carried out by Abu Dhabi-based Mubadala Investment Company, Dubai Future Foundation and GE Additive. “These micro-factories are a glimpse of what the future represents, combining innovation and educational ecosystems with fast, efficient and sustainable manufacturing capabilities. The possibilities are truly limitless,” Mohammed bin Abdullah Al Gergawi, the minister of Cabinet affairs for the UAE and managing director of Dubai Future Foundation, told local media in March 2017.

Moving Forward

By establishing a standardised Made in UAE label, and properly laying the groundwork for the ways in which it can be used and the standards it represents, Dubai and the rest of the UAE have an opportunity to build a regional or even global reputation for the Made in UAE brand. This could help facilitate growth in important areas of the local manufacturing and industrial sector, which would in turn help further diversify the economy. If fully standardised and linked with marketing campaigns, Made in UAE could one day rival other countries’ offerings when it comes to global awareness.

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The Report: Dubai 2018

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