Ajman, one of the seven emirates in the UAE, is rapidly gaining recognition for its industrial sector and strategic economic initiatives. Its economy is largely diversified, focusing on the non-oil sector. The emirate has fostered industrial growth in recent years, with contributions from subsectors like food and beverages, textiles and construction materials. It has also embraced modern technology and advanced manufacturing to boost productivity.
This commitment is evident in initiatives like the Ajman Smart City project, which integrates smart technology to improve life for residents and businesses. Ajman Vision 2030 outlines a sustainable development roadmap, positioning the emirate as an investment-friendly destination by 2030. The plan prioritises resource efficiency, ecological balance and environmentally responsible growth, which aligns with the UAE’s broader goal of creating a green economy.
Structure & Performance
Ajman operates within a dual framework that balances both federal and local systems of administration. At the national level, the UAE is led by the Federal Supreme Council, comprising the rulers of the seven emirates, with Ajman represented by its ruler, Sheikh Humaid bin Rashid Al Nuaimi, since 1981. The UAE president, Sheikh Mohamed bin Zayed Al Nahyan, chairs the Cabinet, which shapes national policy and oversees federal institutions.
Locally, the Ajman Executive Council manages governance – crafting policies, implementing legislation and overseeing the emirate’s budget. The council also coordinates with federal authorities on shared matters. Various local departments handle specific areas like urban development, infrastructure and economic planning. This structure allows Ajman to balance its role within the federation with the autonomy to pursue its own development priorities.
Sector Breakdown
Since recovering from the Covid-19 pandemic, Ajman’s economy has shown strong performance, with a 6.3% increase from 2022 to 2023, and a GDP of Dh36bn ($9.8bn). This is down slightly from a 7% growth rate between 2021 and 2022. According to data from the Ajman Statistics Centre, in 2022 manufacturing accounted for 18.4% of nominal GDP, construction 17.5%, wholesale retail and vehicle repair 17.6%, and real estate 12.7% of all economic output. In 2023 the top contributors to the economy were manufacturing, at 18.8% of nominal GDP; wholesale, retail and vehicle repair, at 18%; and construction, at 16.4%. Unlike some other GCC economies, Ajman is not heavily reliant on oil and gas, with the emirate’s hydrocarbons activity being extremely limited.
Oversight
The oversight of the Ajman economy involves several key authorities. Ajman Department of Economic Development (AJDED) is responsible for promoting economic growth and development in the emirate. AJDED focuses on creating a favourable business environment for companies, attracting investment and supporting local businesses. It offers business licensing, economic planning and market research while working closely with other government entities at the local and federal level, as well as private sector organisations, to implement growth policies and initiatives. Additionally, AJDED organises events and workshops to foster innovation and entrepreneurship.
Another important institution is the Ajman Chamber, which supports the private sector by promoting trade and development initiatives. It collaborates with local and international businesses, providing resources and networking opportunities. The Ajman Chamber’s 2024-30 strategy aims to drive economic growth, improve the business environment and support progress towards Ajman Vision 2030 through enhanced competitiveness, innovation and sustainability.
In addition, the Ajman Municipality and Planning Department (MPDA) oversees urban planning and infrastructure projects, ensuring that development aligns with the emirate’s broader economic and sustainability goals. Through these efforts, the department enhances Ajman’s appeal as a leader in business and residential development, attracting further investment.
Planning & Development
The MPDA oversees urban planning, infrastructure development, environmental management and public services to ensure sustainable growth. The entity is focused on creating a liveable urban environment, collaborating with various institutions to provide essential services such as waste management, public health and safety while integrating digital tools for streamlined e-government services.
The Ajman Tourism Development Department is responsible for promoting tourism and leisure activities – both of which are essential pillars of the emirate’s economy. Tourism is a major driver for local businesses and makes a substantial contribution to growth. By actively focusing on expanding tourism offerings and attracting visitors, the department helps create new opportunities across industries, enhancing the emirate’s economic vitality (See Tourism & Culture chapter).
Sustainability
Ajman’s government has prioritised sustainable development and environmental stewardship through several initiatives including projects aimed at improving energy efficiency, reducing pollution and increasing the use of alternative energy sources. Additionally, multiple entities in Ajman have integrated corporate social responsibility (CSR) into their development strategies. For instance, AJDED collaborates with the CSR UAE fund known as Majra to encourage companies to adopt sustainable practices and contribute to community development projects. In 2020 AJDED established a specialised sustainability team whose responsibilities include developing work plans, conducting benchmarking comparisons, calculating CO₂ emissions, raising awareness and supervising sustainability initiatives. A critical three-way policy alignment is between the AJDED’s sustainability practices, the objectives of Ajman Vision 2030 and the UAE’s broader goals to become a regional and global leader in sustainable development.
Government Spending
Between 2022 and 2023 the spending commitments of Ajman’s government rose by 21%, increasing from Dh2.4bn ($653.3m) in 2022 to Dh2.9bn ($789.4m). This total is more than double the overall budget for the year 2018 at Dh1.4bn ($381.1m). Some 40% of the budget is dedicated to economic affairs to enhance Ajman’s competitiveness and support sustainable development. Public services receive a substantial portion to ensure high-quality delivery. Around 15% of the budget is directed at improving housing and community infrastructure, while 13% is allocated to maintaining public order and safety. Environmental protection and green initiatives receive 8% and 2% is devoted to enriching cultural and religious activities. This budget reflects the emirate’s commitment to achieving the goals outlined in Ajman Vision 2030, focusing on economic growth, social welfare and environmental sustainability.
Free Zones
As with Jebel Ali Free Zone, which catalysed non-oil economic growth in Dubai beginning in 1985, Ajman Free Zone (AFZ) plays a pivotal role in Ajman’s long-term growth, its ongoing diversification and pursuit of investment inflows. Established in 1988, AFZ is home to over 9000 companies from 185 countries spread across more than 22 clusters and sectors. Businesses in the free zone benefit from numerous incentives such as tax-free operations and 100% foreign ownership, and a digital platform enabling multiple transactions with relevant entities through a single window service. AFZ provides seven types of licences to businesses, from an offshore licence to an e-commerce licence, and a special pioneers’ licence aimed at encouraging youth entrepreneurship.
Ajman Port
Managed by the Ajman Ports and Customs Department, Ajman Port is a key maritime centre in the emirate. It offers integrated maritime services, including organising the movement of incoming and outgoing ships and providing sustainable services that enhance maritime transport. In 2022 the port handled approximately 15,000 twenty-foot equivalent units, and its essential infrastructure includes Customs facilities and warehousing spaces for businesses operating, importing and exporting goods to and from the emirate.
Business Licences
AJDED reported strong growth in business activity in the first half of 2024, with active licences increasing by 15% year-on-year to 37,755. New licences rose by 5%, totalling 3000, with industrial and commercial categories seeing a 14% uptick. Renewal activity also climbed 9%, with over 34,000 commercial permits issued. This growth highlights Ajman’s efforts to create a competitive, efficient business environment, making it an increasingly attractive destination for investment and entrepreneurship.
Interest Rates
In 2022 the UAE – as well as most other markets across the world – experienced a significant rise in the inflation rate. In the UAE it reached 4.8%, a notable increase from the -0.01% recorded in 2021. This surge was primarily driven by global supply chain disruptions and higher commodity prices that accompanied the end of the pandemic.
To combat inflation and respond to the US Federal Reserve’s rate hikes, the Central Bank of the UAE (CBUAE) raised interest rates by 425 basis points in 2022. The authority continued to adjust rates until mid-2023, fixing the base rate at 5.4% before the easing cycle began in September 2024. As a result, the UAE’s inflation rate decreased to 3.01% in November 2024, reflecting the effectiveness of these monetary policies. However, despite these adjustments, inflation remained a concern around the world – particularly reflecting international uncertainty regarding the new US administration’s macroeconomic policies.
Trade
Ajman and the UAE have demonstrated resilience and growth in commerce, despite facing challenges such as global geopolitical tensions, economic disruptions and rising inflation. In 2022 inflation in the UAE surged to 4.8%, driven primarily by global supply chain disruptions and higher commodity prices following the end of Covid-19. To combat inflation and respond to the US Federal Reserve’s rate hikes, the CBUAE raised interest rates by 425 basis points in 2022, continuing adjustments through to the first half of 2023. Despite these efforts, inflation remained a global concern, fuelled by uncertainties surrounding new US macroeconomic policies. However, the UAE’s adaptability and strategic responses have helped maintain growth in the face of these ongoing obstacles.
Key trading partners for the UAE include India, Japan and China, which are the top importers of UAE products, particularly in energy, petrochemicals and manufactured goods. One of the UAE and Ajman’s closest trading partners is Saudi Arabia. Trade volume between the Kingdom and the emirate increased by 29% in 2023, compared to 2022, with Saudi Arabia ranking first in exports from Ajman, accounting for 14% of the emirate’s total export value. The value of Saudi-destined exports reached Dh859.8m ($234m) in 2023, reflecting significant growth compared to previous years.
In the first half of 2024 Saudi Arabia and Iraq were the top destinations for Ajman’s exports, followed by Kuwait, Turkey and Ethiopia as the next largest markets. The UAE federal government oversees trade policy and the ACCI plays a key role in enhancing trade and investment ties between the emirate and global markets.
The UAE has also strengthened its trade relations with European countries, leveraging its strategic location as a gateway to the Middle East. In recent years, Ajman has actively sought ties with countries such as Belgium, Greece, Ireland and Portugal. The emirate’s investment promotion strategy focuses on bolstering bilateral trade and investment opportunities with target countries to solidify economic ties and explore new avenues for collaboration. This approach specifically aims to highlight and unlock opportunities for cooperation in various sectors, including tourism, industry, trade, education, health and technology. Furthermore, Ajman is fostering closer ties between its business community and selected countries to enable more organic private sector collaboration on an international level.
This includes recommendations for holding bilateral meetings, exchanging experiences and best practices, and participating in exhibitions and events to foster cooperation. In addition to engaging with EU member countries, business leaders from Ajman have made efforts to strengthen ties with Azerbaijan during the second Gulf-Azerbaijani Economic Forum in September 2024, and Hong Kong through a meeting with the Hong Kong General Chamber of Commerce in November 2024. The Azerbaijan forum focused on energy, agriculture and food security, while the Hong Kong meeting covered sectors such as advanced industries, artificial intelligence, e-commerce, education, energy, health care, innovation, logistics, real estate and technology.
Investment
The UAE remains among the most attractive foreign direct investment (FDI) destinations globally. While global FDI fell some 2% in 2023 from the previous year, inflows to the UAE rose substantially by 35% from $23bn to $31bn in the same period. Ajman’s FDI numbers have also outpaced its GDP growth rate in recent years, with the latest available figures showing an 8% expansion in 2022. The breakdown for 2022 shows the manufacturing sector as the key driver, consisting of 86.3% of the total, with accommodation and food services accounting for 11.8%, and retail and wholesale trade comprising 1.9% of the remainder. Saudi Arabia is a key partner, with 685 Saudi investors operating across various economic sectors by September 2024. This represents a growth of 13% from 2023.
Key sectors attracting Saudi investment include contracting, construction and real estate, hospitality and tourism, and retail. The economic partnership between Ajman and Saudi Arabia continues to grow, benefitting both regions and reflecting their shared visions. Ajman’s government has implemented policies to attract foreign investors, offering a supportive legislative and regulatory framework, as well as incentives and facilities through the electronic services portal.
Public-Private Frameworks
A characteristic of many Gulf economies is a prominent role for the government in driving economic activity and shaping key sectors. In Ajman, as well as in the UAE more broadly, a key component of economic growth is how the public and private sectors interact and collaborate. As a result, the Ajman government passed Law No. 2 in February 2022 – a landmark piece of legislation that regulates and facilitates partnerships between the public and private sectors. This law encourages private sector participation in project development and aims to increase investment in various sectors considered strategic to the emirate’s economy.
The law also seeks to reduce project implementation times, improve service costs, and transfer knowledge and expertise from the private to the public sector. Crucially, it outlines conditions for public-private contracts, requiring projects to be economically, financially, technically and socially viable. For contracts involving government financial instalments, public sector budgets must have already accounted for these instalments. Project approval depends on cost thresholds: the director-general of a government agency approves contracts up to Dh20m ($5.4m), the Ajman Department of Finance (ADoF) oversees those from Dh20m ($5.4m) to Dh50m ($13.6m) and contracts exceeding Dh50m ($13.6m) require approval from the Ajman Ruler’s Representative for Administrative and Financial Affairs. Additionally, government authorities must form a partnership committee including an ADoF representative for projects exceeding Dh10m ($2.7m).
Another example of public-private collaboration is the agreement signed in September 2024 by AJDED and Ruya Islamic Bank, a local financial institution. This agreement aims to improve the emirate’s investment environment by offering investors streamlined bank account setups, bonuses and incentives for new customers, and premium banking services for businesses. The goal is to increase local and foreign investment while fostering sustainable economic growth. Additionally, the ACCI digital platform known as Eshaar acts as an online portal to help companies overcome challenges involved in commerce. It was created in collaboration with chambers in other emirates to serve investors and businesses country-wide. The platform looks to boost networking opportunities between entities within the private sector to help them share best practices.
Small Business Programmes
Ajman’s government has sought to bolster growth through several policies focused on building the capabilities of small and medium-sized enterprises (SMEs). For instance, the Taziz Programme focuses on enabling SME expansion through access to government contracts, advisory services and training. Similarly, the Reyada Programme, which encourages home-based entrepreneurship, seeks to respond to the rise of remote and flexible work. By reducing overhead costs and supporting business skills, the initiative broadens economic participation among SMEs and their workers. In addition, the feasibility study component offers practical support, helping entrepreneurs make informed decisions and avoid costly missteps. Together, these programmes intend to create a competitive business environment, attract investment, and position Ajman as a prime destination for SMEs and grassroots economic development.
Outlook
Ajman is rapidly emerging as a dynamic centre for economic growth, with a focus on diversification and sustainability. The emirate’s industrial sector, supported by AFZ, plays a crucial role in its development, while the wholesale and retail sectors contribute strongly to GDP expansion. The Ajman government has invested heavily in economic development, public services and sustainability, with agencies like AJDED and the Ajman Chamber further promoting innovation and entrepreneurship, and attracting investment.
Ajman Port boosts the emirate’s connectivity by facilitating regional trade and logistics, reinforcing its role in the global supply chain. Additionally, Ajman’s commitment to the UAE’s green development goals is reflected in projects focused on energy efficiency, renewable energy and environmental sustainability. Despite global uncertainties, Ajman’s strategic policies, economic reforms and significant infrastructure investments highlight its dedication to long-term growth.
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