Today's Edition
MUSTAFA ABDEL AZIM (ABU DHABI) - Highlighting the pivotal role of Foreign Direct Investment (FDI) in supporting the structural growth of Sharjah’s economy, Mohamed Juma Al Musharrakh, CEO of Sharjah FDI Office (Invest in Sharjah), revealed that FDI flows to the emirate increased 15% during the first half of 2023 compared to the same period of the previous year, with 34 new FDI projects valued at over Dh1.2 billion.
Today, Sharjah is a significant investment incubator for global companies in a wide array of sectors, Al Musharrakh explained in an interview with Aletihad. The diversity of Sharjah’s economy has enhanced the strength and flexibility of the emirate’s economic structure, shown through the nearly equal contributions of its various economic sectors to the emirate’s GDP.
No one sector exceeds 20% of the economy, Al Musharrakh said, adding that contributions from the emirate’s non-oil sectors reached Dh133.4 billion in 2022, compared to Dh126.8 billion in 2021. Sharjah is moving forward confidently with its comprehensive development project, and has witnessed a variety of successes year after year, Al Musharrakh said.
This continuous progress is reflected in the emirate’s enhanced security, stability, standards of living, quality of life, and per capita share of GDP, which grew 5.2% in 2022, reaching Dh136.9 billion compared to Dh130.1 billion in 2021.
Investment Trends
As the global investment scene is continually developing, Sharjah is ready to adapt to these changes into the future, the Sharjah FDI Office CEO said. The emirate’s investment attraction factors, culture, trends, and preferences of investment naturally respond to global developments and transformations, he added.
“In the past, the abundance of natural resources, primarily minerals, directed investors towards markets, due to the nature of economies at those stages which relied on manufacturing products from minerals. Then, the economic centre of gravity shifted in favour of trade due to the surplus production after the industrial revolution. Today, investment trends have settled in the arena of innovation, technology, data, recycling, and sustainability, in addition to integrating the latest technologies in industry, agriculture, health, and education,” Al Musharrakh said.
Shifting investment trends are in Sharjah’s favour, as it has established its position at the forefront of the region’s most important sectors and serves as an integral component of the Emirati business and investment ecosystem, he added.
International Investors’ Interests
Al Musharrakh explained that Sharjah represents a model for modern investment destinations by embodying three central factors that have formed the core of investors’ interests around the world since the beginning of the current century.
The first factor, Al Musharrakh explained, is Sharjah’s positive international reputation. Thanks to the leadership and directives of His Highness Sheikh Dr. Sultan bin Muhammad Al-Qasimi, Supreme Council Member and Ruler of Sharjah, and due to the cooperation and consensus of all its bodies and institutions, Sharjah has achieved a distinguished and prominent international reputation, he said.
Sharjah is known as the cultural capital of the UAE, and has won important international titles in this regard, in addition to its listing among the best global tourism destinations for 2023 due to its unique social, cultural, and urban identity. This plays a significant role in investors’ choices and in attracting investments to knowledge economy sectors such as publishing, research, innovation, arts, technology, education, and other promising sectors, Al Musharrakh said.
Sharjah’s global standing consequentially comprises an important part of the UAE’s standing as a whole, which ranked first globally in the Global Entrepreneurship Monitor report for 2022. The nation’s economic diversification strategy and efforts to enhance the attractiveness of the UAE’s business environment will have a positive cumulative effect on Sharjah, which hosts about 60,000 small and medium-sized companies, 6 free zones, 33 industrial areas, and over 2,900 factories, Al Musharrakh said.
With the industrial sector contributing 20% to its total GDP, Sharjah is well-positioned to benefit from the positive economic transformations that the region will witness in the coming years, he added.
Global Sustainability Returns
“In Sharjah, we do not treat sustainability as if it is a tax on business communities, or as regulations that limit investment choices. Rather, it is considered both as part of the investment climate and an investment opportunity at the same time.
It is a climate for investors who are looking to invest somewhere committed to sustainability standards, and offers vast investment possibilities for those interested in investing in clean energy solutions, sustainable communities, sustainable transport, agriculture, and the circular and green economy,” Al Musharrakh said.
As the modern investor is increasingly interested in commitments ot sustainability standards, particularly in light of the multitude of international agreements signed in this context, Sharjah is a firm proponent and adopter of sustainability standards, he added, noting that the UAE Energy Strategy 2050 stipulates around Dh600 billion in clean energy investments by 2050, which indicates the emergence of significant investment opportunities in the field.
Investment and Social Development
Al Musharrakh explained that social development is a key draw for investors, with investments in health, education, and skills development being among the most important features of Sharjah’s social development journey. He clarified that the contribution of the “human health and social work activities” sector to the Emirate’s GDP increased by 7.9% during the past year 2022.
Investment in education is also experiencing steady growth in the emirate, as the budget of the University of Sharjah for the year 2022 - 2023 reached more than Dh1 billion. This reflects the sectors’ ability to constantly receive investments, especially considering that 23% of the Emirate’s general budget for the year 2023 is directed towards the social development sector in support of scientific, cultural, and heritage services, stimulating creativity and innovation and scientific research, ensuring an ideal healthy environment, and enhancing decent living.
This means that we will witness an active economic movement in these fields and new business opportunities for local and foreign investors.
Solid Growth and Promising Future
Al Musharrakh expressed optimism about the future of Sharjah’s investment landscape in light of the promising strategic partnerships between the emirate and the global investment community. While the high growth rates of GDP and the balance of structural contributions showcase Sharjah’s economic durability and flexibility, they also constitute important indicators for the emirate’s future position in the global investment community.
The balanced growth of the emirate’s sectors show that all industries are capable of contributing to the local community and business community, and especially to investors, emerging projects, companies, and new entrepreneurs, he noted.
The experience of Sharjah’s foreign investors, many of whom have been present in Sharjah’s various markets from their inception through the present say, demonstrate the emirate’s keenness to build long-term partnerships with investors as well as its respect for mutual interests.
