Playing its part in an integrated scheme

Sharjah has undergone rapid growth over the past few decades.  What have been the key milestones and features of the emirate’s economic development, and the main hurdles?
 
I think the development in Sharjah is derived from the vision of His Highness Dr Shaikh Sultan Bin Mohammad Al Qasimi, Member of the Supreme Council and Ruler of Sharjah, of embedding sustainable development within the economic, social, and cultural development of Sharjah.

Of course these developments get manifested in different outcomes.  If I look at the economic outcomes, Sharjah hosts most of the small and medium enterprises in the UAE. We have up to 34 per cent of the [country’s] industry in Sharjah. Further, we have very successful initiatives such as Air Arabia, which started in Sharjah, and last but not the least we have companies like Dana Gas, which reported stellar results just days ago.

[On] the social aspect, Sharjah is the most advanced [in terms of] the social infrastructure and institutions.  If you look at the Supreme Family Councils, you look at the Ladies Clubs, you look at Sharjah City for Humanitarian Services - these are all manifestations.

Sharjah is the UAE’s education capital, with the universities located here, [and] Sharjah launched an environmental company Bee’ah, which is the first initiative of its kind in the UAE.

As to the challenges, we have to talk about Sharjah in the context of the UAE and the region. The whole region over the past ten years has witnessed drastic growth, something that is unprecedented. That put a lot of pressure on the infrastructure, on the government, on the people, on everybody — private sector and public.

For Sharjah it is no different. Because of its unique location, because of its unique characteristics, it also managed to attract a lot of companies, [putting] a lot of pressure on its infrastructure.

So electricity demand, for example, has soared, and demand [outpaced] the supply available. The government has not stood still doing nothing.  As you know, there has been a long negotiation with countries around us [for] gas.

Also, people have to understand how the energy business works.  If you go to an energy company, there you have people working for 30-40 years…and you wonder why. It’s because each project from inception to maturity takes 10-15 years. So [getting rapid change] is not that simple.

People in this part of the world have all seen the growth, and they think that things can be easily done. But electricity is a serious business, and it takes time. Also it is costly; diesel is not cheap.

Sharjah’s [approach] to this problem is very practical in my opinion.  It does not necessarily live up to everybody’s expectations, [but] government is trying to do its best, keeping in mind the resources they have, the time frame and the capabilities.

What is Sharjah’s main contribution to the development of the UAE as a whole? How does the emirate’s constituent activities and strategy differ from the other emirates?

One thing we must say right at the beginning is that the UAE is one country and Sharjah is one of its constituents and an integral part. We all complement each other.
 
Sharjah, because of His Highness’s long-term vision, has selected a certain theme differentiating it from the other [emirates]. Sharjah wants to be known as the cultural centre of the UAE, as the social centre of the UAE, as the Islamic-Arabic city, as the industrial city, and the small- and medium-[sized business] state, as the education centre, and the environmental city of the UAE. These are the themes. 

But Abu Dhabi is also trying to be the cultural city of the country?  How are you going to compete with the capital city?

Abu Dhabi is our capital city and there are many unique things about Abu Dhabi. Their long-term vision is of establishing Abu Dhabi as a global city. They have managed to attract global brands —Guggenheim, Louvre, NYU, Ferrari — these are all global products for global people.

In Sharjah we have a different focus. Our target group is a little bit different. We are targeting regional people. Hence our museums are home-grown, more tailor-made towards Arab and Islamic regional people. Even in industry, our focus or strength is in encouraging the small- and medium-sized enterprises (SMEs); Abu Dhabi is going for the big manufacturing sector.

So, in a way we are complementing each other. Also, the value proposition that Abu Dhabi offers is different from the value proposition that Sharjah offers. The type of people that can do business in Sharjah cannot do the same in Abu Dhabi because the scheme is different. That’s what is unique about UAE - each city has its own characteristics. 

Sharjah has made significant progress in developing a diverse economic base, with the industrial sector and SMEs playing prominent roles. Does the government have particular sectors that it aims to encourage now? Is there a target mix of public and private sectors, industrial and service sectors, etc.?

In the past 10-15 years we have made good progress, reached a level of maturity.  I think the next step is growing our existing industries and taking them to the next level. By that I mean those industries that have grown over the past 30 years with very basic access to technology and market.

The different initiatives that the Chamber has launched have to modernize those industries, to make them competitive with the global standards. If you ask me what are the themes, I would say they are health care, renewable energies, new technologies — for instance, the IT Park. Today Sharjah University has research and development on sugar disease and renewable energy.

Also, we would like to grow and nurture our existing industries: food, manufacturing. 

The government is a facilitator to everything that gets done in Sharjah. It has invested a lot of money in infrastructure: new roads, the sewerage, security, upgrading the port.

Today Sharjah has the second-largest company in the region for port management, Gulftainer. Sharjah port and Khor Fakkan port especially is [ranked close] to Jebel Ali. So you are talking about real business and industry in this emirate. 

How far has the emirate been impacted by the global economic downturn, and more particularly the slowdown in the Dubai economy? To what extent is Sharjah dependent on the economies of the two largest emirates?

I would really stop talking about the slowdown in the economy, because the economy has actually moved. We have the data to support that.

Sharjah just witnessed the launch of the Sharjah Spare Parts and Car City, which is a Dh600-Dh700 million investment. We have Ramada opening a new hotel. Last month we opened the Sharjah Construction Material City. Lulu has opened its branch a few months ago.

So there are activities going on. Yes, of course over the past two years there was crisis and slowdown and Sharjah was affected by this like anybody else.  But the good news is I think we are on the verge of growth, and this is due to the government’s progressive policies. They did not sit and do nothing. On the contrary, they dealt with the problem and now we are going and promoting the country outside.

Recently we had a Steel Fab exhibition where we had a 15-20 per cent increase in the participation. Also for the recently inaugurated Dubai dental or health show, according to news reports, there was a corporate attendance increase of 15 per cent.  

These are all signs of growth and progress, and I am very [hopeful] things will be positive going forward. The crisis helped in lessons being learned, and in the long run it will make the country and economy much more solid and better able to better face global vulnerabilities.

[The UAE is] just 40 years old and we have to learn. There are things in life that you won’t learn if you don’t go through these things.
 
As to Sharjah’s dependence on the two biggest emirates, the UAE’s economy is very well interlinked, and while it may be of different cities, it is one economy. The backbone is Abu Dhabi, there’s no question; they fund 85 per cent of the whole of the UAE,

I always say we are a rich country - rich not only in resources [but also] in human capital. This is something that a lot of people don’t really touch on, don’t really appreciate the vision and outcome of late Shaikh Zayed. In 40 years he built a population — a partnership between the locals and the expatriates, a very unique picture of 200 nationalities sitting side by side without any problems. This is the biggest achievement and the biggest asset for the UAE. As long as we have this asset, I think we are all rich. We are also rich by our diversity.
 
On top of this, yes, God blessed us with money in this country. And yes, what Abu Dhabi brings to this country gets to all places, including Sharjah. What Dubai has done in the past years has made everybody flourish and grow.

Sharjah has definitely, because of its geography, and because of even the social fabric of this country benefited from what happened in Dubai. [There’s] market economics, supply-demand. We have never in this country orchestrated things like where people live.
 
The fact that people move between Sharjah and Dubai is true, [although] I would question how many. A lot of people look not only at the monetary but also other things as well. Some people move because of traffic, others move because of social reasons - it depends. 

What has been Sharjah’s track record in attracting inward investment in recent years? What have been the most important initiatives, and what more can be done?

Our free zones have managed to do a great job attracting investments from outside. Sharjah itself has managed to attract a good level of investors.

Free zones are working very closely with the Indians, with Europeans.  There are some very bright companies that have been established in Sharjah today — they have been able to spin them as public share companies outside. I am very excited and optimistic. 

We don’t attract investors for the sake of attracting investors, but create projects and then we bring them here. This way is the right model.  We don’t sell investors dreams in the air, but the right products. We launched the first economy airlines in the region, we launched the first integrated regional gas companies.
 
Our focus [tends to be] regional. There are a lot of Gulf investors. Al Nujoom Island, for example, which is a Saudi investment. Emirates Industrial City is another Saudi investment. Some Kuwaiti investors are in the manufacturing sector. And there are [other] Arab investors.

Sharjah has a regional appeal which is very powerful. That doesn’t mean that we don’t have very special relationships with other countries. Take India, for example – in Sharjah we have the first trade centre for India outside India.

I am going  to India to inaugurate my own projects: Sharjah Technology and Science Centre, in Kerala state. This is the type of project that brings real value. We are hoping it will bring science and know-how into Sharjah. This is about how can we activate the private sectors of Sharjah and India to come up with ideas related to [business segments] such as health care, science, knowledge, which we don’t really do much. India is only two hours from here. 

We are not yet leveraging as a country what India can offer, in my opinion. This project provides a focus which I hope will foster that. 

What has been the general tendency in trade business (imports and exports) in recent years?  What developments have there been in opening up new export markets?

Sharjah has a very unique project — the trade centres. Today we have the China Trade centre, we have Egypt, we have the Indian Trade Centre. And if you look at these countries, they are the really big ones — future-wise, economy-wise, politics-wise.

The way we position ourselves is: Abu Dhabi has the embassies, we have the trade centres here in Sharjah. These trade centres will open up a lot of doors.  We are working to attract other countries. Our focus for the next year is North Africa, East Africa, Middle East  and the subcontinent - also central Asia.

We have two big initiatives coming up in the next couple of months — one is the Sharjah Business Forum. It will be more of a GCC-focused forum attracting investment. The other will be a 13-member organisation of Islamic countries exhibition and forum, hosting more than 50 countries.

That’s what I think will further endorse Sharjah’s unique position. When it comes to an investor, this is where we have our value proposition. It’s not only about electricity; it’s also about the ‘soft’ issues. Sharjah is known to be [about offering] Islamic and Arabic culture. We are very keen on marketing that in a proper way. 

In terms of trading, imports and exports, Sharjah is doing very well. Sharjah Khalid Port and Khor Fakkan are doing very well. We just recently launched an inland facility to support freight and trade.

What initiatives has the SCCI introduced to enhance economic development, and what has been the responsiveness among businesses? 
 
We started a lot of initiatives. We launched a SME initiative to promote such businesses to help them grow. We also initiated ‘Made in Sharjah’ and that aims at modernising and building up our industries. We just had an exhibition [for it], all subsidised and free of charge for people to participate.

As part of the SME initiative, we took more than 50 companies on our account to places such as Libya, Algeria, Tunisia, and Kenya to help these businesses to expand, part of internationalisation programme.

We launched corporate social responsibility (CSR), which the Chamber is big on.  It focuses on three elements - the green element, corporate governance and the human capital development. The SCCI is spending more than Dh40 million on CSR.

Add to that the Sharjah Institute of Technology, which is by itself a separate entity for vocational training.

In terms of promoting our industries, we have launched the Industrial Working Groups. Each working group has a committee to represent it, to strengthen the engagement process between the chamber and its own members.

One unique initiative is helping young entrepreneurs to start their own businesses.  Sharjah works with different government bodies such as the economic department and RUWAD to support [that venture].

In the next month you will hear [more] good news from the chamber.