Sharjah becomes a hotspot for investment
World Finance speaks to the COO of Sharjah Investment and Development Authority to find out about developments in the UAE’s third-largest city
The third-largest city in the UAE – Sharjah – which has a GDP of over AED 100bn, a massive manufacturing sector, and is a leading centre for arts and culture – is becoming a hotspot for investment. World Finance speaks to Ahmed Obaid Al Qaseer, COO of Sharjah Investment and Development Authority, to find out about developments.
World Finance: Well Sharjah, maybe you can start by telling me, how well developed is the economy and infrastructure in the city, and where are the opportunities?
Ahmed Obaid Al Qaseer: Sharjah has a state of the art infrastructure when it comes to roads, especially telecommunications, which is very well connected with high-speed internet: all required services by businesses.
Talking about opportunities; we have first of all tourism. As you said, Sharjah is a culture and arts hub. We have a lot of museums, a lot of places to visit. So what’s lacking currently and what we’re looking at, is five star hotels, where we have a lack of around 3,000 rooms.
And we’re also looking at food and beverage, which complements the tourism attraction. This is something that we’re looking to develop – we’re looking at restaurants, we’re looking at cafés. And we’re looking at a growth of around AED 1.9bn in this sector over the coming two years.
Sharjah’s well known as an industrial hub; 33 percent of the industries in the whole UAE are in Sharjah
Then we’re looking at another sector, an important sector, which is transportation and logistics. We’re looking here at air carriers, where they can land in Sharjah airport. We’re also looking at the ports. We’re expecting a AED 6.2bn growth by 2016.
Another sector we’re looking at is the healthcare sector. This is a sector where we expect a growth of AED 6.5bn by 2016. And here the government have taken an initiative where they have launched Healthcare City. Healthcare City will be a free zone, focused not only on hospitals, but we’re also talking about clinics, research centres, development centres. Pharmaceuticals is something important as well. So this is another big sector.
The last sector we’re focusing on is environment, where we’re talking about renewable energy and energy efficiencies. This is also something booming in the world, and again Sharjah has taken the lead here. Sharjah by 2015 will have zero waste to landfill.
And here we have a lot of opportunities; we have offers about wood recycling, plastic recycling, and also we’re looking at solar farms.
So these are the four sectors with a lot of opportunities with a return of at least 15 percent.
World Finance: Well how well set up is the business environment in Sharjah for investors, and where are the advantages or favourable regulations?
Ahmed Obaid Al Qaseer: Sharjah’s well established when it comes to businesses. There are two types of companies that can be established in Sharjah.
One is a free zone company, where it’s 100 percent repatriation of profits, plus 100 percent tax free. The other is the inland companies, which are out of the free zones. They have slightly different policies, but still where you can make 100 percent of your repatriation, and still 100 percent tax free.
Sharjah has a diversified economy; none of the sectors contribute more than 20 percent to GDP. And Sharjah’s well known as an industrial hub; 33 percent of the industries in the whole UAE are in Sharjah. And Sharjah has around 21 zones only for industries.
World Finance: Well how does Sharjah compare with other cities in the UAE, such as Dubai?
Ahmed Obaid Al Qaseer: The UAE by itself is a unique country, where we have different emirates. And as the UAE, we all complement each other. Every emirate has its own niche; as I said Sharjah’s diversified, and more focused towards the industrial zones.
World Finance: Well Sharjah of course has a very rich heritage, so how well developed is the tourism sector, and what challenges does it still face?
Ahmed Obaid Al Qaseer: Sharjah’s well known as the cultural capital of the UAE. In 2014 Sharjah was voted the Islamic Cultural Capital. In 2015 we are celebrating the Arab World Tourism Capital.
It’s famous for its arts; we do have the largest arts event in the region, like the Sharjah Art Biennial. We have the Sharjah International Book Fair, which is the fourth-largest in the world. We do have the Formula One boat races. So we do have a lot of activities.
Yes, we do have some challenges, and that’s why we’re promoting the tourism sector. We have a lack of rooms; 3,000 rooms between now and 2016, so there’s a big chance of development of hotels here. Plus we have our own plans in promoting Sharjah as a tourist hub compared with other emirates.
World Finance: Well the Middle East is of course fraught with political instability, so what impact has this had on the city, and is it still a safe place to invest?
Ahmed Obaid Al Qaseer: Well the UAE is a safe country – thank God it’s a safe country. Yes, there are some things happening around, but we are 100 percent safe.
We see a lot of increase in tourism, we see a lot of increase in investments; so yes, I would definitely stress that it’s a safe place to be in. A safe place to live, and a safe place to work.
World Finance: So finally, what are the priorities for your organisation moving forward?
Ahmed Obaid Al Qaseer: As an investment and development authority, for investment side, as an IPA, we are now looking at the market again: updating our studies to focus on where to look for investors from, geographically, and what sectors to emphasise more.
Then again, as a development authority, we do develop projects. Especially in the tourism sector, where currently we’re developing two hotels in Sharjah, which are the Chedi Khorfakkan on the east coast, and we have a great hotel which will be managed by the five star über-luxury brand which comes out of Singapore: GHM, also under the Cheddi brand.
We have a famous destination, which is the waterfront, the Al Majaz waterfront. It has restaurants and cafés that have been successful. We’re now starting phase two, we’re adding more restaurants and cafés. And we’re adding offices into this project.
So yes; we do have a lot of things happening, whether it’s on the development side, or on the investment/attraction side.