Free Zones

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The increased number of free zones operating in the country is serving to offer a wider range of options to potential investors, including 100 percent ownership of investments. The massive Jebel Ali Free Zone (JAFZ) has become one of the largest industrial complexes worldwide which, together with the adjacent port, the world's largest manmade harbour, has continued to attract investors. Fujairah Free Trade Zone (FTZ), which was awarded an ISO 9002 certificate in 1999, offers businessmen the location advantage of an east coast port as well as the benefits of partnership with the Fujairah Government. FTZ has been growing at a rate of 20-22 percent annually and currently has over 125 projects registered at the zone, representing sector investment worth Dh 750 million. Trade value out of the zone by the end of 1999 should top Dh 1 billion. Arab, Gulf and international capital investment in Sharjah's Hamriyyah Free Zone had exceeded Dh 2.5 billion by the end of 1999, with local investment accounting for 50 percent. The Sharjah Government has invested Dh 600 million in infrastructure projects in the zone.

Saadiyat Free Zone Authority

The US $3.3 billion Emirates Global Capital Corporation (EGCC), which was incorporated in April 1999, has been granted a 50-year concession by Saadiyat Free Zone Authority (SFZA) to establish a major new commodities market and free zone on Saadiyat island near Abu Dhabi. The concession covers an area of 26 square kilometers. EGCC will develop a 50,000 square meter trading center with a stock exchange, futures exchange and clearing house and warehouses, the requisite commercial and residential real estate and physical infrastructure, including a port with storage facilities and a freight airport. Construction of the necessary infrastructure is scheduled to take three years to complete. Planned facilities on the island, which will have a six-lane bridge to link it with Abu Dhabi, will include a marina, an extensive exhibition center, a luxury hotel, a golf course, an equestrian club, a motor racing circuit, water and power plants, a telecommunications network and other utilities. The Basic Law for the Authority imposes no restrictions on foreign ownership of companies and assets and allows full repatriation of capital and profits as well as exemption from all taxes. Companies and residents will be offered land on lease for periods of 50 years or more and leases will be fully transferable. Since the announcement of its creation in July 1996, the Saadiyat project has attracted considerable attention from regional and global investment and banking circles. The project will have a major impact on many economic sectors including trade, industry, agriculture, real estate, building contracting and engineering, banking, brokerage, insurance, tourism, hotel, entertainment and services, as well as providing employment for nationals. Saadiyat Free Zone, shares in which will be offered on domestic and international markets, will give a major boost to the UAE's investment policy and is intended to complement the Jebel Ali Free Zone and other zones in the country and the AGCC.

Dubai Airport Free Zone Authority

Dubai Airport Free Zone Authority (DAFZA), one of the most recently established free zones in the UAE, grants licenses to companies with an international reputation who intend to invest properly in environment-friendly projects that are not labour-intensive. The emphasis is on long-term gains within the context of a five-year business plan. By mid-1999, 54 percent of the 50 companies operating out of DAFZ were European, 32 percent American, 4 per cent each from the Far East, Middle East and GCC states and 2 percent from Africa. Applicants to date include global dealers in the jewellery, diamonds, crystal, cosmetics, electronics and computer industries. The free zone has been allocated an area of 1.2 million square meters, including 473,000 square meters of apron space, which will be developed in stages over the coming years.

Ajman Information Technology Park

Ajman Free Zone (AFZ) commenced work in July 1999 on the region's first information technology park. The park will be developed in two phases, the first of which, a pilot project of 10 offices, is under way. A further Dh 5 million will be invested in a purpose-built block that will house 100 offices. The IT park will offer a 'move in and plug in' facility in which a company can start operating as soon as it occupies designated premises . The park offers all the facilities needed for an effective business operation - PCs, ISDN, phone and fax lines, Internet access and related services - to attract IT developers and IT support centers, besides emerging Internet retailing, wholesale and e-commerce business. AFZ already has a wide cross-section of companies involved in textiles, medical equipment, furniture, foodstuffs, tobacco derivatives, watches, electrical appliances, paper, metal and plastic products. In 1998 the number of companies operating out of AFZ quadrupled and in the first six months of 1999 the zone grew by 7.5 percent from 400 to 430 companies. Total capitalization of companies now stands at Dh 1.1 billion (US $300 million).