The new partnership presents outstanding opportunities for corporates in DIFC to connect with financial institutions in New South Wales, Australia’s largest state economy. The MoU will further support the promotion of unexplored investment opportunities between New South Wales and the GCC region among potential investors from both sides.

The MoU was signed by Chris Eccles, Director General, Department of Premier and Cabinet, and Abdulla Mohammed Al Awar, Chief Executive Officer of DIFC Authority.

Abdulla Al Awar said, “As we continue to reinforce DIFC’s position as a global financial centre, we remain cognisant of the critical importance of establishing and maintaining strong collaborations with peers, key institutions and government bodies that are driving economic development around the world. Our partnership with NSW Trade & Investment falls well within this strategy and presents vast mutual opportunities in the areas of investment, education and financial sector development.”

The region has had strong economic ties with Australia for many years, particularly the UAE, which is considered Australia’s largest merchandise trade partner in the Middle East with two-way trade at over USD 5.3 billion in 2010-11.

Australian investment in the UAE was worth USD 1.060 billion in 2010. In addition, over 15,000 Australians live and work in the UAE with more than 600 Australian companies doing business in the Emirates.

“We are confident that this MoU will take DIFC’s and the wider region’s economic relations with Australia to the next level, and unveil significant investment opportunities on both ends, particularly in infrastructure. The GCC region alone is expected to spend about USD 968 billion on projects including infrastructure developments over the next decade, while infrastructure expenditure in NSW is estimated to be in excess of USD 770 billion between now and 2018. Our region can also benefit a lot from the policies adopted by the Australian government to support these opportunities, including mobilising public-private partnerships and creating a range of solutions for infrastructure financing,” Al Awar added.

(L-R) Chris-Eccles and Abdulla Al Awar signing the MoU

Honourable Barry O’Farrell MP, Premier of New South Wales said: “Attracting conventional and Islamic finance investment into infrastructure and other sectors of NSW is an important part of the NSW Government’s efforts to position Sydney as a leading international financial services centre.”

Last year, DIFC welcomed two leading Australian financial firms, Macquarie Capital Finance (Dubai) Limited and Australia and New Zealand Banking Group Limited (ANZ), which is among the world’s 25 largest banks by market capitalisation. In addition, the Dubai Financial Services Authority (DFSA) has had an MoU with the Australian Securities and Investment Commission since September 2006.

The Chairman, accompanied by His Excellency Jamal Majid Bin Thaniah, Vice Chairman, DP World, called on the Senegalese President in Dakar May 14^th. They also met the new Prime Minister, His Excellency Abdoul Mbaye and congratulated him on his appointment.

Their talks covered DP World’s investments and operations in Senegaland efforts to step up mutual cooperation.

During their visit to the Senegalese capital, Bin Sulayem and Bin Thaniah also toured Terminal à Conteneur, West Africa’s largest and most modern container terminal, managed and operated by DP World Dakar.

Four Ship-to-Shore (STS) cranes and ten10 Rubber Tyred Gantries (RTGs) were installed at the terminal recently, completing the upgrading work, which also included new gate complex and new reefer storage facilities. The terminal was opened to business last November after DP World carried out new expansion work that more than doubled capacity to over 600,000 TEU (twenty-foot equivalent container units) under a concession agreement signed in 2007.

HE Sultan Ahmed Bin Sulayem, Chairman, DP World, said: “We are extremely honoured to meet His Excellency Macky Sall and congratulate him on his election as President of Senegal. DP World’s commitment toSenegalis long term and is driven by the immense economic possibilities in this great country.

His Excellency Sultan Ahmed Bin Sulayem, Chairman, DP World and his Excellency Jamal Majid Bin Thaniah, Vice Chairman, DP World during their meeting with the newly-elected President of Senegal, His Excellency Macky Sall.

“As the most modern and efficient terminal in western Africa, DP World Dakar acts as a growth engine in a rapidly developing emerging market region. We look forward to building on our excellent relations with the Government of Senegal.”

Jamal Majid Bin Thaniah, Vice Chairman, DP World, said: “As Africa’s favoured first port of call for vessels south-bound from Europe, DP World Dakar occupies an important place as a commercial gateway for both Senegal and the west African hinterland. We remain committed to constantly improve efficiencies at DP World Dakar and offer world class, reliable, value added services to our customers and continue to support the economic growth of this great nation.”

Since winning the Dakar concession in 2007, DP World has introduced window berthing, where vessels book a specific time they can berth, virtually eliminating waiting time at anchorage. In addition, DP World has reduced truck turnaround time to less than half an hour, and introduced clear tariffs and processes supported by modern technology systems.

Importantly, DP World Dakar has directly created more than 200 jobs for local Senegalese people. Under the company’s management, specialised training has been given to all terminal employees to bring operational efficiencies in line with DP World’s global standards.

The traditional problem that faces all SMEs looking to export is to find growing global markets that are relatively easy to penetrate with low investment. As much as any business consultant would like to say that they have the answer to this problem, the reality is no such market exists. However, SMEs need not despair because there are some sectors or markets which are very close to meeting the ideal solution.

One such area that is becoming extremely lucrative and one that SMEs can tap into, for both profitable as well as ethical reasons, is the green product and service sector. Although, various estimates have been produced by different organisations the general view is that it is increasing each year and is projected to reach USD 3.5 trillion by 2017.

The attention towards green products and services has been greatly assisted by an increasing awareness about the environment among consumers, governments and businesses. The latter have used the environmental concern to develop green marketing. This is essentially creating customer perceptions largely about the brand, but can also refer to the products or services based on the company’s practices and policies related to the wider environment issues.

Academic studies have shown that consumers value the green credentials of a company and are prepared to pay a premium price. This is also the case in a recessionary period and as such it has been a means of survival for many firms. Due to both its ethical foundation and good business sense, many SMEs are becoming green even with their limited resources and rather tight budgets. The interesting trend in the last few years is the diversity of companies that are embracing green marketing.

Initially, green marketing was carried out by a few firms in food production or technology related areas such as solar power. Today, the market has changed considerably and even local grocery stores are adapting their business towards green products and processes. For instance, the range of products stocked tend to be organic and from nearby supplies so as to reduce the carbon footprint.

There are of course very good financial reasons for embracing the green revolution; it can help a business reduce its energy costs, reduce wastage and improve its brand recognition, as well as popularity. A study by Carnegie Mellon University shows that energy efficient upgrades and sustainable building practices can go a long way towards enhancing productivity of employees. The study showed that improving indoor air quality and installing energy efficient lighting can increase employee productivity by an average of 20%. Furthermore, installing high-efficiency lighting can increase productivity by an average of 7%. Non-environmentally friendly work areas have also been argued to have an impact on an employee’s health, leading to sick days. Other studies have shown that the benefit through increased productivity and reduction in days lost due to sick leave is on average USD 45  per square foot, or an annual gain of USD 6,500 (in 2009 prices) per employee. The increase in productivity, together with savings in energy costs, represents a strong case for any SME to implement the green changes.

Embracing green solutions does not only reduce costs, but also makes an SME more likely to increase or even start exporting. SMEs have benefited greatly from new green laws which have been enacted in a number of countries. These new laws clearly state the requirements a company must satisfy in order to sell their products or services in the country. In most cases the new laws have been supported with actual financial support.

For instance the US government has allocated USD 20 billion in tax cuts for wind, geothermal and bio-energy. The UK government has set aside EUR 250 million to develop low-carbon vehicles. The German government has promised a USD 67 billion subsidy to the car industry to develop green vehicles. Although, these policies are designed to primarily support domestic firms, in the process of doing so, they also benefit foreign companies. Foreign companies cannot not only export products and services that allow domestic companies to comply with the green regulations but also seek long-term relationships.

SMEs from the region can look at green business as a means of examining alliances and joint ventures in overseas markets. Working together with foreign counterparts can deal with two of the major challenges that SMEs face; namely capabilities and local knowledge. In the case of the latter, SMEs seldom have sufficient information regarding the green aspects in overseas markets. Even if they have the knowledge they still face the problem of appropriately integrating local views regarding the environment into their marketing initiatives.

Secondly, international alliances allows for a coming together of capabilities and capacities. This is more so the case for SMEs who tend to have limited financial resources.

However, SMEs cannot automatically assume once they have adopted the green credentials that consumers will then purchase their products. There is no guarantee for green products and they have to compete with conventional products. In this sense, even though producers can charge a premium, they nevertheless need to provide value to the consumer. In fact, consumers are well aware of greenwashing and SMEs need to be very careful not to over exaggerate their green claims. Academic studies have shown that over claiming a green policy can have a negative impact on the demand of the SMEs products and services. Consumers are quick to spot companies that are seeking to use green initiatives as a means of improving their public image or generating additional sales without environmental concerns actually being the firm’s core objective. As such SMEs cannot simply wear the green coat and need to be sincere to the environmental concern.

So how can a SME become sincere to the green cause, while also enhance its business opportunities? In the first instance the SME needs to examine its processes and products to evaluate which of them can be changed, or at least modified so that there is less wastage and a lower carbon footprint. Not all the processes or products can be immediately changed or modified and the SME may need to put into place a programme of small changes over a period of time. It’s important for an SME to realise that it cannot be completely green, but need to demonstrate their commitment.

Dr. Ashraf Mahate

Second, the company needs to select which of its products are appropriate for the green market. In some sense, this decision is made by the products which already meet the green regulations set by many importing countries, or those that can be changed to meet these requirements. The changes can be greatly assisted through independent certification. There is considerable evidence to suggest that the final buying decision is impacted by the presence of an independent certification.

In essence, the green marketing strategy is really about following three steps: to make a genuine effort to understand the environmental impact of a firm’s activities; take action that either avoids or reduces the negative impact and thirdly, to inform the customers through certification and appropriate labelling.

Once a company can achieve this, the opportunities are huge. With greater concern for the environment your company has a better chance of reducing costs, increasing employee productivity and becoming international.

About

Dr. Ashraf Mahate is the Head of Export Market Intelligence at Dubai Exports (formerly known as the Dubai Export
Development Corporation), which is an agency of the Dubai Economic Department. Dr. Mahate is also the Vice Chair of the Economic Policy Committee with the Dubai Economic Committee with the Dubai Economic Department. He has written a number of journal articles, chapters in books and edited books in the areas of economics, finance and banking. He has also presented papers at major international conferences. Dr. Mahate has provided extensive consultancy services to various organisations in the areas of banking, economics and finance. He has been a director of a number of companies including a venture capital company and a private equity fund.

Dr. Mahate received his doctorate from Cass City University Business School in London (UK) which was ranked by the Financial Times newspaper as the 12th best university in the world for finance. He read Economics at University College London, followed by a Masters in International Economics and Banking at the University of Wales in Cardiff. Dr. Mahate is a professional educator and received his training at the Institution of Commercial Management (UK). He is also a member of the Association of Certified Anti-Money Laundering Specialists. (ACAMS)

How is the private sector important for an economy? And within the private sector, what is the role of SMEs?

The private sector plays a critical role in development and growth. It provides about 90% of jobs worldwide.

The role of SMEs in promoting economic growth and spurring job creation is becoming more prominent now than ever. Many countries are recognising the importance of this sector in the context of the current global economic slowdown and rising unemployment.
To give a few examples from across the globe, SMEs contribute to:
o        48% of GDP and 54% of employment in the United States
o        60% of GDP and 83% of employment in China
o        86% of GDP and 95% of employment in Chile
A recent study by the World Bank shows that SMEs are the biggest contributors to employment across 99 developing countries surveyed. This study also shows that SMEs account for over 80% of net job creation and 67% of employment in developing countries.

In the MENA region, SMEs represent between 80% to 95% of all local enterprises, and account for up to around 40% of all private sector employment. Supporting the SMEs, is hence, an integral part of the growth and jobs equation in the region.

What is the role of IFC, its investments and advisory services , in SME promotion?

Recent events have deepened the development challenges in the region and brought renewed attention to the consequences of youth unemployment. The public sector can no longer be the main provider of jobs in the region – promoting private sector-led growth is critical. IFC is helping SMEs through its investment and advisory services.

IFC investment services address market failures to finance SMEs through:

• Debt and equity investments in SME-focused banks
• Risk-sharing facilities to encourage SME lending
• Trade lines to finance capital equipment and inventory imports and exports
• Mobilisation of private funding, equity and debt guarantees
• Build leasing and franchising
• Equity investments through private equity funds

IFC advisory services provides training and tools to help SMEs improve strategy, products, marketing, sales culture and delivery channels, credit-risk management, information technology and governance.

IFC advisory works with governments to improve the business climate and remove the obstacles that prevent small firms from joining the formal sector where research shows grow more and hire more people.

The SME Toolkit, an innovation of IFC, helps over five million users a year across 32 countries, in 18 languages, to learn and implement sustainable business management practices and increase their capacity, access to finance and new markets.  Through a network of global partners and local distribution partners, localised SME Toolkit platforms provides SMEs with online and mobile phone access to key business management information (news, how to articles), interactive tools, business forms in accounting and finance, marketing and sales, legal and human resources, business directory and so forth.  A strategic partner since 2006, IBM strengthens and expands the Toolkit’s technical capabilities. IFC’s Business Edge classroom business training workshops have been delivered to more than 150,000 people across Asia, Africa, the Middle East and Latin America.

Tell us a bit more about IFC’s programme in the Middle East and North Africa.

IFC’s immediate focus has been to restore confidence in the private sector, which is the critical engine of economic growth and job creation. We have committed over USD 2.4 billion (including mobilisation) since January 2011, boosting investors’ confidence and demonstrating that the region has a long-term potential.

Assuming the political situation stabilises and new governments are supportive of private sector development, we expect to invest up to USD six billion, including USD two billion in mobilisation, in the Middle East and North Africa over the next three to four years.

IFC  has signed several significant transactions recently including a loan to support the construction sector in Iraq (Lafarge), a transaction to improve access to high-quality generic medicine (Hikma), and one to help increase access to finance for SMEs (BankMuscat).

Our advisory work is fully integrated into many of its investments and initiatives. Advisory services are helping companies improve their corporate governance, advice on public-private partnerships in infrastructure, help SMEs access credit, and improve the regulatory framework for private education.

IFC also works to make business more inclusive to women and the youth, especially through access to finance, education, MSME and Business Edge training programmes.

An integral part of IFC’s strategy over the last five years has also been to develop regional champion investors in the GCC and mobilise them to enter developing markets in the region and outside.

IFC, working with partners, has launched four initiatives to help the region:

• Small and Medium Enterprise Facility – joint with the International Bank for Reconstruction and Development (IBRD), and the European Investment Bank (EIB)

USD 550 million facility was created to help financial institutions increase access to finance SMEs through a combination of investments and advisory services

• Education for Employment (e4e) – a joint initiative with the Islamic Development Bank (IDB)

In April 2011, IFC and IDB launched the Education for Employment (e4e) initiative for Arab youth. It aims to bring public and private partners together to improve the quality and relevance of the skills students bring into the workforce, in order to increase their chances of employment. It is also helping demonstrate the viability of private sector investment in the employment-driven education sector. Jordan and Tunisia are the initial target countries.

• Arab Financing Facility for Infrastructure (AFFI) – joint initiative by IFC, IDB & IBRD

Its aim is to provide financing and advisory assistance for infrastructure Public Private Partnerships, cross-border infrastructure projects, and other innovative infrastructure plans with the potential for regional impact. The facility includes several components, including an investment vehicle and a technical assistance fund. The facility includes several components, including a private investment vehicle, a joint IBRD, IFC, IDB technical assistance facility (TAF), a public sector window for financing by IBRD, and a policy forum which supports policy work in the region.

• MENA Fund: It will initially channel USD 300 million to USD 500 million towards minority equity investments in diverse sectors in the Middle East and North Africa. The fund aims to restore investor confidence in the region, spur the return of foreign direct investment, and increase access to finance for SMEs, education and infrastructure sectors. The fund will be managed by the Asset Management Company. IFC will provide up to 20% of its total commitments.

What else does the SME Toolkit offer?

It offers business forms, how-to articles, community features and much more. The SME Toolkit (www.smetoolkit.org), helps entrepreneurs and SMEs in emerging markets learn and implement sustainable business management practices and increase their productivity, their capacity, as well as improve their access to finance and new markets. Through a network of global partners and local distribution partners, the Toolkit provides online and mobile phone access to key business management information, interactive tools, and educational resources.

Localised SME Toolkit sites include hundreds of free business forms, tools, and how-to articles, in addition to a global business directory, multilingual community forums and a host of other interactive features, as per the choice of the local distribution partner. Core content areas include: accounting and finance, human resources, international business, legal and insurance, marketing and sales, operations and technology.

How has the SME Toolkit fared so far?

In the MENA region, local distribution partners are financial institutions that have a vested interest in becoming the partner of growth of emerging entrepreneurs and SMEs, as they often develop SME banking departments or initiatives.

Current partners in MENA include Riyad Bank in KSA, AlexBank in Egypt, and Qatar Development Bank.

The Toolkit is also used by Dialog Telecom, the leading telecom operator in Sri Lanka, as well as one of the world’s largest SME bans, ICICI Bank in India.

About

Mouayed Makhlouf is the Director of the MENA region at IFC. He is responsible for the institution’s investments and advisory programs in over 20 countries, which aim to support economic development across the region through private sector development.

IFC, a member of the World Bank Group, is the largest global development institution focused exclusively on the private sector in developing countries.

Established in 1956, IFC is owned by 182 member countries, a group that collectively determines the institution’s policies. IFC’s work in more than 100 developing countries allows companies and financial institutions in emerging markets to create jobs, generate tax revenues, improve corporate governance and environmental performance, and contribute to their local communities.

Commercial licenses accounted for 74% of the total licenses issued in quarter one (Q1) of 2012, followed by professional (23%), industrial (2%) and tourism (1%) licenses. The figures demonstrate a higher level of interest in commercial and professional activities among businessmen and investors in Dubai.

Mohammed Shael Al Saadi, CEO, Business Registration & Licensing (BRL) in DED, said: “DED provides a varied and integrated bouquet of services to ensure time and cost savings for clients. These services are tailored to meet all their requirements efficiently. The quarterly report confirms the success of our initiatives and procedures, and affirms the growing investor interest in engaging in diverse business activities in Dubai.”

Al Saadi added: “Such impressive growth in the overall business activity will further boost investor confidence, drive inward investments and strengthen the competitiveness of Dubai’s economy.”

The total number of licenses renewed in Q1 of 2012 was 25,382, a three per cent decrease over the same period in 2011, while amended licenses showed a 21% increase. The total number of BRL transactions reached 144,840, compared to 124,037 during the same period in 2011, a 17% increase.

The number of trade names reserved during the first three months of the current year reached 17,565, a 44% increase compared to the same period in 2011, while the number of initial approvals reached 7,735, a 36% increase over the 5,701 recorded in Q1 of 2011.

The total number of commercial activities licensed reached 4,634, with general trade leading the list of the top ten licensed activities in the commercial category with 195 licences issued in Q1 of 2012, followed by Dyes & paints (191 licenses), Tiling of floors and walls (188), and carpentry and flooring (185).

The number of professional activities licensed in Q1 of 2011 reached 1,109. Residences and building cleaning services led the list of the top ten licensed activities in this category with 135 licences, followed by restaurants (43), wiring repair and electrical installation (42), sewing and female embroidery (39), sewing women’s clothes (38), and sewing women’s gowns (31).

In the tourism sector, Inbound tourism was the leader with 17 licenses, followed by travel agents  (6) hotel management (3), accredited airline general service agent and leasing of hotel apartments (one licence each).

“The licensing activity in tourism sector reflects the substantial growth in this sector, resulting from the vision and strategies of our leadership aimed at making Dubai a destination of choice for tourists and visitors from all over the world. It also underlines the important role played by the retail sector and the presence of varied shopping centres across Dubai, in addition to the security, stability and safety that distinguish the emirate,” stated Al Saadi.

In the industrial activities segment, bblacksmithing and welding workshops led the list of the top ten licensed activities with three licences, followed by furniture for schools and hospitals, assembly of cars, canning and packaged fruits, manufacture of coil aluminum foil, assembly of electronic devices, metal for building construction, plastic for buildings, manufacturing of napkins and paper towels and Liquid battery industry, with one license each within the total industrial activities (28).

Al Saadi said: “The industrial sector in the UAE receives significant attention from our leaders who seeks to attract heavy and medium industries and encourage them to set up units jointly with local businesses. The UAE industrial production has proved to be capable of competing globally.”

Tell us about the RAK FTZ and the role it performs. How many companies do you currently have?

The Ras Al Khaimah (RAK) Free Trade Zone (FTZ) was established in 2000 with a vision to achieve global brand recognition as a premium free trade zone and investment hub, where customers find optimal business solutions to their needs. RAK FTZ offers many aspiring entrepreneurs and business owners the ideal platform to enter the Middle East market. The process of establishing a company at the free zone involves selecting a combination of business license, legal entity and facility.

Over the last decade, we have remained committed to extending the best and most affordable solutions for business needs across sectors. This success has been achieved through innovative business models. We have been able to consolidate our importance locally and internationally and today, we boast of over 5,000 active companies as our members across various fields and economic activities.

We perform the following roles:

In the economy: RAK FTZ is a major contributor to the GDP growth of the Emirate. In 2011, we achieved phenomenal growth with the registration of 2033 new companies. This was a 17% increase over the 1,740 company registrations in 2010.

In the community: As a leading corporate player in the Emirate of Ras Al Khaimah, RAK FTZ recognises that the role of a major organisation within the community in which it operates extends beyond economic contribution, and we are committed to delivering corporate social responsibility objectives across a number of key activities. RAK FTZ demonstrates its ongoing commitment by promoting, supporting, organising and participating in activities that nurture community spirit, promote a balanced lifestyle and help preserve the emirate’s cultural and natural heritage.

In the workforce: RAK FTZ’s UAE National Empowerment Programme has been specifically designed to attract, recruit and develop the next generation of talented UAE nationals and provide a unique opportunity to experience the free zone’s professional working environment and business community. Through our CSR mandate we are on the lookout for talented and ambitious UAE nationals who have long-term career potential, and passion, that will make them the future leaders of tomorrow. Successful applicants are enrolled in one of three specialist training programmes. We have the Graduate Programme, Work Placement Programme and Summer Job Opportunities.

We also develop our Emirati employees by sending them to training courses, both local and international, and support them to pursue higher education. Currently, we have 55 Emiratis out of 238 staff, which represents 23% of our workforce. In addition we have over 50% Emiratis in the management level in RAK FTZ. At the moment, our hiring focuses on UAE Nationals to reach our goal of increasing our Emiratis workforce by 15%.

What role does the RAK FTZ play for foreign companies that want to setup base in the UAE?

Over the last decade, RAK FTZ has remained committed to extending the best and the most affordable solutions for business needs across sectors from around the globe. As we move ahead, the RAK Free Trade Zone plans to strengthen its position as a business hub geared by helping small-and-medium enterprises (SMEs) connect to emerging market economies.

The RAK Free Trade Zone’s philosophy centres on attracting and maximising the growth of value-added, know-how based, technologically advanced, innovative businesses in RAK. We are eyeing closer partnerships with US-based companies. We also have international promotions and liaison offices in India, Turkey, Germany and USA, that assist our clients abroad to promote RAK FTZ to foreign investors.

How does RAK FTZ distinguish itself from other free zones and attract new companies?

The RAK FTZ is one of the most cost effective incorporations available in the UAE. Additionally, with the minimum amount of

paperwork, investors can have their company established and running within a few days time. RAK FTZ is worth a close look for a majority of startups or newcomers to the region as it offers a quick and cost effective of entry into the UAE and Middle East.

RAK FTZ aims to become one of the largest, most effective and most environmental-friendly free zone in the Gulf region. RAK FTZ is also the first and only free zone to set up offices and promotion centres in the UAE (Dubai and Abu Dhabi) and internationally (India, Turkey, Germany and USA). No other free zones have this advantage until now.

What countries have you seen the most interest from?

We have investors from 138 countries. The most interest is from countries in India (43%), the UK (14%), Egypt (9%), Pakistan (7%), followed by the US and Germany (6%). Aside from the top 10, the rest of the countries represent 2% and below.

How did the global recession impact your business and what strategy did you develop to soften the impact?

Some free zones in the region have been affected by the global downturn, especially those which have big industrial companies within their zone. With trade being low because of the downturn, some of these companies had to scale down production for their export or import requirements.

On the other hand, the downturn did not really have a big impact on free zones such as RAK FTZ, which are more focused on SMEs. With our business model of affordable cost and reach, and our promotion centres and business centres, RAK FTZ helped small and medium businesses grow even during the downturn. The fact that they also have smaller operational costs and the potential to grow made it easier for them to weather the downturn.

With RAK FTZ’s nurturing environment, the number of companies that joined the free zone did not slow down even during the downturn.

How did RAK FTZ perform in 2011 and what are your expectations for 2012?

RAK FTZ posted an impressive performance at the end of 2011:

• More than 17% increase in 2011 compared to the same period in 2010
• 2,033 registrations in 2011, which exceeded our total annual registration of 1,740 in 2010
• Our renewals were also up by 16% compared to last year, with a total number of 3,776 in 2011 compared to 3,271 in 2010. These renewal numbers give us reassurance that we are doing a good job, as we are not only registering new companies but also retaining our clients.

The exceptional growth in new registrations and renewals amidst the challenging economic climate reflects investor confidence in our business model and re-emphasises the world-class standards, facilities and services on offer at RAK FTZ. The fact that this achievement came amidst a volatile business atmosphere is even more commendable.

We have a business model that works, and that is the reason we are growing. Hence, our plan is to continue to improve our system and services. We are on the lookout for new trends in the market, in order to adapt and implement new initiatives that will benefit our existing clients and attract new investors.

In addition, Ras Al Khaimah, where RAK FTZ is located, has development plans in the future that would enhance the RAK airport, port, as well as infrastructure like roads, telecommunications, health, education and renewable energy. These initiatives will further attract investors to the emirate.

Our outlook for RAK FTZ in 2012 remains positive. We look forward to seeing growth in company registrations and renewals. We will continue our programmes to achieve our goals and, most importantly, to contribute to the GDP of Ras Al Khaimah. We are also focusing on research and studies on how to better improve processes, as well as sharing best practices with other free zones around the globe.

In 2012, we will also enhance our current focus on corporate social responsibility programmes. As one of the leading organisations in Ras Al Khaimah, we firmly believe that we have a great responsibility to the community that goes beyond our economic contributions.

The RAK FTZ focuses on SMEs. What initiatives have you taken to promote SMEs?

It makes great economic sense for us to focus on SMEs, especially those looking to do business in emerging markets. Flourishing SMEs encourage private ownership, which in turn, provides employment opportunities to the local population.

Because of our focus on small and medium businesses, RAK FTZ has partnered with several local banks that have programmes to assist SMEs, including HSBC, National Bank of Abu Dhabi, Emirates NBD, and Bank of Baroda. These banks have their own solutions that are geared for small and medium size businesses to help them start their companies faster and minimal procedures.

Other solutions that we offer SMEs are the following:

• Our Mazeed Service Desk helps clients – especially those new in the market – to start their business operations with minimum hassle. From finding out where to get insurance policy for employees, to printing business cards, setting up a website, buying furniture, finding a house, RAK FTZ assists clients through the entire process;
• One of the most notable features that make RAK FTZ the hub for SMEs is the ease of registration. Additionally, we are set apart by our environment and value-added services, which are specifically designed to meet the needs of SMEs focused on operating in emerging markets.
• Our slogan Home of Business says it all. When a client chooses RAK FTZ, we help them every step of the way. We offer them services that make them feel like they are in their own house.
• We offer flexi facilities with low start-up costs that are geared towards SMEs.
• We offer SMEs networking opportunities and B2B meetings with other RAK FTZ clients that can help them with their business.

RAK FTZ offers the following advantages to businesses:

• Cost-effective alternative to Dubai
• State-of-the-art IP-based telecommunication technology
• Quick and easy registration process
• 5,000 SMEs From 106 Countries
•  Value-added services: RAK FTZ offers a wide range of extra services that cater to the unique needs of its clients, including IT, marketing, creative, procurement, human resources and more. These are designed to assist clients with the many different steps involved in setting up and running a successful business.
• Customised Packages: Whether you need a business license in order to distribute your products, offer consultancy services or look for an office, warehouse or land for industrial activities,RAK FTZ offers solutions to match client requirements.
• Award-Winning Service: RAK FTZ’s accomplishments have been recognised by a number of well-respected international business organisations, such as the World Free Zone Convention for Best Website Award, the Middle East Logistics Awards for Best Emerging Free Zone for three consecutive years, and the Supply Chain and Transport Awards for Industrial Area of the Year.
• International Reach: RAK FTZ is the first and only free zone with international promotion centres in India, Germany, Turkey and US that provide marketing, sales, client support and administrative services.
• Ranked one of the top five Middle East free zones of the future: fDi Magazine ranked RAK FTZ fourth in the best “Middle East Free Zone of the Future” category, and third for the “Best Economic Potential” in the 2011-2012 ranking of 115 free zones in the region.
• Reputed clients and partners: RAK FTZ is home to large and successful organisations, as well as many local and international small businesses. Some of the well-known companies include Cisco, DHL, Dole, HSBC, Knauf, Emirates NBD, Hyundai, Cumi Middle East FZE – Murrugappa Group, Kotak Commodities – Kotak Mahindra Ltd, and Thrifty.

About

The Ras Al Khaimah Free Trade Zone Authority (RAK FTZ) was formed by an Emiri decree on 1 May 2000 – the result of an initiative on the part of His Highness Sheikh Faisal Bin Saqr Al Qasimi, Chairman of the Ras Al Khaimah Finance Department, to set up the emirate’s first free trade zone.

It established itself across Ras Al Khaimah at various specialised sites – the aim being to provide separate environments that would suit the needs of different types of investors and industries. Currently, RAK FTZ has four fully operational “parks” – the Business Park, Industrial Park, Technology Park and Academy Zone – with plans to develop additional industry-specific sites in the future.

RAK FTZ also has business and promotion centres in Dubai and Abu Dhabi, to cater to the needs of existing and potential clients based in those cities, and international liaison offices (in Germany, Turkey, India, and the United States), to support its international marketing activities and provide certain customer services.

With transparent and investment friendly laws and regulations, lack of restrictions on profit and capital repatriation, a strategic location not far from Dubai’s business and financial centres, proximity to international airports and seaports and considerably lower costs of living in RAK compared to Dubai and Abu Dhabi all working in its favour, RAK FTZ has been successful in attracting investors and entrepreneurs looking for cost-effective, hassle-free and secure options for setting up a business in the UAE.

RAK FTZ continues to improve its products and services and strengthen its positioning as a business hub geared at helping SMEs connect to emerging economies. Today, it is one of the fastest growing and most cost-effective free trade zones in the UAE, home to more than 5,000 active companies from 106 countries around the globe. Its reputation for affordability, flexibility and broad geographical reach has served it well, and it is rapidly emerging as the preferred business hub in the region, from which investors of all industries and origins can easily access and expand into key emerging markets – proving that it is, indeed, what its slogan states – The Home of Business.

Along with highlighting current trends and prospects in the food trade in SADC countries, the report also outlines opportunities for the Southern African bloc to export to the wider GCC region through Dubai by capitalising on the excellent infrastructure in the Emirate.

The report is produced as a part of Dubai Exports activities centered on capitalising the huge export potential that the African continent offers firms in the UAE. Earlier this year Dubai Exports announced its Trade Missions to East and Africa. In the case of Southern Africa Dubai exports plans to participate in the premier food and beverage exhibition namely Africa Big 7 in July taking place in Johannesburg, South Africa, from 15th to 17th July.

“The South African Development Community represents a strategic growth market within Africa. Together the 15 member states in SADC have a population of over 257 million and they import foods worth nearly USD 11 billion,” said Engineer Saed Al Awadi, Chief Executive Officer of Dubai Exports.

Besides South Africa, SADC has Angola, Botswana, Democratic Republic of Congo (DRC), Lesotho, Madagascar, Malawi, Mauritius, Mozambique, Namibia, Seychelles, Swaziland, Tanzania, Zambia and Zimbabwe as members. Among them, South Africa and Angola, the top two food importers, together imported USD 6 billion worth of foods in 2010.

“Exporters in Dubai are best placed to successfully target the developing economies in SADC with fast and reliable supply of processed foods. Dubai is already well-connected to the Republic of South Africa, which offers a gateway to the rest of SADC, with its efficient transport infrastructure,” added Al Awadi.

Total exports and re-exports from Dubai to South Africa in 2011 were valued at AED1.5 billion (US$408 million approximately), with food exports and re-exports  from Dubai contributing AED 105 million, while AED 50 million came from free zone companies in Dubai.

Chocolates, fruit juices, pasta, wheat flour, rice and edible oils account for the majority of food exports and re-exports to South Africa from Dubai. The Dubai Exports research shows that SADC as a whole offers additional export opportunities in a variety of foods including meat, sugar, confectionary and beverages, as their imports have grown at a rate higher than the global average.

Al Awadi commented that Dubai, with its proximity to Africa and competitive business environment, is well placed as a trade hub for SADC to the regional market. The SADC states have seen exports of their chief commodities like fruits and nuts as well as fats and oils growing at an annual average of 25-30% and exceeding USD 2 billion, while GCC imports of the same stuff reached USD 4 billion in 2010, growing 40% annually.

“Dubai is expanding its logistics, transport and manufacturing facilities to facilitate movement of goods and flow of trade. The Dubai World Central, for instance, will add a futuristic multi-modal transport component to the region’s supply chain network. Given such developments the economic momentum in our respective regions, Dubai and SADC has excellent opportunities to build high-value, sustainable trade partnerships,” said Al Awadi.

BrazArtis, an import-export company based out of Brazil, today launched a new array of organic coffee catering to the coffee enthusiasts in the Gulf Region, this includes gourmet green, roasted and freeze dried coffee.

With about third of the world’s production, Brazil is the largest producers of coffee. It is estimated that it will reach between 48 and 52 million 60kg (132-pound) bags in 2012, up by 20.2% compared to last year’s production which has reached an estimated 43 million bags, according to CONAB. The production of Arabica coffee represents about 74% of national production, roughly 36 to 39 million bags.

“Brazil’s vast landscape offers various types of splendid coffee beans, as they are planted in diverse micro-climates within separated growing region. When taking organic coffee into consideration, it comprises top quality coffee grains, and consequently offers unsurpassed taste and aroma. With a vast line up of green coffee beans as well as processed coffee, we are passionate about offering our clients with top quality taste and fragrance.” – said a spokesperson for BrazArtis.

BrazArtis’ scope of operations includes green, gourmet, freeze and spray dried coffee. The endeavour to expand organic coffee exports to the Middle East is aligned with the continuously growing demand for organic products.

From left to right: Rashed Ali Al Ansari, General Manager of Al Ansari Exchange, and Chandra Prasad Dhakal, Executive Chairman of International Money Express

Al Ansari Exchange, the UAE’s largest exchange house network that provides worldwide remittance and foreign exchange services, has announced that it has recently signed an agreement with International Money Express (IME), Nepal’s leading money transfer company, offering remittance services to Nepal through “Cash Express” service. Al Ansari Exchange will facilitate remittance transactions through any of its more than 110 branches across UAE, while recipients can receive the amount through more than 1,800 outlets of IME in Nepal.

“Dubai being a hub, various categories of businesses choose to set up in the Emirate for faster growth and market access. The 120 days licence is part of DED’s efforts to enable businesses to make full use of the advantages of Dubai and improve the Emirate’s ranking in the Doing Business Report of the World Bank,” said Mohammed Shael, Chief Executive Officer of the Business Registration and Licencing (BRL) Division at DED.

The new initiative will allow investors to have their licences issued immediately from DED depending on the risk factors of the intended business activity.  Business activities in Dubai have been categorised as No-risk, Low-risk and High-risk for the sake of evaluating the risk component.

“The categorisation depends on four main risk factors, evaluated on the basis of whether the business activity is harmful to human beings, harmful to animal life, harmful to plants, or harmful to the environment. When a businessman approaches DED for a licence, a 120 days licence is issued immediately, on completion of the necessary procedures, if the specific business activity falls under the No-risk or Low-risk categories,” explained Shael.

The 120 days licence allows the entrepreneur to start his business immediately and complete the rest of the licencing requirements, such as approvals from other government authorities concerned within the next 120 days. Government authorities are entitled to ensure full compliance of the licence holder to the licence criteria on day 121.

More than 90% of businesses in Dubai are No-Risk or Low-Risk and therefore a vast majority of businesses stand to benefit from the 120 days licence. For High-risk business activities constituting the remaining 10%, e.g. restaurants and clinics,  all standards set by the government authorities concerned have to be fully met before DED issues the licence.

The Low-risk category includes chemical plants and similar industrial operations that require pre-approvals from various authorities including Dubai Municipality and Civil Defence. “These facilities have stringent standards often embedded in their design and they go through years of preparation and inspections. Hence, there is no risk in issuing them a licence. It will in fact allow them to complete procedures like testing and hiring before starting actual operations,” Shael said.

Referring to the 120 day hassle free licence as a new philosophy of business registration and licencing, Shael said the initiative along with significant reforms like the Law No.13 of 2011 will dramatically enhance ease of doing business in Dubai.

The Law No. 13 issued by H.H. Sheikh Mohammed Bin Rashid Al Maktoum in 2011 acknowledges the contributions of the Free Zone companies to Dubai’s economy and allows such companies to open branches in Dubai while maintaining their presence in the Free Zone. A Free Zone company can operate a branch in Dubai as long as it is active within the Free Zone but any termination of Free Zone activity will reflect in the Dubai licence as well.

The Law No. 13 also allows Free Zone companies that have no local partners to open branches in Dubai, provided such branch has a Local Service Agent on board. A Local Service Agent is a UAE national or UAE company who will sponsor employees for the Dubai branch of a Free Zone company at the Ministry of Labour. The Local Service agent will have no rights of voting or decision-making in the company.

Shael stated that non-UAE nationals are already allowed to hold 100% ownership in Dubai companies even without a Free Zone licence. Professionals such as doctors, technicians, carpenters, cooks etc can have 100% ownership unless the entity is a Limited Liability Company (LLC). Expatriates can only have 49% ownership in LLCs with UAE nationals holding 51%.