Author - U.S. Department of Commerce
|
Source:
STAT-USA on the Internet
US Department of Commerce
(202) 482-1986
|
Long Term Prospects
BEST PROSPECTS: RANK OF SECTOR
Rank
Oil & Gasfield Machinery & Services 2
Telecommunications Equipment 4
Computers & Peripherals 6
Electrical Generation Equipment 8
Construction Equipment 10
Furniture 12
Cosmetics/Toiletries 14
Part 1. Title Line: Best Prospects - U.A.E.
Rank of sector: 1
Name of sector: Defense Industry Equipment
Three-letter ITA Industry sector code: DFN
Part 2. Narrative:
The two principal entities in the U.A.E. engaged in the
procurement of defense equipment - the General Headquarters of
the U.A.E. Armed Forces (GHQ) in Abu Dhabi and the Central
Military Command (CMC) in Dubai- have merged into one entity
earlier this year. Now the GHQ is the sole entity in charge of
procuring military equipment and supplies to the U.A.E. Armed
Forces which includes the Land Forces, the Air Force & Air
Defense, the Navy Forces, and Special Operations Group.
In order for U.S. firms to do business with the GHQ, they should
pre-register their interest with the GHQ. Only prequalified
companies are invited to bid on tenders.
On May 12, 1998, Abu Dhabi Crown Prince Sheikh Khalifa Bin Zayed
Al-Nahyan agreed with U.S. President Clinton, in Washington on a
USD 6 billion deal for the provision of eighty F-16 Lockheed
Martin air fighters. The final contract will be signed later on
this year. The deal still needs to gain approval of the U.S.
Congress. A sale of this size to the GHQ will generate massive
offset inflow to the U.A.E., thus creating investment and
business opportunities for international companies. France's
Dessault Aviation's Rafale fighters and the European Consortium
Euro Fighter 2000 were fierce competitors for the deal. The
U.A.E. Air Force is also looking at constructing two new airbases
to accommodate the new air fighters and to acquire the necessary
command and control systems.
The U.A.E. Navy has undertaken an ambitious three-phase expansion
plan named "Liwa Project" to modernize and upgrade its aging
fleet. The first phase of the project includes the acquisition
of six ocean capable patrol boats (OCPB). Phase two of the Liwa
Project includes the acquisition of six small frigates or
corvettes. Liwa III calls for the purchase of up to 200 fast
intercept craft (FIC) for the Navy and the Coast Guards. A bid
was announced end of last year for the supply of six 65-meter
Ocean capable patrol crafts worth about USD 600 million. These
new vessels will be supported by six 50-meter Baniyas Class
TNC-45 fast attack patrol boats, the first of which was recently
delivered by pre-offset Abu Dhabi Ship Building Company (ADSB).
(N.B. Newport News (USA) owns 40% percent stake of ADSB). The
U.A.E. is also considering to expand its naval base facilities to
serve up to 100 fast attack craft which are programmed under the
third phase of Liwa Program. Plans are underway for the
construction of two new naval bases along with command and
control headquarters. The proposed location for the first Naval
base is between Khorfakan and Fujairah Port (Northern Emirates).
Other planned procurement include maritime patrol aircraft (MPA),
armored personnel carriers, heavy equipment transporters, field
medical hospital equipment, and expansion of command, control and
communications (C3) systems.
Three major defense trade events are held every other year in the
U.A.E. The Dubai Air show, the International Defense Exhibition
(IDEX), and the Triple International Defense Exhibition (TRIDEX).
The first two events are the largest and they are certified by
the U.S. Department of Commerce. IDEX 99 will be held next year
on March 14-18. Two U.S. companies were certified by the USDOC
for organizing IDEX 99. They are the Association of the United
States Army (AUSA), and American Aerospace & Defense Industries,
Inc. (AADI).
The U.A.E. Armed Forces imposes offsets obligations on
international defense contractors who make sales in excess of
$10 million. (N.B. Further details on offset regulations are
available at the Commercial Office in Abu Dhabi). Major
competitors include companies from France, U.K., Germany, Italy,
Russia, Spain, and South Africa.
The U.A.E. is part of the GCC unified defense program named
"Hizam Al-Ta'awon" for the provision of an early warning defense
system and communication network among the GCC Higher Military
Commands. Offers from U.S. and other European companies are
under evaluation for this project. A special forces program
"Dir'u Al-Jazira" (known as Peninsula Shield) was established by
the GCC countries and conducts regular live munition training.
In 1997, the U.S. market share of defense contracts was 30
percent. The GHQ rules for military procurement are applied.
The most promising subsectors within this sector, with the
estimated 1998 total market sizes of each:
o Defense Electronics 250
o CCC Communications 250
o Military Telecommunications 125
Part 3 Data table:
1997 1998 1999
Total market size 1,875 6,875 3,600
Total local production 0 0 0
Total exports* 0 0 0
Total imports 1,875 6,875 3,600
Total imports from U.S. 562 6,000 500
Exchange rates used US$ 3.673
*NOTE: Reexports indicated where total imports exceed market
size. All figures are estimates in millions of USD.
Part 1. Title Line: Best Prospects- U.A.E.
Rank of sector: 2
Name of sector: Oil and Gas-Field Machinery & Services
Three-letter ITA industry sector code: OGM
Part 2. Narrative:
Despite the volatility of oil prices the U.A.E. has continued
steady on its course of increasing its petroleum and gas
production capacity. Oil production, currently set at 2.1
million barrels a day (mbd),is just within the OPEC quota, so the
development of the U.A.E.'s gas fields allows further increases
of exports and revenues, as gas is not subject to OPEC quotas.
Gas demands is expected to double within the next ten years to
more than 2,000 million cf/d-mainly as a result of increased
demand from the power sector and the planned expansion of
downstream industries.
Approximately $2.5 billion has been allocated for the expansion
and modernization of existing gas field facilities which will
continue over the next decade. This is an indication of the
market potential for state-of-the art equipment and supplies and
services.
The procurement of gas equipment and services relies on three
factors, the approval of new projects, the routine replacement of
existing machinery and continued demand of after sales service
and the supply of spare parts. Demand for gas field services and
equipment is expected to increase by about 10% a year.
The following projects will require oil and gas field machinery
and services:
-$1.3 billion Onshore Gas Development Program Phase Two (OGD) for
new gas processing facilities at Habshan to produce 1,000 MMSCFD
of gas, 205 tones a day of NLG, 54,000 BPSD of condensate and
2,500 tones a day of sulphur;
-Onshore Gas Development - Phase Three; Although OGD Phase Two
was expected to meet gas demands until 2004, this phase will
address the needs after 2004. The Abu Dhabi Industrial Master
plan which is still being developed will cover the scope of work.
- $1 billion Khuff Gas project for the development of the
U.A.E.'s largest offshore gas reservoir located under Umm Shaif
and Abu Bukhoosh oil fields;
- $680 million Asab Gas Gathering expansion of the onshore gas
field expected to process 830 million cubic feed a day (mcf/d) of
wet gas from development of the Thammama F&G gas reservoirs in
the Asab field.
- $140 million Zakum Gas Injection Project which involves the
injection of gas into the reservoir to enhance oil recovery. The
scope of the project includes the construction of a new
compression platform and injection network to deliver the gas to
the injection wellheads.
- $205 million Jebel Ali Condensate Refinery Project for Emirates
National Oil Company (ENCO) which covers engineering, procurement
and construction of a 4440,000 sq. mt. plant to produce 60,000
barrels per day of jet fuel, naphtha and diesel for the U.A.E.
market.
- $136 million Urban Natural Gas Distribution network for
domestic natural gas. Key element of the system will be to
utilize natural gas to power large building and industrial
air-conditioning requirements especially during peak summer power
demand season.
Although U.S. suppliers dominate this industry, competitors from
Europe such as B.P., Technip, John Brown Engineering, and
Japanese firms including Mitsui Corp., Chiyoda, and Mitsubishi is
intense.
In 1997 the U.S. market share was 35%.
There are no regulatory/demand issues affecting the market.
The most promising subsectors within this sector, with the
estimated 1998 total market size of each:
o Liquid Natural Gas Equipment 100
o Drilling Equipment: oil and Gas 150
o Petrochemical Equipment 90
o Services: Oil and Gas 100
Part 3. Data table:
1997 1998 1999
Total market size 670 730 803
Total local production 0 0 0
Total exports* 56 62 67
Total imports 726 792 870
The above statistics are unofficial estimates.
NOTE: Reexports indicated where total imports exceed market
size. All figures are estimates in millions of USD.
Part 1. Title Line: Best Prospects- U.A.E.
Rank of sector: 3
Name of sector: Architecture/Construction/Engineering
Services
Three-letter ITA Industry sector code: ACE
Part 2. Narrative:
With a drop in oil prices to 30 percent lower than last year,
Government spending in the construction sector is expected to
take a dramatic down turn in the next two to three years. The
domestic housing market is in decline with a number of vacant
properties. Abu Dhabi Municipality and Town Planning
Department's focus has moved from buildings to industry and
infrastructure and recently stopped issuing permits for the
construction of commercial buildings. However, this measure does
not apply to the construction of residential buildings. Over the
next decade, the petroleum sector still represents excellent
opportunities, as on going $2.5 billion expansion includes a $600
million general utilities plant, a $600 million ethylene
dichloride plant and phase two of the $1.3 billion onshore gas
development.
In the private sector the hotel industry remains buoyant with
several new hotels or refurbishment planned. Dubai will also
remain a vibrant business center with several new projects either
planned or ongoing.
Current and future projects include:
(In the Emirate of Abu Dhabi)
- $3 billion free trade zone on Sadiyat island to develop a new
port, storage facilities, an airport and commodities trading
exchange, and a six kilometer bridge to link the island to the
mainland. $ 2 billion will be spent on construction.
- $330 million expansion of the Abu Dhabi and Al Ain Airports
- a $272 million Abu Dhabi trade center development which
includes a shopping mall and office complex, three cinemas,
restaurants, sports and leisure complex and underground parking
areas.
- a new World trade center in Abu Dhabi which includes offices,
conference rooms, a five star hotel, conference rooms, an
exhibition center and a shopping mall.
- a master plan to modernize all the existing old markets, which
includes a one storey shopping mall, car parks and commercial
buildings.
- a $95 million container terminal at Mina Zayed.
- a $70 million, 25 storey, oil company headquarters for Abu
Dhabi National Oil Company;
-a $27.2 million, five storey headquarters building for Emirates
Telecommunications Corporation (Etisalat)in Al Ain, together with
four new Etisalat towers in other Emirates.
- Design and construction of a $54 million 23 storey tower block
for the new Head Office for ZADCO/GASCO Development on Hoderiyat
Island to accommodate a population of up to 60,000 U.A.E.
nationals.
-Development of a tourist center at Mirfa, comprising chalets,
hotels and residences.
-Development of an industrial city in Mussafah area which covers
a 1,380-hectare industrial area including utility buildings,
offices, a police station and a clinic. Industries to be set up
there include a $100 million steel plant and a $120 million
shipyard, together with several other ventures to be set up
through the U.A.E. Offset Group. International Bechtel (US) has
been preparing the master plan.
Dubai:
- a $500 magic world theme park due for completion in 2001.is
under consideration as Dubai develops its role as a regional
services center and tourist destination.
- $300 million Dubai "Emirates Hills" residential gated community
project with two 18 hole golf courses, club house and leisure
center, adjacent to the existing Emirates Golf Club.
Sharjah:
- a $122 million 309 meter high tower block for Sharjah Chamber
of Commerce and Industry.
All Government major projects require international construction
management firms to supervise work execution; U.S. companies
enjoy an excellent reputation for such services. There are no
regulatory/demand issues affecting the market.
Government laws call for preregistration and prequalification.
Strong competition comes from local, European, Korean and
Canadian firms. US firms represented in the market include
Bechtel, Brown & Root, Leo Daly, Pritchard Corp., TAMS, Stanley
Corp, CRSS etc.
The most promising subsectors within this sector, with the
estimated 1997 total market size of each in millions of U.S.
dollars:
o Petrochemical engineering Services 95
o Civil engineering services 50
o Port Development 12
o Hotel A/C/E/ services 10
Part 3. Data table:
1997 1998 1999
Total market sales 178 203 221
Sales by local firms 45 50 53
Sales by Foreign owned firms 133 153 168
Sales by US owned firms 35 37 39
Exchange rates used US$ 3.673
*NOTE: Reexports indicated where total imports exceed market
size.
Part One. Title Line: Best Prospects- U.A.E.
Rank of Sector: 4
Name of sector: Telecommunications Equipment
Three-letter ITA Industry sector code: TEL
Over the past few years, telecommunications in the U.A.E. has
been developing at a rapid pace. The U.A.E. Government has given
telecommunications priority and it is one of the fastest growing
areas in the economy.
Emirates Telecommunications Corporation (ETISALAT), the local
P.T.T. of the U.A.E. is a quasi-state company 60 percent owned by
the U.A.E. Government and 40 percent by individual U.A.E.
nationals, and is the second most valuable quoted company in the
Middle East. Most of Etisalat's services range from advanced
satellite and optic fiber based global communication systems to
GSM and other up to date applications.
Etisalat presently operates a 855,000 line nation wide telephone
system with an expansion capacity of one million lines. This
represents over 40 lines for every 100 residents. U.A.E. mobile
subscriber users reached 312,734 in early 1998, up from 193,222
in 1996. Etisalat will expand its 250,000 line capacity GSM
mobile network to 750,000 lines and increase the number of base
stations to 2,250 by the end of 1998. Such is the optimism at
the region's potential subscriber base for cellular services via
satellite, that Etisalat plans to start a geostationary regional
mobile satellite system in September 2000. The $1.5 billion deal
was signed in September 1997 between the U.S's Hughes Space &
Communications and U.A.E.'s Etisalat/Thuraya Satellite
Telecommunications Company.
Etisalat recently enhanced its Internet service with the addition
of 45 megabit a second to the network and plans to make the
U.A.E. a regional hub for Internet services. The hub will serve
countries in the Middle East and Southeast and Central Asia.
Projects currently under evaluation include:
- a $6-$8 million pilot cable TV project (leading to an entire
project of $100 million) throughout the U.A.E.. This is the
initial step for a federal wide cable television company.
Expected award date is January 1999. Etisalat will be utilizing
its existing fiber optic and coaxial cable for the project.
Etisalat will create a new subsidiary in which it will be a major
shareholder, with paid in capital of $218 million. Shares of the
company will be offered to U.A.E. Nationals through an initial
public offering. Plans are also in hand to launch a second
Arabic satellite channel in Dubai by 2000. The satellite channel
will use ArabSat 11 to broadcast, using disk server technology.
Subscribers will also be able to connect to the service via
Internet.
-The emirate of Ras Al Khaimah plans to provide 42,000 new
telephone lines and 15,000 mobile telephones for 1999.
In 1997 the U.S. market share was 14 percent.
There are no regulatory/demand issues affecting the market.
The most promising subsectors within this sector, with the
estimated 1997 total market size of each:
o Cable TV 100
o Mobile Communication services 120
o Fiber optic transmission equipment 25
o Packet Switching systems 30
Other end users of telecommunication equipment include Abu Dhabi
National Oil Company (ADNOC), Dubai Petroleum Company, Ministry
of Interior and the U.A.E. Armed Forces/GHQ.
Part 3. Data Table:
1997 1998 1999
Total market size 177 204 235
Total local production 0 0 0
Total exports* 23 26 30
Total imports 200 230 265
The above statistics are unofficial estimates.
Exchange rates used US$ 3.673
All figures are estimates in millions of U.S. dollars.
*NOTE: Reexports indicated where total imports exceed market
size.
Government laws call for preregistration and prequalification.
Strong competition comes from local, European and Japanese firms.
Part 1. Title Line: Best Prospects - U.A.E.
Rank of Sector: 5
Name of Sector: Air conditioning & Refrigeration
Three-letter ITA Industry sector code: ACR
Part 2. Narrative:
The United Arab Emirates (U.A.E.) combines three distinctive
characteristics which makes it a key market for air-conditioning
equipment: high per capita income; extremely hot and humid
climatic conditions; and relatively low electricity cost. In
addition, the boom in the construction industry, caused by rapid
economic and population growth, has created a strong and growing
market demand.
The nature of the U.A.E. climate made air-conditioning a
necessity, rather than luxury. The trend in the 1990s has been
toward more complex centrally packaged and air cooled water
chillers. The growth in size sophistication of the U.A.E. market
has resulted in the establishment of a major local manufacturer
of central air-conditioning equipment.
Use of CFC (Chloroflurocarbons) in not prohibited but there
is a tendency to replace it by non-hazardous chemicals that will
not affect the ozone layer in the atmosphere. Although the
U.A.E. has been granted a 10-year exemption from complying with
the Montreal Protocol, which requires signatory countries to
implement a complete phase-out of ozone depleting substances by
the end of 1996, the U.A.E. has plans to achieve that goal in
five years by year 2001. Awareness among air-conditioning
consulting firms is growing. CFC-free central air-conditioning
systems are now specified by local consultants in major
air-conditioning contracts in the U.A.E.
The U.A.E. market is very receptive to U.S. central
air-conditioning equipment, because of their reputation for high
quality, safety, brand recognition, and low maintenance
requirements.
The most promising subsectors within this sector, with the
estimated 1999 total market size of each in millions of U.S.
dollars:
o Central Air-conditioning 139
o Mini Split Air-conditioning 70
o Window Air-conditioning 66
o Cold Storage Equipment 71
Part 3. Data Table:
1997 1998 1999
A: Total Market Size 303 336 369
B: Total Local Production 24 24 26
C: Total Exports* 70 77 85
D: Total Imports 349 389 428
Exchange Rate: USD 1 = Dhs. 3.673
The above statistics are unofficial estimates in millions of U.S.
dollars.
*NOTE: Reexports indicated where total imports exceed market
size.
Part 1. Title Line: Best Prospects - U.A.E.
Rank of Sector: 6
Name of Sector: Computers/Peripherals
Three-letter ITA Industry sector code: CPT
Part 2. Narrative:
Computer utilization is on the rise with current computer users
moving toward upgraded and higher capacity computers. Government
offices and businesses are shifting from mainframes to more
flexible, faster and cheaper micro computers or personal
computers in networking environments. Local business sources
estimate the current market for personal computers at USD 85
million. The annual market growth for computers is estimated at
20-25% over the next three years. Software piracy is a major
problem facing computer software companies. Serious efforts are
made by the U.A.E. Ministry of Economy through their Patent
Office to combat software piracy.
Computer companies/dealers continuously offer special promotional
bargains to gain or keep their market share. With the drop in
prices for reputable brand names, computers of U.S. origin have
become more affordable, thereby making it more attractive to
persons who wish to buy quality products. U.S. computer
manufacturers are looked upon as market leaders and will maintain
their edge to the extent that they continue to be able to
introduce state-of-the-art technology and products at competitive
prices. With the introduction of Internet services into the
U.A.E. the market for personal computers has increased and it is
expected to increase even further. Major U.S. computer hardware
and software brands available in the U.A.E. are Microsoft,
Silicon Graphics, Oracle, CompuLink Research CLR, Western
Digital, Gateway 2000, AST, Apple, Compaq, Dell, digital,
Hewlett-Packard, IBM, and NCR. Computer assembly plants
operating in the Free Zone manufacture Acer, Toshiba, Hyundai,
Samsung, Mitac, Lexmark, Commodore, and Supra brands. Products
brought into the U.A.E. from the Jebel Ali Free Zone are
considered as imports.
Major competitors are Japan, U.K., Netherlands, Taiwan and
Singapore. There are no import restrictions for the computer
industry in the U.A.E. However, U.S. companies exporting
sophisticated and advanced computer technology to the U.A.E. are
subject to the U.S. Export Licensing regulations. The U.A.E.
imposes 4 percent across-the-board customs duty on all imports
including computer hardware and software.
The most promising subsectors within this sector, with the
estimated 1999 total market size of each in millions of US
dollars:
o Personal Computers 63.0
o Computer Monitors 49.0
o Printers, computer 49.0
o LAN equipment 49.0
o Modems 28.0
o Multimedia upgrades 28.0
o OCS/Scanners 28.0
o CD-ROM Drives 24.5
0 Network Adapters 15.5
o File Servers 14.0
Part 3. Data table:
1997 1989 1999
A. Total Market Size 265 304 350
B. Total Local Production 0 0 0
C. Total Exports* 142 164 188
D. Total Imports 407 468 538
Exchange Rate: USD 1 = Dhs. 3.673
The above statistics are unofficial estimates in millions of U.S.
dollars.
*NOTE: Reexports indicated where total imports exceed market
size.
Part 1. Title Line: Best Prospects - U.A.E.
Rank of Sector: 7
Name of Sector: Automotive Parts and Service Equipment
Three-letter ITA Industry sector code: APS
Part 2. Narrative:
With per capita income among the highest in the world, the
automotive sector has traditionally fared well in this small but
lucrative market. U.S. cars are increasing market share due to
more favorable exchange rates vis-a-vis Japan and Germany. Most
well known brand names are already represented in this highly
competitive market. Local companies are increasingly interested
in joint ventures/licensing agreements to manufacture in the
U.A.E. items such as spark plugs, shock absorbers, air/oil/fuel
filters etc. for the regional market. There is minimal
manufacturing of auto spare parts in the U.A.E. Local industry
sources commented that the U.S. retained its market share of
approximately 21 percent. There are no regulatory/demand issues
impacting the market. Customs duty is 4 percent.
The most promising subsectors within this sector, with the
estimated 1998 total market size of each in millions of US
dollars:
o Automotive Engine Parts 125
o Automotive Repair Maintenance Equipment 39
o Automotive Accessories 25
o Motor Vehicles H/V/A/C Equipment 19
o Automotive Electronic Parts 13
Part 3. Data Table:
1996 1997 1998
A. Total Market Size 224 247 271
B. Total Local Production 0 0 0
C. Total Exports* 208 220 233
D. Total Imports 432 467 504
Exchange Rate: USD 1 = Dhs. 3.673
*NOTE: Reexports indicated where total imports exceed
Potential growth for US exports = 11%
Part 1. Title Line: Best Prospects- U.A.E.
Rank of sector: 8
Name of sector: Electric Power Systems
Three-letter ITA Industry sector code: ELP
Part 2. Narrative:
U.A.E.'s current power production is estimated at 6000 Mega Watt
with a projected annual demand growth of 10 percent. Gas is
heavily used for electrical generation in the U.A.E. due to its
availability and low price. Gas turbines and gas operated steam
turbines are widely used in power generation plants. This year
Abu Dhabi government has launched the power privatization scheme
as a model to be followed by other emirates. Privatization of
the power sector is believed to be economically feasible. It
will reduce government's capital expenditures incurred for the
expansion and maintenance of power projects, as well as reduce
federal subsidies. The cost of generating one kilowatt hour is 7
cents while the selling price is 4 cents to non-U.A.E. nationals
and commercial offices, and two cents to U.A.E. nationals. The
annual figure for Government subsidies for this sector is
estimated at USD 271.7 million. The Abu Dhabi Water and
Electricity Authority (ADWEA),established earlier this year, is
in charge of handling all Independent Power Projects (IPP) in Abu
Dhabi. The Taweelah A2 (IPP) expansion project is the first in
line on a B.O.O. basis. The project involves increasing the
current power plant's capacity by 480 MW. ADWEA is evaluating
the bids for the project and the project is expected to be
awarded mid June.
In 1997, U.S. market share for power generation equipment in the
U.A.E. was reported at 28 percent. Lots of attractive
opportunities are available for U.S. power equipment
manufacturers and power plant management companies to participate
in forthcoming B.O.O. projects. In Abu Dhabi alone, there are
more than six major power projects coming up, while at least four
major ones are foreseen in Dubai and the northern emirates.
The U.A.E. is involved in a GCC plan to construct a unified power
grid. The first phase of the project connects Saudi Arabia,
Kuwait, Bahrain, and Qatar, while the second phase incorporates
Oman and the U.A.E. in the overall grid. Execution of this plan
is dependent on the construction of a unified power grid in each
country. The U.A.E. has started the construction of its
four-phase unified grid connecting all emirates. Actually, the
completion of the first phase of the project is expected end of
this year, thus interconnecting all power stations in the western
coast with the central region stations.
There are no constraints on the import of power generation
equipment in the U.A.E.. A 4 percent tax applies to power
generation equipment imported for sale in the country.
Major power subsectors Estimated Market Size in 1999
(in Million USD)
0 Gas and Steam Turbines and parts 600
0 Power Transmission/Distribution Equipment 100
0 Switchgear motors/engines 55
1997 1998 1999
Total market size 522 650 715
Total local production 0 0 0
Total exports* 66 75 83
Total imports 588 725 798
Total imports from U.S. 165 203 223
The above statistics are unofficial estimates.
Exchange rate used is One USD equals 3.673 dirhams.
*Note: Re-exports indicated where total imports exceed market
size. All figures are estimates in millions of USD.
Part 1. Title Line: Best Prospects - U.A.E.
Rank of sector: 9
Name of sector: Water Resources Equipment
Three-letter ITA industry sector code: WRE
The privatization of the water sector goes hand in hand with that
of the power sector especially that power and water generation in
the U.A.E. are co-linked at the same plant. Last year, a US$2
billion budget was allocated for the development of power and
water desalination capacity for 1997-1998. With privatization
plans ahead, the U.A.E. government is expected to reduce its
budget allocations for the power and water desalination projects,
thus giving a bigger role for the private sector. Total demand
for water in the U.A.E. is estimated at 400 MGPD. The Ministry
of Water and Electricity estimates an annual growth of 12 percent
in demand for water in the next couple of years. Current water
desalination capacity in Abu Dhabi alone is reported at 196 MGPD.
The Taweelah A2 power and water desalination project was launched
earlier this year in Abu Dhabi under the newly adopted
privatization scheme. The project will increase the current
Taweelah A2 water desalination capacity by 50 MGPD. The final
phase Taweelah C Power/Water Desalination plant will add 40 MGPD
of desalinated water by year. Almost 20% of all water consumed is
used for agricultural purposes especially that the U.A.E. is
focusing more on developing its agricultural sector. By year
2015, water consumption forecast exceeds 600 million GPD of which
Abu Dhabi's share could reach 250 million GPD. Overall, capacity
to produce water will double in the U.A.E. during the next 5
years, including new opportunities for Independent International
Power Producers to invest in B-O-O (build-own-operate) projects
worth billions of dollars. The application of Reverse Osmosis
technology have encountered several problems in the U.A.E. due to
the high temperature and salination rates in summer, which causes
the closure of the membranes, thus suspends desalination
operation. Multi-Stage Flash and Multi-Electric desalination
technologies are becoming widely used in the U.A.E.. U.S.
companies with RO technology should exert an effort to update
U.A.E. officials at the Ministry of Water and Electricity on
technological developments made to overcome those problems.
Wastewater treatment systems are in great demand now but because
of religious considerations, waste water cannot be used either
for human consumption or agricultural crop production. It's
principal use is in municipal decorative and ornamental
agriculture and golf courses.
U.S. companies face tough competition from French, Italian,
British, German and Japanese companies.
There are no regulatory/demand issues affecting the market.
The most promising subsectors within this sector, with the
estimated 1998 total market size of each:
o Desalination equipment 350
o Irrigation Equipment 100
o Water supply/Dist. Systems 220
Part 3. Data table:
1997 1998 1999
Total market size 627 750 840
Total local production 0 0 0
Total exports* 60 67 67
Total imports from U.S. 175 210 252
The above statistics are unofficial estimates.
Exchange rates used US$ 3.673
*NOTE: Reexports indicated where total imports exceed market
size. All figures are estimates in millions of U.S.
Dollars.
Part 1. Title Line: Best Prospects - UAE
Rank of Sector: 10
Name of Sector: Construction Equipment
Three-letter ITA Industry sector code: CON
Part 2. Narrative:
The construction sector of the U.A.E. is one of the most active
sectors of the economy. The current boom in construction and
renovation activity, fueled by rapid economic and population
growth, will create a strong growing market demand for
construction equipment. The U.A.E. will spend well over USD ten
billion for civil work projects over the next five years.
Projects include construction of new high-rise
commercial/residential buildings, houses, hotels, beach resorts,
hospitals, schools, roads, public parks, shopping malls, two
major airport expansions, and theme parks.
Industry sources are confident that the upward trend in the
construction industry will continue during the next three years.
Thus, additional construction equipment will be in demand to
support this high level of construction activity.
All construction equipment demand is met through imports. U.S.
market share is expected to increase during the next three years.
U.S. manufacturers and exporters enjoy an excellent reputation
for product quality and durability. There are no significant
trade barriers to the importation and sale of construction
equipment in the UAE. Custom duties are four percent.
The most promising subsectors within this sector, with the
estimated 1999 total market size of each in millions of U.S.
dollars:
O Heavy Construction Machinery 160
O Road Construction Machinery 146
O Earth Moving Machinery 125
Part 3. Data Table:
1997 1998 1999
A: Total Market Size 414 462 521
B: Total Local Production 0 0 0
C: Total Exports* 131 145 160
D: Total Imports 545 607 681
Exchange Rate: USD 1 = Dhs. 3.673
The above statistics are unofficial estimates in millions of U.S.
dollars.
*NOTE: Reexports indicated where total imports exceed market
size.
Part 1. Title Line: Best Prospects - UAE
Rank of Sector: 11
Name of Sector: Building Products
Three-letter ITA Industry sector code: BLD
Part 2. Narrative:
The U.A.E. import market of building products is influenced
largely by the level of construction activity in the country.
Local market demand for building products is growing rapidly as
public and private sectors are floating tenders for the
construction of diversified commercial, residential, and
institutional buildings. Major current civil construction
projects include: Abu Dhabi Grand Mosque, Abu Dhabi Airport
Expansion, Adnoc Headquarters, Ruwais Housing Program, Abu Dhabi
Pediatric Hospital, Dubai Airport Expansion, Chicago Beach Resort
Development, Emirates Towers, Sharjah Tower and Exhibition
Complex, two new Etisalat Towers, and Magic World Theme Park.
Local importers and distributors of building products indicated
that U.S. manufacturers/suppliers have an excellent reputation
for supplying quality-engineered products and foresee an increase
in the U.S. market share. The primary reason for this expected
growth is due to the satisfaction among end-users with the
quality of U.S. building products. There are no significant
trade barriers to the importation and sale of building products
in the UAE. Custom duties are four percent.
The most promising subsectors within this sector, with the
estimated 1999 total market size of each in millions of U.S.
dollars:
o Wood & Wood Products 296
o Architectural Glass 256
o Electrical Products 220
o Ceramic Products 217
o Plumbing Products 138
Part 3. Data Table:
1997 1998 1999
A: Total Market Size 1,459 1,691 1,974
B: Total Local Production 210 231 258
C: Total Exports* 312 364 420
D: Total Imports 1,561 1,824 2,136
Exchange Rate: USD 1 = Dhs. 3.673
The above statistics are unofficial estimates in millions of U.S.
dollars.
*NOTE: Reexports indicated where total imports exceed market
size.
Part 1. Title Line: Best Prospects - U.A.E.
Rank of Sector: 12
Name of Sector: Furniture
Three-letter ITA Industry sector code: FUR
Part 2. Narrative:
A growing population means increasing requirements of both office
and residential space, implying a higher demand for furniture.
Improving standards of living and high disposable incomes lead to
larger living spaces and frequent replacement of furniture. In
addition, the fast growth in tourism is boosting construction of
hotels and leisure facilities. Dubai attracted well over two
million visitors in 1997. There are currently 233 hotels rated 3
stars and above with over 12,000 rooms. The total number of
hotel rooms is expected to increase to 20,000 during the next
five years. There are six new hotel projects currently under
construction including the world tallest hotel tower currently
being built on a man-made island. Several other hotels are in the
process of expanding/renovating their existing facilities.
The most promising subsectors within this sector, with the
estimated 1999 total market size of each in millions of US
dollars:
o Household furniture 126
o Office furniture 107
o Medical/hospital furniture 73
Part 3. Data Table:
1997 1998 1999
A. Total Market Size 253 300 362
B. Total Local Production 54 62 70
C. Total Exports* 35 42 49
D. Total Imports 234 280 341
Exchange Rate: USD 1 = Dhs. 3.673
The above statistics are unofficial estimates in millions of U.S.
dollars.
*NOTE: Reexports indicated where total imports exceed market
size.
Part 1. Title Line: Best Prospects - U.A.E.
Rank of Sector: 13
Name of Sector: Sporting Goods/Recreation Equipment
Three-letter ITA Industry sector code: SPT
The U.A.E. follows Saudi Arabia as the second most important
consumer market among GCC countries. With a high per capita
income ($17,500) and competitive worldwide salaries it presents a
very attractive market for the leisure/recreational industry.
The large resident expatriate population (80% of total
population) has a significant influence on the demand for
sporting goods.
In recent years, both the public and private sector have begun to
build and operate large scale recreational facilities/theme parks
in the U.A.E. Three water/theme parks are in the planning stage.
Opportunities for further development and expansion exist
especially for theme park equipment. All the centers/parks will
be supplied with imported equipment. Actual value figures for
recreational equipment is not reflected below as it usually gets
noted under construction activities by the local statistics
office.
Innovative new products and increased promotional activity
characterize this highly competitive market.
Customs duty is 4 percent.
The most promising subsectors within this sector, with the
estimated 1999 total market size of each in millions of US
dollars:
o Video games 17.1
o Amusement park/Outdoor
playground equipment 9.0
o Racquet Sports and Accessories 7.5
o Fitness Equipment 6.2
o Golf Equipment 4.1
o Playing cards 2.2
o Soft playgrounds 1.8
o Fishing Equipment 1.4
o Hunting/Shooting Equipment 1.0
Part 3. Data Table:
1997 1998 1999
B. Total Local Production 0 0 0
C. Total Exports* 46 48 51
D. Total Imports 128 135 141
Exchange Rate: USD 1 = Dhs. 3.673
The above statistics are unofficial estimates in millions of U.S.
dollars.
*NOTE: Reexports indicated where total imports exceed
market size.
Part 1. Title Line: Best Prospects - U.A.E.
Rank of Sector: 14
Name of Sector: Cosmetics/Toiletries
Three-letter ITA Industry sector code: COS
Part 2. Narrative
Innovative new product formulations and increased promotional
activity characterize this highly competitive market.
Opportunities for further development and expansion exist
especially for hypo-allergenic and therapeutic skin care
products. Demographic trends indicate an ageing population which
offers potential further growth for anti-ageing products. U.S.
market share for the U.A.E. in 1996 was 11 percent. Companies
offering natural cosmetic/toiletry products comparable to the
Body Shop, U.K. have excellent potential in the U.A.E.
Customs duty is 4 percent.
Cosmetic creams which offer recuperative or restorative skin care
must be approved by the Ministry of Health before market entry
into the U.A.E.
The most promising subsectors within this sector, with the
estimated 1999 total market size of each in millions of US
dollars:
o Cosmetics 72
o Perfumes 60
o Skin Care Products 43
o Hair care Products 36
o Cosmetics & Toiletries - Men 30
Part 3. Data Table:
1997 1998 1999
A. Total Market Size 229 247 266
B. Total Local Production 20 22 24
C. Total Exports* 70 82 96
D. Total Imports 279 307 338
Exchange Rate: USD 1 = Dhs. 3.673
The above statistics are unofficial estimates in millions of U.S.
dollars.
*NOTE: Reexports indicated where total imports exceed
market size.
BEST AGRICULTURAL PROSPECTS:
Name of Sector: Horticultural and Tropical Products
PS&D Commodity Heading: Apples, Fresh
Comments: Because of their high quality, demand for U.S. red
apples is very strong, particularly among institutional
end-users. In fact, the UAE is one of the top 10 markets in the
world for U.S. apple exports. Iran is currently the principal
apple supplier to the UAE, providing mostly golden varieties.
Chile and France are other major suppliers.
Data Table 1996 1997 1998
(1,000 MT)
A. Total Market Size 45 47 49
B. Total Local Production 0 0 0
C. Total Exports 38 38 39
D. Total Imports 83 85 88
E. Total Imports from U.S. 16 18 20
Name of Sector: Oilseeds and Products
PS&D Commodity Heading: Corn Oil
Comments: The U.S. is currently the principal corn oil supplier
to the UAE. Most oil is shipped in bulk for further processing
and packaging in local plants. There is also growing demand for
sunflower seed and to a lesser extent, canola oil.
Data Table 1996 1997 1998
(1,000 MT)
A. Total Market Size 20 22 23
B. Total Local Production 0 0 0
C. Total Exports 5 8 10
D. Total Imports 25 30 33
E. Total Imports from U.S. 20 25 27