UAE, Egypt, Jordan partner for sustainable economic growth

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The United Arab Emirates,  Egypt, and  Jordan announced an Industrial Partnership for Sustainable Economic Growth in Abu Dhabi on Sunday.
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  • The countries allocated a US$10bn investment fund, to be managed by ADQ Holding, to accelerate the partnership objectives
  • The partnership seeks to enhance growth across food and agriculture, fertilisers, pharmaceuticals, textiles, minerals, and petrochemicals

The United Arab Emirates,  Egypt, and  Jordan announced an Industrial Partnership for Sustainable Economic Growth in Abu Dhabi on Sunday to unlock new industrial opportunities and enhance sustainable economic growth in the three countries, across five sectors comprising food and agriculture, fertilisers, pharmaceuticals, textiles, minerals, and petrochemicals.

The countries allocated a US$10bn investment fund to accelerate the partnership objectives. The fund will be managed by ADQ Holding.

The partnership agreement was signed by Dr. Sultan bin Ahmed Al Jaber, Minister of Industry and Advanced Technology, Dr. Nevein Gamea, Egyptian Minister of Industry and Trade, and Yousef Al Shamali, Jordan Minister of Industry, Trade and Supply.

“The partnership embodies the vision of President His Highness Sheikh Mohamed bin Zayed Al Nahyan, to enhance industrial integration with Arab nations and the rest of the world so we can achieve a major leap in the industrial sector and transform its potential into an economic driver.” said Sheikh Mansour bin Zayed Al Nahyan, the UAE Deputy Prime Minister and Minister of Presidential Affairs.  “Through its capabilities, effective policies and current focus on developing advanced technology and logistics infrastructure, we are confident that the UAE can build a global economic powerhouse by leveraging industrial partnerships across the region.”

Sheikh Mansour added that advancing the industrial sector in the UAE, Egypt and Jordan will help strengthen and diversify the economy in each nation and increase the contribution of industry to the national GDP.

Agriculture

The value of the agricultural and food products market in the three countries was estimated at US$52 billion in 2019, with an annual growth rate of 11 percent. The value of imports such as wheat, fodder, fruits, vegetables, meat and fish reached US$37 billion in 2019.

The three countries also have a high potential in fertilizer production, estimated at 7.6 million tons annually, which offers an important platform for expansion projects in fertiliser production to meet the increasing demand.

Industrial capacity

The three nations’ combined industrial capacity represents around 26 percent of the total industrial capacity of the MENA region. These countries also enjoy a highly developed logistical infrastructure, including airports, ports and strategic transport corridors such as the Suez Canal; major companies with distinct capabilities in the main focus areas of the partnership; and access to capital and smart financing solutions. Almost half the total population of the partner countries comprising 122 million people are young people, who represent both a large market and an emerging workforce.

.Pharma

The UAE, Egypt and Jordan are amongst the largest drug manufacturing centers in the region, with more than 200 pharmaceutical factories and exports to 90 countries worth more than US$1 billion. The value of the pharmaceutical market in these countries is estimated at US$9 billion, with an annual growth rate of 7 percent. The value of the pharmaceutical market of imports reached US$5 billion in 2019.

There are opportunities for projects in medicines estimated at about US$5 billion, especially in the field of producing alternative medicines and manufacturing active ingredients for medicines (raw materials).

Textiles

The textile industry across the three countries is worth US$5 billion today. Collectively, they supply some of the leading global brands with high-quality fabrics and finished garments. All three countries bring inherent strengths across the value chain to create substantial economic opportunities.

Egypt brings a vertically integrated textile sector, leveraging competitive labor, cost and skills, extensive fabric and garment facilities, a strategic location and exports equivalent to 300,000-plus tons of cloth and apparel annually.

Jordan has a competitive export-oriented finished garment sector, benefitting from numerous free-trade agreements with various countries including the US. The UAE is well positioned to provide competitive raw materials to support the scaling up of fabric manufacturing in both Egypt and Jordan. Additionally, it also has ready access to large regional markets, such as India with which it recently signed a Comprehensive Economic Partnership Agreement.

The value of clothing and textile imports for the three countries amounts to about US$9 billion annually, which provides significant opportunities for new projects, especially in the polyester industry, whose imports amount to more than US$600 million.

Petrochemicals 

Petrochemicals are key enablers for the agriculture, food, fertilizer, textile, pharmaceutical and other sectors. In 2019, the combined contribution of the petrochemical industry to GDP in the UAE, Egypt and Jordan exceeded US$16 billion.

The three countries have access to a range of energy sources, especially natural gas, which is estimated at about 278 trillion cubic feet, in addition to advanced capabilities in the field of petrochemical production and derivatives, which are estimated at about 20 million tons per year. This paves the way for expansion projects in the petrochemical sector and manufacturing industries which could exceed US$21 billion.

Metals 

The three countries have abundant sources of metals that will make an important contribution to value-added products. The value of the iron, aluminum, metal and steel market in the three countries is estimated at US$13 billion, with an annual growth rate of 2 percent.

Egypt and Jordan also have large reserves of high-quality silica, which is the building block for many manufacturing industries, providing a platform for higher value-added industries.

The UAE is one of the world’s five largest aluminum producers, benefiting from its access to bauxite ore, competitive and sustainable energy sources, and advanced technology. There are opportunities in the metals sector (aluminum, iron, silica and potash) for projects worth US$23 billion by using these materials to manufacture higher value products such as glass, electrical wires, car components, solar panels and microelectronic chips.

 

 

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