The United Arab Emirates (UAE) has long been recognized as a regional business and trading powerhouse, underpinned by world-class logistics and infrastructure. In recent years, this country, which has been home to me for 33 years, has deliberately shifted its economic focus from oil to manufacturing, aiming to establish itself as a global industrial hub.
“Make It in the Emirates” (MIITE) – this initiative, launched in 2021, is at the heart of this transformation, targeting sectors such as clean energy, food, pharmaceuticals, and automotive manufacturing, while creating opportunities at a great level for UAE nationals.
Salient Points: Strategic Vision and Policy Backbone
The MIITE initiative is part of a broader industrial strategy. Operation 300bn, which seeks to increase the industrial sector’s contribution to GDP to over $80 billion by 2031, which is just six years from now.
The UAE government has implemented several measures, including the National In-Country Value (ICV) Program and the National Program to Transform Technology. These programs incentivize companies to localize value chains, reduce reliance on imports, and strengthen domestic capabilities. Government-owned banks, such as Emirates Development Bank, have allocated billions in funding to bolster domestic manufacturing.
A key pillar is the ICV program. This is redirecting spending toward UAE-made goods and services, fueling growth in local industries and job creation. The government has also pursued bilateral trade agreements to boost non-oil exports, further integrating the UAE into global markets.
Positives and Strengths: Results and Competitive Edge
The results are increasingly tangible. By 2024, manufacturing’s share of GDP reached 15.1%, with industrial exports surging to $53.7 billion—a 68% increase since 2020. The sector’s contribution to GDP surpassed AED 210 billion and is on track to exceed the AED 300 billion target by 2031. The ICV program has been pivotal, with local spending exceeding $94 billion and over 22,000 jobs created for Emiratis.
Several factors have set the UAE apart from regional competitors:
- Robust Infrastructure: The UAE offers reliable infrastructure, competitive operating costs, and investor-friendly regulation. Specialized industrial zones like KEZAD, Dubai Industrial City, and Jebel Ali Free Zone have become major manufacturing and job creation hubs.
- Global Connectivity: The country’s logistics networks ensure efficient value chain operations, connecting manufacturers to raw material sources and high-demand markets in the GCC, Africa, and Europe.
- Diverse Talent Pool: Access to a highly skilled, multinational workforce and a strong focus on Emiratisation and advanced training are building a specialized, industry-ready workforce in times to come.
- Investment Magnet: The UAE’s stable macroeconomic environment, sovereign wealth fund backing (ADQ, Mubadala), and streamlined regulations attract both local and foreign investors. In 2023 alone, over $32 billion was committed to MIITE, and the number of products identified for local manufacturing surged.
Sectoral Highlights and Local Impact
Abu Dhabi’s manufacturing sector is now the largest non-oil contributor to its GDP, accounting for 9.5% in 2024. The emirate has launched the Abu Dhabi Industrial Strategy 2031, which includes targeted programs like the Energy Support Program and the Smart Manufacturing Acceleration Program.
Dubai, meanwhile, continues to lead in diversified industrial clusters, including electronics, aerospace, and consumer goods. Sharjah and Ras Al Khaimah also report high manufacturing contributions to GDP, at 16% and 27% respectively.
The local impact is visible across large and small businesses. Companies like Emerson and Orbitworks have established advanced manufacturing facilities, exporting UAE-made products globally and pioneering new sectors such as satellite manufacturing. Homegrown firms benefit from improved local sourcing and a more reliable supply chain, while Emiratisation and skills development initiatives are yielding a more specialized workforce.
Opportunities for Foreign Investors
The UAE’s localization strategy is not insular; it actively encourages foreign investment. Investors benefit from partnerships with local firms, access to sovereign wealth funds, and the advantages of free zones with tax incentives. The country’s strategic location and trade agreements offer a strong comparative advantage, especially as global trade dynamics shift. Notably, global chipmakers like TSMC and Samsung have explored multi-billion-dollar projects in the UAE, and there is growing speculation about a potential Nvidia facility—moves that could cement the UAE’s role in advanced manufacturing and AI hardware.
Workforce Transformation and Future Clusters
The manufacturing sector employed over 750,000 people in 2023, spanning food processing, petrochemicals, pharmaceuticals, and advanced machinery. The UAE is investing in future-defining clusters—life sciences, agri-food, smart vehicles, and clean energy—each with a robust manufacturing component. Education and upskilling, exemplified by institutions like the Mohamed bin Zayed University of Artificial Intelligence, are nurturing globally competitive talent.
The Next Few Years: Outlook and Challenges
Looking ahead, the UAE’s manufacturing sector is poised for continued growth, driven by sustained investment, policy support, and a clear strategic vision. The focus will be on:
- Scaling up advanced manufacturing in sectors like semiconductors, aerospace, and medical technology.
- Attracting high-value foreign direct investment, particularly in frontier technologies.
- Deepening workforce transformation through targeted upskilling and Emiratisation.
- Expanding the industrial base through new clusters and continued infrastructure development.
However, the transition will be gradual but certain.
Conclusion
The UAE’s manufacturing renaissance is real and accelerating. With robust policy frameworks, world-class infrastructure, and a relentless focus on innovation and talent, the country is well on its way to becoming a global industrial powerhouse. The next few years will see the UAE deepen its manufacturing capabilities, expand its global footprint, and solidify its role as a launchpad for next-generation industries. The greatest possible strength that the UAE has shown at an intangible level is the ability to keep friendly relations with all, and to welcome all into its fold, as long as we are willing to abide by its laws and cultural sensitivities.
To all the large Indian Groups wanting to test waters – it is no more the time to just open a small trading office. Its time to think big, to think strategic in order to use the Emirates as an extension of India, and as a stepping stone to global markets.
**Sources of information – Various reputed local and government publications, the internet, and Fast Company
