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SMEs to Lead Manufacturing in UAE

With the focus being on creating a knowledge-based economy for the future, Dubai has taken the lead when it comes to innovation. It is now exploring the possibility of establishing agile manufacturing hubs to increase the contribution of the manufacturing sector to AED 25 billion in the next two decades. Dubai aims to achieve this objective by improving industrial productivity by 30%.

His Excellency Mohammed Abdullah Al Gergawi, the Minister of Cabinet Affairs and the Managing Director of the Dubai Future Foundation, says that the time needed for marketing consumer goods today ranges from 1 to 7 years at present. This, he adds, is a really long period considering how consumer preferences are changing rapidly.


What that means is that the manufacturing sector is under immense pressure to change it traditional working model, given that consumers are now demanding an increased degree of personalisation and faster delivery. This is where the concept of agile manufacturing hubs becomes particularly relevant, presenting a host of opportunities to the manufacturing sector.


Agile manufacturing will help ramp up production within a matter of hours, and will be aided by machine intelligence as well as multipurpose materials. With increased computational power and modelling capabilities, the time taken to market can be shortened considerably through a process of monitoring demand and reconfiguration to test innovations.


Predictive demand can help reduce waste and transform the supply chain. His Excellency Mohammed Abdullah Al Gergawi believes that small and medium-sized enterprises or SMEs can establish agile manufacturing hubs to lower their operating costs and thus boost their capital efficiency. Agile manufacturing holds a lot of promise for the United Arab Emirates.


The world over, the productivity gap between SMEs and large industrial corporations ranges from 26% to 80%. This gap can be reduced by half if small and medium-sized enterprises take to agile manufacturing. In economic terms, that would add $15 trillion to the global GDP, which amounts to about 7%. About 90% of all companies in the UAE are small and medium-sized companies.


Small and medium-sized companies in the United Arab Emirates account for around 40% of the GDP, while also being directly responsible for half of all new jobs. With Dubai being home to 10,000startups, it is estimated that 20 million new jobs will be created by 2025. His Excellency Dr. Sultan Al Jaber, the UAE Minister of Industry and Advanced Technology, agrees with these views.


These industry insights are part of the Future Opportunities Report – The Global 50 published by the Dubai Future Foundation. It covers a wide range of industry sectors, ranging from health, medicine, education, culture, governance, communications, energy, environment, ecology, and business. The report forecasts likely disruptions and the challenges posed.


New Horizons Business Consultants is a provider of business setup services in Dubai, United Arab Emirates. We are led by Ms. Francesca Bouwman, who has years of experience in International Business Advisory and fluently speaks several European languages. If you would like to know more about how we can help your business explore new markets, please call us at +971 58 500 8643 or email us at [email protected]

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