Details

– Al Mazaya: Manufacturing–focused plans provide significant economic stimulants

-A successful manufacturing sector reflects positively on all shared platforms, particularly building, construction

-Region’s natural resources spur manufacturing, accelerate new wave of projects

Al Mazaya Holding’s weekly report said that the manufacturing sector in the Arab region is on an upward trajectory, moving towards further diversification and development, driven by growing domestic demand from all sectors. At the forefront of these comes the real estate sector where the need for building materials, especially aluminium and iron, is growingly arising because of its significant and direct impact on the feasibility and success of real estate projects.

This is coupled with the significant importance held by the sector for other shared platforms in light of the momentum enjoyed by the sector in terms of manpower employment and its effective role in augmenting exports and reducing imports.

According to the report, investments in the aluminium industry hit $58 billion, a breakthrough in the development of the sector across the region. Partnerships with overseas companies are witnessing further progress, leading to increased investments. Production is projected to hit about six million tonnes by 2020, in light of the large gas finds by several countries of the region, which promotes the expansion of the industry, reduces production costs and enhances competitiveness in foreign markets.

Al Mazaya report pointed out that demand for steel products is witnessing further growth and investment momentum, due to the continuation of government-led infrastructure projects, along with real estate, construction and energy enterprises, in addition to the expected increase in demand for steel and iron products, backed by the accompanying plans by steel companies to tap new markets across the region and globally.

The weekly report pointed out that the steel industry in Saudi Arabia is now matured to meet local demand under all circumstances and at a production capacity of 13 million tonnes per year, which exceeds the domestic demand that amounts to six million tonnes, which means the prevailing prices will remain at stimulating limits. This is supportive as well of the construction sector, which is looking towards providing low-priced and competitive products that can compete globally.

Al Mazaya said that the UAE’s manufacturing sector is more diverse with real estate activities and projects expanding at an accelerated pace. The integration between short and long term will give both sectors more diversification and momentum to achieve the ultimate financial and economic goals.

Performance indicators are more positive in this context and establish new levels of investment, as the value-added by manufacturing activities reached about 32.3 billion dollars, with the sector contributing 53% to the country’s non-oil exports at a target rate of 25% of the output. By 2025, manufacturing will add about AED 160 billion to Dubai’s economy by 2030, given that more than 2 million people are employed in this sector, accounting for 33% of total employment.

Al Mazaya Holding report pointed out that the mobility recorded by the Saudi industrial sector plays an important role in providing all products and solutions for essential sectors, especially construction in particular and real estate in general, in addition to the diversification provided by commercial activities. It is expected to contribute SAR1.2 trillion to the Saudi economy by 2030, and to create more than 1.6 million jobs. The Kingdom aims to attract SAR1.6 trillion in investments and transactions on this score, which will necessarily reflect positively on the financial and economic activities and ultimately on the domestic economy.

The weekly report of Al Mazaya Holding underlined the importance of evolving the manufacturing sector in the region as a whole, given the considerable demand for the output of this sector and the need for increasing the volume of exports.

Concluding, the report said existing natural resources represent real and direct incentives for the sector to grow, with a large number of projects being launched and those under construction providing the needed momentum for further development, diversification and job creation.