- According to latest report developed by DSOA in collaboration with Thomson Reuters
- 30 free zones across 18 cities worldwide support Islamic economy activities
- Free zones contribute US$55 billion to Islamic economy in 2015
- Contribution expected to reach US$117 billion by 2021
Dubai, UAE: March 16, 2017: Dubai Silicon Oasis Authority (DSOA), the regulatory body for Dubai Silicon Oasis (DSO), the integrated free zone technology park, today announced the findings of the Free Zones Outlook Report, developed in collaboration with Thomson Reuters, the world’s leading source of intelligent information for businesses and professionals.
The report, launched at a joint press conference held yesterday at Dubai Technology Entrepreneur Centre (DTEC), a wholly owned technology incubation centre by DSOA and the largest of its kind in the region, identifies cities where free zones are best positioned to drive the growth of Islamic economy sectors and ranks Dubai as the world’s leading Islamic economy-enabling free zone city, followed by Kuala Lumpur and Johor Bahru in Malaysia, and Manama in Bahrain.
The report estimates that in 2015 free zones contributed US$55 billion to the Islamic economy, valued at US$1.9 trillion, and projections suggest this number will increase to US$117 billion by 2021. Meanwhile, free zone contribution to the halal food sector amounted to US$34 billion and is expected to hit US$74 billion by 2021, while the US$7 billion contribution to the modest fashion sector is projected to double by the same period.
In the Islamic economy arena, free zones are a relatively new phenomenon and largely focus on halal food. According to the report, Malaysia was one of the first nations to develop the concept, creating dedicated free zone “hubs” across the country. At present, 30 free zones across 18 cities worldwide support Islamic economy activities.
Commenting on the report, Dr Mohammed Alzarooni, Vice Chairman and CEO, of DSOA, said: “The Free Zone Report is a ready reference on niche economies that drive the growth of Islamic economy sectors. It outlines the contribution of free zones to the various sectors of the Islamic economy based on their attractiveness to companies and entrepreneurs working in this domain. In line with the Dubai: ‘Capital of Islamic Economy’ initiative launched by His Highness Sheikh Mohammed bin Rashid Al Maktoum, Vice President and Prime Minister of the UAE and Ruler of Dubai, DSOA actively participates in boosting the growth of the emirate’s Islamic economy sector.”
He added: “Through DTEC, we support start-ups in the fields of technology, digital Islamic economy, online Arabic content and smart city initiatives. Our ultimate aim is to contribute to shaping the UAE’s post-oil economy.”
For his part, Abdulla Mohammed Al Awar, Chief Executive Officer of the Dubai Islamic Economy Development Centre (DIEDC), said: “Free zones represent ideal platforms to grow the key sectors of Islamic economy. Even though the facilities free zones provide may differ around the globe, their value proposition is essentially the same – they enable local and foreign investors alike to operate, network and expand. However, the benefits are mutual – today and in the near future, Islamic economy can offer real added value to free zones.”
“The Free Zones Outlook Report 2017 highlights the issues facing each of the Islamic economy sectors that free zones can address. Along with our partners and stakeholders, we at the Dubai Islamic Economy Development Centre have been working relentlessly to turn challenges into opportunities to advance the growth of Islamic economy,” Al Awar added.
Nadim Najjar, Managing Director of Thomson Reuters in the Middle East and North Africa, said, “Free zones allow constituents to maintain superior quality of products and services and adhere to best practices. There are ample opportunities for free zones to create significant economic value across all pillars of the Islamic economy. Our report projects that the value of Islamic free zone exports will more than double over the next five years.”
Maximizing free zone use across all sectors of the Islamic economy has the potential to spearhead significant growth of the SME segment in the UAE. These sectors can go a long way towards achieving the goals of the UAE Vision 2021, including raising SME contribution to non-oil GDP to 70 percent and increasing non-oil sector contribution to the total GDP to 80 percent.