Interview: Salma bin Hareb, CEO, Economic Zones World

CEO talks about the success of Jafza over the years.
Logistics, INTERVIEWS, Ports & Free Zones

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Twenty-eight years ago the Jebel Ali Free Zone (Jafza) was created; the result of the vision of the late Sheikh Rashid bin Saeed Al Maktoum, who wanted to position Dubai as a leading trade and business hub on the global stage. The idea was for Jafza to attract multinational companies to the free zone, which in effect meant to Dubai, and to promote trade and support container throughput at the Jebel Ali Port.

“I am proud to say that Jafza successfully achieved its mandate,” says Salma Ali Saif bin Hareb, CEO, Economic Zones World, the parent company of Jafza. “We’ve attracted global names into the free zone and helped Dubai in establishing itself as the region’s commercial capital. We have been playing our mandated role efficiently ever since.

“Jafza is currently home to more than 7000 of the world’s finest companies, which includes 120 Global Fortune 500 enterprises, and has been one of the main drivers of Dubai’s burgeoning economy over the years. The Free Zone contributes 21 percent of Dubai’s GDP on a year-to-year basis, accounts for more than 50 percent of the Emirate’s total exports and sustains the employment of more than 138,000 people in the country.”

Indeed, if Dubai was compared to a luxury car, Jafza would be the engine – effectively a well-run machine driving business in the emirate. But as any car-maker will tell you, there has to be a constant upgrading and tweaking of the system over the years to make sure the product remains a premium brand that continues to attract customers. The same process applies to the free zone.

“We employ a trigger mechanism in our development strategy. For each facility there is a set of criteria that drive the development plan,” says Hareb. “For instance, in 1985, when Jafza started operations, the first group of our investors was engaged in light manufacturing and trading activities and their scale of operation was not as big, hence we developed standard offices, warehouses and plots.

“By the nineties more trading enterprises and service providers had chosen Jafza as their home. We responded to this demand trend by building low-rise office buildings. Between 1998 and 2003 Jafza witnessed a sharp rise in the demand for office space, which led to the development of mid-rise buildings. We saw a similar increase in demand for office space; this led to the development of high-rise office buildings like Jafza View 18 and 19.

“In 2003 we saw a growing demand for industrial space from the chemical and food industry, which led to the development of the South Zone and hybrid clusters for these two sectors.

“The outcomes of these demand trends are: the re-engineered customer facility, Jafza One, the Convention Centre complex; Jafza Plus-customisable Jafza warehouse-cum-showrooms; and Jafza Business Park, the innovative office complex which has integrated business centre facilities to cater to the short-term requirements of investors.”

And as a result, the growth statistics in recent years speak for themselves. The total number of active customers in Jafza has grown at a five -year compound annual growth rate of seven percent from 5494 in 2009 to 6780 in 2012. In the first half of this year, 295 new multi-nationals joined the free zone, up 21 percent from 243 during the same period in 2012.

What the numbers don’t reveal though, is the human factor behind the success. Jafza as an organisation has implemented a single-minded commitment to serve and support its customers, thus enabling them to achieve their aspirations in the region. It has developed to become a one-stop-shop for all the services in the free zone: services that make their clients’ operations function seamlessly and efficiently.

“As a business facilitator we continue to work towards enhancing our value propositions to customers,” says Hareb. “All of our products, services and initiatives are tailored to fit this commitment.

“Jafza initiatives can be grouped under two categories: firstly, those that are designed to enhance customers’ operational efficiencies, and secondly, those that support customers in growing their businesses.

“Jafza initiatives under the first category include the free zone’s continued investments in upgrading its physical infrastructure and facilities, and the investments which further enhance its IT infrastructure, in order to provide its customer services more efficiently. For example, Jafza launched its first mobile application earlier this year. Our e-services has now achieved a 90 percent adoption rate.

“The initiatives under the second category include our drive to maintain dialogue with our customers through strategic forums which focus on exploring ways to enhance growth opportunities for our customers. Jafza arranges industry-specific road shows that are conducted in potential markets across the world, and we also participate in trade exhibitions globally.”

However, all those trade shows and exhibitions will pale in comparison if Dubai wins the bid to be the host city for the six-month long Expo 2020. The UAE is competing against Brazil, Russia and Turkey for the honour. The decision on the host will be announced on November 27th, 2013.

“Hosting the World Expo is a colossal undertaking and requires massive investment in developing the required infrastructure. The event, therefore, opens up huge opportunities for global businesses and investors,” says Hareb.

“And the Expo 2020 in Dubai will unveil huge growth opportunities for Jafza and our customers. As the region’s trade, commerce and logistics hub, Jafza expects massive increase in the demand for facilities and services, not only from the new multi-nationals who would be interested in joining the free zone to capitalise on the emerging opportunities in the UAE and the region, but also from our existing customers looking to expand their operations,” she adds.

Whether Dubai wins the bid or not, infrastructural projects worth more than Dh3 billion are already currently under way in the free zone. These projects include the Dh2.5 billion Jafza One, the convention centre complex; the Dh105 million Gate 4 project; the Dh100 million LIU-11 (Light Industrial Unit-11); and the Dh27.5 million road development and access gate projects.

The Dubai bid for the World Expo 2020 is under the theme Connecting Minds, Creating the Future. And, on that note, what does the future hold for Jafza? “Our growth strategy is driven by three key words – Connect, Network and Operate,” says Hareb.

“Our endeavour is to provide our customers unbeatable logistics infrastructure, using the world’s best multimodal connectivity to enable them to reach any part of the world at the fastest pace.

“Jafza’s top priority at present is to consolidate its strengths and enhance its capability as the region’s trade, commerce and logistics hub to meet the anticipated growth in demand for world class facilities and services.”