The Gulf News reported about $41.5bn worth of imports or 32.6 percent of Dubai’s total imports — valued at $85.5bn — were carried out by companies in the free zones in 2009. Dubai houses around 20 free zones with more than 20,000 companies, and major imports, exports and re-exports happen via Jebel Ali Free Zone, Technopark and Dubai Airport Free Zone (DAFZ).

Albeit Dubai does not produce oil as compared to other key trade centers in the Middle East to fuel the economy, it relies solely on various business processes of exim trade. Dubai free trade zones are understood to have grown largely owing to its transit point status between growing economies of Asia and Africa as well as plunging into free zone strategy much early on.

Dubai’s first free zone was launched in the early 1980s when the government commissioned Jebel Ali port — now the main trading hub of the Middle East. The free zones across the globe have prospered mainly due to the possibilities of having controlling stake in investments and repatriable revenue generation opportunities.

And Dubai is case in point to it as foreigners can own 100 percent stake in companies within the free zones. It should be noted the UAE’s Commercial Companies Law restricts foreign investment in private companies to 49 percent and foreigners cannot do business without a local partner except at free zones.

Last week, DAFZ said it had recorded a 63 percent jump in sale during the first half of this year while Ras Al Khaimah Free Trade Zone reported that 785 companies have already registered for businesses during the first half of the year. Hamad Bu Amim, Director General of Dubai Chamber, said, “Dubai’s free zones are a major source of attraction for global companies and firms due to the many advantages they offer to investors looking for all the benefits of operating in the designated free zone areas.”

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The projects in the pipeline and in progress range from city trams to heavier freight routes. From the sponsorship line-up including IBM and Sharp during the ongoing MENA Rail 2009 conference in Dubai made it apparent that besides railway companies there are many in the fray vying to have a piece of the mega Gulf railway pie.

Various companies that provide rail-related products and services have opened offices across the Gulf region to utilize business opportunities and market their wares. Invensys, a UK based company that provides industrial automation, rail transportation and controls is one such company that has set up office in Dubai to augment its regional visibility.

Ala Ghanem, the regional director of business development at Invensys opined the Gulf was the most promising region at the moment for railway and related businesses. He acknowledged that there were not only many projects coming up but also were massive ones that no one in this field could afford to sideline.

The foremost project is the first proposed route of 1,970km long running through Kuwait, Saudi Arabia, and Bahrain over Qatar, and crossing the relevant stretches of water by bridge and continuing to UAE and Oman. The second will cover 1,984km from Kuwait to Saudi Arabia before passing through UAE and ending in Oman. The ultimate goal of this project is to link the whole of Middle East with each every country of the region. Once completed it is likely to have 16 lanes and an approximate length of 19,000km.

Other projects such as $4.2bn worth Dubai metro system, Abu Dhabi’s freight rail network, 130km of metro lines and a 340km tram system, 580km of high-speed rail to Al Ain, Dubai and Al Gharbia and Bahrain’s $8.13bn rail line with six lanes stretching 184km are few of those projects attracting many from this field.

According to Unife, a European rail consortium the global market is worth $167bn (Dh608.81bn) a year, and the Middle East and Africa account for just about $5.5bn. Michael Clausecker, the director general of Unife asserted that though it would not be the largest market, but it was one with substantial opportunities and substantial growth potential.
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