UAE - Petrochemicals & Basic Industries In Dubai & Other Emirates

The chemicals sector in Dubai and Sharjah have been expanding steadily over the past decade. The projects have generally been of a small scale. Both emirates are implementing such ventures in a cautious way. The development of this sector is being pursued as part of an overall expansion of industry in these two emirates, rather than as a special focus on chemicals. The petrochemical sector in Dubai got a boost in March 1997, with the official inauguration of a methyl tertiary butyl ether (MTBE) plant in the emirate. This venture made Dubai the second Gulf Co-operation Council (GCC) state to produce MTBE after Saudi Arabia. In early 1997, the Dubai government had approved a proposal by the German giant BASF to build a $2 billion petrochemical complex in the emirate. Dubai is also setting up a nitrogenous fertiliser plant in Jebel Ali as a joint venture with Southern Petrochemical Industries Corp. of India. The industrial base of Dubai is growing rapidly in every direction. Dubai's Jebel Ali Free Zone (JAFZ) is a focal point of this growth, with about $3.5 billion in investments having been made since 1980 by around 800 companies from all parts of the world. High-tech industries such as electronics, microchips and CD-ROMs to basic goods factories like sugar are proposed to be set up in the coming years. Existing ventures in the emirate, such as Dubai Aluminium Company (Dubal), Dubai Cable Company (Ducab) and Emirates Airlines, are seen as leading businesses in the region and have a global reputation. Dubal is regarded as one of the top aluminium companies in the world and is the world's largest supplier of foundry alloy for the car wheel manufacturing industry (see following pages). Sharjah is developing the Hamriya free zone, but this still has some way to go before it can match JAFZ. New industrial projects are planned to be implemented in the other emirates as well. Ajman is focusing on a major "fun city" and tourist complex estimated to cost $545 million. Fujairah has no petrochemicals industry. There had been speculation in recent years that Metro Oil, which owns the only refinery in the emirate, may get involved in this sector. But this seems unlikely now, since Metro Oil filed for bankruptcy in March 1998. There have been reports that the company's existing bunkerage operations have been slowed down or halted.