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Business and investment

Sharjah provides promising FDI alternative

Sharjah's modern skyline. Photo: Invest in Sharjah

As the mutually beneficial partnership between China and UAE goes from strength to strength, the diversified economy of Sharjah, the country’s center of trade and industry, is attracting increasing numbers of Chinese investors eager to enter the region

Although economic diversification has been high on the agenda of all governments of the Gulf region in recent years, the Emirate of Sharjah leads the pack, with no single sector accounting for more than 20 percent of GDP. This not only provides a buffer against external shocks, but also creates a multitude of investment opportunities not otherwise found in the region.

“Sharjah’s key advantage is its low dependency on oil-related investments, with the oil and gas sector comprising less than six percent of Sharjah’s GDP,” says Mohamed Juma Al Musharrkh, CEO of Invest in Sharjah, the emirate’s foreign direct investment (FDI) office. From leisure and tourism, environment, healthcare and logistics to light manufacturing and financial services, Sharjah’s economy is one of the most developed in the Middle East when it comes to offering investment opportunities in non-oil sectors.

As a result, investment into the emirate is booming. While UNCTAD figures show that FDI fell globally last year by 16 percent, Sharjah bucked the declining trend with an increase of 102 percent to $1.62 billion, with China as one of the emirate’s leading sources of investment. Almost 700 Chinese companies now call Sharjah home, and their number is quickly growing.

The Sharjah skyline. Photo: Invest in Sharjah

“Sharjah’s key advantage is its low dependency on oil-related investments”

- Mohamed Juma Al Musharrkh, CEO, Invest in Sharjah

“We are so pleased with the extent of Chinese investment in the Emirate of Sharjah and the increase in the number of activities involving Chinese investors, as seen through the four-percent growth of license renewals in 2017,” says Sultan Abdullah bin Hadda Al Suwaidi, chairman of Sharjah Economic Development Department (SEDD). He highlights key recent developments in the emirate’s economic infrastructure, such as new investment facilities and specialized free zones that cater to the specific needs of Chinese investors and business owners, enabling them to operate in a favorable fiscal environment while receiving ongoing support from Sharjah’s government.

While Chinese investment is visible in almost every sector, industry and logistics are a major draw: the number of industrial licenses for Chinese investments also increased by four percent in 2017, reflecting the growth in trade between the two sides. And as Sharjah’s popularity grows, so too does demand for residential and commercial developments, with the government now seeking investment into real estate, shopping centers and hotels.

Photo: Invest in Sharjah

The UAE is ranked third among countries due to benefit from China’s Belt and Road Initiative, and Sharjah is keen to capitalize on its unique position as the only emirate with ports on both coasts of the country: the Arabian Gulf and the Gulf of Oman. The recent entry of Chinese companies COSCO and Hutchison Ports into the emirate’s ports looks set to cement its status as a major transshipment and re-export center, paving the way for yet further Chinese investment.

Today, investors in Sharjah benefit from an attractive and continuously improving national investment environment, the integration of government and private sector organizations, and transparent rules and regulations. In the World Bank’s 2017 ease of doing business index, the UAE ranked 21st out of 190 countries, up eight places from the previous year. Meanwhile, in the World Economic Forum’s Global Competitiveness Report 2016-17, the UAE ranked 11th out of 138 countries.

“When it comes to investments, we are here to change how people look at Sharjah. We are here to create a future for our youth. We are here to create opportunity for investors,” explains Marwan bin Jassim Al Sarkal, executive chairman of Shurooq, the Sharjah Investment and Development Authority.

Today, Chinese individual and corporate investors are very nearly spoilt for choice, with available projects in almost every industrial sector. Coupled with a pro-business regulatory structure and strong human capital, Sharjah has become a promising alternative for Chinese investors looking for a base in the MENA region.

Sharjah’s top five free zones

Photos: Hamriyah Free Zones

Driving world-class business

Sharjah Airport International Free Zone (SAIF)

Located next to Sharjah International Airport with access to more than two billion people within a four-hour flight, SAIF’s facilities can accommodate every business and every scenario. Warehouses, storage, container parking, bunkers and labor housing are all available at the lowest costs and highest quality.

Gateway to global trade

Hamriyah Free Zone Authority (HFZA)

The UAE’s second-largest industrial free zone, HFZA offers a center for export and re-export to global markets. The free zone manages an area of approximately 26 million square meters of prime industrial and commercial land and a deep-water port, which is constantly expanding.

A global first in publishing and printing

Sharjah Publishing City (SPC)

With access to the lucrative and underserved book markets in the Asia and MENA regions, SPC enables the production and distribution of publications through its publishing ecosystem, including creative space, printing facilities, access to the region’s distribution companies, export promotion and logistics infrastructure.

Harnessing the growing healthcare market

Sharjah Healthcare City

With the GCC healthcare market forecast to reach $94 billion by 2021, the supply-demand gap is increasingly drawing investors to the region. The Sharjah Healthcare City free zone enables investors to enjoy 100 percent ownership of their entity, zero tax and duties, hassle-free licensing and world-class infrastructure.

Fostering creative entrepreneurship

Sharjah Media City (SHAMS)

Established in January 2017 to act as a catalyst for creative and media businesses to grow and thrive, SHAMS’s mission is to make creative entrepreneurship accessible to all aspiring startups, SMEs and established companies striving to grow their business both locally and globally.