ABU DHABI, 21st February 2023 — UAE-based SMEs in the industrial sector will soon be able to access new financing solutions and enablers following a memorandum of understanding (MoU) signed at IDEX and NAVDEX 2023.
The MoU between the Ministry of Industry and Advanced Technology (MoIAT), Tawazun Industrial Park (TIP) and the Emirates Development Bank (EDB) was signed on the side-lines of the defense exhibition.
In line with the Make it in the Emirates initiative, the MoU aims to attract industrial investors to strategic sectors such as defense by providing a package of incentives and benefits. It will ultimately support the sustainable development of the industrial sector and help provide an attractive business environment for local and international investors, as well as incentivize the use of advanced technologies in industrial solutions.
The MoU was signed by Omar Al Suwaidi, Undersecretary of the Ministry of Industry and Advanced Technology, Eng. Faiz Saleh Al Nahdi, CEO of the Tawazun Industrial Park, and Ahmed Mohammed Al Naqbi, CEO of the Emirates Development Bank, in the presence of Dr Sultan Al Jaber, Minister of Industry and Advanced Technology, Sarah Al Amiri, Minister of State for Public Education and Advanced Technology, Major General Dr. Mubarak Saeed Ghafan Al Jabri, Assistant Undersecretary for Support and Defence Industries at the Ministry of Defence and Deputy Chairman of the Committee for IDEX and NAVDEX, and Tariq Al Hosani, Secretary General of Tawazun Council, as well as senior officials from MoIAT, the Ministry of Defence, the Tawazun Council and the Emirates Development Bank.
Under the MoU, MoIAT and the Tawazun Industrial Park will provide incentives to attract industrial investments to the park in line with MoIAT’s efforts to create an attractive business environment for local and international investors, as well as stimulate innovation and the adoption of advanced technology in industry. The Emirates Development Bank will provide flexible and competitive financing solutions such as green financing, financing capital expenditure, and financing start-ups and SMEs.
Omar Al Suwaidi, Undersecretary of the Ministry of Industry and Advanced Technology said: “The memorandum of understanding will help empower the industrial sector in line with MoIAT’s mission, and the objectives of Operation 300bn. This strategy aims to enhance the business environment that attracts local and international investors, especially to vital industrial sectors under the umbrella of Make it in the Emirates, the National ICV Program, and the Technological Transformation Program.
“The Emirates Development Bank is one of our most important strategic partners. Over the past year, the bank provided industrial companies with AED 3.14 billion worth of incentives, enablers and financing solutions Similarly, Tawazun Industrial Park, the UAE’s integrated national center for defense, security and technology industries, is critical in enabling local defense contractors. Our MoU will offer incentives packages that include competitive prices for land and facilities, as well as incentives to encourage exports from TIP.”
He added: “The ministry continues to facilitate partnerships that promote the growth and competitiveness of the national industrial sector and support local supply chains. MoIAT is implementing many enabling projects and initiatives in cooperation with federal and local government entities as well as the private sector, such as enabling manufacturers through technology transformations. In addition to encouraging companies to benefit from National ICV Program membership, we have introduced initiatives such as the exemption of customs fees for industrial production inputs, which saved industry nearly AED 4 billion in 2022.”
Eng. Faiz Saleh Al Nahdi, CEO of Tawazun Industrial Park, said: “The memorandum of understanding provides a framework for cooperation to enable and stimulate industrial sectors in the country. It also represents a platform to support the objectives of Operation 300bn as well as the goals of the Make it in the Emirates initiative, which helps the national industrial sector, especially in vital and priority industries.
He added: “Tawazun Industrial Park will encourage and empower investors through tailor-made incentives and facilities, as well as long-term lease contracts, free lease terms, and supportive business incubators, while the Emirates Development Bank will provide financing solutions to attract foreign direct investment to the UAE.”
The defence sector is a priority industry for MoIAT, which aims to increase the contribution of the industrial sector to GDP to AED 300 billion by 2031, raise productivity, and create more job opportunities for Emiratis. By 2030, the UAE will increase its domestic defense expenditure from 10 percent to 30 percent of its total defense expenditure, which represents an opportunity to substitute imports and promote supply chain localization.
Ahmed Mohammed Al Naqbi, CEO of the Emirates Development Bank, said: “The Emirates Development Bank is pleased to be part of a dynamic partnership with the Ministry of Industry and Advanced Technology and the Tawazun Industrial Park in order to explore opportunities for cooperation in the industry and to strengthen the investment ecosystem in the UAE. Through this partnership, we look forward to establishing a strategic framework for the benefit of our tenants, which supports the objectives of the Make in the Emirates initiative and contributes to attracting more foreign direct investment to the country.
He added: “As one of Operation 300bn’s priority sectors, we are pleased to announce that to date, the defense sector has benefited from AED 375 million provided by Emirates Development Bank. Our mission is to promote the growth of a healthy and sustainable economy while also contributing to advancing the country’s industrial progress. We look forward to exploring further collaboration with the ministry and Tawazun Industrial Park and uniting our efforts to provide a supportive and sustainable environment for vital sectors while enhancing local supply chains.”