Dubai has carved out a position as one of the giants of international shipping and maritime activities. The maritime sector accounts for $3.92 billion or around 4.6% of the local GDP. Among the top maritime components contributing to GDP are maritime operations and engineering, ports and shipping, recreational maritime services, and maritime support services. In 2014, more than 75,000 jobs were created in maritime operations, maritime engineering and ports, which accounted for 51% and 25% of the employment rates respectively.
Dubai has taken Singapore, the world’s second busiest port, as a role model in the development of its maritime industry. Singapore’s success is often attributed to the variety of services and possibilities that the location provides. Dubai’s approach appears to reflect this, with a multi-faceted strategy being adopted. One aspect of this multi-faceted strategy is to take steps towards ensuring the implementation of international best practices in all areas, from operations through to environmental impact, at the Dubai and the UAE level, seeking to create a suitable platform for international operators. An another aspect of the approach is ensuring inter-operability, that is, linking up services together, which increases efficiency and ease for customers but also adds to the positive inertia of the sector; one example of this being linking local transport networks more closely with cruise passenger terminals, helping to funnel visitors’ money into Dubai’s economy.
The government has formulated a plan called the Dubai Maritime Vision 2030, seeking to establish Dubai as a world maritime hub. The maritime sector is expected to drive other sectors, such as logistics, tourism and luxury goods. Moreover, by creating local tertiary sector jobs, the government can drive the development of local human capital. In parallel with this policy, the government founded “Tasneef” that encourages local students to enter fields related to the maritime industry, to reduce the industry’s dependence on foreign workers. As well as shipping and maintenance-related activities, the sector provides jobs in areas such as insurance, finance, tourism and marine brokerage, which require employees with tertiary education and skills.
The Dubai government has sought to encourage investment in the sector, as well as to broaden maritime activities and investment opportunities in Dubai. One such example is the launch of Dubai Maritime Week that will consist of a series of roundtables with the aim of developing new ideas and plans for maritime development programs. Another initiative is the Maritime Creativity Lab that also hopes to develop new ideas for pushing forward Dubai’s maritime industry through meetings and brainstorming sessions.
DP World at a glance
Rank: The world’s third-largest ports operator
Terminals: 65 marine terminals across the world
Revenue: $3.4 billion in 2014
Net profit: $675 million in 2014
Dubai Maritime City
Most of the developments in the Dubai maritime industry have focused on the development of Dubai Maritime City, which the government seeks to further develop into a cluster, creating synergies with other sectors around the increasing inertia of the space. Indeed, the cluster has brought in a considerable number of companies in recent years, including Dubai super yacht builder Gulf Craft. Always looking to increase this, last year Dubai Maritime City held a series of meetings and presentations to open up new areas for cooperation to broaden its reach. Dubai Maritime City believes that Dubai Expo 2020 will act as a catalyst for trade providing huge opportunities to develop the maritime sector in Dubai.
Did you know?
Between 2003 and 2013, Dubai’s port activity grew by 150%.
Jebel Ali Port
Jebel Ali, Dubai’s biggest port, is the world’s 9th biggest container port, and the largest in the Middle East. The port has been linked to Dubai’s expressway system and to the Dubai International Airport Cargo Village and thanks to the integrated infrastructure, four-hour transfer is possible from airplane to cargo ship. Jebel Ali increased its handling capacity to 19 million TEU at the end of 2015 from 15.2 million TEU in 2014. The port's total capacity set to reach 22.1 million TEU in 2018. The Jebel Ali Port is home to over 7,000 companies and 100 of the Fortune 500, describing itself as a trade catalyst ecosystem.
Maritime Arbitration Centre
Recently, Dubai has begun establishing the Emirates Maritime Arbitration Centre, which will be an expert center dealing with issues relating to maritime law disputes in the region. By doing so, Dubai hopes to further cement itself as a hub of maritime activity for the region, drawing in legal services and other auxiliary activities, creating further sectorial inertia.
Luxury Yacht Manufacturing
Other marine sectors, such as super-yacht manufacturing, are also showing growth in Dubai. Recent statistics state that UAE currently ranks ninth in the world for super yacht manufacturing, with 15 projects under development. According to Dubai Council for Marine and Maritime Industries, the total UAE maritime industry is worth more than $61 billion, with 386 boats over 24m built in 2014, up eight percent on 2013. Dubai’s Mina Rashid cruise terminal directs increasing numbers of cruise ship passengers to Dubai’s various tourist attractions and shopping areas. DP World is set to expand the Emirate’s cruise terminal capacity, forecasting 150 ships with a predicted 600,000 passengers expected to pass through in 2016. The UAE’s Gulf Craft is also investing $100 million over the next five years to develop a facility to build a shipyard for the manufacture of mega and super yachts within the marine district of Dubai Maritime City.
Dubai’s GDP is set to continue to grow at 4.5% and the maritime sector is projected to develop alongside. Dubai’s competitive pricing, in terms of labor costs, compared to other global maritime centers such as Singapore have and will help continue to drive some of this growth, although it is unlikely to witness the same explosive growth that it did upon its initial rise into the top end of the market. However, Dubai's maritime sector is expected to enjoy an increase in commodities traffic over the next years and the sector is still seen as having notable room for growth.