GCC industrial investments triple over past decade

Mar 29, 2002 01:00 AM

Industrial investments in the GCC nearly tripled over the past decade to approach $ 100 bn as the countries pushed ahead with a drive to boost revenue and immunise their economies against volatile oil sales. From around $ 33 bn in 1990, the cumulative capital pumped in the GCC's manufacturing sector leapt to nearly $ 98 bn by end-2001, according to Doha-based Gulf Organisation for Industrial Consulting (GOIC).
Saudi Arabia emerged as the biggest industrial power, accounting for nearly 68 % of the total. The UAE was second with more than 10 %. The massive investments also sharply boosted the number of industrial units in the region from around 4,380 to 7,680.

A breakdown showed industrial capital in Saudi Arabia jumped from $ 17.5 bn to $ 60.7 bn while factories surged by 56 % to 3,270. Investment in manufacturing in the UAE soared from $ 5.5 bn to nearly $ 9.2 bn, pushing up industrial establishments by 168 % to 2,147.
In Kuwait, investment in this sector shot up from around $ 4 bn to $ 8.5 bn and industrial units by 23 % to around 705. In Qatar, such investments surged from $ 1.1 bn to around $ 3.2 bn and the number of manufacturing units by 41 % to 403. Capital pumped into Bahrain's industry grew from $ 3.6 bn to $ 5.3 bn and industrial units by 43 % to 348. In Oman, such industrial capital increased from 989 mm to $ 2.1 bn and industrial units by around 106 % to 769, according to the report.

Experts said combined GCC industrial investments covered mainly petrochemicals, cement, aluminium, paper, home appliances, furniture, machinery, equipment, spare parts and electrical products. They did not include investment in LNG projects, which have attracted more than $ 30 bn, mainly in the UAE, Qatar and Oman.
GOIC, which advises on industrial and economic policies in the GCC, said the growth in such investments created hundreds of thousands of new jobs. From around 270,000 in 1990, the number of jobs in the non-oil industrial sector surged to 622,000 at the end of 2001, the report said.

The sector accommodated around 325,000 jobs in Saudi Arabia last year while there were 166,000 jobs in the UAE, 48,000 in Kuwait, 25,000 in Bahrain, 24,100 in Qatar and around 32,000 in Oman. GOIC gave no figures on output but industry experts estimated GCC's industrial exports at around $ 20 bn in 2001 compared with less than $ 10 bn in 1990. The sector's contribution to GDP has also exceeded 10 % in most members and is poised for further expansion.
GCC states have embarked on an industrialisation drive in a bid to ease reliance on unpredictable oil sales, which still provide more than two-thirds of total income. The expansion in non-oil sectors has slashed the share of the oil sector's in the GDP to around one-third after it dominated the economy two decades ago.

Source: Gulf News Online
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