Regional market key to Sharjah's economic growth

03 July 2014

Hussain Mohamed al-Mahmoudi, the director-general of Sharjah Chamber of Commerce, highlights the role trade plays in Sharjah’s economic growth

When Hussain Mohamed al-Mahmoudi was appointed director-general of the Sharjah Chamber of Commerce in 2008, his move to public service from the private sector (where he worked at UK/Dutch oil major Shell) may have appeared a dramatic career change.

Al-Mahmoudi thinks differently. He still considers himself to be part of the private sector. “A lot of people in this part of the world wrongly think the chamber is the government, when in reality it is a private sector organisation,” he says. “Of course, we are a governmental organisation, but our mandate is to act in the interests of the private sector.”

By law, firms doing business in Sharjah are obliged to be members of the chamber, except those based in the emirate’s free zones. Many free zone companies are members however, so they can take advantage of the chamber’s activities, and firms exporting products internationally receive certificates of origination.

Promotional activities

The chamber organises events including interactions with visiting trade delegations, international road shows and other specialised services, such as arbitration advice, training, and business development. “We run our own activities and promotions,” says Al-Mahmoudi. “For example, every year, we have four major promotions such as shopping festivals, Ramadan festivals, retail promotions targeting shopping malls and other different sectors.”

When Al-Mahmoudi joined the chamber, the most pressing issue for its members was the global financial crisis. “The crisis was a slow period,” he says. “However, the federal government was very active and mitigated the risks to the economy by not only putting in place the right organisations, but also the right economic stimulus schemes. Launching different projects made things move and that is why today, after five years, you find the UAE is one of the earliest countries to come out [of the financial crisis], and now things have become positive.”

The chamber played a role in helping Sharjah navigate the downturn. “In Sharjah, we were examining what was going on with the slowdown and working on tools to deal with the situation, and the tools we adopted were to focus on and foster trade,” says Al-Mahmoudi. “We identified trade as one of the key enablers to get out of this [slowdown]. We targeted new markets and we were very active; we went with delegations to Africa, the GCC, and Asia.”

In 2014, Sharjah’s private sector is thriving again. Despite the financial crisis, the number of companies operating in the emirate has grown substantially. “From 2008 to 2014, Sharjah has grown drastically,” says Al-Mahmoudi. “Today, we have a membership of nearly 50,000 firms. It is a significant number of private sector companies and among them there are some very solid firms.”

Businesses in Sharjah are bullish on the prospects for the future. “Most of our members are now optimistic about the present and the future,” says Al-Mahmoudi. “They are eager to grow and think they will grow. They think they will hire more people and sell more. That is a very positive outlook. From a macroeconomic perspective, we have significant regional projects in the coming years – [the Fifa 2022] World Cup in Qatar, the [2020] Expo in Dubai, and this will fuel the economy further.”

Sharjah’s leading firms already play an important role in the regional economy. “We have the first budget airline in the region – Air Arabia,” says Al-Mahmoudi. “We have the biggest oil services company in the region – Petrofac – with more than 3,000 people based in Sharjah. We have the first integrated gas firm – Dana Gas. We have one of the world’s biggest privately owned port management companies – Gulftainer, and the biggest food firm in the region – International Foodstuffs Company.”

Dubai relationship

Sharjah has managed to follow the lead of neighbouring Dubai and establish itself as a hub for trade with the GCC and the broader region. “The proximity and relationship with Dubai is very important for Sharjah,” says Al-Mahmoudi. “Sharjah has always been affected, whether positively or negatively, by whatever happens in Dubai. However, I believe the relationship has more of a positive impact than negative. The relationship can be much more leveraged and can be more competitive. More coordination and synergy between both [Emirates’] public and private sectors will definitely enable more economies of scale.”

The immediate region could also become more important for firms based in Sharjah if international sanctions on Iran are lifted. “Trade with Iran is very important,” says Al-Mahmoudi. “It is historical and logical because we share geography with them. It is a big market and trading relationships with Iran have always been there. Of course, the UAE as a country respects and plays by the rules when it comes to international regulations, but trading with Iran is important and I hope in the near future you will see the volumes that got affected in the past few years grow back again.”

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