Khalifa Industrial Zone (Kizad) has grown exponentially over the last few years, seeing total occupied space increasing by 27 per cent (in 2018) and attracting investments from around the world to the tune of Dh70 billion ($19 billion) since 2012.

Currently, more than 500 companies call Kizad their home, with 340 of these being small and medium entrerpises (SMEs). Meanwhile, the total number of people working within the zone has leapt by 15 per cent. As of Q3 2019, it had under 16,000 people working there.

In an exclusive interview with Gulf Industry magazine, Kizad’s CEO, Samir Chaturvedi, underlined their biggest milestones, one being success in attracting substantial private-sector investment, especially from abroad.

Major sources of foreign investments have been from India and Europe, while there is also a strong interest from China through Kizad’s strategic partnership with Jiangsu Provincial Overseas Cooperation and Investment Company (JOCIC).

In fact, just recently ground was broken on the $614.37-million Roadbot Abu Dhabi tyre manufacturing project, located inside Kizad’s China-UAE Industrial Capacity Cooperation Demonstration Zone.

Chaturvedi said Abu Dhabi is an ideal partner for Chinese companies, offering unprecedented access to local and global markets, and an ecosystem that is backed by purpose-built infrastructure, efficient investor support services and low operational costs. “It’s a win-win situation,” he said.

“The powerful combination of Abu Dhabi’s strategic location, Kizad’s logistics efficiencies, and the connectivity offered by Khalifa Port, create a powerful magnet for Chinese investments in the UAE. Our partnership with JOCIC to develop a Chinese industrial cluster is also gaining strong traction and we will see a consistent investment from China through this platform,” he added.

Speaking of China, Chaturvedi said Kizad has a great deal to offer the belt-and-road initiative, and they are very proactive in attracting and supporting Chinese investment.

Also in the past few weeks, Hadaf Foods – the company behind the famous Pinar dairy brand – opened its first processing plant outside Turkey at Kizad.

Some other major companies from an exhaustive list that have made Kizad their hub include Emirates Global Aluminium (EGA)–which provides anchor for Kizad’s metals cluster–with other operations including Talex, Al Gharbia Pipe Company, and Ducab cable manufacturing.

Kizad’s food cluster includes operations for Binghatti Beverages, Spinneys Supermarkets, National Food Products Company, and Brasil Foods (owner of Sadia chicken brand). Kizad Polymers Park has been developed with Borouge as a strategic partner, and hosts facilities for companies such as Cosmoplast and Songwon.

In logistics and distribution, Kizad houses important third-party providers such as DHL, Schmidt, Agility Logistics and GAC, as well as several companies managing their own supply chains such as Al Futtaim Group and Ghassan Aboud.

Investment in Kizad continues to increase strongly year-on-year. The cumulative investment was estimated to be around $19 billion by August 2019. This figure was up from $18.6 billion at 2018 end, representing 12 per cent growth (from $17 billion) at the end of 2017.

Kizad has over the last decade been building an integrated port based industrial ecosystem for Abu Dhabi.

“The effort has been towards providing all the key components that are critical for manufacturers to thrive. These include multi-modal connectivity options to reach local, regional and global markets - excellent pre-built facilities such as warehouses and light industrial units by sea, road, air and soon rail,” said Chaturvedi.

Chaturvedi said growth will continue across Kizad’s main industrial clusters, supported by its strongly pro-business environment.

The incentives for doing business at Kizad are numerous. Recently, charges for over 75 per cent of services were waived to make it even easier for firms to set-up and do business at Kizad. And while clients at Kizad benefit from highly competitive fees, the zone’s main advantage remains servicing of the fundamental needs of industrial businesses. The support offered is long-term in a healthy industrial ecosystem, far beyond one-off incentives.

The zone is also increasing its product portfolio to meet a wider range of customer needs, making its ecosystem even more competitive.

Chaturvedi said Kizad’s ecosystem makes customers competitive across four key areas: speed, cost, scale, and community.

He explained: “We offer speed of setup and going to market; competitive cost of overall operations; the scale businesses need to grow; and a community of associated businesses that enables shared success.

“Our value proposition is intrinsically linked to the attractiveness of Abu Dhabi and immediate access to Khalifa Port, which offers direct links to 70 international destinations via more than 25 shipping lines. Add to that the zone’s location between Dubai and Abu Dhabi, with exceptional landward connectivity, and Kizad is very attractive for anyone looking to serve the local, regional or global markets.”

In addition to a prime location, clients can benefit from huge cost-savings for energy-intensive industries, including access to continuous gas supply and the lowest power cost in the country. In fact, our power costs are among the most competitive in the world.

Also on the cards is expansion in capacity at Khalifa Port that will further drive trade-oriented business at Kizad. Chaturvedi said Abu Dhabi Ports is committed to expanding capacity to 9.1 million TEU by 2024.

In Q1 2018, container volume at the port grew from 621,000 TEU to more than 1.1 million in 2019. “As infrastructure improves, Kizad will increasingly become an international hub for industry – with our 410 sq km of land providing ample space for future construction,” he added.

In the local context, Kizad’s contribution to the UAE economy has been significant. The zone is committed to developing Abu Dhabi and the UAE as an international manufacturing hub, with industries that can serve both regional and global industries at scale – while also leveraging the country’s natural advantages, such as access to abundant energy.

Currently, Kizad and Abu Dhabi Ports together contribute 3.6 per cent of Abu Dhabi’s non-oil GDP, or around Dh19.6 billion. This is estimated to reach 15 per cent by 2030. The additional share of GDP will primarily come from new activity added to Abu Dhabi’s economy.

Kizad, Chaturvedi said, will help drive that growth, building manufacturing capacity across several target sectors, polymers, metals, food, automotive, and oil and gas. Key advantages to capitalise on include well-established logistics, energy infrastructure and services available within the zone.