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ICT, an Enabler for the Manufacturing Sector in Dubai


13-01-2014
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Official figures released by the Department of Economic Development and other related organizations in Dubai reveal that the manufacturing sector is one of the major contributors to  the gross domestic product (GDP) of Dubai. According to these organizations, the sector also contributes significantly to Dubai exports and employment. But in spite of this, and as in many other developing countries, Dubai's manufacturing sector contribution to GDP is still very low compared with developed countries, which adopt the most recent innovations in all aspects including ICT.
The ICT covers component and final products (including hardware and software) and services that utilize electronic, photonic or similar means to collect, record, convert, store, process, analyze and communicate data and/or information. There is large scope for utilizing ICT effectively in the manufacturing sector. In addition to ICT's role in improving production and productivity, it has an important role in the functions of selling and buying, management and administration, and in supporting the enterprise's communication with external parties like customers, suppliers and partners.
Many studies concluded that new technology including ICT has made large contributions to productivity growth in the manufacturing industries. An example is a study by Gilchrist on manufacturing companies in the USA, which showed that ICT had significant impact on labor productivity and on multi factor productivity growth. Similar results were recorded in other developed countries in Europe and Asia. However, there are large variations in the growth of productivity rates of different manufacturing industries, where the less technology oriented and lower capital industries are recording lower productivity growth rates.
ICT is now increasingly adopted in the various aspects of manufacturing in developed countries, because it can play a significant role in supporting process improvement, increasing productivity and reducing costs and time. The miniaturization of microprocessors combined with the development of cellular networks for mobile communication will lead to the implantation of communicating microprocessors in all kinds of equipment.
UAE, especially Dubai, is considered among the top countries in the region in the field of ICT. Hence, Dubai should make use of its strong position in ICT and avoid isolating itself from the changes brought about by global ICT developments. It is therefore imperative for Dubais manufacturing sector to adopt ICT to compete in an increasingly globalised market. However, Dubai may face challenges in adopting ICT in the manufacturing sector, some of which include:
- Availability of adequate capital to invest in modern ICT systems specially in small and medium manufacturing enterprises which form the majority of enterprises in the sector
- Availability and cost of skilled ICT human resources.
- Lack of dedicated research and development in the field of ICT.
Dubai needs to work hard in order to enable its manufacturing sector to benefit from ICT and the developments that take place in the field. The following recommendations may be considered:
- The concerned Government authorities should formulate and implement comprehensive ICT strategies that help manufacturing enterprises in Dubai to adopt ICT in their various processes and activities.
- Encourage the manufacturing investors to use high technology in their factories to be able to adopt and make use of the developments in ICT and to be able to compete in the local and international markets.
- Encourage top management to offer strong support to the adoption of ICT in their factories'.
- Encourage top management to introduce innovative organizational culture, skilled ICT personnel and other resources to help utilize the promised benefits of ICT.
- Encourage research and innovation in ICT for manufacturing.
- The Dubai government may provide adequate resources to help in adopting ICT in the manufacturing sector, as the manufacturing enterprises in Dubai are mostly small and medium size enterprises with limited resources.

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Abdelrahman Yousif is an expert at b'huth, and a previous expert at Dubai's Department of Economic Development.

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ICT, an Enabler for the Manufacturing Sector in Dubai

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