Transcript INDUSTRIALIZATION IN MIDDLE EAST

INDUSTRIALIZATION
IN
MIDDLE EAST
Presented by
Just & Fair Consultants
Industrial Consultants & Engineers
(A Member Firm of AGN International)
P.O. Box: 124600, Dubai – U.A.E
Tel: +971 4 3354233, Fax: +971 4 3351711
Email: [email protected]
Web: www.jfc-group.com
WHAT IS INDUSTRIALIZATION?
• Industrialization is a process of social and economic change
whereby a human group is transformed from a pre-industrial
society into an industrial one.
• It is a part of a wider modernization process, where social
change and economic development are closely related with
technological innovation, particularly with the development of
large-scale energy and metallurgy production.
• Industrialization also introduces a form of philosophical change,
where people obtain a different attitude towards their
perception of nature.
INDUSRIALISATION HISTORY - COUNTRIES
•
The industrial revolution had started first in Britain in the 19th century
which spread to other countries during 19th and 20th century.
•
This created major changes in agriculture, manufacturing and
transportation which had a profound effect on the socio-economic and
cultural conditions in Britain and other countries.
•
The world’s most industrialized democracies of United States of
America, Japan, Canada, France, Germany, Italy, United Kingdom and
Russia are popularly called Group of Eight (G8) Nations.
•
Together, the G8 countries represent about 65% of the Gross World
Product, the majority of global military power (seven are in the top 8
nations for military expenditure), and almost all of the world's active
nuclear weapons.
•
The eight countries making up the G8 represent about 14% of the
world population, but they account for 65% of the world's economic
output measured by gross domestic product
GDP & INDUSTRIAL GROWTH IN MOST
INDUSTRIALIZED NATIONS
COUNTRIES
GDP
in bln USD
Per capita
income
in USD
Ind. Growth
Rate (%)
United States
13,780
45,800
-1.70%
Japan
4,272
33,500
1.30%
Germany
2,807
34,100
5.20%
United Kingdom
2,130
35,000
0.50%
Russia
2,097
14,800
7.40%
France
2,075
32,600
1.80%
Italy
1,800
30,900
0.60%
Canada
1,271
38,600
0.30%
POPULATION & LABOUR FORCE IN MOST
INDUSTRIALIZED NATIONS
COUNTRIES
Population
(In Millions)
Labour Force
(In Millions)
United States
303.82
153.10
Japan
127.29
66.69
Germany
82.37
43.54
United Kingdom
60.94
30.89
Russia
140.70
75.10
France
64.06
27.91
Italy
58.15
24.74
Canada
33.21
17.95
INDUSTRIALIZED Vs DEVELOPING
COUNTRIES
• The industrialized country is called & known as developed
country. The concept of “Industrial Countries" is to be preferred
to “Developed Countries".
• There is a striking difference in the employment figures when
comparing the industrial and developing countries.
• The industrial sector accounts for 33% of the workforce in the
industrial countries but only 10% in the developing ones.
• Agriculture employs 61% of the working population in
developing countries but a mere 10% in the industrial ones.
• The service sector occupies a great proportion of the workforce
in industrial countries, which is 57%, while it is only 23% in the
developing countries.
ECONOMIES OF INDUSTRIAL SOCIETIES
• The Urbanization of Production
• Rise in Productivity leads to rise in living standard.
• The Shift from Labor-Intensive to Capital-Intensive
Industries
• Changes in the Labor Force
• The Rise of Market Economies
• Moves Toward Mixed Economies
• Evolution of the Modern Corporation
OUTLOOK OF INDUSTRIALIZED ECONOMIES
Vs ECONOMIES IN THE REGION
• The growth momentum of the world economy is clearly slowing
from the second half of 2008 and growth is likely to remain
subdued during 2009 and few years thereafter.
• Barring major catastrophes affecting the world economy, a
modest upturn is likely to start in the second half of the year
2009 in response to additional policy stimulus in industrial
countries, particularly in the US, Euro area and Japan.
• Consumption demand has played an important role in the past
few years in supporting economic growth in industrial countries,
particularly in the US.
• The upturn in industrial countries is projected to further
strengthen in 2009 as uncertainties in the world economy abate.
• In contrast to the substantial slow down in industrialized
countries, economies of Middle East world likely to grow at
much faster pace.
• GCC countries and Iran in Middle East are implementing big
agenda for substantial industrialization and growth.
DRIVING FACTORS OF
INDUSTRIALIZATION
• Liquid Capital
• Natural Resources
• Infrastructure
• Technological Advancement
• Cheap Labor
• Sources of Energy
• Markets
• New forms of Business Organization
RESULTS OF INDUSTRIALIZATION
• Overall economic growth.
• Rapid growth of cities and increased immigration
• New emphasis on Scientific Research and Development
• Beginning of Mass Marketing
• Employment opportunities and better living conditions
• Exploitation of natural resources
MIDDLE EAST REGION
Middle East Countries
Kuwait
Bahrain
Oman
Qatar
Saudi Arabia
United Arab Emirates
Yemen
Egypt
Turkey
Syria
Jordan
Lebanon
Iran
Iraq
Industrialization in Middle East
•
Given opportunities and emerging economic factors, the Middle East region is being
considered for investment and commerce especially the GCC Countries.
•
Although major multinationals are in the region, global midsized companies ($200800 million) are expanding in this region.
•
Region is currently stable and governments are investing heavily in infrastructure.
•
Real Estate has been the driver of growth in the middle east which has resulted in
industrial expansion as well.
•
Most governments in GCC and Gulf are keen in developing huge industrial base and
there is clear shift in the policy.
•
Petro Dollar surplus and thrust for value addition by using energy resources for down
stream projects would lead to huge industrialization which can sustain the growth for
next two decades.
MIDDLE EAST - ECONOMY
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The Middle East economy is USD 3.36 Trillion economy with an average
annual industrial growth rate of 5%.
The GCC per capita income ranks among the highest in the world due
to its enormous oil and gas wealth.
Having high per capita income of USD 20,000 on an average while
Qatar’s per capita income of USD 80,900 is the highest in the world.
The GCC nations mainly depend on oil & gas and hold almost 42% of
world’s proven oil resources.
The region’s economy is traditionally a trade and commerce based
economy due to its excellent geographical location, but given the huge
resources and liquid capital, big change is expected for the drive
towards industrialization.
POPULATION Vs LABOUR FORCE
Population Vs Labour Force
90.00
77.50
80.00
71.21
70.59
60.00
50.00
40.00
30.00
24.00
23.51
18.70
20.00
10.00
3.10
0.66
3.20
1.41
17.16
5.31 3.68
4.50
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Population
Countries
Labour Force
GDP & INDUSTRIAL GROWTH IN
MIDDLE EAST REGION
Countries
GDP
in bln USD
Per capita income
in USD
Ind. growth
rate (%)
Kuwait
130
39,300
1.7%
Bahrain
25
32,100
5.2%
Oman
62
24,000
3.2%
Qatar
58
80,900
8.0%
Saudi
Arabia
565
23,200
2.9%
U.A.E
167
37,300
4.3%
Yemen
52
2,300
3.2%
Egypt
404
5,500
7.5%
Turkey
888
12,900
5.4%
Syria
87
4,500
2.5%
Jordan
28
4,900
7.7%
Lebanon
42
11,300
Iran
753
10,600
4.8%
Iraq
102
3,600
7.9%
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EASE OF DOING BUSINESS- GLOBAL
RANKING FOR MIDDLE EAST
Ease of Doing Business- Global Rank
160
152
137
140
114
120
98
100
99
101
80
60
46
52
57
37
40
16
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CHARACTERISTICS OF MIDDLE EAST
MARKET
• Young societies
• Rapid economic growth
• Continuous inflow of foreign capital
• High standard of living
• Countries competing with each other
• Economic link between Europe and Asia
DRIVING FACTORS FOR
INDUSTRIALIZATION IN M.E.
• Population growth
• Diversification from oil and gas
• Regional growth/Intra Port trade
• World trade organization membership
• Oil and Gas
• Tourism
• Freehold ownership for expatriates
MIDDLE EAST OUTLOOK
• The Middle East countries are going to play the key role in
reconstruction of the current global financial turmoil especially,
the GCC Countries.
• The Industrial Products sector is large and diverse in the Middle
East, but most sector players face similar challenges.
• Increased costs for oil, natural gas, steel, copper and plastics
are squeezing margins, unless offset by pricing and surcharge
increases.
• There is significant pressure as competition increases,
particularly from low-cost manufacturing centers such as China.
KEY SECTORS
Energy &
Power
Building &
Construction
(including interior
furnishings)
Manufacturing,
Consumer goods,
Pharmaceuticals,
Food & Beverages
Petrochemicals in
downstream
Transport & Logistics
services
POTENTIAL SECTORS IN MIDDLE EAST
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Petrochemical & Energy Sectors
Electricity and Power Generation
Manufacturing of FMCG, Pharmaceuticals & others.
Banking & Islamic finance
Environmental Equipment & Services
Automotives
Railroad & Locomotive Equipment
Medical Equipment
Hotel & Restaurant Equipment
THANK YOU
Prepared By
JUST & FAIR CONSULTANTS
Industrial, Business & Management Consultants
(A Member Firm of AGN International)
DUBAI
# 3 Oud Metha Building,
8/319, Oud Metha Area,
P.O. Box 124600
Dubai- UAE.
Tel: +971 4 3354233
Fax: +971 4 3351711
ABU DHABI
1102, Al Ahlia Insurance Building,
Hamdan Street,
P.O. Box 29236
Abu Dhabi, UAE.
Tel: +971 2 6260480
Fax: +971 2 6260490
Email: [email protected],
Web : www.jfc-group.com
Email: [email protected]