Exports have resulted in a raw material shortage for local factories, which have to import the raw materials for relatively higher prices. Meanwhile, local industrial waste is being exported at lower prices, especially to certain Asian countries. The meeting was briefed that this practice ultimately reduces the contribution of the domestic industry sector to the national GDP.
The meeting, chaired by the ministry’s Assistant Under-Secretary for Industrial Affairs, Abdullah Sultan Alfan Alshamsi, also saw representatives of local and federal government agencies in attendance. This included the Ministry of Climate Change and Environment; Ministry of Finance; Fujairah Department of Industry and Economy; Fujairah Municipality; Sharjah Municipality; Departments of Economic Development in various regions and the Federal Customs Authority.
Alshamsi called the issue strategically important, since support for national industrial development is vital for the ministry’s economic diversification policy as part of the UAE Vision 2021. He cited the results of a study conducted by the ministry on industrial waste exports in 2010-2014. The study found that waste-paper exports rose 54%, leather waste exports rose 33% and aluminium scrap exports rose 32%.
Alshamsi noted three of six paper mills in the UAE use waste paper for cardboard roll production. The mills have up to AED 1.1 billion in combined annual revenues and a total capacity of 396,000 tonnes. He noted that just 34% of total waste-paper is made available for domestic use, with 66% exported overseas. This results in an estimated shortage of 55,000 tonnes at the three plants, compensated by importing of costlier waste paper.
He added that a new paper plant is set to open in January 2017 in Abu Dhabi, and this will increase the shortage by around 200,000 tonnes. Similar shortfalls were highlighted for aluminium scrap and leather waste.
At the end of the meeting, it was recommended to submit a proposal for imposition of fees on raw leather and waste paper exports to the Council of Ministers. This will prevent excessive exports and make available more raw materials for the domestic industry.