America's best sales prospects in the UAE - United Arab Emigrates

Nation's Business, Oct, 1992

The seven emirates that make up the United Arab Emirates (UAE) have ambitious plans to increase their oil and gas production capacity and to upgrade their national infrastructure over the next several years. The residents of the emirates are affluent and enjoy spending their money. These and other factors add up to excellent sales opportunities for U.S. companies. Here is a brief look at the best prospects, according to the U.S. Department of Commerce.

Air Conditioning and Refrigeration Equipment. Temperatures can reach 120 degrees Fahrenheit in the UAE, so sales of airconditioning equipment totaled a robust $120 million in 1991, and refrigeration equipment sales were $15 million. The market for these products is competitive.

Architectural and Engineering Services. Contracts for these services in this growing nation total over $750 million annually. Competition is fierce, but U.S. firms have been highly successful in areas such as design of facilities for oil and gas extraction, water desalination, and power generation.

Computers, Peripherals, and Software. The big U.S. computer makers' continued success in the UAE has spawned strong demand for compatible software and peripheral products. Newly strengthened intellectual-property laws could dramatically increase sales of copyrighted software.

Construction and Related Equipment. The UAE will spend at least $5 billion during 1992-94 to construct or refurbish its infrastructure. U.S. construction firms and American-made construction equipment generally enjoy excellent reputations in the UAE.

Consumer Goods. The high per-capita income of citizens of the Emirates creates a continuing strong demand for consumer goods of every imaginable kind. Although the UAE's consumers are affluent, they are nonetheless price-conscious and expect high quality.

Cosmetics and Toiletries. The UAE's imports of these products total about $190 million a year, with about $22 million of imports coming from the United States. an products enjoy good reputations, and additional marketing could lead to increased sales.

Food-processing Equipment. Though the UAE, imports about 80 percent of its food, the country produces some milk and related products and is self-sufficient in baked goods. Sales opportunities abound for processing equipment in these areas and for certain types of packaging equipment.

Industrial Chemicals. Last year, the UAE imported more than $250 million worth of industrial chemicals such as disinfectants, insecticides, fungicides, and anti-corrosive products. Sales have been growing 9 percent a year on average as a result of the harsh climate.

Medical Equipment. The UAE plans to spend more than $400 million during 1992-94 to build new medical facilities and upgrade existing ones. Related equipment that will be needed includes surgical supplies and appliances, laboratory analysis instruments, and cancer diagnosis tools.

Oil and Gas Extraction Equipment and Services. The UAE will spend an estimated $8 billion in 1992-94 on oil and gas field projects. The U .S. provides at least half of current UAE imports of energy-production equipment, and U.S. goods are regarded as high in quality.

Pharmaceuticals. The U.S. accounts for about 10 percent of the UAE's pharmaceutical imports, and American products are held in high esteem. Current favorable exchange rates could help U.S. firms win additional sales at the expense of their German and Swiss competitors.

Power Generation Equipment. The UAE's demand for electric power is increasing 10 percent a year, prompting plans for construction or expansion of several power plants;. The cost of these projects will be an estimated $2.5 billion. Demand for related equipment should be high.

Telecommunications Equipment. The Emirates Telecommunications Corp. plans to spend about $500 million during 1992-94 to improve and expand its networks. Planned projects include construction of fiber optic links, enhanced exchanges, and expansion of mobile phone coverage.

Textiles. Most carpets, rugs, linens, and apparel in the UAE are imported. While American firms have fared well in the floor-covering and linen markets, they account for only 5 percent of UAE clothing imports. Aggressive marketing could lead to additional sales.

Water Desalination Equipment. The Emirates currently desalinate approximately 200 million gallons of water a day at 30 or more sites. Related consulting and engineering services and equipment provide a potentially lucrative market for American firms.