T

he United Arab Emirates (UAE) is encouraging Indonesian companies to set up businesses in Jafza, the country'€™s largest free-trade zone, in Dubai as the special business area can be used as a gateway to the Middle East.

Ibrahim Al Janahi, Jafza CEO, said in Jakarta on Tuesday that the strategically located Jafza economic-free zone would not only provide tax incentives but also multimodal connectivity such as airports, seaports and railways to support shipment and other trade activities.

Jafza, for example, offers incentives such as zero percent personal income tax; zero percent import or reexport duties; and no currency restrictions, said Ibrahim, who is currently visiting Indonesia as part of the UAE trade delegation.

Ibrahim said that the free-trade zone would become a strategic trade gateway to other Middle East countries and some European countries.

'€œJafza is a strategic gateway for Indonesian enterprises to enter the global market,'€ said Ibrahim. '€œIn Jafza, the UAE government not only provides world-class infrastructure to Indonesian entrepreneurs, but also numerous incentives that will benefit their business,'€ Ibrahim said during a meeting with government officials.

Edy Putra Irawady, the deputy of the coordinating economic minister, said that the Jafza also provided a special training program for Indonesia'€™s small and medium enterprises (SMEs) wanting to set up in the free trade zone.

'€œThey offer an incubator located within the Jafza area. Through the incubator, Indonesian companies will have access to training programs to be able to meet market demand,'€ he said.

'€œThis is big chance for SMEs to go international,'€ said Edy.

Local SMEs are expected to produce and sell unique products that are more competitive than items from other countries, Edy said.

'€œMuslim clothes, halal food and fishery products are some of the items that have the potential to compete in the Middle East market,'€ Edy said.

Despite these advantages, currently there are only three Indonesian companies operating in Jatza. They include PT Astra Otoparts (AUTO), part of conglomerate PT Astra International (ASII).

Jafza was launched in 1985 with only 19 companies, but today it is home to over 7,300 multinational corporations, including over 500 enterprises, from 125 countries.

Jafza attracts more than 20 percent of the UAE'€™s foreign direct investment with non-oil international trade value of US$90 billion. (alz)