Private and public sector entities try to keep pace with current technology and communication methods by using computer equipment in-line with what the current market offers. Computers of US origin are seen as attractive buys for those wanting quality products, as the margin of pricing is negligible when compared to a locally assembled machine. US manufacturers are looked upon as market leaders and will maintain their edge to the extent that they continue to be able to introduce state-of-theart technology and products at competitive prices. A factor that has grown this market is the e-enablement of local government offices. The sole local ISP has also been trying to increase the number of users for Internet access. Growing awareness of the value of accessing the internet has augmented the home PC market, which is expected to further increase. Local governments are placing great emphasis on Information Technology (IT) being made available in public schools. Computer assembly plants in the Jebel Al Free Zone (JAFZA) assemble Acer and Supra brands. Such products, when brought into the UAE from JAFZA are considered imports.
The estimated recorded market share of 9% in 2006 for US computer imports into the UAE does not reflect the true picture, as US computer branded products are also imported from factories located outside of the US. Major competitors are China, Germany, UK, Japan, Taiwan and the Netherlands. There are no import restrictions for the computer industry. Effective January 1, 2003, customs duty became five percent. US companies need to obtain USG approval before exporting certain high-end sophisticated computer equipment to the UAE.
The UAE Federal government approved for a second telecommunications company to offer services in the UAE to start on February 11, 2007. Our late President, His Highness Sheikh Zayed bin Sultan Al Nahyyan, made the initial announcement, providing for a second telecommunication company to operate in the UAE in April 2004 via Federal Decree No.3. This decree abrogated the exclusive operation of the telecommunication sector by Etisalat, the sole service provider for the UAE.
The duopoly in the telecom sector in the UAE will offer opportunities for companies offering products to telecom operators. It was hoped the duopoly would introduce competitive pricing in the telecommunication sector. To date little price competition has been seen in the market.