UAE: Dubai Customs Inks E-Commerce Cooperation Deal with JAFZA

Dubai Customs and the Jebel Ali Free Zone (Jafza) have signed an e-commerce cooperation agreement that allows Jafza, one of the flagship free zones in the emirate, to use and integrate various Dubai Customs services and benefits available on its cross-border e-commerce platform. According to the Dubai Customs release, its platform uses block chain technology to integrate and automate operations between customs, free zones, logistics, and courier companies. It is the first of its kind in the region, and aims to help the emirate become a global hub for e-commerce, and encourage e-commerce companies set up businesses in Dubai. 

The agreement encourages Dubai Customs to work with Jafza on developing e-commerce services that continue to improve Dubai’s external e-trade capabilities and keep up the sector’s growing momentum. Abdullah Mohammed Al Khaja, Executive Director of the Clients Management Division at Dubai Customs said: “The number of e-commerce parcels has increased in the first half of 2020 to 4.3 million, marking a staggering 150% growth compared to the corresponding period in 2019.” 

The government’s plan is to raise Dubai-based companies’ domestic and regional distribution share of e-commerce trade in the emirate to about AED24 billion (US$ 6.54 billion) by 2022, through a 20% reduction in e-commerce operational costs. Al Khaja said that this agreement will expand the number of beneficiaries using the system, and make sure that the best e-commerce services are delivered to Jafza-located operations. 

Abdulla bin Damithan, Chief Commercial Officer at DP World, UAE Region, which owns and runs Jafza, said that the Free Zone’s e-commerce and retail sectors are growing fast, seeing 10.6% growth in the first half of 2020 and making AED37.6 billion in revenue. There has also been a 300% surge in demand for e-commerce services, so the zone is urging its registered firms to beef up online capabilities as quickly as possible.