Khaldoon Khalifa Al Mubarak, CEO and Managing Director, Mubadala Investment Company: Interview

Interview: Khaldoon Khalifa Al Mubarak

How does the Mubadala Investment Company merger accelerate economic diversification?

KHALDOON KHALIFA AL MUBARAK: Mubadala was created in 2002 to support the vision of the UAE’s founding father, the late Sheikh Zayed bin Sultan Al Nahyan, who believed that sustainable development and a diversified economic base were vital to Abu Dhabi’s long-term prosperity. Over its 14-year history, Mubadala’s role has been to strengthen the emirate’s position in diverse sectors, markets and industries; build infrastructure that supports industrial, business and social development; and deploy capital globally. The long-term, positive impact of these initiatives is demonstrated through the market leadership of these assets, as well as through broader benefits such as job creation and the growth of a knowledge-based economy. The fact that non-oil sectors now make up over 64% of Abu Dhabi’s GDP is a significant point of pride. In terms of accelerating Abu Dhabi’s economic development, the merger with International Petroleum Investment Company (IPIC) to create Mubadala Investment Company was one such action taken by the government to deepen its diversification efforts. This combined entity will have significant scale; a stronger, more dynamic balance sheet; and expertise in a pool of industries vital to Abu Dhabi’s growth. Mubadala will have an even more central role in delivering the emirate’s economic plan and long-term vision. Economic diversification is not solely about non-oil industries – there are also opportunities to leverage the emirate’s competitive advantages in the wider hydrocarbon value chain, enhance private sector participation in industrial and business hubs, and build on the partnerships, networks and opportunities created by IPIC’s 30-year legacy.

What do Mubadala’s foreign investments bring to the wider economic development of Abu Dhabi?

AL MUBARAK: Mubadala’s focus will continue the efforts of both legacy companies to fulfil Abu Dhabi’s long-term vision for a globally integrated and diverse economy, and to operate as a trusted global business that partners with the world’s best companies and institutions. IPIC brings a significant international portfolio of 18 assets, boosting Mubadala’s international portfolio, including stakes in Cepsa, the Spanish integrated energy firm, and Borealis, one of the largest polyolefin producers in the world, which has helped bring petrochemicals back to Abu Dhabi through Borouge, a joint venture with Abu Dhabi National Oil Company. As a combined entity, Mubadala will be active globally, with partnerships and subsidiaries in more than 30 countries. We foresee opportunities to support Abu Dhabi’s vision through global investment.

Where do you see opportunities for further private sector participation in economic diversification?

AL MUBARAK: We see a significant opportunity for small and medium-sized enterprises (SMEs) to participate in the opportunities created by industrial diversification, and there are some great examples of where this is already happening. Strata, for instance, is creating a robust local supplier network. More than 50% of its suppliers are based in the UAE and almost 90% are SMEs, supporting the development of Emirati entrepreneurship and capabilities in the aerospace industry. Our joint investment with Investment Corporation of Dubai to create Emirates Global Aluminium is also focused on developing an effective and sustainable supply chain, and also acting as a foundation of the UAE’s aluminium ecosystem that employs around 22,000 people. In 2016 Emirates Global Aluminium began supplying local customers in Al Taweelah with liquid metal via a dedicated hot metal road, reducing costs and environmental emissions, while also stimulating private sector opportunities. The partnership model has proven highly effective in accelerating Mubadala’s strategic objectives to establish new industries for our economy.