How Is ICV Befitting UAE Economy?

May 12, 2022Dated:  | |

In November 2017, the Abu Dhabi National Oil Company (ADNOC) Group Companies announced an In-Country Value (ICV) program with the goals of Emiratization, GDP Diversification, and Strategic Considerations. 

The program considers local manufacturing expenditure, local products and services, local investments, and Emirati hiring and development. Its goal is to boost domestic industry and redirect spending on goods and services back into the domestic economy.

In this post, we discuss the favorable impact of ICV on the UAE economy.

What is In-Country Value (ICV)?

The In-Country Value program aims to boost the UAE’s domestic economy. The National In-Country Value Program (ICV) seeks to help the Ministry of Industry and Advanced Technology improve the industrial sector’s performance and sustainability and thus boost UAE’s economy.

When deciding whom to award contracts to, ICV registered entities consider the “ICV score” an essential factor. Any company or individual who wishes to work with an ICV entity and reap the program’s benefits must first obtain ICV certification. The program is quite simple to grasp; there are ICV registered entities or companies that have adopted the ICV program.

Strategic Implications of Implementing the ICV Program

The objectives of the ICV are as follow:

Localization and Growth

The ICV aims to strategize supply chain localization and develop new local industries and services.

Attracting Foreign Investment

Improving the economy and attracting foreign investment, and diversifying the economy.

Employment Opportunities

Creating multiple job opportunities in the private sector

ICV Befits the Economy in UAE

As of December 2019, the AdnocICV program had returned over Dh44 billion ($12 billion) to the UAE economy. Over 3,000 companies in the UAE hold ICV certification. 

The ICV certificate also benefits businesses by granting them the first right of refusal in the tender process. ICV certification is entirely dependent on the company’s audited financial statements as per International Financial Reporting Standards (IFRS). 

When a company has multiple entities, each license within a group is treated as an independent legal entity, even if the owner is the same.

Over the last three years, the ICV program has produced outstanding results, re-injecting AED88 billion into the local economy and creating approximately 2,000 jobs for national talent. 

It has also aided in stimulating economic activity and expanding local businesses. The number of approved suppliers in the program’s various sectors has surpassed 5,000.

The ICV program has played a significant role in assisting the UAE in coping with the effects of COVID-19. The program has accelerated job creation, localized critical components of the Emirate’s supply chains, and increased GDP. Although COVID-19 has crippled many economies, the ICV program has helped mitigate its impact of COVID-19.

Wrapping Up

Entities that have joined the program must also make an active effort to seek out collaborative opportunities. This will help to increase job opportunities and demand for locally sourced services and goods.

Looking at the numbers, it is clear that the ICV program has positively impacted the economy thus far. Since the ICV program’s inception in January 2018, the program has seen substantial growth.

How Can We Help?

Flyingcolour can assist you with the ICV Certificate Sample or Supplier Submission Template, which suppliers must submit to certifying bodies.

Book your free consultation with us to know more about the comprehensive services. 

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