As Mubadala Development celebrates 10 years of operations, Khaldoon Al Mubarak, the chief executive and managing director, reflects on the company’s first decade and gives his thoughts on the future.
How has Mubadala changed in 10 years?
It's been an incredibly enjoyable journey, and a very fulfilling one. If in 2002 I was asked to project 10 years ahead, it would have been impossible to see where we are now. If you'd put the 2012 annual report in front of me then, no way would I have said it was possible. Its origins lie in the Dolphin oil and gas project. Dolphin was the code name, maybe because a dolphin goes up and down in the sea, like a pipeline. It was a very delicate project, the first multi-country regional project, involving Qatar, Oman and UAE. Dolphin represents Mubadala [a strategic investment company owned by the Abu Dhabi Government] in every way: it was a difficult project, with large investment, with global implications in energy, involving the creation of large-scale job opportunities. It involved foreign equity and a complex financing structure. It was a classic Mubadala project in every way, and a template for the future.
What are the big milestones of the past 10 years?
There are several projects to which I've become emotionally attached. Dolphin, of course, but also Emal [Emirates Aluminium].
It's an ambitious industrial project in the new economic and industrial zone, near the new Khalifa port. Emal is on schedule, and is a big employer in the UAE. It also involves partnership with Dubai, and has a tangible contribution to UAE's GDP. It's a true macro project, and has genuine Emirati leadership.
I've also got a big emotional attachment to Yahsat, the satellite business. We are going into space, it's incredible. And it's an Emirati programme of great complexity, involving financing the project, the design and construction of two satellites, launching them and getting them into an orbital position. Now we are selling telecoms space from Afghanistan to South Africa.
But the heart of the Mubadala portfolio, and your biggest revenue earner, is the semiconductor business. Tell me why that's so important.
Part of our mission is to help with the diversification of the Abu Dhabi economy and add value to Abu Dhabi. That was oil and gas focused in the beginning, then later expanded into ICT [information and communications technology], health care and other technology. But GlobalFoundries is a worldwide platform in one of the most exciting fields in business today - the future of telecommunications. We're managing one of the most complex engineering processes imaginable, with manufacturing in New York and Dresden, Germany. It gives us true global scope.
And we will have manufacturing facilities in the UAE. It has always been part of the plan to have a trained workforce here. We need to think about location, with proximity to the airport and other transport links. The geography is very important here.
We've been through the most severe global financial crisis. What has Mubadala learnt from that?
It's certainly true the world is evolving in a dramatic and erratic way. We have had to learn these past few years and progress through economic instability and crisis. The team worked hard to deal with it in 2008, and they will have to continue to do so, because this crisis is not over. We learnt to be resilient, to develop thick skins and be patient, how to refine asset allocation and learn to weather the storm. We've come out of this different people, but better people.
Can I ask you about aerospace, which is another major contributor to revenue?
There are two businesses. First manufacturing, which is another operation I'm very attached to emotionally. If you'd told me 10 years ago that down in Al Ain there would be a workforce with UAE nationals, including female workers, putting together composite material products for Boeing and Airbus, I wouldn't have believed you.
The business, Strata, is a wonderful product and I have lots of aspirations for it. We will commit significantly to it. Then there is aircraft maintenance and overhaul, where we have started to progress into military aspects of the operation. Globally it is an industry in change, and we have to be very patient. I don't know where it [the global industry] will end up after the failure of the BAE/EADS merger.
Real estate has been problematic throughout the UAE for the past couple of years. What is your view?
I wouldn't consider it a significant part of our portfolio. We're involved mainly through our role in Al Maryah Island, where we're building the Cleveland Clinic. Al Maryah is a flagship development that will house the stock exchange, the commercial towers as well as our hospital and a retail galleria. That's a very interesting project that affects us in every way … I should say more about health care. It's a very good business, which makes a profit but also brings a direct tangible benefit to the UAE. Our clinics have changed people's lives. I regularly take calls from fathers and mothers of children with diabetes. There's also the Knee and Sports Medicine Clinic, where I've had direct experience of the benefit.
A few years back I needed an operation and had to go to New York, which basically involved taking a whole month out, what with travel, surgery and recuperation. Now we have those kinds of facilities here in the UAE. I had a recurrence of the injury recently and was back at my desk in two days. That's my personal experience in health care.
That's how Mubadala serves Abu Dhabi and the country in a very tangible way.
We are a contributor to the diversification of the UAE and now a global player, in New York, Europe, Singapore, Nigeria, Algeria. It's been an incredible journey and I never dreamed we'd get this far in 10 years.
