Dubai's non-oil foreign trade touches Dh1 trillion in 2020
Figures show non-oil foreign trade strongly rebounded from the challenges of Covid.
Dubai on Saturday said its non-oil foreign trade hit Dh1.182 trillion last year despite headwinds from an intensified global economic downturn.
Spurred by its efforts to achieve Dh2 trillion trade target by 2025, the emirate’s non-oil foreign trade strongly rebounded from the challenges posed by the global economic repercussions of Covid-19 and the suspension of business activity by countries across the world in the first half of last year to record high growth in 2020.
The emirate, which recorded Dh1.37 trillion foreign trade in 2019 before the pandemic strike, proved its resilience to global headwinds, as well as its rapid economic recovery and revitalised growth in the second half of the year, by sustaining steady growth in foreign trade.
“Total trade volume in 2020 reached 100 million tonnes, driven by a six per cent year-on-year volume growth in the second half of the year. Overall value of exports in 2020 grew eight per cent to Dh167 billion while imports accounted for Dh686 billion and re-exports totalled Dh329 billion,” according to official data released on Saturday.
Sheikh Hamdan bin Mohammed bin Rashid Al Maktoum, Crown Prince of Dubai and Chairman of Dubai Executive Council, said the exceptional growth performance of Dubai’s external trade sector reflects the emirate’s impressive resilience and its ability to recover and grow amidst international crises.
“Dubai has set an example for the world in dealing with both the economic and health repercussions of the pandemic. We were able to quickly renew our momentum of growth and reestablish our global leadership in various sectors,” Sheikh Hamdan said.
“This growth has been made possible by robust governance and the stimulus packages the Dubai Government launched under the directives of His Highness Sheikh Mohammed bin Rashid Al Maktoum, Vice-President and Prime Minister of the UAE and Ruler of Dubai. The stimulus packages included a number of initiatives to support the foreign trade sector and enable it to continue playing its important role in national economic growth. The strong trade performance signals a positive start to the ‘Year of the 50th’’ and the efforts to achieve the goals of the UAE Centennial Plan 2071,” noted Sheikh Hamdan.
Sheikh Hamdan said the external trade sector’s distinctive growth in 2020 will boost the implementation of Dubai’s five-year plan to expand its external trade to Dh2 trillion, consolidating the emirate’s position as a leading regional and global trade and investment hub.
“Dubai’s new international trade map will see an expansion in air and sea navigation routes, with 200 new cities set to be added to the emirate’s existing network of 400 cities,” the Crown Prince said, adding that Dubai will continue its efforts to generate new practical and creative solutions to tide over challenges and turn them into new opportunities.
2020 1.182 . pic.twitter.com/16TS4B8L0H— Hamdan bin Mohammed (@HamdanMohammed) April 10, 2021
China remains a top trading partner
Dubai’s direct trade reached at Dh711 billion last year while trade through free zones hit Dh464 billion and customs warehouse trade weighed in at Dh7 billion. Airborne trade accounted for Dh559 billion, sea trade reached Dh421 billion while land trade touched Dh203 billion.
China maintained its position as Dubai’s largest trading partner in 2020 with Dh142 billion worth of trade. India came in second with Dh89 billion, followed by the US in third place with Dh61 billion.
Saudi Arabia continued to be Dubai’s largest Gulf and Arab trade partner and its fourth largest global trade partner with Dh54 billion worth of trade, followed by Iraq in the fifth place with Dh41 billion.
Defies Covid-19 pandemic
Sultan bin Sulayem, DP World Group Chairman and CEO and Chairman of Ports, Customs and Free Zone Corporation said Dubai’s external trade sector impressively overcame the impact of a global trade downturn in 2020.
“With the gradual opening of borders, Dubai’s trade volumes started recovering and growing quickly in the second half of 2020. In the third quarter, Dubai’s trade surged 34 per cent compared to second quarter. Trade grew by seven per cent to Dh326 billion in fourth quarter compared to the third quarter of 2020,” Bin Sulayem said.
He said trade volumes in the second half of 2020 expanded by six per cent compared to the corresponding period in 2019. Overall, 100 million tonnes of goods were traded in 2020, which reflects the rapid recovery of this sector. This rebound is now spurring greater growth in 2021, he said.
“The resumption of trade with Qatar, the start of trade engagement with Israel, the positive spin-offs from hosting EXPO 2020 and the launch of the Dubai 2040 Urban Master Plan will all contribute to accelerating the emirate’s growth momentum,” he said.
To develop the external trade sector and play a greater role in maintaining Dubai’s leading position in global trade, Bin Sulayem said the Dubai Chamber has been restructured by creating three new chambers of commerce.
“The new chambers will enhance support for the trade sector by creating new solutions for the needs of investors and companies as part of a strategy to grow the emirate’s global trade in line with the vision of Dubai’s leadership for the next 50 years,” he said.
Gold top traded commodity
Gold topped the list of commodities in Dubai’s 2020 external trade at Dh213 billion, followed by telecoms at Dh153 billion. Diamonds came third with Dh64 billion, followed by petroleum oils with Dh57 billion and jewellery with Dh47 billion, according to the official data.
Monica Malik, chief economist at Abu Dhabi Commercial Bank, said Dubai as a global transhipment hub was in a strong position to benefit from the shift in spending towards good as a result of the pandemic, which boosted trade and manufacturing activity.
“We continued to see strong trade activity through Dubai in 2021 with continued Covid waves including in Europe, maintaining the strong demand for goods. Moreover, the rebound in global growth is also a positive driver,” Malik told Khaleej Times on Saturday.
Shailesh Dash, a Dubai-based financier and entrepreneur, attributed steady non-oil foreign trade to the government’s stimulus packages and timely relief measures announced by the government to facilitate businesses and investors despite challenging environment caused by the Covid-19 pandemic.
“The credit to sustain positive trends in non-oil foreign trade goes to number of initiatives announced by the government to revive economic activity at the earliest. We have a bright outlook ahead for economt as the IMF also doubles the GDP growth forecast for the UAE in 2021,” Dash said.
He said Expo 2020 starting in October this year will be catalyst to drive tourism and hospitality sectors in coming years while real estate and retail will continue to strengthen the economy.
Atik Munshi, managing partner at Enterprise House, said the Emirate of Dubai, since long has a target of lesser reliance on oil based earnings and this aspect has materialised more and more over the years. The current achievement of crossing Dh1 trillion non-oil revenues is a result of this government drive.
“The UAE and Dubai are among the very few states in the world who have tackled the Covid challenge in an amazing way which has ensured that businesses and social aspects are affected in the least possible manner. The government incentives in the form of stimulus packages, vision 2040, vaccination drives, Make in UAE initiative, long term visas, etc, has helped in bringing more FDI and has built investor confidence. More positive news are expected in the future,” Munshi said.
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