Saudi Arabia largest export, re-export market for Dubai

DUBAI - Dubai Chamber members’ exports and re-exports to Saudi Arabia during the first six months of the year reached a total value of Dh36.3 billion, or 27 per cent of the overall total, making the kingdom the largest export market for the members.

By (Staff Report)

Published: Thu 16 Aug 2012, 10:26 PM

Last updated: Sat 4 Apr 2015, 7:24 AM

According to a study released by Dubai Chamber on Wednesday, Iraq was the second major export market for members of prestigious trade body with exports and re-exports valued at Dh19.4 billion during the first half.

Qatar, destination of goods valued at Dh10.4 billion; Kuwait (Dh8.8 billion), Oman (Dh5.1 billion) and India (Dh2.8 billion) were the other major markets for the chamer members.

Trade between UAE’s local companies and Dubai’s free zones and duty free shops placed the UAE as a large export and re-export market, registering an export value of Dh6.9 billion.

Hamad Buamim, director-general, Dubai Chamber, informed that the study indicates the pivotal role played by the trading sector led by the exports and re-exports of Dubai Chamber members which have shown an impressive growth in the first half of the year by making a record in the Chamber’s history of operations. “This excellent performance is the result of the traders’ determination to explore new and emerging destinations to market their goods and expand their global outreach,” he said.

The study further analysed that proximity and ease of movement of goods within the region had made the GCC countries the busiest export and re-export destinations for Dubai Chamber members. During the six-month period, 109,315 certificates of origin (COs) had been issued to export shipments destined to Saudi Arabia, equivalent to 30 per cent of all COs issued during the half yearly period.

Still, COs covering export shipments of members to Qatar reached a total of 60,810 or 16 per cent of the total number; to Kuwait, 35,146 COs or nine per cent; to Oman, 22,910 COs or six per cent; to Bahrain, 17,629 COs or five per cent; and to the UAE, 17,000 COs or five per cent of the total certificates of origin issued during the six-month period.

Meanwhile, in terms of number of members exporting to a particular country, Qatar was ahead of Saudi Arabia. During the six-month period, 3,540 members exported to Qatar, or 38 per cent, of the 9,194 exporters during the period. The number of exporters to Saudi Arabia was 130 less at 3,410, or 37 per cent.

The other GCC member countries made up the top six busiest destinations, with exporters to Kuwait numbering 2,344 or 25 per cent; to Bahrain, 1,439 exporters or 16 per cent; to Oman, 1,375 exporters or 15 per cent; and to the UAE, 1,119 exporters or 12 per cent. Non-GCC member countries with high number of exporters were Iraq, with 997 members exporting to the country; Jordan, with 992 exporters; and Egypt, with 963 exporters.

Iraq is fastest growing market

Comparative figures on export values to the various destinations for the first six months of the last two years singled out the rapid expansion of Iraq, with exports and re-exports to the country increasing from only AED 4.1 billion from January to June of 2011 to a high of Dh19.4 billion for the same period in 2012. The difference in value of Dh15.3 billion was equivalent to a year-on-year growth of 376 per cent.

Exports and re-exports to Saudi Arabia grew by Dh6.6 billion, making the country second largest gainers. However, in terms of growth, the rate was comparatively much lower at 22 per cent.

The third largest gainer was Qatar, growing by Dh2.4 billion, or 31 per cent. Other GCC member countries that gained significantly were Kuwait and Oman, exports to each country increasing by Dh1.2 billion.

The reconstruction of Libya led to a surge in demand in the country. Exports and re-exports of Dubai Chamber members to Libya grew by Dh1.7 billion or by 260 per cent on an annual basis.

The short-lived political turmoil in Egypt in the early part of 2011 led to lower exports to the country during the period. Thus, the export value of Dh2.7 billion in the first half of 2012 translated to an increase of 40 per cent to a value of Dh769 million.

Other destinations that grew significantly were Jordan, by Dh759 million, or 43 per cent; Turkey, by Dh663 million, or 131 per cent; and Pakistan, by Dh661 million, or 53 per cent. Value of exports/re-exports of 9,194 members during the first half of 2012, based on declared value of shipments in certificates of origin issued during the period, reached a record high of Dh136.2 billion, registering a year-on-year growth of 13 per cent.

The value is the highest recorded for the first six months of the year, surpassing by 30 per cent the highest pre-crisis export level of Dh104.4 billion recorded for the same period in 2008.

Nonetheless, the rate of growth following the dip in 2009 had been relatively modest compared to the pre-crisis period when the highest growth of 38 per cent was reached in 2008.

By month, highest export value was recorded in May, at Dh28 billion, while lowest value was in the month of February, with Dh19.7 billion. June’s Dh22.7 billion was the third highest, following the Dh23 billion export value noted for March.

In terms of level of activity, as indicated by the frequency of exports, or number of certificates of origin issued during the first six months of the year, the number registered in 2012 was highest at 372,955 COs while the highest monthly record was registered in May at 69,460 COs. This was followed by the 63,181 certificates issued in June.

The recovery of exports of Dubai Chamber members from the impact of the global crisis in 2009 had been the product of the members’ ability to adjust to shifts in market demands and changes in the global conditions, and of the government’s friendly policies and regulations for trading across borders.

With growth prospects for the global economy remaining low, demands are expected to be sluggish.

Thus, in its conclusion, the study suggests that the government and the financial sector must continue to implement policies and procedures that are supportive of the export sector.

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