Reflecting Dubai’s strong economic ties with the Gulf Cooperation Council (GCC) countries, the emirate’s trade within the region, especially with Saudi Arabia accounting for 45% of Dubai’s total trade within the region, is witnessing higher pace of growth, stated a recently-released report by the Dubai Chamber of Commerce and Industry.
The report pointed out that in 2011 Dubai’s trade with GCC countries recorded 20% growth rate to a value of AED 74.0 billion, and it rose further to 28% in 2012 to a total value of AED 94.8 billion. Although the growth rate slowed down in 2013, it remained high at 20% to a value of AED113.8 billion. With oil prices declining in the global market, the slowdown in growth became more defined in the following year, growing by only 3%, to AED 117.5 billion. However, it recorded 8% growth in 2015, with the total trade value reaching AED 126.6 billion.
The report showed that Oman and Kuwait followed Saudi Arabia with 19% and 16%, respectively. While Qatar’s GDP at US$ 210.1 billion was larger than of Oman land Kuwait, at respective values of US$ 81.8 billion and US$ 163.6 billion, its share of trade with Dubai was lower at 12%. Being the smallest economy, with GDP of US$ 33.9 billion and population of 1.36 million, Bahrain accounted for the lowest share of 8% of Dubai’s trade in the region.
Commenting on the report, H.E. Hamad Buamim, President and CEO, Dubai Chamber, said: “The latest Dubai Chamber report highlights Dubai’s leading status as the regional commercial hub with state-of-the art infrastructure and a world class business environment. Over the years, Dubai Chamber has been the main engine of trade growth in Dubai, and contributed to the development of the emirate’s economy by creating a favourable atmosphere for investment and business. Dubai’s robust trade ties with the GCC countries highlight its key role in enhancing business and trade activities in the region and beyond.”
According to the report, Dubai’s non-oil trade has maintained a pace of sustained growth in recent years and achieved significant growth of 18% in 2011 to AED 1.06 trillion, and of 16% in 2012 to AED 1.23 trillion, with a decreased growth of 8% in 2013, to a total value of AED 1.33 trillion. The following year’s performance was just about the same at a value of AED 1.33 trillion, while in 2015 it was AED 1.28 trillion.
The report said that trade with all the GCC countries in 2015 had been favourable to Dubai, leading to a total net trade of AED 87 billion during the year. Highest net trade resulted from trade with Saudi Arabia, for a share of 51% of the total, while net trade with Oman contributed 18%. Trade with Kuwait and Qatar both led to shares of 13% to total net trade, while trade with Bahrain accounted for 5%.
Products contributing to net trade
According to the report, mineral products dominated Dubai’s imports from GCC countries. The 2015 total import value of the product group of AED 10.5 billion accounted for a share of 53% of the total imports from the region. Meanwhile, Dubai’s export of pearls, precious and semi-precious stones and metals as well as jewellery to the region reached AED 13.8 billion, or 51% of the total export value. Machinery and electrical and electronic equipment and parts dominated re-exports, with the AED 46.7 billion re-export value accounting for 59% of total re-exports to the region, it said.
Although Dubai’s trade on machinery and electrical and electronic equipment and parts as well as on pearls and precious stones and metals and jewelleries was responsible for the largest contributions to Dubai’s trade surpluses from all GCC countries, the intensity varied from country to country. For instance, Dubai’s trade with Saudi Arabia on machinery and electrical and electronic equipment and parts led to a trade surplus of AED 30.5 billion, overshadowing all other product groups that contributed to trade surplus such as pearls and precious stones and metals and jewelleries and transport equipment, the report stated.
Dubai’s trade on the two products groups with the other GCC countries also resulted in large trade surpluses. However, it was notable that in the case of Dubai’s trade with Bahrain, the trade surplus from machinery and electrical and electronic equipment and parts came second to the trade surplus from pearls and precious stones and metals and jewellery.
Dubai’s trade with Kuwait yielded significant trade surplus in chemicals and allied products, while transport equipment led to trade surplus from trade with Saudi Arabia. In Oman, transport equipment and base metals and articles yielded significant trade surpluses for Dubai, the report said.
The report pointed out that Dubai’s trade on mineral products with Saudi Arabia, Kuwait and Bahrain led to major trade deficits, while in the case of Qatar the trade deficits were attributed to base metals and articles as well as on chemicals and allied products. Concerning Dubai’s trade with Oman, the trade deficit was on animal fats and oils.
The recently-released World Trade Organisation (WTO) global trade forecast for 2016, pointed to an expected 2.8% growth for the year, the same level of growth noted for 2015. Pushing up growth prospects are the rising demands of the developing Asian economies, as demands in developed countries are expected to remain moderate.
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