Diversification push sees UAE’s non-oil trade rise to $953bn

▶ ‘Record year’ as deals with top 10 overseas trading partners rose 26%

The UAE’s non-oil foreign trade jumped to a record Dh3.5 trillion ($953 billion) last year, driven by the country’s economic diversification plans and despite a global slowdown in the movement of goods and services.

The figure surged from Dh2.23 trillion in 2022, as the UAE increased efforts to reduce its dependence on hydrocarbons and boost economic partnerships around the world through a series of trade agreements.

The Emirates has signed deals with India, Israel, Turkey, Indonesia, Cambodia and Georgia, and is planning another 26 agreements as it seeks to attract investment.

The country’s trade with its top 10 most important partners grew by 26 per cent last year, Sheikh Mohammed bin Rashid, Vice President and Ruler of Dubai, said in a post on social media yesterday.

“We indicated at the beginning of 2023 that it will be a record year for the economy … and the UAE has cemented new bridges of co-operation through comprehensive partnership agreements in 2023,” Sheikh Mohammed said.

The value of the UAE’s non-oil trade with current and future comprehensive agreement partners exceeded Dh390.5 billion, up 24.5 per cent on 2022, Dr Thani Al Zeyoudi, Minister of State for Foreign Trade, said yesterday.

The UAE’s non-oil trade last year comprised Dh2.6 trillion in goods and Dh900 billion in services, reflecting the “resilience and dynamism” of its economy, Dr Al Zeyoudi said.

The trade in non-oil goods grew 12.6 per cent year-onyear, while overall exports of goods and services exceeded Dh1 trillion last year for the first time, he added.

This milestone “confirms that economic diversification plans are moving in the right direction towards a future economy based on knowledge and innovation, and reflects the increasing international trust in the UAE’s economy and its move towards more openness to the world in terms of trade and investment”, he said.

China retained its status as the leading trade partner, followed by India, the US, Saudi Arabia and Turkey, the UAE government media office said yesterday.

The UAE’s non-oil foreign trade hit a record Dh3.5 trillion ($953 billion) in 2023, bolstered by its economic diversification plans despite a decline in the international movement of goods and services.

The country’s trade with its top 10 most important foreign partners expanded 26 per cent last year, Sheikh Mohammed bin Rashid, Vice President and Ruler of Dubai, said on social media platform X yesterday.

“We indicated at the beginning of 2023 that it will be a record year for the economy … and the UAE has cemented new bridges of co-operation through comprehensive partnership agreements in 2023,” he said.

The Arab world’s second-largest economy has signed a series of Comprehensive economic Partnership Agreements (Cepa) with countries such as India, Turkey and Indonesia.

The UAE, a global transport and logistics hub, is working towards signing 26 such agreements as it seeks to attract more investment and diversify its economy.

The country’s non-oil foreign trade of Dh3.5 trillion last year compares with Dh2.23 trillion in 2022, amid accelerated efforts to reduce its dependence on hydrocarbons and boost economic partnerships around the world.

The UAE is “on course” to achieve its non-oil trade target of Dh4 trillion by 2031, driven by policies such as the signing of Cepas, Dr Thani Al Zeyoudi, Minister of State for Foreign Trade, said in August.

The UAE’s non-oil trade last year comprised Dh2.6 trillion in goods and Dh900 billion in services, reflecting the “resilience and dynamism” of its economy, Dr Al Zeyoudi said on X yesterday. The country’s non-oil goods trade expanded 12.6 per cent annually, while overall exports of goods and services exceeded the Dh1 trillion mark in 2023 for the first time, he said.

This milestone “confirms that economic diversification plans are moving in the right direction towards a future economy based on knowledge and innovation,” the minister said.

Non-oil exports of goods now make up 17.1 per cent of the country’s total non-oil foreign trade, compared with 13 per cent in 2018, he added.

China retained its status as the UAE’s leading trading partner, followed by India, the US, Saudi Arabia and Turkey, the UAE government media office said yesterday. Rounding off the top 10 were Iraq, Switzerland, Hong Kong, Japan and Oman.

The UAE’s non-oil trade with Turkey, which contributed 5.1 per cent to the total, climbed 103.7 per cent annually in 2023, the highest among the top 10 trading partners.

The UAE’s trade with Hong Kong last year expanded 47.9 per cent, ranking it eighth among the UAE’s top 10 trading partners, while trade with the US rose 20.1 per cent, and with China 4.2 per cent.

Trade with India, which signed a Cepa with the UAE in May 2022, climbed by 3.9 per cent, accounting for more than 7.6 per cent of the total trade.

The UAE’s non-oil trade was buoyed by a continued increase in its non-oil exports. The value of non-oil exports last year exceeded Dh441 billion, up 16.7 per cent from 2022.

Gold, aluminium, oil, cigarettes, jewellery, copper wire and ethylene polymers topped the list of the country’s most important exports.

Similarly, the UAE’s re-exports also increased last year to Dh690 billion, up 6.9 per cent from the year before.

The country’s imports last year rose 14.2 per cent annually to Dh1.4 trillion. The top goods imported were gold, telephones, petroleum oils, cars and diamonds.

The UAE’s services trade surplus reached Dh207 billion in 2023, up from Dh96.26 billion in 2021, lifted by the travel and tourism industry, the media office said.

Dubai recorded its best annual tourism performance, with international tourist arrivals to the emirate increasing by 19.4 per cent annually to 17.15 million in 2023, according to the latest data published by Dubai’s Department of Economy and Tourism. This exceeded the previous record of 16.73 million visitors in 2019.

The quarterly performance of the UAE’s non-oil trade “promises further growth”, the government said.

In the fourth quarter, the UAE’s non-oil foreign trade of goods reached a record Dh710 billion, up 16.3 per cent annually. Non-oil exports of goods in the period totalled Dh132.2 billion, a 39.3 per cent rise from the previous year.

Last month, the UAE Central Bank increased its 2024 growth forecast for the country’s economy to 5.7 per cent from its earlier estimate of 4.3 per cent, due to an expected rise in oil production. The banking regulator also raised the UAE’s non-oil gross domestic product growth to 5.9 per cent and 4.7 per cent, for 2023 and 2024, respectively.