REAPING FREE TRADE FRUITS
dubai — The UAE’s investor-friendly and free trade policies, establishment of new free zones and state-of-the-art infrastructure are paying rich dividends as the country’s trade grows.
According to the World Trade Organisation, the UAE, which leads the Arab world, moved up 4 places to become 15th largest exporter in the world, surpassing Russia, Spain and Switzerland.
The UAE also progressed by 1 place in imports, to occupy the 18th position internationally. In total, official figures revealed that the UAE’s foreign trade reached Dh1.7 trillion last year.
As per the WTO’s International Trade Statistics in 2017, the UAE occupied the 21st position internationally and first in the Arab world in service exports and 17th
Sultan bin Saeed Al Mansouri, Minister of Economy
position internationally and first in the Arab region in service imports.
In 2017, the UAE achieved a growth rate of 20.4 per cent in exports, considering that the global figure during the same period was 10.7 per cent, while the Middle East achieved a rate of 18 per cent. The UAE’s growth figures is the highest among the top 15 international exporters.
Regarding imports, the UAE’s import of goods decreased in 2017 by 1.1 per cent
Hamad Buamim,
compared to 2016, while the world’s imports increased by 10.7 per cent and the Middle East by 1.1 per cent.
Sultan bin Saeed Al Mansouri, Minister of Economy, said the trade growth rates reported by the WTO reflect the UAE’s position in the regional and international markets.
He pointed out that UAE’s trade volume growth reflects the continuous national
President and CEO, Dubai Chamber of Commerce and Industry
UAE’s trade volume growth reflects the continuous national efforts over the past years to build up a dynamic foreign trade sector
Dubai has strengthened its position and appeal as a preferred re-export hub and global centre for trade and commerce
efforts over the past years to build up a dynamic foreign trade sector based on the UAE’s efforts at building a multilateral trading system.
Hamad Buamim, president and CEO, Dubai Chamber of Commerce and Industry, said there are several factors that are supporting the growth of UAE’s non-oil foreign trade at the moment, including a rebound in global economic growth led by emerging markets, renewed commitment from top trading partners such as India and China to boosting exports and economic cooperation, increased economic diversification, improving business confidence and steady infrastructure spending in the lead up to Expo 2020.
“Dubai accounts for a majority of the UAE’s non-oil foreign trade as it has strengthened its position and appeal as a preferred re-export hub and global centre for trade and commerce. In recent years, Dubai has forged stronger relations with emerging markets across Africa, Asia, Latin America, and the Commonwealth of Independent States,” he said.
According to the WTO report, the UAE has maintained its position among the world’s top 20 exporters, and is also the first among Arab countries since 2013. The UAE accounts for 2 per cent of the world’s total merchandise exports in 2017 compared to 1.7 per cent in 2016, and 1.5 per cent of the world’s merchandise imports for 2017, as against 1.4 per cent of world commodity imports for 2016.
The WTO data showed that the UAE also achieved growth in its service exports in 2017 of 7.5 per cent compared to 2016, valued at $70 billion (Dh257 billion), as well as in its service imports by 1.9 per cent during the same period, valued at $84 billion (Dh308.3 billion). Global service exports increased 7.4 per cent, while global service imports increased 6.5 per cent during the same period.
The Department of Economic Development in Dubai announced 4 initiatives to increase investments. The initiatives focus on retail cost reduction, local production and procurement support programme, attracting investment in research and development, and creating new opportunities for companies that rely on knowledge, innovation and digital technologies.
According to Dubai Chamber president and COE Buamim, gold, diamonds and jewellery continue to dominate UAE exports, along with aluminium and metals.
Imports are currently led by gold, diamonds, machinery and transport equipment, he said, adding that the UAE greatly benefits from its position as a re-export hub for food products.
Buamim said these trends are likely to continue given the UAE’s fast-growing population, rising consumer demand, ongoing development and infrastructure plans tied to Expo 2020, and steady flow of visitors to the UAE which continues to increase every year.
“In addition, we have seen the UAE sign several strategic cooperation agreements with developing and emerging markets with the aim of expanding economic cooperation and increasing trade and investment flows in key sectors and areas, while the government has also introduced measures to ease of visa restrictions. These measures will pave the way for stronger trade partnerships and sustainable economic growth,” he added.
According to Anurag Chaturvedi, partner, Crowe Horwath, international players look for 3 critical factor to choose a hub for trade which includes ease of doing business, efficient logistics and swift banking.
“The UAE government has made significant advancements in these area ranging from easy and quick business establishment which takes one working day, smart and hasslefree banking at door step to logistics parks such as Jafza, Kizad with 6 airports connecting every part of the world. The UAE leads the region in trading in commodities, tourism and hospitality and re-export of goods.”
Suresh Panwar, chairman, the Institute of Chartered Accountants of India (Abu Dhabi chapter), said that in additional to the hydrocarbon sector and related industries, low tax regime and 100 per cent ownership in the free zones along with travel and tourism sector played a very vital role in UAE achieving high ranking in international trade.
“This ranking can be improved by allowing 100 per cent foreign ownership in mainland companies and implementing the bankruptcyrelated laws. Recent focus on innovation and transformation to a knowledge-based economy will help in improving the ratings.”
Nimish Makvana, ex-chairman ICAI (Dubai chapter) and partner at Crowe Horwath UAE, said strategic geopolitical location between developed and emerging markets business and strategic offices of Dubai Chambers in Africa has helped boost UAE’s foreign trade.
— waheedabbas@khaleejtimes.com