UAE exports more then Brazil, India, Australia or Malaysia
Posted on 21 May 2011 with 7 comments from readers
With total exports worth $235 billion last year the United Arab Emirates was the 13th largest exporter in the world ahead of two of the BRIC countries, Brazil and India, and even beating the Asian commodities giant Australia and dynamic Malaysia.
That is what the latest World Trade Organisation report reveals. The UAE is also the 18th largest importer in the world with imports of $170 billion leaving a trade surplus of $65 billion.
Big trade upturn
The recovery from the global financial sell-off is clearly seen in UAE trade growth last year, with imports up 13 per cent in value and exports up 27 per cent, mainly due to higher oil prices.
However, total non-oil trade last year was up 14 per cent to $206 billion out of $405 billion in combined exports and imports. The balance comprised almost entirely hydrocarbon exports.
The UAE exported 2.4 million barrels per day last year at an average price of $78, delivering an average daily income of $187 million. Oil prices are running about 25 per cent above this level for 2011, so the UAE is in for another huge windfall profit.
The ArabianMoney investment newsletter continues to point out that this massive recovery in fortune for the UAE since the global financial crisis is just not being reflected in local stock markets, mainly because the stocks are concentrated in the still depressed banking and real estate sectors, and neither trade nor hydrocarbons.
However, in due course much of these increased trade and capital flows must begin to impact favorably on the local economy. It is not all about tourism fleeing from the rest of the region and the UAE becoming a safe haven for Arab investors, although that has also happened too.
Investment implications
Stock markets tend to wallow in recession and maintain their pessimism far after the facts and fundamentals no longer support this conclusion. That said ArabianMoney notes that US stock markets have closed lower for the past three weeks and that this may well be the start of a long-awaited correction.
UAE bourses would feel the impact if US markets fall and oil prices drop but this could be the best time to buy. The ArabianMoney investment newsletter will be highlighting the best ways to invest in these markets in future issues (click here to sign-up) well in advance of anything that appears on this free website.
7 Comments posted by readers:
They export more because of transits that pass through Dubai and not because of local manufacturers make more for exports. Many surrounding countries like Syria and Iran have sanctions which prohibit exports to their countries so the items are shipped to Dubai first and re-exported later.
Andy nailed a lot of it. Plus, a full super tanker of oil is worth something like $200 million. That adds up fast!
Those Syrian demonstrators are a tough bunch. It makes me glad I’m living in a small town. I hope people around here aren’t that mad.
Osama wanted to blow up oil tankers. He didn’t know much about the enormous size of the oil business. There are hundreds of tankers, and they are quite difficult to sink unless you have a jet fighter or a submarine. A continuous chain of tankers extends from the Gulf to Japan, with a ship roughly every 100 miles.
Electric cars are looking better every day. Ford’s all-electric Focus is supposed to have a 100 mile range between charges. A 220 volt charger can charge an electric car at home in about 3 to 4 hours. A commercial charger can do it in between 15 and 30 minutes. A 115 volt extension cord takes about 12 hours.
Don’t order one until this rapture thing is over.
@ Bill
Oil exports are roughly $68 Billion of that $235 Billion which leaves you with around $166 or so Billion and of that amount most of it is re-exports which goes to Afghanistan,Syria,Iran,Kuwait,Saudi,Egypt,Yemen,Pakistan,Libya,Oman and a few others in the region. The numbers are big and look big but when you look into details you know that they are not exports due to local manufacturing exports.
Perhaps the headline could be re-worded: “UAE re-exports more then Brazil, India, Australia or Malaysia.”
For example, 2 years ago US company reported huge volumes of product sold into UAE, somewhere in the order of a dedicated laser printer for every man woman and child! Of course 90+% of this was re-exported (bypassing US sanctions) with revenues booked by the UAE HQ. Pop down to the creek or sharjah, take a look at the big dhows loaded up with product outbound.
Numbers are often not what they seem here in UAE which makes any sort of analysis suspect at best.
Ed Note: Re-exports feature in many national trade series – and not to include them would be to completely misrepresent Dubai’s focus as a trading hub city. What about Singapore and China? Or Hong Kong and China?
Hong Kong exports the goods manufactured in China and Singapore is similar for Malaysian, Thai, Indonesian goods etc… The point is…does this represent the massive recovery for the UAE that the editor suggests. Of course it doesn’t. There is no evidence…none..that the UAE actually understands what is going on. The export story will definitely favour one group or sector, but the depressed stock market tells the story of other groups. Is prosperity returning for the majority of UAE residents? Not a chance! This collapse is only just finding it’s legs…Enjoy the weather…enjoy your tax-free salary…enjoy the quality time you get to spend with family…. but whatever you do….don’t invest your hard-earned in this region!
Singapore and Hong-Kong mainly act as a trading hub like Dubai where China and Taiwan are most likely to export what they manufactured and not what passes through. The numbers coming out of India,Brazil and Australia are most likely local export numbers as well and not based on as a trading hub.
The article forgot to mention that the UAE was the top export market for Indian goods and services in 2010.