Value of non-oil exports from the UAE rose last year by the fastest rate in almost 30 years, but trade deficit grows.
Non-oil exports surge to Dh60bn
The value of non-oil exports from the UAE rose last year by the fastest rate in almost 30 years, climbing 66.45 per cent to Dh60.35 billion (US$16.43bn), according to the Ministry of Economy. However, the country's total non-oil trade deficit also widened the most since 1981. The deficit expanded by 53 per cent to Dh342bn, indicating that the country became more dependent on sales of oil products, despite efforts to diversify the economy.
The figures were in line with last week's data released by Abu Dhabi, revealing that non-oil exports and re-exports from the emirate also expanded at a slower pace than import growth. Strong economic growth in the UAE last year was the main reason for the widening non-oil trade gap, according to Giyas Gokkent, the chief economist at the National Bank of Abu Dhabi. "It makes sense. In 2008, you had very strong economic activity, which usually means you draw in lots of imports," he said.
"However, although the non-oil deficit might have been very high, if you were to include oil in the picture, which hit a record last year, 2008 would have been a very good year from an overall trade surplus perspective." Information on the total value of exports including oil for last year has not yet been released by the Central Bank. The total value of imports including oil into the UAE came to Dh565.71bn.
The volume of total non-oil trade for the country rose by 42.67 per cent to Dh788.92bn. The largest recipient of UAE non-oil exports was India, which accounted for Dh17.9bn, or 29.68 per cent of total non-oil exports by value. Qatar was the second-largest recipient with non-oil exports valued at Dh7.71bn, or 12.79 per cent of the total. The top three exporters of non-oil goods to the UAE were China with 11.27 per cent, India with 10.95 per cent and the US with 7.94 per cent. India, Iran and Iraq receive most of the UAE's re-exports, comprising 23.37 per cent, 13.72 per cent and 5.97 per cent of the total value, respectively.