A yen for something different: UAE seeks more trading partners in wake of Sino-slump
The UAE is a top re-export hub for Chinese goods. (Shutterstock)
The United Arab Emirates is aiming to diversify its trading partners following the recent slowdown in China and other emerging economies, according to a senior Ministry of Economy official.
In an exclusive interview with Gulf Business on the sidelines of an industry event, the UAE Ministry of Economy’s assistant undersecretary of foreign trade affairs Juma Mohammed Al Kait said that the country is looking to make its trade relations more geographically diverse.
“We are trying to relax the concentration of foreign trade that we have with some countries. If you look at our structure, UAE foreign trade is concentrated in terms of goods and even geographically.
“We are heavily focused on India and China, then the United States. Now we need to diversify trade with other countries.”
The UAE is looking to tap into other high potential markets such as Africa and Latin America, he said. Although the country will continue to grow its links with India and China.
“China and India will remain on the top mainly because of the opportunities there. We have good relations, good investments and also good legal bases that allow both the private sector and government to deal with each other. I think we need to do more with African markets. There are a lot of opportunities in Africa.”
The UAE’s diversification efforts come as China’s economic growth slows and India’s begins to edge up. Trade volume between China and the UAE stood at $54.8bn in 2014. Trade with India is estimated to have reached $60bn last year.
Al Kait did not reveal how much of a bearing the Chinese economic slowdown will have on UAE-Sino trade levels but admitted that it will clearly “have an impact”.
“Definitely there will be an impact on us because China is playing a vital role in the global trade system. We have not seen a slowdown [in trade with China] but we have not seen a big difference in growth either,” he said.
The UAE is a top re-export hub for Chinese goods while the country has also previously courted China for energy deals, all of which might be hit by the downturn.
“There was always a demand for energy there. But with what is happening now, it might slow down the demand,” Al Kait said.
The official said that the UAE did not have an overall trade target but that it aimed to increase trade with countries where its trading value was below $20m.
According to the Ministry of Economy, total UAE trade value touched Dhs 1.6 trillion in 2014. Al Kaif added that there was positive growth in the first quarter of 2015, despite challenges in the global economy.
By Mary Sophia
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