UAE-Japan H1 trade grows to Dh95 billion

Trade between the UAE and Japan showed a healthy upswing in the first half of 2014.

According figures released by Japan External Trade Organisation (Jetro), a government-related organisation promoting trade and investments, value of two-way trade between Japan and the UAE during in H1 2014 rose 4.43 per cent to $25.92 billion (Dh95 billion) compared to $24.82 billion (Dh91 billion) during the same period last year.

The increase in trade is driven by growth in both exports and imports to and from the UAE.

Japan’s exports to the UAE surged nearly 13 per cent to $4.59 billion (Dh16.8 billion), and imports 2.76 per cent to $21.34 billion (Dh78.3 billion) during the first six months of 2014. Japan’s H1 2014 trade deficit with the UAE remained nearly at the same level of H1 2013 at $16.7 billion (Dh61.3 billion).

Japan’s major exports to the UAE

Considerable expansion in exports was seen in almost all major commodities, with the exception of structural iron and steel, tyres and organic chemicals. Export of most other commodities, starting from automobiles to non-alcoholic beverages, expanded in varying degrees. Notable increase in exports was registered for general machinery, iron and steel products, optical and photographic products and non-alcoholic beverages. Electrical machinery, textiles, precious stones and metals etc. have posted moderate increase in exports.

Motor vehicles remained to be the dominant component of Japan’s exports to the UAE, covering more than half of Japan’s total exports to the UAE.

Export of motor vehicles rose 11.36 per cent during the first half of 2014 to $2.38 billion, compared to $2.13 billion during the same period in 2013. Export of passenger motor cars, covering 67.2 per cent of all motor vehicle exports to the UAE, surged 17.62 per cent to $1.6 billion during the six-month period.

UAE was Japan’s fifth largest export destination of passenger motor cars in the world, after the US, China, Russia and Canada.

Saudi Arabia ranked 7th and Oman 9th. However, due to a major fall in the export (-38.52 per cent) of small trucks below 5-tonne capacity, truck exports to the UAE fell an overall 22.44 per cent to $313 million from $404 million in the previous first half.

Export of automobile parts and accessories also registered an increase of 22 per cent to $233.2 million. Though the amount is not large, s significant increase of 130 per cent was seen in the export of motorcycles, posting the export value at $15.1 million, compared to $6.8 million in the previous first half.

Among general machinery, increase in export value was mostly supported by expansion in the exports of bulldozers, angle dozers, ball or roller bearings, various types of pumps, pipes and valves. Few items that showed decline in exports were printing machinery, ship derricks and mobile cranes. Within an overall 10.4 per cent expansion in the export of electrical machinery which was valued at $265.2 million, electrical transformers, electrical ignition equipment and generators showed major increases. Electrical apparatus for line telephones posted an outstanding 123 per cent expansion in exports.

Steep increase in the exports of various kinds of tubes and pipes were instrumental to the 86.5 per cent overall increase in the value of iron and steel products, amounting to $329.8 million, during the first half of 2013, compared to $176.82 million in the previous year’s first half.

Nickel pipes, tubes and pipe fittings found new market in the UAE, registering an export value worth $42 million in the first half of 2014, against $2.5 million during whole of 2013.

Though UAE remained to be a major export destination for Japan for new tyres, the first half 2014 results showed a 7.21 per cent drop in tyre exports to the UAE. The export value of new tyres during the first half 2014 was worth $212.98 million, compared to $229.45 million during the corresponding period in the previous year.

Export of non-alcoholic beverages including mineral waters and aerated waters rose 61.34 per cent to $22.46 million during the six-month period, compared to $13.92 million in the previous first half.      

Japan’s imports from the UAE

Driven by an increase in the volume and price of crude oils that Japan imported from the UAE, the value of Japan’s overall imports from the country rose 2.76 per cent during the first half of 2014 to $21.3 billion compared to $20.7 billion in the corresponding period of the previous year. A 28.8 per cent increase in aluminium imports from the UAE had also contributed to the surge in trade value.

Mineral fuels covered 98.10 per cent of the total imports and aluminium, 1.63 per cent. The remainder consisted of copper scrap, precious stones and metals, animal feed and fabrics.
During the first half of 2014, Japan imported mineral fuels worth $20.93 billion, with crude oils accounting for $16.39 billion.

Japan imported a total of 146.78 million barrels of crude oils from Japan during the first six months of 2014, 1.59 per cent higher in volume.

The average price of crude oils rose 1.53 per cent to $111.70 per barrel during the six-month period in 2014, compared to $110.02 per barrel during corresponding period in the previous year. The UAE remained the second largest supplier of crude oils to Japan, covering a supply of nearly 23.2 per cent of Japan’s total crude oil imports during the first half of 2014.

Saudi Arabia continued to be the top supplier of crude oils, with a share of 32.8 per cent in Japan’s crude oil imports. Other major suppliers of crude oils to Japan were Qatar (12.3 per cent), Russia (8.1 per cent) Kuwait (7.5 per cent), Iran (4.2 per cent), Indonesia (2.9 per cent), Vietnam (1.6 per cent, Gabon (1.5 per cent), Oman (1.5 per cent) and Iraq (1.1 per cent).

Japan imported petroleum gases worth $4.26 billion from the UAE during the first six months of 2014, 0.87 per cent less in value compared to the value during the first half 2013.

The average price of petroleum gases increased 1.3 per cent to $917.24 per tonne compared to $905.83 per tonne in the previous first half. Volume of gas imports, however, slipped 2.1 per cent to 4.26 million tonnes from 4.35 million tonnes.

The UAE was the fourth largest source of petroleum gases to Japan after Qatar, Australia and Malaysia. Oman, Kuwait and Saudi Arabia were the other sources of Japan for petroleum gases, from among the GCC countries.

Besides oil and gas, Japan’s other imports were mainly aluminium in semi-finished forms.

The UAE has been a traditional source of semi-finished aluminium for Japan, and, during the first six months of 2014, Japan imported aluminium worth $347.7 million from the UAE, which was 28.8 per cent higher in value, compared to the value in the previous first half.

In terms of volume, Japan imported 163.7 million kg of aluminium from the UAE during the first half of 2014 which was 38.6 per cent higher in volume, compared to the corresponding period in 2013. The UAE was Japan’s 4th largest supplier of aluminium after China, Russia and Australia.

Although in small quantities, increase in imports were registered in many other commodities such as copper scraps ($20.7 million, up 35.6 per cent), food waste and animal feed ($4.4 million, up 396.5 per cent), lead articles ($2.7 million, up 284.9 per cent) plastic articles ($2.2 million, up 37.4 per cent), electrical machinery ($2.2 million, up 316 per cent) and textile materials ($1.6 million, up 25.6 per cent). The only category of imports that registered a decline was precious stones and metals that posted a combined fall of 50 per cent to $8 million.

 

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