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29 March 2024

Japan's GCC trade deficit down 9% to $115bn

Published
By Staff

The value of Japan’s bilateral trade with the GCC countries contracted 3.82 per cent in 2014 to $164.76 billion, compared to $171.31 billion in 2013, mainly due to an estimated 4.28 per cent average fall in the price of crude that Japan imported from the GCC countries in 2014, according to figures released by Jetro.

The average price of crude fell to $104.76 per barrel in 2014, from $109.44 per barrel in 2013. The effect of the depreciation in the value of Japanese yen against the US dollar, estimated to be slightly more than 8 per cent in average, during 2014, has also reflected in the reduced value of bilateral trade.

Although Japan’s trade deficit with the GCC countries is huge, the decline in crude oil price is gradually bringing down the deficit. In 2014, the deficit was brought down by 9.14 per cent to $114.9 billion compared to $126.5 billion in 2013.

Japan’s global trade during the year 2014 slipped marginally by 2.83 per cent to $1,503.7 billion compared to $1,547.5 billion in the previous year. Exports declined by 3.3 per cent to $690.9 billion from $714.9 billion, and imports by 2.39 per cent to $812.8 billion from $832.6 billion. As a result of higher decline in exports compared to imports, Japan’s overall trade deficit increased by 3.48 per cent to $121.9 billion in 2014 from $117.8 billion in 2013.

Exports to GCC

Japan’s exports to the GCC countries showed a strong recovery in 2014 supported by increased demand for machinery and equipment, and iron and steel products, Jetro said.

The export value of general machinery surged 24 per cent to $3.45 billion and that of electrical machinery 23.7 per cent to $1.2 billion in 2014. Export of self-propelled dozers witnessed an increase of 46.5 per cent in value to $564.4 million in 2014 from $385.3 million in the previous year.

Similarly, export of air pumps rose by 47.6 per cent to $270.7 million and steam turbines by 110.7 per cent to $198.1 million. Export of machinery for temperature changing and steam generating machinery jumped 5 to 6 times in 2014, compared to the previous year. Export of iron and steel products, such as tubes and pipes, surged by 32.2 per cent to $1.58 billion. Export of beverages, including mineral and aerated waters registered a considerable increase of 35.6 per cent to $45.1 million in 2014 from $33.3 million in 2013.

Motor vehicle exports, covering almost 60 per cent of Japan’s total exports to the GCC, increased by 8.77 per cent to $14.79 billion, of which, passenger motor cars above 3000 cc engine capacity rose the most, by 10.7 per cent, to $7.6 billion. GCC countries remained to be one of the top export markets for motor vehicles from Japan.

In addition to the above traditional export commodities, increases were registered in the exports of optical goods, nickel and copper articles, water transport machinery such as ships and boats etc. in considerable levels. While export of nickel articles such as pipes and tubes surged by 558 per cent to $170.41 million from $26 million in the previous year, export of coper articles rose by 48 per cent to $15.41 million from $10.36 million.

On the other side, the export value of iron and steel (structural), such as large sized flat rolled iron, and flat rolled alloy steel etc. declined collectively by 21 per cent $555.96 million in 2014 from $705.15 million in the previous year. Textiles and organic chemicals have also registered negative growths in exports at the rate of 11.4 per cent and 15.0 per cent respectively, compared to the previous year.

UAE leads food imports

There had been notable increases in the export of foodstuff from Japan to the GCC in 2014, especially to the UAE.

Though the value was small compared to major other commodities, foodstuff export to the GCC rose by nearly 17 per cent to $83.04 million in 2014, compared to $71.08 million in 2013.

Particularly to the UAE, the increase in foodstuff exports was registered at 38.5 per cent to $50.33 million in 2014 from $36.33 million in the previous year. Most of the increases in food exports to the UAE were attributed to non-alcoholic beverages. Among foodstuff exports to the GCC, 35.58 per cent increase was registered for beverages alone, and 19.3 per cent for fish and seafood. Following table illustrates the growth of food exports to the GCC.

Japan’s major imports from GCC


Mineral fuels, including crude oils and gaseous hydrocarbons, remained to be the dominant commodities of Japan’s import from the GCC countries in 2014.

Nearly 98.5 per cent of Japan’s total imports from the GCC fall under this category.

Aluminium, organic chemicals, copper articles, plastics, inorganic chemicals, fertilizers, precious stones, fish and seafood constitute the remaining small portion.

The import value of crude oils, the major item of Japan’s imports from the GCC, which covered 72.61 per cent of the total imports from the block, fell by 8.96 per cent to $101.53 billion in 2014, from $111.52 billion in the previous year.

In terms of volume, Japan’s crude oil import declined by 4.89 per cent to 969.21 million barrels in 2014, against 1,019.04 million barrels in 2013. Japan’s total crude oil import in 2014, from the world over, was estimated at 1,253.9 million barrels, which was 5.62 per cent lower, compared to the volume in 2013. GCC countries together met 77.30 per cent of Japan’s crude oil requirement in 2014, 0.78 per cent higher compared to the supply in 2013.

Saudi Arabia topped the list of crude oil suppliers to Japan in the world, supplying 33.26 per cent of Japan’s crude oil requirements in 2014, followed by the UAE with a supply share of 24.36 per cent. Qatar was the 3rd largest supplier of crude oils to Japan, covering 11.14 per cent of Japan’s total requirement of crude oils.

Japan’s import of petroleum gases from the GCC declined marginally in terms of value due to a slight decline in the price of gases. Japan imported 34.06 million tons of petroleum gases from the GCC countries in 2014 at an average price of $845.89 per ton, compared to 34.97 million tons at $848.17 per ton in 2013. Qatar was Japan’s largest supplier of petroleum gases in the world, supplying over 20 per cent of Japan’s total gas requirement in 2014. UAE stood 4th in gas supply to Japan, with a share of 8.67 per cent of Japan’s total gas imports.

Japan’s import of aluminium from the GCC countries surged by 44.77 per cent to $1,095.00 million in 2014 compared to $756.88 million in the previous year. Most of the additional supply came from the UAE, from where, the imports grew by 41.37 per cent in 2014. UAE was the largest supplier of aluminium to Japan among the GCC countries, and the 4th largest supplier in the world with a share of 8.28 per cent of Japan’s total aluminium imports. Aluminium is mostly imported to Japan as raw-materials, in the form of ingots.

Though low in total value, import of some metals like iron & steel in the form of alloys, wastes and scraps, and unwrought lead from the GCC had shown considerable increase in 2014. Oman, Kuwait and Bahrain were some of the suppliers of ferroalloys from the GCC block, together supplying this material worth $7.45 million in 2014. Import of unwrought lead from the UAE rose by 872 per cent in value to $5.57 million in 2014, compared to just above half a million in the previous year.