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29 March 2024

Gulf exports to Japan surge 60% in five months

Published
By Nadim Kawach

A sharp rise in oil prices and higher crude supplies boosted exports of goods by the UAE and five other Gulf countries to Japan by nearly 60 per cent in the first five months of 2010, according to official Japanese data.

The surge followed a steep fall in such exports last year compared with the previous year because of a decline in crude prices and lower Japanese imports of Gulf oil due to slackening demand caused by the 2008 global fiscal crisis.
 
From around $26.751 billion in the first five months of 2009, the exports by the six-nation Gulf Cooperation Council (GCC) to the southeast Asian giant shot up to nearly $42.993 billion in the first five months of 2010, showed the figures by the Japan External Trade Organization (Jetro).
 
Japan’s exports to the 29-year-old GCC alliance also swelled by 22.5 per cent to around $8.135 billion from $$2.675 billion in the same period.
 
The higher growth in GCC exports sharply widened the group’s surplus in trade with Japan to nearly $34.857 billion from $20.11 billion.
 
The report showed the UAE, the second largest Arab economy, emerged as the largest GCC exporter to Japan in the first five months of this year after overtaking Saudi Arabia. Its exports to that country stood at nearly $2.93 billion while Saudi exports to Japan were valued at nearly $2.60 billion.
 
As for imports, Saudi Arabia remained the largest Middle East market for Japanese products, with an import value of about $15.31 billion in the first five months of 2010. The UAE came second, with around $12.03 billion.
 
Qatar’s imports from Japan stood at $437 million while its exports shot up to around $9.09 billion in the first five months of this year from nearly $5.58 billion in the first five months of 2009 following an increase in LNG supplies.
 
The report showed Kuwait’s imports from Japan stood at around $594 million while exports were valued at $4.24 billion.
 
Imports by Oman and Bahrain from Japan stood at $1.34 billion and $231 million respectively. Their exports were estimated at $2.05 billion and $256 million.
 
In 2009, GCC’s exports to Japan plunged by around 48 per cent because of lower oil prices and crude sales to the Asian country. Japan’s exports to the region also dipped by nearly 37 per cent due to lower domestic demand.
 
Analysts said the surge in the region’s exports to Japan year-to-date was a result of a sharp rise in oil prices and higher crude supplies to that country. From around $40 a barrel in the first five months of 2009, average oil prices surged above $70 a barrel in the first five months of 2010.
 
Strong crude prices combined with high output boosted the GCC’s exports to Japan to a record high of $144.1 billion in 2008 from $98.5 billion in 2007, an increase of nearly 47 per cent, according to Jetro.
 
Massive oil supplies have kept the GCC-Japan trade balance largely in favour of the Gulf group, with the surplus peaking at nearly $117 billion in 2008.
 
Japan gets more than 80 per cent of its oil needs from the GCC, Iran, Iraq and other Middle Eastern crude producers. Saudi Arabia and the UAE alone supply it with more than two million bpd, nearly half its total oil imports.
 
Besides crude, the GCC’s exports to Japan include aluminium, natural gas, LNG and petroleum products. Their imports from that country comprise mainly electronics, vehicles, machinery, and other industrial products.