UAE-Japan trade grows 14.5%

The value of Japan’s bilateral trade with the UAE increased by 14.5 per cent to $27.2 billion during the first six months of 2012.

In addition to the effects of increased price of crude oils, a 71 per cent increase in Japan’s exports of motor vehicles, 37 per cent increase in general machinery exports and 97 per cent increase in iron and steel products exports to the UAE have also played a considerable role in the increase in trade value.

Price of crude oils rose by 11.75 per cent during the first half of 2012 compared to the same period in 2011.  As crude oil import covers a major portion of the imports from the UAE, fluctuations in its price will affect the value of bilateral trade in a significant way.

The average price of crude oils during the first half of 2012 was $119.44 per barrel whereas; it was $106.88 during the same period in 2011. The volume of crude oil imports, at the same time, has declined by 3.23 per cent to 145.9 million barrels, compared to 150.8 million barrels during the first half of 2011.

Japan exports to UAE

Japan’s exports to the UAE grew by 45.93 per cent during the first six months of 2012, driven by surge in automobile, machinery and iron and steel exports.

Motor vehicle exports, that jumped 71.08 per cent during this period, formed 48.23 per cent of Japan’s total exports to the UAE, with a value of $2,228 million. Japan reached a record $2,245.50 million export of motor vehicles to the UAE during the first half of 2008 (45.37 per cent of the total exports to the UAE), which still remains unbroken.  However, the global financial crisis brought Japan’s motor vehicle exports to the UAE down to $746.76 million during the first half of 2009 (24.43 per cent of the total exports), and to $1,619.10 million during the first half of 2010 (45.30 per cent of the total exports).

The evident recovery in 2010 was again curtailed in 2011 due to the Great East Japan Earthquake and the tsunami in March that year, which brought the export down to $1,302.40 million during the first six months of 2011.  Now, as the financial crisis is almost over and the production facilities in the North East Japan are returning to its previous positions, Japan’s Motor vehicle exports to the UAE is closing in on the record registered in 2008.

Export of passenger motor cars, covering 66.71 per cent of the motor vehicle exports to the UAE rose by 78.27 per cent with a value of $1,486.4 million. Nearly 68 per cent of the passenger motor cars exported to the UAE belonged to higher capacity cars having 3,000cc or above.

Export of this category of cars grew by 102.8 per cent to $1,001 million, compared to $498 million during the first half of 2011. UAE was the 6th largest export market for Japan for passenger motor cars. US, Russia, Australia, China and Canada were the other major markets in the order of export value. A major increase was also witnessed in the export of motor trucks, which, more than doubled the export value to $372 million during January – June 2012 from $185 million during the same period in 2011. Export of public transport vehicles has also increased by 116.5 per cent to $125.8 million.

Export of general machinery to the UAE grew by 37 per cent to $853.8 million during the period under review, compared to $623.4 million during the same period in 2011. A 400 per cent increase in export was recorded for air or vacuum pumps to $93.7 million from just $18.7 million.

Export of self-propelled bulldozers, angle-dozers or graders rose by 45 per cent to $134 million from $92.5 million. There had been a big jump in the export of machines and mechanical appliances, bringing the value to $32.2 million from just 2 million in the previous first half. Similarly, exports of machinery for working with plastics or rubber registered a major increase from less an a million UD dollars during the first six months of 2011 to $30 million during the first half of 2012. Similar increases have also been registered for the exports of steam boilers and gas turbines.

Export of Iron & Steel products to the UAE almost doubled during the first half of 2012 to $366 million, from $185.5 million during the same period in the previous year. Among iron and steel products, export of tubes and pipes scored the highest increase, i.e, from $162.4 million to $349.1 million when comparing the two first halves of 2011 and 2012. At the same time, export of iron and steel materials registered an increase of 21.7 per cent to $113.3 million, with the flat rolled iron or steel registering a 60 per cent increase in exports.

Export of Electrical machinery as a whole scored an increase of 7.76 per cent to $300.5 million from $278.9 million. Major among the electrical machinery that showed increase in exports were transmission apparatus for radio telephony (+ 11 per cent to $73.6 million) and the insulated cables and wires (+ 23.4 per cent to $47.4 million) and electrical ignition machinery (+48.8 per cent to $34.9 million)

Export of tyres rose by 15.9 per cent to $240 million during January-June 2012, compared to $207.2 million during January-June 2011. UAE was the 4th largest export market for new tyres for Japan after US, Australia and Russia during the first half of 2012.

Japan’s imports from UAE

The value of Japan’s imports from the UAE increased by 9.7 per cent to $22.61 billion during the first six months of 2012, compared to $20.61 billion during in the same period in 2011. 98.4 per cent of imports from the UAE were consisted of mineral fuels that include crude oils and other gaseous hydrocarbons. Out of the remaining 1.6 per cent imports, 1.3 per cent was comprised of aluminium, the 2nd largest export item of UAE.  Other items in small quantities include copper scraps, precious stones and metals and live animals.

The value of crude oil imports alone covered 78.31 per cent of the total imports from the UAE, which showed an 8.14 per cent increase in value during the first half of 2012. Japan imported a total of 146 million barrels of crude oils with a value of $17.43 billion during the first six months of 2011.  The volume of crude oil import was down 3.23 per cent, compared to the volume during the first half of 2011. The average price of crude oils surged 11.75 per cent $119.44 per barrel, compared to $106.88 per barrel during the same period in the previous year. UAE remained to be the 2nd largest supplier of crude oils to Japan during the first six months of 2012, covering a supply of 21.40 per cent of Japan’s total crude oil imports.  Saudi Arabia remained the top supplier of crude oils, with a 32.72 per cent share. Other major suppliers of crude oils to Japan were Qatar (10.31 per cent), Kuwait (7.35 per cent), Iran (6.07 per cent), Russia (4.43 per cent), Indonesia (3.76 per cent) and the Sultanate of Oman (2.98 per cent). There were as many as 16 other suppliers with smaller quantities, including Gabon, Iraq, and Australia.

The value of import of petroleum gases from the UAE rose by 22.28 per cent to $4.1 billion, with a 2.42 per cent increase in the volume of import. The average price of petroleum gases increased 19.38 per cent to $940 per Metric Tonne from $787.4 per Metric Tonne during the previous first half. UAE was the 4th largest supplier of petroleum gases to Japan after Qatar, Malaysia and Australia. Gas import from Qatar rose significantly during the first half of 2012 to exceed supplies from major suppliers like Malaysia and Australia. The different kinds of petroleum gases that Japan imported from the UAE include liquefied natural gas, liquefied propane and liquefied butanes.

Beside oil and gas, Japan’s major import from the UAE is aluminium in different forms. UAE has been a traditional source of semi-finished aluminium for Japan, and during the first 6 months of 2012, Japan imported aluminium worth $294.59 million from the UAE, 16.18 per cent higher in value compared to the value during the same period in the previous year. In terms of quantity, Japan imported 125.6 million Kg of aluminium during the first half of 2012, which was 32.45 per cent higher compared to the quantity imported during the first half of 2011. However, the average price of aluminium declined by nearly 12 per cent to $2.35 per Kg from $2.67 per Kg in the previous first half. UAE became the 4th largest supplier of the aluminium to Japan during this period, overtaking suppliers like Brazil and New Zealand, who were ahead of UAE in the previous year. The three top exporters of aluminium to Japan were Australia, Russia and China.

In addition to aluminium, Japan’s imports from the UAE included small quantities of copper waste & scrap, precious stones and metals, live animals, fish and seafood etc. Significant among them was the increase in the export of copper waste that rose by 68.2 per cent to $14.8 million, compared to $8.8 million in the first half of 2011. Export of fish, though was limited to nearly a million US dollars only, saw an big jump compared to the previous year’s first half, when it is almost nil, and nearly 0.2 million US dollars during the first half of 2010. Similar increase was also posted in the export of live animals, mostly horses, to $4.4 million from almost nil during the first halves of the previous two years. 

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