Trade flows between GCC countries and Latin America and the Caribbean, LAC, reached US$16.3 billion in 2018, while the UAE remained a top trading partner in the Gulf region for LAC countries, according to a new report conducted by the Inter-American Development Bank, IDB, in cooperation with the Dubai Chamber of Commerce and Industry.
The report, entitled 'Towards a Renewed and Strengthened Relationship: Fostering ties between Latin America and the Caribbean and the Gulf Countries', was released during the 3rd Global Business Forum on Latin America which kicked off today in Panama City.
In 2018, Gulf countries imported $10.9 billion worth of products from Latin America and the Caribbean, while they exported products to the region valued at $5.4 billion. The UAE accounted for 27 percent of exports from GCC region to Latin America and the Caribbean, and 46 percent of imports from LAC countries, making it the top growth market for LAC traders, the report revealed.
Brazil, Argentina and Mexico were identified as the top trading partners in the region for GCC markets, jointly acquiring 76 percent of the total intraregional trade between the two regions. Brazil's trade with the Gulf countries in 2018 amounted to $9.1 billion, followed by Argentina at $2 billion and Mexico at $1.3 billion.
Commenting on the report findings, Hamad Buamim, President and CEO of Dubai Chamber, said the report highlights the tremendous trade potential that remains largely untapped and noted that it highlights a major business opportunity which the Chamber will plan to capitalise on through the GBF platform and its three representative offices in Latin America.
He explained that Dubai Chamber’s growing presence in Latin America supports Dubai’s economic diversification plans and strategic vision, adding that boosting bilateral trade and attracting Latin American companies to Dubai are among the representative offices’ top priorities. Buamim noted that the report released by IDB provided much-needed clarity on trade flows and commerce between the GCC and LAC region, and stressed Dubai Chamber’s commitment to further facilitating business exchange and forging new partnerships that create mutual benefits and economic growth.
The Dubai Chamber President pointed out that the report results show that there are many commercial and investment opportunities for cooperation between the GCC and Latin markets in various sectors and fields, adding that Dubai Chamber regularly conducts its studies on promising Latin American and Caribbean markets as part of its efforts to identify business opportunities for its members.
The report outlined several recommendations for boosting trade flows between the two regions, including establishing new trade, investment and double taxation agreements, increasing the number of diplomatic missions, launching additional direct flights, and further facilitating bilateral business exchange.
According to IDB’s estimates, new trade agreements could potentially increase trade flows between the GCC and LAC regions by $9.8 billion per year, while it also noted that expanding diplomatic footprint could give a $3.3 billion boost to bilateral trade.
Simplifying export and import mechanisms and processes were also deemed as essential to facilitate and accelerate bilateral trade.
Plastic products and electrical machinery remain the top categories dominating bilateral trade between the two regions, while vehicles, pharmaceutical products, electrical appliances, iron and steel were identified as high-potential products.