Tuesday, Dec 09, 2008
Gulf News
Dubai: Dubai's exports to major markets, affected by the credit crunch, could fall in 2009, but trade with other countries such as India could cushion the impact, UAE-based exporters said.
The amount of Dubai's exports in the third quarter, which stood at Dh56.6 billion, is still higher than last year's Dh45.3 billion.
However, a quarterly comparison showed that total exports of firms listed with the Dubai Chamber of Commerce and Industry declined slightly by 1.7 per cent in September from Dh57.6 billion in June.
According to the Dubai Chamber, exports to Iran dropped by 15.4 per cent, while exports to other destinations, which include the United States, Yemen, Qatar, China, Algeria, Indonesia and American Samoa, posted an overall decline of 25.9 per cent. Exports to GCC countries except Qatar are still rising.
Paras Shahdadpuri, chairman of Dubai-based export firm Nikai Group of Companies, said a slowdown in exports from Dubai is inevitable considering that the city trades with markets overseas.
"The world trade will shrink due to the financial crisis. To that extent, Dubai will also be affected because, after all, the UAE or Dubai is part of the global trade. But I don't think the impact is going to be very long," Shahdadpuri told Gulf News.
He said that aside from the credit crunch, exporters and manufacturers in the UAE are grappling with the high cost of operations, so the government should provide some incentives to traders and encourage them to produce globally competitive products.
"There's much more to be done if the UAE wants to establish itself as a major export and re-export destination. They should encourage business people and manufacturers here to make their products competitive. They should also facilitate trade financing for manufacturers and exporters," Shahdadpuri added,
However, Dr. Ram Buxani, group executive vice chairman of Cosmos, said any decline in exports could be compensated by Dubai's trade with other countries like India, which is one of the city's top destinations for exports.
"Exports, when they're made from here, will go all over the country of India, which is home to more than one billion people. Besides, despite the crisis, India does not see Dubai as a risky trading partner and vice versa. Also, most of the things that are exported are consumer articles. People buy them. The property market may be affected here, but not the exports," he added.
Latest statistics from the Dubai Export Development Corporation showed that exports to India grew by 109 per cent between 2006 and 2007.
Gulf News 2008. All rights reserved.
