With Korea's imports from UAE reaching USD 12.2 billion, the UAE has becomes its 9th largest import market internationally, indicates a Dubai Chamber study
Dubai, UAE: A recently released study by Dubai Chamber of Commerce and Industry stated that during the year 2010, South Korea's imports from UAE reached USD 12.2 billion, up by 31% from the year ago level of USD 9.3 billion; making the UAE its 9th largest import market internationally and the second largest market in the region after Saudi Arabia.
Meanwhile, South Korea's exports to the UAE expanded significantly in recent years. In 2010, the UAE was ranked as its 19th largest export market in the world and the largest in the Middle East.
The study further revealed that South Korea has achieved a remarkable record of growth and global integration to become a high-tech industrialized economy; thus, becoming a member of G-20 along with other major economies. It was ranked as the world's sixth largest exporter and tenth largest importer in 2010.
Fig. 1 illustrates the value of South Korea's trade with the UAE from 2007 to 2010. Imports in 2008 registered a significant growth of 52%, reaching a peak of USD 19.2 billion. The slowdown in 2009 pulled imports down to USD 9.3 billion, before showing signs of recovery in 2010. Although, exports to UAE followed the same pattern, the decline in 2009 was more modest at 13% to USD 4.9 billion, from USD 5.7 billion in 2008, narrowing down the trade balance from a year ago level of USD -13.4 billion to USD -4.3 billion. With imports growing faster than export in 2010, South Korea's trade deficit with UAE expanded to USD 6.7 billion.
Oil continues to dominate South Korea's imports from UAE
UAE supplies about 10% of South Korea's imports of Petroleum oil and products. With oil prices reaching peak levels in 2008, Korea's imports of the oil products from the UAE reached USD 19 billion, accounting for 99% of its total imports from the country (Fig.2).
The significant decline in oil prices, as global demand for oil fell during the crisis; South Korea's statistics from UAE for 2010 fell to lowest levels in the last four years at USD 9.1 billion, a reduction of 52% from 2008 level.
Other major products imported by South Korea from the UAE during 2010 included Aluminium and articles thereof, valued at USD 256 million; Copper and articles thereof, USD 63 million and Glass and glassware, USD 14 million.
Electrical machinery/Ships, boats and floating structures topped Korea's exports to the UAE
Korea's exports to UAE were relatively varied. Topping the list were Electrical machinery and equipment and parts thereof valued at USD 1.1 billion and accounting for 20% of the total, representing an annual growth of 18% (Table 1). Ships, boats and floating structures came second for a value of USD 748.7 million; posting a substantial growth of 79,119% from USD 0.9 million registered in 2009. When looking at the four-digit HS code level, this group consists mostly of cruise and cargo ships with a value of USD 719 million.
Despite the global crisis, exports of Machinery and part thereof posted a slight increase of 1%, to reach a total value of USD 774.7 million in 2009. However, an 8% decline in 2010 pulled down the total export value of the products to USD 712 million.
Other major products exported to the UAE in 2010 were Vehicles other than railway or tramway rolling-stock, valued at USD 647.1 million, posting a growth of 82% over 2009 value.
The combined export value of the four major export groups reached USD 3.2 billion, representing 58.8% of total exports during 2010 and posting a year-on-year growth of 55%.
Bright prospects for continued trade relations
South Korea is one of the first countries to recover from the global financial crisis. With its 6.1% GDP growth forecast for 2010 it is the 4th largest economy in Asia and the 14th globally. This growth is boosted by acceleration in private consumption growth, strong investment and rise in demand for South Korea exports.
UAE can take advantage of its low import taxes and excellent trade infrastructure and support services in developing its role as the re-exporting hub in the Middle East for Korean products. This bid can also find support from being the regional base of international logistics companies as well as efficient road, air and sea transport facilities linking the UAE with the rest of the world.
-Ends-
Established in 1965, the Dubai Chamber of Commerce & Industry is a non-profit public entity, whose mission is to represent, support and protect the interests of the business community in Dubai by creating a favorable business environment, supporting the development of business, and by promoting Dubai as an international business hub.
© Press Release 2011
