Download UAE and Spain Trade Relations Fact Sheet

Bilateral relations between the UAE and Spain Fact Sheet
UAE as a gateway to the Gulf
The countries of the Middle East and GCC have directly
benefited from the recovery in world trade and higher oil
prices and from the increasing shift in their pattern of
trade towards Asia and Europe. In this context, the UAE
has been a major beneficiary due to the massive
investments it has made in ports, airports, transport
systems and trade facilitating logistics. The World Bank’s
1
Logistics Performance Index (LPI) ranks the UAE 24th
on a global basis, the highest rated country in the Gulf
and MENA. The regional and international networks of
Emirates Airlines and Etihad make the UAE the most
connected country in the Middle East, South Asia and
Africa for passengers and cargo. Dubai Ports World is one
of the largest marine terminal operators in the world, with
50 terminals and 11 new developments across 31
countries, with an extensive coverage of the fast growing
emerging economies.
Compared to other countries of the Middle East, the GCC
are characterised by high growth, liberal economic
policies and open labour markets, with trade and
investment policies that facilitate foreign direct investment.
The GCC sit on over 50% of the world’s proven oil & gas
reserves but are focusing on economic diversification in
order to create jobs for their demographically young and
fast growing populations. They are increasingly
internationally competitive as a result of the
implementation of WTO participation and liberal trade
policies with a low external tariff (5%) as part of the GCC
customs union. The GCC are moving to greater regional
economic integration, with the gradual implementation of
a GCC Common Market.
Given its central location between Europe and Asia at the
mouth of the Gulf, the UAE/Dubai has became an
important destination for global and regional tourism,
rising as a top location for shopping, leisure, international
conferences and media events. The strong growth of the
tourism sector (more than 15% p.a.) has had a multiplier
effect on the economy in the UAE, not only because of its
direct contribution to GDP, but also for its indirect effect
on retail sales and transportation (including logistics),
which together represent about 44% of GDP. UAE is in
the list of the top 15 importers for transportation services
1
The WB’s Logistics Performance Index (LPI) aims to rank
economies on the Ease of Shipping and Trade. It is based on a
worldwide survey of operators (global freight forwarders and
express carriers), providing feedback on the logistics
“friendliness” of the countries in which they operate and those
with which they trade. They combine in-depth knowledge of the
countries in which they operate with informed qualitative
assessments of other countries with which they trade, and
experience of global logistics environment
given its increasing role as a logistics hub, and is the 7th
main international destination of Russian travelers.
The Table below provides main macroeconomic indicators
for the UAE confirming the recovery of economic from the
effects of the global Great Recession. Macroeconomic
indicators of the UAE show an overall positive trend since
the crisis with an estimated real GDP growth in 2010 of
1.3% compared to last year. The current account has
swung into a surplus of 7.8% of GDP compared to a
deficit of last year (-3.1%), while public debt has
decreased to 41.6% compared to 46% of GDP in 2009.
UAE exports were estimated at 192.2 billion $ in 2009.
This represents about half of the total exports of the GCC
countries, while Imports of the UAE represent about
37.8% of total GCC imports.
UAE Macro Indicators
2007
2008
Population (millions)
5.3
Real GDP growth (%)*
6.1
Nominal GDP (US$ bn)*
Budget balance (%GDP)
2009
2010
5.6
5.4
5.5
5.1
-0.7
1.3
207.6
261.4
230.0
252.7
9.1
14.2
2.6
2.5
Public debt (%GDP)
41.2
39.4
46.0
41.6
Government consumption (%GDP)
10.1
9.3
19.3
20.1
Private consumption (%GDP)
46.2
45.5
47.4
47.2
Domestic demand (%GDP)
90.0
88.6
95.2
95.6
Trade balance (%GDP)
13.8
15.3
8.7
6.5
9.4
8.5
-3.1
7.8
77.2
31.7
36.1
39.1
Current Account (%GDP)
International Reserves (US$ mn)
* IMF data
Source: Economic Intelligence Unit
Trade Balance
UAE is considered as the first destination of Spain exports
in the Middle East region, and is ranked as the third in the
MENA region. Spain exports to the UAE are estimated at
about € 1 Billion. The trade balance between both
countries has been traditionally favorable to Spain, having
reached its record on 2008 with a positive variation of
19.4%.
1
Trade by main products
More than half of Spain exports to the UAE consist of
commodities, industrial products and capital goods. The
exports of agro-foods and beverages items have
increased during the last three years. In terms of value,
the agro-food exports grew from 89 million € in 2007 to
124 million € in 2009 (28%) while the value of beverages
that were exported increased by 796 million € (20%)
during the same period (Table 1). Similarly, Spain import
from UAE commodities and capital goods which alone
accounted for 89% of overall imports. Plastics and
Aluminum are the main imported items which make 21%
and 37% respectively of overall imported articles between
January and May 2010.
Spain Investments with the UAE
Data show that the Foreign Direct Investment received by
Spain in 2009 originated primarily from the UAE and is
estimated at 3.322 million Euros. The largest fraction of
these investments are for the manufacture of coke and
refined petroleum products (3.3 million Euros) followed by
the construction of buildings (4 million Euros). Spain on
the other hand contributed to the UAE 40 million Euros for
the water transport and 18 million Euros for the
manufacture of other metallic mineral products.
Today, both countries endeavour to enhance economic
and commercial ties and open up joint-business
opportunities for both countries in different sectors with
great development potential, such as environmental,
water treatment and desalination, renewable energies,
aeronautics, biotechnology and health sciences and
information and communication technologies
Trade Balance - Spain w ith United Arab Emirates
Thousands Euros
Exports
Imports
References:
1. “Dubai World Central and the evolution of Dubai
Logistic Cluster” DIFC Economic Note No. 10, August
2010 available at
http://www.difc.ae/index.php/download_file//view/1903/
2. “Forecasting Tourism in Dubai” DIFC Economic Note.
8, February 2010 available at
http://www.difc.ae/index.php/download_file//view/1733/
Balance
1,400,000.00
1,200,000.00
1,000,000.00
800,000.00
600,000.00
400,000.00
200,000.00
2007
2008
2009
Jan-May 2010
Imom UAE are primarily commodities and
Table 1. Exports, Spain to United Arab Emirates by sector
(in thousands euros)
Main Sectors
2007
2008
2009
2010
Agro Alimentary
Beverages
Consumer Goods
88,951.1
3,735.5
300,962.2
105,107.7
4,051.4
343,818.7
123,663.5
4,531.4
294,102.9
14,453.5
10,044.8
9,632.0
Commodities, industrial
products and capital goods
483,206.0
724,384.4
496,689.7
9,448.3
Total
876,854.8
1,177,362.3
918,987.4
43,578.5
Source: ICEX. Spanish Institute of Foreign Trade
Table 2. Imports, Spain to United Arab Emirates by sector
(in thousands euros)
Main Sectors
2008
2009
2010
Agro Alimentary
Beverages
Consumer Goods
2007
188.1
1,621.9
16,737.7
603.2
30.1
15,690.4
670.7
335.3
7,762.4
473.2
566.0
3,201.2
Commodities, industrial products
and capital goods
77,673.4
228,836.6
71,199.7
32,748.4
Total
96,221.0
245,160.3
79,968.1
36,988.7
Source: ICEX. Spanish Institute of Foreign Trade
2