Japan reports a 64-percent growth of imports from UAE

Imports of mineral fuels accounted for much of this growth.

Japan's imports from UAE had been primarily mineral products, consisting mainly of petroleum oil. From a share of 98.5% to the total imports in January to April 2005, the share of the product group increased to 99 percent in 2006. Thus, despite the 25% growth in imports of base metals and products thereof, the share of the product group declined from 1.1% to 0.9%. Imports of the other product groups actually registered declines.

Japan's exports to UAE, on the other hand, remained well below the value of imports, reaching AED 7 billion for the first 4 months of 2006, leading to a 72% increase in trade deficit for Japan. Trade deficit of the period was placed at AED 31 billion, from AED 18 billion for the same period in the previous year. Vehicles continued to be the main exports of Japan to the UAE. Figure 1 shows that vehicles, aircrafts and transport equipment and parts accounted for nearly half (47%) of the total, for an export value of AED 3.4 billion, which was more than a billion higher than the corresponding value a year earlier.

Machinery, electrical and electronic products constituted the second largest group in terms of contribution to total exports, with export value of AD 2 billion, or 26% of the total. These were mainly machineries used in construction and electronic products. Japan is the biggest supplier of video telephones, cameras and other video-audio equipment in the UAE. The group posted a growth of 28% over the same 4-month period a year earlier.

Largest export growth of 110% was recorded for base metals and articles thereof, with export value increasing from AED 318 million to AED 668 million. Largest contributors to the group were construction materials of iron and steel. Other groups that posted increases were plastics and rubber products, from AED 382 million to 508 million.; textiles and articles of textiles, from AED 132 million to AED 171 million; and stone, cement, ceramics and glass products, from AED 67 million to AED 86 million.

On the other hand, an 85% decline was noted for semi-precious/precious stones and metals and jewelleries, with export value declining from AED 73 million to AED 11 million; optical and precision instruments, from AED 113 million to AED 83 million; and chemicals and chemical products, from AED 106 million to AED 104 million.

UAE is No. 4 supplier of Japan's imports

The UAE ranks fourth among the largest suppliers of Japan's imports (Table 2), accounting for more than 5% of total imports of Japan. Largest supplier was China, with a share of more than 20% of the import market; followed by USA, with nearly 12%. While imports from Saudi Arabia and UAE were primarily petroleum oils and products thereof, top imports from China were automatic data processing machines, peripherals and parts. Top imports from USA were aircrafts and parts. Other top import markets of Japan were South Korea (4.7%), Australia (4.6%), Indonesia (4.1%), Taiwan (3.5%), Germany (3.2%) and Thailand (2.8%).

Japan's largest markets for its exports were the USA, absorbing 23% of Japan's total exports and China, almost 14%. While exports to China were primarily machinery and electronic equipment, cars dominated exports to USA. Other top export markets of Japan were South Korea (7.9%), Taiwan (7%), Hong Kong (5.5%), Thailand (3.5%), Germany (3.1%), Singapore (2.9%), UK (2.5%), and Netherlands (2.2%).

Among the major destinations of Japanese exports, Hong Kong and Netherlands play a comparable role to UAE as they serve as the gateways to China and to Europe, respectively. However, UAE ranks 22nd among the export markets of Japan, with a share of less than 1% to total exports. Dubai serves as gateway of products to the Middle and Africa. With the increasing affluence of the oil exporting countries, demand for high-quality Japanese products in the area is expanding. This is an opportune time for UAE, specifically Dubai, to bolster its role as international trading hub.