May 2018

Gulf Industry Magazine helps you catch up with the numbers behind economic and industrial developments in the region.


Abu Dhabi non-oil trade hits $3.38bn

ABU DHABI’S non-oil foreign merchandise trade in January stood at Dh12.4 billion ($3.38 billion), according to figures released by the Statistics Centre – Abu Dhabi.

Saudi Arabia topped the list of the emirate’s trade partners with Dh300 million worth of exports received from Abu Dhabi, a Wam news agency report said. According to the figures, the value of exports during January 2018 increased to Dh2 billion, up 32.9 percent from Dh1.52 billion in January 2017.

The noticeable increase in the volume of exports comes against a decline in imports to Dh8.6 billion from Dh12.4 billion in January 2017, with re-exports hitting Dh1.733 billion.

The statistics cover the value of non-oil foreign merchandise trade which entered or exited the territory of Abu Dhabi through the emirate›s air, sea and land points of entry, and do not cover non-oil exports and imports through ports of other emirates in the UAE. Industrial accessories got the lion’s share of Abu Dhabi exports, amounting to around Dh1.87 billion, thus accounting for 93.5 percent of January’s total exports. Industrial commodities were valued at Dh3.6 billion out of the emirate’s total imports, while transportation equipment came first in te rms of re-exports, at a value of Dh992 million.


Global steel demand ‘to rise 1.8pc this year’

GLOBAL finished steel demand will grow by 1.8 per cent to more than 1.616 billion metric tonnes (mt) in 2018, and increase by another 0.7 per cent to nearly 1.627 billion mt in 2019, the World Steel Association said. Delivering the Brussels-based organization’s short-range outlook during a media briefing in London, worldsteel’s director General Edwin Basson said the growth expected this year and next is spread fairly evenly. “For the first time in a number of quarters we now see strong growth in both developing and developed economies,” Basson said. “The exception to the rule is China.” World production and consumption leader China will see flat demand this year, followed by a 2 per cent decline in 2019. Steel demand for China will be roughly 736.8 million mt this year and 722.1 million mt next year, according to worldsteel.


UAE elevator market seen growing at 4.7pc

THE elevator and escalator market in the UAE is expected to grow at a compound annual growth rate (CAGR) of 4.7 per cent during 2018-24 on the back of mega infrastructure development due to the upcoming World Expo 2020, a report said.

Further, for the upcoming World Expo 2020, more than $200 billion are expected to be spent for the expansion of existing and construction of new public and private infrastructure projects, which would deploy elevators and escalators, added the report titled “UAE Elevator and Escalator Market (2018-2024)” from 6Wresearch, a global market research and consulting firm.


Saudi cement sales weakness persists

SAUDI ARABIA’S total cement sales for Q1 2018 stood at 11.8 million tons, down 11 per cent year-on-year (y-o-y) and one per cent quarter-on-quarter (q-o-q) as a result of the continued slowdown in construction activity, a report said.

The combination of weak demand and high inventory levels forced the companies to seek other solutions such as entering other regions within the kingdom as well as exporting with low selling prices – a case in point is Yanbu Cement›s export agreement which seeks to lower the inventory and increase cash levels, said Al Rajhi, a leading financial services provider in the kingdom.

Yanbu Cement’s low cash cost per ton gives the company the ability to export at lower prices, which is likely not possible for other companies to replicate, says Al Rajhi.

Going forward, demand is unlikely to pick up based on the trends witnessed during the first three months of 2018. Al Rajhi says it remains cautious as construction activities are bound to remain weak. It adds that Q2 will witness a material drop in sales volume due to seasonality (Ramadan and the Eid ) which will result in around 20 per cent drop on q-o-q basis to reach 9.6 million tonnes (-14 per cent y-o-y) based on Al Rajhi’s analysis. For now, Al Rajhi remains neutral on the sector given the low demand, high inventories and price war in the sector, the company said in the report.


Dubai non-oil sector sees solid growth

DUBAI’S non-oil private sector witnessed a significant improvement in business conditions during March, with sharp growth in both output and new work contributing to the latest expansion, according to the latest Emirates NBD Dubai Economy Tracker.  That said, employment slipped into contraction for the first time since February last year. The seasonally adjusted Emirates NBD Dubai Economy Tracker Index – a composite indicator designed to give an accurate overview of operating conditions in the non-oil private sector economy – was at 55.3, down from 55.8 in February. Scoring well above the neutral 50.0 threshold, the figure indicated a marked expansion that was in line with the historical average, albeit the lowest for three months. Growth was recorded across all three monitored sub-sectors in March, led by travel & tourism (56.7), followed by wholesale & retail (56.3) and construction (53.2).


UAE attracts over $10 billion FDI in 2017

THE foreign direct investment (FDI) inflow to the UAE reached $10.3 billion (Dh37.8 billion) in 2017, up from $9.6 billion (Dh35.23 billion) recorded in 2016, said the organisers of the Annual Investment Meeting (AIM) in Dubai, UAE, citing figures from the UAE Competitiveness and Statistics Authority.

Dawood Al Shezawi, the CEO of AIM, said: “The UAE’s FDI inflow is a living testimony of how liberal approach and an ease in doing business is helping the UAE attract more investment. The UAE’s FDI stock now exceeds $128.85 billion, which is significant and puts the UAE ahead of most countries in the Middle East. Besides, the country’s 45 free zones collectively create a large gateway for trade and investment. In 2017, the UAE’s free zones handled Dh225.5 billion ($61.39 billion) worth of exports, a growth of 6.6 percent from the previous year, according to the UAE Central Bank.


Global logistics spend to top $10 trillion

GLOBAL logistics spending is expected to reach $10.6 trillion in 2020, with transportation accounting for the majority at 70 per cent, finds a recent analysis from growth partnership firm Frost & Sullivan.

Emerging technologies such as cloud computing, big data, and crowdsourcing, coupled with an influx of tech-savvy start-ups, are unbundling the value chain and transforming delivery models, said the analysis titled “Urban Logistics Opportunities – Last-Mile Innovation”.


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