The Growth of UAE’s Non-Oil Foreign Trade Vs Other Sectors

The UAE’s non-oil foreign trade reached a record high of AED3.5 trillion ($953 billion) in 2023, according to the data released by the Federal Competitiveness and Statistics Centre. This represents a 19% increase from the previous year, and a 45% increase from 2019, before the COVID-19 pandemic.

The growth of UAE’s non-oil foreign trade was driven by several factors, such as:

The recovery and resilience of the UAE’s economy, which achieved a 4.2% growth rate in 2023, despite the challenges and uncertainties posed by the pandemic. The UAE’s economy benefited from its diversified and flexible structure, its proactive and effective policies, and its strong and stable institutions.

The expansion and diversification of the UAE’s trade partners and products, which reflected its openness and integration with the global markets, as well as its innovation and competitiveness in various sectors. The UAE’s trade with its top 10 partners, which include China, India, Saudi Arabia, and the US, grew by 26% in 2023, while its trade with new and emerging markets, such as Turkey, Indonesia, and Israel, increased by 36%. The UAE’s trade also covered a wide range of products and services, such as gold, electronics, chemicals, and food.

The development and enhancement of the UAE’s trade infrastructure and facilitation, which improved its accessibility and connectivity with the regional and international trade routes and hubs. The UAE invested heavily in its ports, airports, roads, and railways, as well as in its digital and smart platforms, such as the Dubai Trade Portal, the Abu Dhabi Trade Platform, and the Sharjah Trade Platform. The UAE also signed and implemented several trade agreements and initiatives, such as the Comprehensive Economic Partnership Agreements (CEPAs), the World Trade Organization (WTO) Trade Facilitation Agreement (TFA), and the Regional Comprehensive Economic Partnership (RCEP).

The Impact of UAE’s Non-Oil Foreign Trade

The UAE’s non-oil foreign trade has a positive and significant impact on the development and prosperity of the country and the region, such as:

The contribution to the UAE’s GDP and fiscal balance, which increased the income and revenue of the country, and supported its economic diversification and sustainability. The non-oil foreign trade accounted for about 70% of the UAE’s GDP in 2023, and generated a trade surplus of AED 182 billion ($49.5 billion).

The creation of jobs and opportunities for the UAE’s workforce and businesses, which enhanced the skills and productivity of the people, and stimulated the growth and innovation of the sectors. The non-oil foreign trade supported more than 2 million jobs in the UAE in 2023, and involved more than 300,000 companies, including small and medium enterprises (SMEs), startups, and women-owned businesses.

The strengthening of the UAE’s regional and global role and influence, which increased its reputation and attractiveness as a trade and investment destination, and as a partner and leader in the international community. The non-oil foreign trade enhanced the UAE’s relations and cooperation with its existing and potential allies and partners, and enabled it to participate and contribute to the regional and global initiatives and agendas, such as the Belt and Road Initiative (BRI), the Expo 2020 Dubai, and the UAE’s Golden Jubilee.

The Comparison of UAE’s Non-Oil Foreign Trade with Other Sectors

The UAE’s non-oil foreign trade accounted for about 70% of the UAE’s GDP in 2023, and generated a trade surplus of AED 182 billion ($49.5 billion). This indicates the importance and the dominance of the non-oil foreign trade sector in the UAE’s economy, as well as its contribution to the economic diversification and sustainability of the country.

The UAE’s non-oil foreign trade sector also outperformed and outpaced other sectors in the UAE’s economy, such as the oil and gas sector, the tourism sector, and the construction sector, which were affected by the fluctuations and the shocks of the global markets and the pandemic. The oil and gas sector, which accounted for about 25% of the UAE’s GDP in 2023, witnessed a decline of 8% in its revenues, due to the drop in the oil prices and the production cuts.

The tourism sector, which accounted for about 12% of the UAE’s GDP in 2023, saw a recovery of 15% in its revenues, after a slump of 40% in 2020, due to the travel restrictions and the health measures. The construction sector, which accounted for about 8% of the UAE’s GDP in 2023, experienced a growth of 10% in its revenues, after a slowdown of 5% in 2020, due to the delays and the disruptions of the projects.

The Prospects of UAE’s Non-Oil Foreign Trade

The UAE’s non-oil foreign trade is expected to continue its growth and expansion in the coming years, as the UAE pursues its vision and strategy of becoming a global leader and hub for trade and investment. The UAE aims to increase its non-oil foreign trade to AED 4 trillion ($1.09 trillion) by 2025, and to meet 50% of its GDP from the non-oil sectors by 2030.

The UAE’s non-oil foreign trade will also benefit from the development and enhancement of its trade infrastructure and facilitation, which will improve its accessibility and connectivity with the regional and international trade routes and hubs.

The UAE has invested heavily in its ports, airports, roads, and railways, as well as in its digital and smart platforms, such as the Dubai Trade Portal, the Abu Dhabi Trade Platform, and the Sharjah Trade Platform. The UAE has also signed and implemented several trade agreements and initiatives, such as the Comprehensive Economic Partnership Agreements (CEPAs), the World Trade Organization (WTO) Trade Facilitation Agreement (TFA), and the Regional Comprehensive Economic Partnership (RCEP).