UAE economic growth is expected to reach approximately 4% in 2021 boosted by the return of tourism and retail spending. Higher oil prices could also boost this figure if they are maintained over the medium term.
Delaware’s Trade Representative office in the United Arab Emirates is OCO Global. We have two talented trade experts who will assist Delaware exporters: Joe Hepworth and Vineetha Sony.
Joe and Vineetha specialize in trade, foreign direct investment, exports, business set up and commercial orientation.
Through OCO Global and its subsidiary company, the British Centres for Business (BCB), they are is committed to helping identify, develop and promote trade and economic opportunities between the Middle East region and other international markets on behalf of our global clients.
Together they work with both government Investment Promotion Agencies/Economic Development Agencies and directly with private companies looking to grow international markets, open new export channels, find new sources of inward investment or simply improve their regional footprint & operations.
- Since 2009, the UAE has been the number one export market for US goods in the entire Middle East and North Africa region. In 2020, bilateral trade totaled $17.83 billion, with the US exporting nearly $15 billion of goods and services to the UAE. The resulting $11.68 billion trade surplus for the US is America’s fourth-largest trade surplus globally.
- The UAE trades with all 50 US states. Electronics was the top category of US exports ($2.58 billion), accounting for approximately 17% of total exports in 2020.
- Delaware exports to the UAE were $82 Million in 2019 and $79.5 Million in 2020.
- The UAE is one of the largest Foreign Military Sales customers of the US, purchasing more than $20 billion in US defense hardware and services over the past decade, including one of the world’s largest non-US F-16 fleets. Infrastructure development projects across the UAE are driving growth and supporting billions in US exports. Projects include the development of a new railway; network support for the UAE civilian nuclear energy program; the construction of new airports in Abu Dhabi and Dubai; and the expansion of commercial seaports across the UAE.
- The workweek in the Middle East is Sunday – Thursday, with the weekend being Friday and Saturday. In Islamic culture, Friday is the day of worship, thus most businesses are closed.
Clean Technology Sector
The UAE is a promising market for renewable energy products and services. The country set the pace in the energy transition for the GCC and has the highest portfolio of renewables for the region. The UAE also launched a national “Energy Strategy 2050” in January 2017, allocating over $163 billion to meet its goal to increase the contribution of clean energy sources in the total capacity mix to 50% by 2050. This goes hand in hand with the UAE’s Vision 2021 strategic plan to generate 27% of its energy requirements from clean sources, including nuclear power, aiming for: Renewable Energy: 44%, Gas: 38%, Clean Coal: 12%, and Nuclear: 6%.
The UAE accounted for the fastest growth of Artificial intelligence contribution among countries in the Middle East and North Africa during the period from 2018 to 2030, with an average annual growth rate of around 33.5%. In relative terms, the UAE was expected to witness the largest impact of AI, at around 1/4th of the country’s GDP. The magnitude of such impact is attributed to the country’s investment in AI technology. The embrace of AI comes as the UAE is cultivating emerging technologies as a means of boosting and diversifying its rentier economy, as well as signaling its innovation capacity and viability as a global trade powerhouse. To achieve this aim, the Emirati government is investing vast sums into its cybersecurity, cloud computing, and space technology sectors.
Information and Telecommunications Sector
UAE led the ICT Global Competitiveness Index in 2019. With consumer demand for ICT products totaling $4 billion in 2016, it is evident that the nation is a strong market for final goods. UAE is the first country in the Arab region and the fourth globally to launch its 5G network.
Subsectors include cloud computing, cybersecurity, IoT, artificial intelligence, smart cities, 5G.
The manufacturing sector has been identified as a crucial industry and is being used as a means to achieve sustainable growth. The UAE is committed to contributing to the sector by continuing the support for the ongoing production of raw materials across its industrial manufacturing subsidiaries in steel, aluminum, glass, and other building materials.
According to the UAE’s Department of Economic Development (DED), the manufacturing sector already accounts for 80% of Dubai’s non-oil trade, making it the second-largest contributor to the UAE’s economy. In total, the UAE’s manufacturing sector accounts for 53% of the country’s total non-oil exports, with the DED predicting it to contribute one-quarter of the country’s GDP by 2025. It is projected that the revenue of manufacturing in UAE will amount to approximately 38.6 billion U.S. Dollars by 2024.
The government is heavily invested in creating a world-class healthcare sector in the UAE. The UAE’s health expenditure reached a value of $15.5 billion (AED 57.0 billion) in 2019.
For medical devices, the UAE is an import-driven market that is growing rapidly to keep pace with the country’s expanding healthcare infrastructure. The government and private healthcare sectors are investing heavily to provide countrywide healthcare solutions to residents, ex-pats, and medical tourists.
Note, all medical devices must be approved by MoHAP’s Drug Registration and Control Department. Imported medical devices will not be cleared by Customs unless a pre-approval for the importation of the consignment is issued by MoHAP. If the exporter company/manufacturer has no legal presence in the UAE, it will have to appoint a local representative to act on its behalf to register the devices. The local representative must be appointed by a written contract stating the appointment of the local authorized representative by the company. The local representative should be licensed by MoHAP.
Strategies for Market Entry: Partner with OCO Global and Export Delaware
- Distributors and agents
- Free Trade Zones
- Trade Shows: The UAE is home to world-class trade shows, including Arab Health, which is scheduled for June 21-24, 2021.
- Trade Missions: Export Delaware is planning a mission to Dubai in the Fall of 2021.
- Customized Virtual Trade Mission: Your Delaware small business can partner with OCO Global on what we call a “Customized Virtual Trade Mission,” where you work one-on-one with the OCO team to identify and meet target clients in the Middle East. The fees to work with OCO or any of our international trade representatives are covered by the STEP grant. To learn more about opportunities for your business in the Middle East, please contact us and let us know you are interested in exploring this opportunity.
If this market interests you, consider joining us on our next business trip. Email us email@example.com to learn more.