(MENAFN- Dubai PR Network) • 256 Certificates of Origin (COOs) targeting China issued by Dubai Chamber in May 2020; Value of COOs rose 27% y-o-y to reach AED 283 million during the same month.
• Diversification of exports, strengthening Dubai-China ties and Dubai traders' strategy of filling gaps in Chinese market among the key drivers of export growth.
Dubai, United Arab Emirates, August 24, 2020: Dubai Chamber of Commerce and Industry member companies' exports to China in May 2020 increased 18% month-on-month (m-o-m) and 26% year-over-year (y-o-y) as the Chamber issued a record 256 Certificates of Origin (COOs) targeting the country worth over AED 283 million.
The value of COOs for May, the third highest on record, marked growth rates of 14% m-o-m 2and 7% y-o-y. Unlike the previous spikes in declared values, the upward trajectory leading to the month of May was largely driven by solid growth in activity, which suggests a continuation in sustained future growth.
Figure 1: Number of COOs for China-bound shipments (monthly)
Export growth drivers
Vegetable oil (i.e. rapeseed oil / colza oil) dominated the value of member exports with a share of 53%. Plastics (i.e. ethylene-alpha-olefin copolymers, polyethers, polymethylene) contributed another 25% to the total, followed by food processing waste/residue, which contributed 12% of the total. The remaining 10% of the total declared value of COOs came from paper products (i.e. fluting paper of recycled linerboard), chemicals, sugar, man-made filaments, wood, and vehicles.
With Dubai developing its rapeseed oil extraction and processing capacity in recent years, traders in the emirate have stepped up to fill gaps in the Chinese market created by ongoing trade tensions, which in turn gave a strong boost to Dubai's total exports.
Figure 2: Declared value of COOs for China-bound shipments (monthly, AED million)
The data also signalled strengthening trade ties between Dubai and China. During the January-May 2020 period, the total number of COOs issued for China-bound shipments reached 1,100 certificates, which is almost double the number issued during the same period six years ago. This upward trend is expected to continue in the coming years, as the current level of exports activity has not yet reached its potential.
In addition, the ongoing diversification of Dubai's exports and development of manufacturing industries in the emirate were highlighted as other key factors driving China-bound exports of member companies.
Figure 3: Composition of COOs issued in May by product type (percentage share in total declared value)
New market opportunities
Dubai Chamber has identified huge potential for boosting exports to China. The Chamber's representative offices in Shanghai and Shenzhen are studying new business opportunities emerging in the Chinese market, which companies in Dubai can benefit from. Dubai based exporters, re-exporters and manufacturers, particularly those active in food processing, plastics, chemicals, packaging, base metals and construction materials can explore such prospects by taking advantage of the various services offered by the Chamber and its international offices to expand their reach in China.
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