16% Dubai export slump in 2009 same as China

13. January. 2010
by: Peter Cooper

New data published by the Dubai Chamber of Commerce and Industry showed total exports slumping 16 per cent to $50.5 billion in 2009, the same annual percentage fall recorded by China, the world’s largest exporter.
Dubai exports also witnessed a similar rebound in December with a 23 per cent gain to $5 billion as global trade bounced back from the worst slump in more than 80 years. The comparative figure of December 2008 was the bottom of the slump so the bounce is not really as good as it looks.
2010 optimism
DCCI director-general Hamad Bu Amin said: ‘The higher December export figures for Dubai are an indication of the positive outlook for 2010 as the export sector can look forward to a better trading year this time around’.
The geographic spread of Dubai exports remained heavily concentrated in its top 20 markets with Gulf Cooperation Council countries accounting for 45 per cent and Saudi Arabia the largest single national destination at 23 per cent.
The GCC region has not been as hard impacted by the global recession as the rest of thw world, aside from Dubai where a local real estate crash has exacerbated the downturn and left developers with huge debts. Indeed, oil prices have staged a remarkable recovery supporting public expenditure in the region.
However, it is far from certain whether the global economy is quite out of the woods just yet. The recent uptick in global trade could be the middle of a W-shaped recession that lands the world back in recession later this year.
Second-leg down?
Some economists believe the recovery thus far is almost entirely down to the massive and unprecedented actions by global governments to stimulate the world economy and offset the impact of the financial crisis surrounding bad debts at banks from the sub-prime lending crisis.
Once this stimulus is withdrawn – and it is too large to be maintained indefinitely – then there will inevitably be another contraction in global demand and downward pressure on trade flows. Dubai should be looking to this modest upturn to put right as much damage as possible from the recession of 2009 just in case more danger lurks around the corner.
The tightening of Chinese bank lending has just thrown a spanner in the works and halted the recent rise in global financial markets, and it may do the same for exports.