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The UAE was ranked among six booming trade hotspots for sourcing, manufacturing and exporting in the medium term, according to a Standard Chartered report (pdf). The UAE was the only Middle Eastern country to feature on the list, ranking alongside India, China, Malaysia, Indonesia, and the US.
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The ranking was based on a survey of 1.2k corporate leaders from 17 markets across four sectors: including consumer and retail; energy and power; technology; and telecommunications.
Corporations looking to diversify their global supply chains are increasingly turning to the UAE. Around 20% of respondents indicated that the Emirates stands out as a market of interest for sourcing, manufacturing, and exporting when looking to shift their existing supply chains. This was increasingly important to respondents — with 56% of them looking towards realigning supply chains geographically to build resilience against trade disruptions.
The UAE remains a key global connector to China and ASEAN markets — indicated by increasing engagement and trade, the report finds. This was particularly evident for Vietnam, Thailand and Malaysia.
ICYMI- The UAE has trade agreements in place with Vietnam, Malaysia, India, Indonesia, and Turkey, and is looking to finalize an agreement with Thailand and Philippines sometime this year. On the other hand, the UAE signed a comprehensive economic partnership agreement (CEPA) with Malaysia in January.
Other key attractions: The country also has one of the world’s busiest container ports — Jebel Ali — and is solidifying its position as a hub for financial services, AI, and digital infrastructure, the report said.
Who’s eyeing the UAE? The UAE is getting a lot of interest from Saudi Arabia, India, and Egypt in particular, with 50% of corporate respondents from KSA, Egypt and India indicating a strong interest in the Emirates, highlighting a strong potential to further intra-regional trade and further investments along the Middle East-India trade corridor.
REMEMBER- Projects like the India-Middle East-Europe Economic Corridor (IMEC) project are set to give cross-border trade between India, the Middle East, and Europe a further boost. The project kicked off inJune of last year, with a focus on establishing the first leg between India and the UAE via sea and rail links. Efforts are currently underway to streamline procedures across the Indian ports of Mundra, Kandla and Nhava Sheva as well as the UAE ports of Jebel Ali and Fujairah.
The caveat: Realigning supply chains geographically “does not come cheap,” Standard Chartered Global Head of Transaction Banking Corporate Sales Mark Troutman said. Over three in five respondents expect the overall costs of goods to rise by between 5% and 14% in the medium term.
