Arab Irish Trade Boom

IRISH-ARAB

TRADE BOOM

Irish exports to the Arab world were up 6.4% for 2020 compared with 2019 despite the ongoing global pandemic, with exports to the region surpassing the overall Irish export market, which grew by 5.4%.

Ireland exported a total of €2.4 billion worth of merchandise products to the Arab countries in 2020, with Saudi Arabia and the United Arab Emirates accounting for almost half. According to Arab Irish Chamber of Commerce CEO Ahmad Younis, strong growth in merchandise exports to Arab countries can contribute to Ireland’s export recovery and ease the impact of Brexit.

However, a notable rate of growth to other Arab countries, including Algeria (up 40%), Qatar (up 33%) and Jordan (up 28%) indicates significant potential for Irish companies considering their export options. There were also considerable increases in exports to the UAE (up 18%) and Iraq (up 17%). As evidenced by these figures, the Arab world is proving itself an important prospect and alternative channel for Ireland’s economic recovery. Companies in Ireland whose export business has been negatively impacted by Brexit have a real opportunity here. Particularly striking are the rapid growth rates of between 30% and 40% recorded in exports to some of the larger Arab nations.

In 2019, an Arab Irish Chamber of Commerce report (Arab Irish Chamber EY-DKM report) forecasted the potential growth areas. The 2020 findings are particularly encouraging, with growth of 40% in 2020 to Algeria showing just how much potential there is for Irish businesses to export here.

Continued Growth Technology is a major player in terms of the types of products in demand, but there is also growth in more traditional sectors such as food.

While Ireland’s high-tech exports are performing strongly, as they are all over the world, demand for Ireland’s food exports is also robust. Given the Arab world’s current population of 420 million (and growing) and rising incomes in the area, this is an exciting market for Irish food producers contemplating a long-term strategy in response to Brexit.

A breakdown of trade between Ireland and its largest Arab export market, Saudi Arabia, shows the country’s huge dependence on a wide range of Irish-produced goods. Essential oils, perfume and toiletries accounted for the plurality – just over one third – of merchandise exports last year at €233.8 million. Medicinal and pharmaceutical accounted for €164.3 million, office machines and data processing €54.1 million, and food exports including dairy and eggs totalled over €90 million.

In monetary terms, a total of €2.45 billion worth of merchandise was exported to the Arab States last year, an increase of €146 million on 2019. Saudi Arabia accounts for one-quarter of this (€627 million), followed by the United Arab Emirates (UAE), which accounts for a further half a billion.

This overall upward trend is encouraging evidence in relation to another forecast made in the Arab Irish Chamber EY-DKM report to the effect that exports to the region, including the exports of traded services, will reach €12 billion by 2028.

Food for Thought Dubai remains a hub for e-commerce growth in the MENA region. With the pandemic changing consumer habits, the growth of digital shopping has accelerated, resulting in many companies investing in online sales activity and omni-channel methods.

Ireland’s leading food retail, wholesale and foodservice company Musgraves recently announced that it is doubling its SuperValu product range sold on noon Grocery, the Middle East’s largest online grocery marketplace and noon.com’s dedicated fresh grocery platform. It will see 250 SuperValu products available across the UAE on noon, to include items from SuperValu’s fresh food range.

The partnership with the Irish food retailer is the first direct distribution partner with the Saudi e-tailer. Musgrave aims for up to 500 products available by the end of 2022 on noon Grocery as the partnership continues. Ali Kafil-Hussain, Chief of Staff, noon, said: “Grocery is increasingly moving online, especially as e-commerce penetration has surged significantly in this region. noon Grocery, our next-day fresh grocery delivery service, currently stocks more than 60,000 products. When we launched the SuperValu range by Musgrave earlier this year we received an overwhelming response from customers in Dubai, particularly those in the ex-pat community, who were delighted to be able to get a part of home delivered to their second home here in the UAE.” of Commerce and Industry, the UAE’s retail e-commerce market reached a record $3.9 billion in 2020, a 53% year-over-year increase driven by the Covid-19-led digital shift, while e-commerce accounted for an 8% share of the retail market during the same year.

Opportunity Knocks The Middle East region, particularly the UAE and Saudi Arabia, provides significant opportunities for Irish green innovators who can help local partners solve their sustainability challenges through cuttingedge innovation, digitisation, quality, compliance, and future-focused energy reduction methods and conservation technology. Across cleantech, fintech, and medtech, Irish companies are supported by Enterprise Ireland to further grow commercial opportunities.

Overall, there is vast potential for trade from Ireland to the Arab States, and the timing has never been better with ambitious plans to increase Ireland’s engagement with the Middle East over the coming years. Under the Global Ireland 2025 strategy, the Irish Department of Foreign Affairs and Trade will expand its diplomatic mission in the UAE and open two new embassies in Jordan and Morocco, giving Ireland a permanent foothold in the Levant and the Maghreb.

Ireland is a small nation but unburdened by the colonial legacies dogging other countries in Western Europe, it has received a warm reception in the Arab world. Irish businesses with high-quality products or services that are willing to put in the effort to cultivate new opportunities are on a path to success.

There is a lot of help and advice available locally to business owners looking to expand their international exporting potential. Organizations like Bord Bia, the AICC and Enterprise Ireland have specialist teams across the region to specifically support Irish firms in getting established and providing advice on the different business models that operate in the UAE.