Sundaymail Editor
Trade Focus
Allan Majuru
DUBAI, a constituent emirate of the United Arab Emirates, has etched a reputation as the home of luxury and a world-class tourist destination.
Over the past decades, UAE has focused more on reducing dependency on oil exports by diversifying its economy, anchored on developments around Dubai.
This diversification has resulted in a boom on other economic activities such as tourism, construction, and trade.
With tourists coming from across the world, the demand for exotic and imported horticultural produce has grown exponentially in Dubai.
Further to this, Dubai has also emerged as a viable gateway to the Middle-East as well as being one of the largest re-exporters of food in the world.
The International Trade Centre states that “Dubai is the most important regional export hub and has become the third largest export centre in the world after Hong Kong and Singapore.”
UAE is strategically located between the East and West, which makes it accessible to major emerging economies in the Gulf region, linking shipping routes and facilitating goods movement between the different regions in Middle East, Asia, Europe, and Africa.
This diversified economy and trade positioning of Dubai creates opportunities for Zimbabwean exporters, particularly those in the horticulture, arts or crafts, and services sectors.
The transformation currently taking place in the UAE requires producers who have been focusing on traditional markets such as Europe to consider Dubai in their diversification strategies.
This way, local companies will join a bandwagon of countries focusing on Dubai such as Kenya, which has increased supplies of avocados, as well as Rwanda and Uganda who have increased exports of coffee.
ZimTrade, the national trade development and promotion organisation, recently took a market visit to Dubai to explore opportunities for Zimbabwe-grown fresh produce, services and other products, as well as develop linkages with buyers from leading retail chains.
The trade mission revealed that there are opportunities to increase fresh produce exports to Dubai as buyers in the country have expressed willingness to import from Zimbabwe.
The increased exports of fresh produce will also improve the trade relations between Zimbabwe and UAE, as the economic relationship is currently dominated by primary commodities.
Current exports to Dubai
Trade between Zimbabwe and UAE has been growing over the past five years, with local businesses exporting US$833 million in 2019, up from US$148 million in 2015, representing an over 460 percent trade growth rate in the past five years.
In 2019, UAE was the second largest export market after South Africa, taking up around 20 percent of total exports.
However, Zimbabwe’s exports to UAE mainly comprise primary products such as minerals, hence the need to diversify the product offering to that market.
Regarding fresh produce, UAE’s imports from Zimbabwe amounted to US$4,6 million in 2019 and this was composed of citrus, peaches, blueberries, and fresh flowers.
The figure could be higher if one considers some Zimbabwe-grown produce that is being re-exported from Europe to UAE.
There is potential for Zimbabwean farmers to increase exports to UAE if they secure direct exports, which will also improve their foreign currency earnings.
For farmers that can produce more, there are indications that Dubai will remain a viable market considering the total fresh produce bill of the market.
According to Trade Map, the fresh produce import market in UAE is valued at over US $4 billion and of this amount, US$2,3 billion is re-exported to Iran, Saudi Arabia, Yemen, Oman, and Iraq.
Without much production in terms of horticulture, the UAE is becoming a major supplier of horticulture into the Gulf Cooperation Council countries through the concept of re-exports.
Re-exports of UAE food industry is now over 50 percent of food imports and the country is regarded as one of the most food secure countries in the world.
What this reflects is that local exporters who are able to create solid markets in Dubai will likely find it easy to use UAE as a gateway to land their products in other markets in the Middle-East.
Low-hanging opportunities
for local exporters
Buyers in the Dubai market have expressed willingness to procure avocadoes, strawberries, blueberries, citrus, peas, fresh or dried fruits, and sweet potatoes.
Some of this produce is finding its way indirectly through intermediary markets such as the Netherlands.
Other low-hanging horticultural produce for exporting to Dubai include tea and coffee.
Green tea consumption is growing, and coffee processing is increasing in the city, which is expected to further expand in the coming years.
For fresh produce, most buyers are already operating in Southern Africa through the Beira and Durban ports, making it easy for local producers to link and start exporting.
Given the increasing competition that is concentrated on Dubai, local producers need to aggressively consider issues around price and window periods.
For example, Zimbabwe’s horticulture season is almost tied to South Africa, which means local exporters need to come up with the right product at the best prices if they are to beat competition.
In addition, fresh produce buyers in the UAE indicated that they are dependent on the Egyptian market and when their seasons ends, they normally focus on South Africa.
This means that local producers need to come up with products and varieties that offer unique windows and are not harvested during the same time as Egypt.
In terms of logistics, exporters can take advantage of the existing direct flights between Harare and Dubai to supply high-end produces.
Exporters of bulk products can utilise the Maputo or Durban ports.
Some buyers in the UAE have indicated that since they also source from South Africa, it would be ideal for Zimbabwean companies to charge them (free on board) based on the Durban port.
Others indicated they prefer the CIF Dubai price, meaning that the exporter will meet all the costs of getting the product into Dubai.
Other opportunities
Further to the opportunities in the horticulture sector, there are emerging opportunities for local companies to supply an array of services to Dubai.
Some major companies operating in Dubai have their call centres remotely located, offering huge benefits for start-ups who have no capital to set huge operations.
It is encouraging to note that some Zimbabwean companies are at an advanced stage of concluding deals that will see them provide services such as customer support and education.
Due to the proliferation of hotels in Dubai, there is a strong sense that exports of arts and crafts sector could do well in the country.
In 2019 alone, imports of arts and crafts in UAE amounted to US$2 billion.
There is a further market for goat meat in Dubai.
However, to penetrate the meat market in the Islamic emirate, meat producers who wish to export to Dubai must ensure that their products are Halal certified.
Documentation requirements
Documentation is critical in the export business, hence it is advisable for exporters to be familiar with documentation required in the UAE.
After completing the necessary Zimbabwean customs documents, local companies will need to work with the buyer or a partner in Dubai to obtain an importers’ licence.
Finding a buyer or partner that already has an importer’s licence will reduce the time required to export to Dubai.
An Import Goods Declaration, the Dubai Municipality approval letter, Commercial Invoice, Bill of Lading, packing List and Delivery Order are some of the documents required to export.
Those seeking to export meat and food of animal origin should be Halal certified by a recognised body in the UAE.
There are also labelling requirements which one should adhere to and this includes the inclusion of both languages, Arabic and English.
Allan Majuru is the chief executive officer of ZimTrade.
Online Reporter