TRADE

SAUDI EXPORTS FIND FRESH IMPETUS FROM BROAD-BASED GROWTH

Saudi exports soared in July as energy prices rallied and the global economy grew at a brisk pace.

The kingdom’s merchandise exports surged 79.6% to SAR 91.8 billion during the month compared to the same period last year, according to latest data from the General Authority for Statistics (GASTAT).

The July export figure was at its highest level in at least a year, surpassing the SAR 84.8 billion reached in June 2021. The country’s trade balance also jumped to at least a 12-month high of SAR 46.13 billion, GASTAT data shows.

The increase was led by gains from oil exports, which rose 112.1% to SAR 71 billion during the same period. OPEC crude prices climbed 54.2% by the first nine months of 2021 to around a seven-year high of USD 77.72 per barrel.

Saudi Arabia has committed to produce 9.9 million barrels per day by November, according to the agreed quota by OPEC and its allies.

NON-OIL EXPORTS FORGE AHEAD

The kingdom’s non-oil exports also rose impressively by 17.9% year on year in July, to reach SAR 20.8 billion.

Among non-oil merchandise, plastics and rubber exports soared 47.7% to SAR 7.8 billion in July compared to the same period last year, while chemical products grew 21.4% to SAR 6.5 billion.

Merchandise imports increased at a steadier pace at 13.2% in July 2021 as authorities continued to focus on domestic suppliers and in-country supply chains. The value of imports reached SAR 45.6 billion during the month, primarily due to a 112.9% increase in vehicles and associated transport equipment and an 18.7% rise in chemical products. However, GASTAT noted that imports declined 3.1% compared to June.

China remains Saudi Arabia’s largest trading partner, accounting for 19.6% (SAR 18 billion) of exports, followed by South Korea with 9.8% (or SAR 9 billion), and India representing 9.1% or SAR 8.3 billion of exports.

“Imports from China amounted to SAR 9.9 billion (21.8% of total imports) in July 2021, making this country the main origin for imports of Saudi Arabia. USA and United Arab Emirates followed next with imports of SAR 4.8 billion (10.6% of total imports) and SAR 3.1 billion (6.7% of total imports), respectively,” GASTAT said.

STRENGTHENING PORT INFRASTRUCTURE

The kingdom is leveraging its proximity to Africa, Europe and Asia to transform itself into a transcontinental hub.

Mawani, the Saudi Ports Authority, said volumes handled at the ports during the first half of 2021 stood at 3.6 million TEUs (twenty-foot equivalent units), 5.18% ahead of last year, while trans-shipment containers soared 24.49% to 1.4 million TEUs compared to the same period last year.

According to statistics issued by Mawani, livestock witnessed accelerated growth reaching 1.7 million heads, 23.6% higher compared with last year.

The port posted a 6.6% increase in the number of ships received at 6,037 during the period, while the number of passengers grew to 288,000, an increase of 0.61% from 2020.

Saudi ports are raising their profile and emerging as new regional and global transportation hubs.

Jeddah Islamic Port reported growth of 6.8% in 2020, with volumes increasing to 4.7 million TEUs from 4.3 million TEUs in 2019, and is now ranked 37 out of 100 top global ports, moving up from 42nd place compared to last year, according to the Lloyd’s List 2021 of Top 100 ports.

King Abdullah Port also improved its ranking by three places to 84th position in the Lloyd’s List.

“We are proud of King Abdullah Port’s growing reputation as an internationally recognised port with state-of-the-art infrastructure and efficient operations,” said Jay New, the chief executive officer of King Abdullah Port.

“This achievement inspires us to continue delivering on our commitment to transform the kingdom into a top global hub connecting Asia, Europe, and Africa, besides supporting the diversification of the national economy by facilitating the growth of non-oil exports.”

The kingdom is also rapidly expanding its logistics infrastructure.

In September, King Salman Energy Park signed an agreement with Singapore’s Hutchison Port to jointly manage and operate the dry port and bonded logistics zone in the SPARK energy industrial city. Spread over a 50-square-kilometre radius, SPARK is a manufacturing, service centre and logistics hub for the energy sector.

“Designed to ensure ease of access to global markets, the three-square-kilometre dry port will enable the future joint venture to capture the growing demand for logistic services for energy-related products in the Middle East and beyond while also serving the neighbouring industrial cities,” according to the company.