Irish exports to the Arab world reached record levels in 2022, having increased 23% in the first nine months of 2022 compared to the same period the previous year, according to an economic report by economist, Jim Power.
The report, prepared on behalf of the Irish Arab Chamber of Commerce, shows that Ireland exported over €2.2 billion in goods alone to the Arab states in the first nine months of 2022, up from €1.8 billion in 2021, and is the largest export total ever recorded with the region.
There were notable increases in exports of Irish goods and services to countries including: Algeria; Bahrain; Egypt,; Oman; Qatar; Saudi Arabia; the UAE; and Yemen.
Exports to Arab states
For Irish small and medium-sized enterprises (SMEs) looking to expand their reach when it comes to export partners, the countries of the Arab region should be considered, according to the report.
“It is a key time to think about exploring opportunities elsewhere, and the reality is business owners don’t have to look too far to successfully diversify their export markets,” Power stated in the report.
“The countries of the Arab world import many of the products and services that Irish companies can supply competitively; they have considerable resources to fund their imports; their rising populations cause demand to grow year after year and they are relatively close to Ireland in terms of accessibility.”
The region of 21 states has a growing population of more than 444 million people, representing 5.5% of the world’s population and accounting for 3.1% of the world’s economy.
The population of the region is growing rapidly and is forecast to exceed 500 million, 6% of the global population, by 2028.
States
Saudi Arabia: With a population of 35.3 million, Saudi Arabia remains the largest importer of Irish goods among the AICC member countries.
According to the report, exports to Saudi Arabia increased by 23% compared with last year.
Exports to Saudi Arabia also hold the highest value of overall exports to the Arab world, with a €627.5 million worth of Irish goods exported in the first three quarters of 2022.
Essential oils, perfume materials and toilet preparations accounted for 41.4% of total exports; medicinal and pharmaceutical products accounted for 32%; miscellaneous edible products and preparations accounted for 5.2% and dairy products and birds’ eggs accounted for 4.9%.
According to Power, Saudi Arabia holds significant potential: “A wide variety of products are exported to Saudi Arabia, but for many, the magnitude is quite modest.
“Clearly, the multi-national sector dominates trade, but many of the smaller export sectors have a strong SME presence, so the potential for export growth for the SME sector does look significant.”
The UAE: Home to an estimated 10,000 Irish ex-pats and with a population of almost 10 million, imported €478 million worth of Irish goods so far this year, the second highest value overall with an increase of 26% for 2022 compared with 2021.
“It is one of the most dynamic and diversified economies in the Arab region with significant growth potential for Irish businesses,” Power added.
Algeria and Egypt: Two other major importers of Irish dairy. Egypt is the world’s 11th largest dairy importer representing a significant opportunity for Irish dairy businesses.
Irish exports to Egypt grew by 36% in 2022, from €198 million (Q1-Q3 2021) to €268.5 million (Q1-Q3 2022), representing the third largest market for Irish exports.
Algeria, with a population of 44.6 million, is the third largest whole milk powder importer in the world.
Total Irish exports to Algeria grew by 32% from €66.7 million (Q1-Q3 2021) to €88.2 million (Q1-Q3 2022), largely attributable to the agri-food sector.
This, coupled with the fact that an Algerian embassy recently opened in Ireland, means there are strengthened business relations and more opportunity.
Qatar and Oman: Other notable increases for 2022 lie in exports to Qatar and Oman, with an increase in exports of 38% to Qatar for the first three quarters of 2022.
There was a 176% increase in exports to Oman for the same period (from €44.8 million to €123.5 million).
According to Power, while some of the other countries are very small in terms of export market share, significant export growth was recorded in many of those countries in the first nine months of 2022.
“In total, 16 of the 22 countries saw export growth in excess of 10%; 11 of the countries recorded export growth in excess of 20%; and four countries recorded export growth in excess of 100%,” he stated.
Two countries to watch are Bahrain and Yemen, each of which had notable increases in exports for 2022 of 40% and 196% respectively with values standing at €46 million for Bahrain and €19 million for Yemen.
Irish market opportunities
According to Ahmad Younis, CEO of the AICC: “The Arab world represents a diverse and rapidly growing market for Irish businesses, so the opportunities really are endless.
“Demand for imports has increased, and, coupled with multiple large-scale investment and recent infrastructure improvements, it’s a market brimming with potential for Irish SMEs.”
Jim Power highlighted that connectivity is an important driver of trade in goods and services, particularly tourism in both directions, and said that four Arab airlines are now flying into Ireland, and the demand for more flights is strong.
“The international reputation for Irish products is strong. Irish agricultural produce is regarded as of a high quality, with a strong organic component,” Power said.
“For technology, and pharmaceutical products, Ireland is recognised as a highly regulated and high-quality production environment.”
The Department of Foreign Affairs is also working to facilitate business opportunities in the region with the Middle East declared a priority market under the government’s Trade and Investment Strategy 2022-2026.
This means putting more staff on the ground in the Arab region, in the form of new embassies and staff from Enterprise Ireland, the IDA and Bord Bia.