Chinese trade surge for Jebel Ali Free Zone

China is playing a bigger role in Dubai's key trading corridor as Jebel Ali Free Zone's trade with the country is expected to surge 10 per cent to Dh40 billion this year.

The number of Chinese companies in Jebel Ali Free Zone has more than doubled to 130 at the end of the third quarter, up from 64 in 2007. Pawan Singh / The National
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Jebel Ali Free Zone's trade with China is expected to surge 10 per cent to more than Dh40 billion (US$10.89bn) this year, reflecting the Asian tiger's growing foothold in Dubai's key trading corridor.

Officials in the free zone said they expected trade to swell from Dh37bn last year.

In a further sign of the strengthening presence of the world's second-biggest economy, the number of Chinese companies in the free zone has more than doubled to 130 at the end of the third quarter from five years ago, up from 64 in 2007.

"The shift in China's outlook is evident in growing numbers of trade visits of Chinese officials and entrepreneurs to the UAE," said Ibrahim Al Janahi,the deputy chief executive of Jafza.

"The import-driven and resource-rich Middle East region has all the potential that a country like China could look for." China's red-hot economy has cooled this year as shock waves from global financial turmoil buffeted its industries. Still, its share of world output and trade is expected to keep rising, with growth tipped at up to 8 per cent a year over the next decade.

China's interests in the UAE have long revolved around oil as the country has sought to secure enough energy to fuel its accelerating industrial output. But as a centre for the trade of non-oil goods in Dubai, Jafza has also benefited from rising flows of many goods, from tyres to electrical equipment.

Chinese companies have explored the possibility of extending their scope further. In the past three months, five trade delegations have visited the zone. Among them was a senior government delegation from Beijing's Shunyi District and a trade party from the construction industry.

Another trade visit focused on the production of methyl tertiary butyl ether, which is used as a blending agent in the motor gasoline industry.

"Using Jafza's facilities and logistics capability to serve the entire region most efficiently carries a lot of weight for the Chinese investors and entrepreneurs," said Mr Al Janahi.

Sinopec, Sinochem International, China National Petroleum Corporation, China State Construction Engineering Corporation, and China Railway Engineering Middle East are among leading conglomerates using the free zone as a centre from which to serve the region.

China is Dubai's second-largest trading partner after India. Jafza's trade with China has grown by 150 per cent over the past five years, reaching Dh37bn by the end of last year.