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trade fact sheet uae

< food & beverages >

Contents
1. About Wesgro 2. Introduction 3. Market Size
3.1 Global trade and relative position of the UAE 3.2 Global trade and relative position of the UAE in relation to the food and beverage sector 3.3 Value, volume and growth analysis of the food and beverage sector in the UAE

trade fact sheet uae


1 2 2
2 3 4

4. Competitor Analysis
4.1 International competition 4.2 Local competition: Local production and producers

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5 6

5. Consumption/Demand
5.1 Local consumption patterns of food and beverages (locally produced and imported) 5.2 Trends in consumption and spending

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6 7

6. Wine
6.1 Market size analysis 6.2 Competitor analysis 6.3 Consumption/demand analysis

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8 8 8

7. Distribution Channels
7.1 Types of distribution channels available 7.2 Most preferred distribution channels 7.3 Regulations on distribution channels

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8 9 9

8. Trade Regulation, Requirements and Standards


8.1 Tariffs 8.2 Import requirements and documentation 8.3 Standards and regulations 8.4 Logistics

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10 10 11 12

9. Price
9.1 Price development

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12 13 13

9.2 Price influencing factors 9.3 Methods of payment

10. Doing Business


10.1 Promotion 10.2 Business culture

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11. Contacts
11.1 Sector/industry contacts 11.2 Embassies and consulate

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12. Sources and References Appendix

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trade fact sheet uae

1.

About Wesgro

Wesgro is the official Investment and Trade Promotion Agency for the Western Cape, located in Cape Town, South Africa. We are the first point of contact for foreign importers, local exporters and investors wishing to take advantage of the unlimited business potential in Cape Town and the Western Cape. Our mandate is: To attract and facilitate foreign and domestic direct investment into the Western Cape To grow exports of products and services of the Western Cape through development of export capability, demand and market access To market the Western Cape globally as a competitive and sustainable business destination

Investment Promotion, Facilitation & Recruitment


Our services to investors include: Investment Recruitment / Promotion Business Facilitation including: Information on incentives, Site location, Accessing finance, Accessing incentives, and Professional referral service. Aftercare Advocacy

International Trade
Our services to local exporters and international buyers include: Export readiness assessment, training, mentoring programmes, experiential market visits Outward selling missions as well as inward foreign buying missions One-on-one foreign buyer and local producer meetings set-up Africa to Africa trade focus Access to international non-traditional markets (particular to Western Cape exports) Assisting exporters with the dti Export Marketing & Investment Assistance scheme (EMIA) For further information and other research publications such as country briefs, trade and investment trends, destination intelligence, trade factsheets or how to become a member of Wesgro, please visit the Wesgro website at www.wesgro.co.za

trade fact sheet uae

2.

Introduction

The United Arab Emirates (UAE), situated on the eastern side of the Arabian Gulf, is a constitutional federation of seven Emirates or states: Abu Dhabi, Dubai, Sharjah, Ajman, Umm al-Qaiwain, Ras al-Khaimah and Fujairah. Although the UAE has large swathes of desert, limited water resources and a harsh climate, it is a trading hub of major strategic importance to the Middle East region, and in recent years has become a magnet for foreign investment, expatriate workers from around the world, business visitors and tourists. The fact that 83% of the countrys oil reserves are in Abu Dhabi makes this the most influential of the seven Emirates. Dubai is the countrys commercial centre and the leading trading entry point into the Arabian Gulf. Since the 1980s, the Government has been intent on reducing the countrys dependence on oil and natural gas and encouraging private sector diversification into a number of other industries; such as manufacturing, property development, financial services and tourism. This has been made possible by the countrys liberal foreign trade policy and investment-friendly business environment. However, the country has been feeling the effects recently of reduced demand and lower prices in the wake of the 2008/2009 global financial crisis. Approximately 80% of the UAEs 5 million residents are expatriates and the remaining 20% are UAE nationals or Emiratis. Dominating the expatriate mix are South Asians (mainly from India, Pakistan, Bangladesh and Sri Lanka) followed by other Middle Eastern nationalities (e.g. Iranians), East Asians (e.g. Chinese and Thai) and westerners. Expatriates are active at all levels of the economy from performing manual labour and clerical work to engaging in high-level consulting and managing corporations. Although very cosmopolitan, the country has not shed its essentially Middle Eastern character which demands discipline, adherence to the rule of law and respect for authority and the Muslim faith. The UAE and South Africa enjoy a good relationship at a diplomatic level (each operates an embassy in the other country) but have not concluded any formal bilateral trade agreement. Nevertheless, trade volumes between the two countries have been growing since the early 1990s when South Africa came out of political isolation. Numerous high-value foreign direct investment deals have also been concluded, e.g. Dubais acquisition of Cape Towns V&A Waterfront some years ago. Given its heavy reliance on imported consumer products to satisfy its diverse market, the UAE offers great scope for Western Cape food and beverage producers to expand their business interests in the lucrative Gulf region and build on their solid performance to date.

3.
3.1

Market Size
Global trade and relative position of the UAE

The Governments liberal attitude towards international trade and investment has paved the way for business dealings with countries all over the world. The UAE is the largest producer of oil amongst the OPEC members and has about 8% of the worlds oil reserves. Not surprisingly, oil and oil-related products are the countrys most important exports, followed by natural gas. In 2008, the value of the UAEs total exports was USD239bn representing an increase of 40% over that of the previous year. The countrys main non-oil exports in 2008 were precious metals and stones, stone articles, plastic and cement products, and (specifically for re-export) vehicle trailers and spare parts, and nuclear reactor components. Its main export destinations were Japan, South Korea, Thailand, India, Qatar, Bahrain, Switzerland and Saudi Arabia. Furthermore, its top re-export destinations were India, Iraq, Iran, Switzerland, Saudi Arabia, Oman, Hong Kong, Qatar and Belgium. It should be noted that the revenues derived from service exports (in particular, those linked to tourism, construction and other services performed in Dubai) are not included in the official export statistics, although they have been substantial in recent years. The Emirates are also heavily involved in the re-exporting of imported goods to other countries in the Middle East and even further afield. Often goods are re-exported after having undergone further processing at various free trade zones that have been established by the Government. Normally, businesses registered in the UAE must have at

trade fact sheet uae


least a 51% Emirati-ownership structure. However, foreign businesses operating in a free trade zone are exempt from this rule and are eligible for 100% duty exemption if goods imported into the zone are destined for re-export. Dubais Jebel Ali Free Zone is the UAEs leading free trade processing facility. Because the UAE is four-fifths desert and has limited water resources, agricultural production is restricted to a few key sectors such as dairy and vegetable farming. In addition, manufacturing, though of a high standard, is not conducted on a very large scale because of space constraints. As a result, the country is dependent on large volumes of imported consumer products. In 2008, the value of the UAEs total imports was USD200bn representing an increase of 33% over that of the previous year. The countrys main imports in 2008 were precious metals and stones, machinery and electrical equipment, transport equipment, chemicals and food. Its main sources of imports, in turn, were China, India, the US, Japan, Germany, Turkey, Italy, Switzerland and Saudi Arabia. The UAE has been a member of the World Trade Organisation (WTO) since 1996 and is a key player in OPEC. The UAE is a member of the Gulf Co-operation Council (GCC), a customs union whose other members are Bahrain, Kuwait, Oman, Qatar and Saudi Arabia. The UAE is also engaged in a large number of bilateral trade negotiations both independently and as a member of the GCC bloc - with countries in different parts of the world.

3.2

Global trade and relative position of the UAE in relation to the food and beverage sector

The Emirates growing population and multicultural expatriate community have in recent years been strong stimulants to the growth of the food and beverage sector, while rising incomes and living standards have also heightened consumers interest in high quality, branded products. As the searing temperatures for much of the year, extensive desert conditions and frequent dust storms make local agricultural production difficult, about 85% of the countrys food and beverage requirements are imported, both in consumer-ready form and as raw materials for processing. These are currently valued at over USD5bn per year. About 50% of such imports are, re-exported to GCC member countries, former Soviet states, the Indian sub-continent and parts of Africa. The remaining 15% of the countrys food and beverage supplies is local produce and mainly consists of dairy products, poultry, eggs, seafood, dates, tomatoes and other selected vegetables, and water. Most of these product groups are supplemented by foreign varieties in line with prevailing demand. More than USD1bn has been invested in the UAE since 1994 in the development of the value-added food manufacturing sector and there are now about 150 food processing plants in the country. The major food groups being produced at these plants (using mainly imported ingredients) are vegetable oil, milled wheat, flour, canned beans, pasta, confectionery, dairy products, carbonated drinks (normally under licence to international companies), fruit juices and snack foods. Given the heterogeneous character of the market, there is a huge choice of food and beverage items available for the many market segments in evidence, and the retail sector is both well developed and highly competitive. Dubai is recognised as the trend setter and largest market for food and beverages in the region. With considerable investment also having gone into the Emirates distribution infrastructure and regional network, potential food exporters will find that the country is not only a promising export destination in its own right but also an important conduit to the Middle East as a whole. Developing the infrastructure and expertise necessary to support a large re-exporting industry is an example of progressive thinking on the part of the UAE leadership. It offers a financial solution to the problems of limited capacity in (and thus low returns from) the domestic agricultural industry, and fluctuating commodity prices (and thus export revenues). It also creates huge opportunities for South African and other producers that are keen to access the lucrative Middle East market via the Emirates re-export initiative. For example, Saudi Arabias recent decision to abandon its longstanding wheat growing programme because it was depleting the countrys scarce water resources and to switch to wheat imports for all its consumption needs might represent a profitable business opportunity for Western Cape wheat producers.
(See APPENDIX : Comparison of Western Capes main food and beverage exports to the UAE and the world 2004 2008.)

trade fact sheet uae

3.3 Value, volume, growth analysis of the food and beverage sector in the UAE
The growth in the UAEs food and beverage sector has mirrored the growth in trade and investment activity and should continue well into the future albeit at a slower pace than that evident during the pre-global crisis period. According to the most recent estimate by Business Monitor International, expenditure on food and beverages in the country amounted to USD6.8bn in 2009 and could grow by a further 2.8% in 2010. The food and beverage retail sector in the UAE is characterised by an extensive range of retail outlets catering to peoples varying tastes and purchasing power. Large hypermarkets and supermarkets enjoy roughly a 50% share of the food and beverage retail market. Carrefour (a French concern) is the largest hypermarket in the UAE and actually introduced the hypermarket concept to the country. Other major players in the hypermarket/supermarket arena include Indian-owned Choithram, Indian-owned Lulu and locally-owned Spinneys (which mainly serves the western expatriate market). The UKs Waitrose group has also recently opened a number of stores in Dubai. These large retailers mainly target middle class and well-heeled consumers in Abu Dhabi, Dubai and Sharjah. Independent retailers have grown in number in recent years and have a strong following. For example, grocery stores and convenience stores, including gasmarts (i.e. small retail outlets attached to petrol stations), far outnumber the large chain stores but their influence and popularity are likely to wane over time as hypermarkets and supermarkets spread even to the more rural parts of the country. A number of speciality stores offering gourmet food have also appeared but are unlikely to garner much support as most consumers are very price-conscious. Together, these smaller competitors to hypermarkets and supermarkets hold the other 50% share of the food and beverage retail market. Margins in the retail sector tend to be tight because of the high levels of competition, and stores rely on high volume sales and quick turnover to maximise profits. Applying private labels to products is a growing practice amongst hypermarkets and supermarkets in the UAE, with products bearing private labels (e.g. Marks & Spencers St Michael label) accounting for about 15% of store turnover. The food service industry, comprising hotel and independent restaurants and bars, coffee shops, fast food outlets, and catering establishments, has seen exponential growth over the past decade, fuelled by the rising number of visitors to the country and a growing penchant for eating out as is typical of the western lifestyle. There are about 11,000 eating establishments, from formal to very casual, and about 500 restaurant or fast food franchises in operation (including Nandos), the demand for which is far from saturated. It has been estimated that about 25% of the countrys residents eat at a quick service restaurant at least once a week. The catering industry is a major buyer of food and beverages in the UAE, e.g. 150,000 in-flight meals are supplied daily to international and local airlines such as Emirates Airline and Etihad Airways. The military forces stationed in and around the Gulf region are also served by the catering industry.
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The types of food available in the country cater to a wide range of tastes, from French to Italian, Chinese, Japanese, Turkish, and so on. Asian cuisine is showing the fastest growth and Lebanese food is also becoming very popular. With about three-quarters of UAE residents being Muslim, demand for Halaal food is high. Halaal literally means what is permissible under Islam. In this regard, Halaal food must be free of alcohol, pork and other prohibited substances, and meat is only acceptable if it is sourced from animals slaughtered according to Islamic guidelines. Halaal food is also re-exported to other countries in the Middle East which is home to some 200 million Muslims. The UAEs beverage market has registered very strong growth over the past few years. Not surprisingly, because of the countrys climate, residents drink large quantities of water and soft drinks. In fact, today the UAE is the third largest consumer of water for drinking purposes after the US and Canada. To meet the growing demand for water, the Government has invested in the establishment of approximately 100 seawater desalination plants which satisfy most of the countrys needs. The shortfall is imported. Fruit juices and carbonated drinks are also rising in popularity, particularly those which carry well-known international brands and are the subject of aggressive marketing campaigns.

trade fact sheet uae


There is an entrenched tea and coffee drinking culture in the country but the strong growth in the consumption of these two beverages in recent years has been boosted by the influx of expatriates, business visitors and tourists. In the face of negligible domestic production, multinationals (e.g. Lipton and Nestl) dominate the hot drinks market in the UAE. Challenges faced by tea and coffee producers looking for a potential new market are that consumption drops during the hot summer months, and consumers tend to be very brand loyal and disinclined to try out new entrants product offerings. Herbal and fruit teas produced by Lipton and Twinings are attracting a following. Alcohol (wine, beer and spirits) is available but the importation and distribution thereof are strictly controlled. Muslims are not permitted to drink alcohol and so consumption is restricted to certain expatriate communities and non-Muslim visitors to the country. As is the case in many developed countries, the food and beverage retail sector in the UAE has been consolidating in response to rising competition, and more attention is being given to upgrading store facilities, engaging in focused marketing campaigns and being more alert to consumers evolving tastes.

4.
4.1

Competitor Analysis
International competition

Suppliers from all over the world compete for a share of the UAEs food and beverage market. European and Asian countries generally pose the greatest competitive threat to producers in South Africa, for example, because their proximity to the market gives them access to comparatively lower freight rates which, in turn, can be translated into more competitive prices than those generally quoted by South African producers. India is the leading supplier of beef to the Emirates, followed by Brazil, Australia, New Zealand and the US. Indias beef, however, is largely used for processing purposes whereas that from Brazil, Australia and other countries is mainly intended for direct consumption. Australia is an important supplier of lamb, as are the US and the Netherlands. Brazil is clearly in the lead when it comes to poultry exports to the UAE, with smaller suppliers being the US, France and Oman. Contrary to popular belief, pork is quite readily available in the UAE and Brazil is the main supplier. Large volumes of foreign fish do not make their way to the UAE as the local fishing industry is well established. However, various cool water varieties, e.g. salmon, are sourced from countries like Canada and Norway. Furthermore, Canada, Australia and New Zealand are well known for their high quality shellfish. A number of processing plants in the UAE specialise in producing value added fish products, such as flavoured mussels and crumbed fillets, for more discerning customers. New Zealand is the leading supplier of dairy products to the Emirates, e.g. butter, cheese and milk powder. Other competing suppliers for these products are France, Denmark, Australia and Turkey. The cheese sector is dominated by France, Switzerland, the UK, the Netherlands and Australia. In terms of egg production, local supplies are supplemented with imports from Brazil and Oman. Imported confectionery items largely originate in China, Vietnam, Colombia and Saudi Arabia, while the Netherlands, Italy, Turkey and the UK compete for the local chocolate market. The US is the main supplier of high quality snacks, and imported cereals mainly come from the UK and Germany often having been made under licence from US firms. Almonds, as a snack or as an ingredient for various processed food items, are mainly supplied by the US with competition coming from Iran, Turkey and India. Herbs and spices are often sourced from the Gulf region as well as Egypt. Fresh fruit and vegetables are supplied by regional trading partners, such as Iran, Saudi Arabia, Lebanon and Jordan, as well as by a number of countries further afield, such as India, Egypt, China, South Africa and Australia. More specifically, India is the main supplier of fresh vegetables to the UAE. India also holds the pre-eminent position in terms of rice supplies. Pakistan and Thailand compete with India but enjoy relatively small shares of the market.

trade fact sheet uae


Despite the availability of locally produced fruit juices, several countries also export their juice ranges to the UAE. The US and South Africa are the main international suppliers of high quality fruit juice to the market. Multinationals such as Nestl (Switzerland), Lipton (US) and Twinings (UK) dominate the tea and coffee market, while South African rooibos tea producers are starting to make a name for themselves amongst more health-conscious tea drinkers. Premium wines are mainly supplied by France, Spain and Italy, with Australia also becoming a formidable competitor in recent years. France, the UK and the US are responsible for the bulk of the UAEs spirits imports, and beer is sourced from several countries, including the Netherlands, Germany, the US and Australia. Amongst the most popular brands are Heineken, Corona, Budweiser, Carlsberg and Becks.

4.2

Local competition - local production and producers

Food and beverages made from locally produced products are quite limited in range because geographic and climatic conditions in the country make large-scale agricultural activity difficult. The main product groups in which local producers have an advantage over or at least are on an equal footing with foreign suppliers are: poultry, eggs, fresh and long-life milk, yoghurt, seafood, tomatoes, watermelons, dates, snack foods, fruit juice and bottled water. Interestingly, consumption of organic food products in the Emirates has been growing at nearly the same rate as the global average of 20% to 25% per year, and the government in the interests of environmental preservation and achieving greater self-sufficiency in the agricultural sector - has been actively promoting the domestic organic farming sector. Part of the governments vision is to set aside 3,000 acres specifically for organic farming in the country. The UAE, Saudi Arabia and Oman are currently leading the way in terms of organic farming in the Gulf region and organic products are available at about 3,000 outlets (including pharmacies and health stores) in these three countries. With the Middle East considered to be the fastest growing market for organic food products and currently enjoying a 30% share of the USD220bn global organic market, there is great scope for UAE-based and foreign organic farming specialists to derive mutual benefit through collaboration.

5.
5.1

Consumption/Demand
Local consumption patterns of goods (locally produced and imported)

With its liberal approach to doing business with other countries, the UAE has become a melting pot of cultures, languages and lifestyles and this has spawned a massive food and beverage market. Whereas people from different ethnic groups and social strata generally display quite divergent food and drink preferences, some broad observations can be made about consumption patterns in the country. Meat, e.g. beef, lamb and poultry, is in high demand and is regularly served in up-market restaurants. Muslims are prohibited from eating pork although it is available in supermarkets. Hotels often serve pork substitutes, e.g. beef sausages and veal rashers, at their breakfast buffets. Fish is popular, with the annual per capita consumption well exceeding that of the world average. Fish is available at dedicated markets, in all the major supermarkets and in many restaurants. Whereas the locally caught fish varieties have a strong following amongst UAE nationals, expatriates and tourists tend to prefer imported products such as mussels and salmon, and canned fish which is convenient to store and prepare. Local consumption of dairy products is high, helped by the fact that most fresh milk is produced locally and is competitively priced. Specialised products such as imported cheese and yoghurt tend to attract more discerning buyers. Honey is consumed in large quantities and is a traditional Arabic food, i.e. it is served during Ramadan observances. It is also used extensively as a sweetener in tea and coffee.

trade fact sheet uae


The UAE has the highest annual per capita beverage consumption in the world, i.e. 685litres compared with the world average of 197litres. This extremely high figure is largely attributable to residents high water intake in the face of excessive daytime temperatures during the summer months. Although tap water is safe to drink, it is not to everyones taste and there is high consumer demand for bottled water. The consumption rate of carbonated drinks is also high and major international brands, such as Coca-Cola and Pepsi are very visible in the market. Fruit juice is ubiquitous in this part of the world no dinner, reception or other event would be complete without large quantities of fruit juice on offer. As more people become concerned about their health, consumption patterns are showing a leaning towards pure fruit juices and nectars rather than the sweetened varieties. Tea and coffee have a very strong following in the Emirates, and tea is typically embellished with saffron or mint for extra flavour.

5.2

Trends in consumption and spending

The food and beverage sector in the UAE is characterised by high levels of competition, and consumers are very price-conscious despite having generally high disposable incomes. Quality is also a key factor when choosing between different product offerings. This preoccupation with quality is a natural consequence of rising income levels, education and a general worldliness acquired from being situated in one of the busiest trading regions in the world. The recent global economic downturn has made people even more discriminating in their buying behaviour, a trend which is likely to continue for the foreseeable future as countries work to revitalise their economies. With profit margins likely to be under pressure indefinitely, producers and retailers are having to devote more attention to branding and customer service in order to distinguish their offerings from those of their competitors. As far as the UAEs retail environment is concerned, consumers are spoilt for choice, and it is clear that many people find shopping an enjoyable pastime. It has been estimated that every year residents spend a total of 492 million hours in hypermarkets and supermarkets alone. This translates into the average consumer devoting 127 hours per year to shopping at these stores, with three to four shopping trips per week being the norm. Consumers in the three largest Emirates tend to frequent hypermarkets and supermarkets in preference to the smaller grocery and convenience stores. In less densely populated parts of the main cities and in the more remote areas of the country, grocery and convenience stores still play an important role. Multi-purpose stores are popular in a hot country like the UAE because they enable consumers to shop for all their food and beverage requirements under one roof in a comfortable, temperature-controlled environment. As more and more residents embrace the concept of eating out and picking up quick meals along urban streets and in shopping malls, so restaurants and other eating establishments have multiplied. The growing numbers of working women together with the large proportion of single males living in the country have given momentum to the eating out/quick meal phenomenon. As is common in Western countries, fast food stores mainly attract young people. Another discernible trend in the countrys food and beverage sector is the growing preference for healthier food, e.g. fruit juice in preference to carbonated drinks, poultry in preference to red meat, yoghurt in preference to high-fat dairy products, and organic products in preference to those which have been chemically treated. The rising incidence of obesity and diabetes has strongly influenced this changing mindset. Healthier foods are not confined to imports. Not long ago, for example, after years of scientific research, the Emirates Industry for Camel Milk and Products in Dubai introduced its first camel milk product to the UAE market. Rich in natural vitamins and minerals and known to boost the immune system, the camel milk has less than half the fat of cows milk. Despite the fact that Western influences are permeating the UAE consumer market, the countrys Muslim identity is firmly intact. Thus, the trading environment as a whole supports Muslim values and practices, and the demand for Halaal food will remain buoyant.

trade fact sheet uae

6.
6.1

Wine
Market size analysis

As is the case with all alcoholic beverages, the purchase and distribution of wine are strictly controlled in the UAE. As Muslims are forbidden to drink alcohol, the wine market is essentially limited to non-Muslim expatriates and visitors to the country. From time to time one hears reports of Muslims purchasing and trading in wine in defiance of Islamic law but the Government has been quite successful in rooting out and exposing offenders. Most wine is consumed in hotels, restaurants and bars rather than in peoples homes mainly because wine retailers are few and far between. An exception, however, are airport duty-free shops which are becoming a very important sales channel for wine. Wine sales to the UAE were growing by about 9% per annum during the period 2003 2008. Recently, sales have dropped as consumers have tightened their belts and become more disciplined in their approach to buying luxury goods. The economy is already showing signs of picking up steam, however, and wine sales in the country are likely to rebound. In 2008 the market for wine in the UAE was estimated to be 1.5 million cases. Dubai alone accounts for about 50% of total market demand. A constraint to higher growth in the wine sector is the fact that wine is expensive. On top of the 50% import duty and 50% excise duty that are charged, a further 30% sales tax is levied at the point of purchase. This pricing structure encourages many people to favour the cheaper varieties although premium wines are enjoyed by the wealthier segments. In addition, the countrys wine licence system has a built-in quota, i.e. people are entitled to a fixed allocation per month and once this is reached, additional purchases are denied until a new quota cycle commences the following month.

6.2

Competitor analysis

There is no local production of wine and all supplies are imported. The main wine suppliers to the UAE are (in order of importance): France, Australia, South Africa, Italy, Chile and the US. Other, lesser suppliers include New Zealand, Argentina, Spain, Hungary, Lebanon and Portugal.

6.3

Consumption/demand analysis

In a country whose climate permits relatively few outdoor pursuits - at least during the warmer months - spending time in resorts and restaurants is a popular pastime, and wine is often a good accompaniment. Most people are drawn to varieties which offer value for money, and red wines are generally preferred over white wines.

7.
7.1

Distribution Channels
Types of distribution channels available

The UAEs reputation as a world-class trading hub has much to do with the speed and efficiency with which goods move through their designated distribution channels helped in many cases by sophisticated warehousing and inventory systems. Retailing of food and non-alcoholic beverages takes place at large chain stores, i.e. hypermarkets and supermarkets (which often have foreign ownership), as well as smaller grocery and convenience stores. Chain stores usually have centralised purchasing departments for better overall control and cost management. Grocery and convenience stores typically stock products which already have a market presence and are in regular demand; thus they are not a suitable distribution channel for newly-launched products. Suppliers of new products are better served by chain stores but the latters entry fees can be high.

trade fact sheet uae


It is common for retailers in the UAE to purchase their stock from local distributors which, in turn, source goods from local and international producers. Local in this context includes manufacturing concerns which are located in the countrys free trade zones. Distribution mark-ups vary from 10% to 50% depending on the services rendered, and whether or not the products in question require special handling, storage and/or cooling facilities. There are exceptions to the general practice of sourcing goods from a distributor. For example, volume buyers such as airlines and large hypermarkets sometimes prefer to buy directly from producers so that they have better control over their respective distribution channels and can pay lower prices because intermediate mark-ups are eliminated. Because supermarkets and other food stores in the UAE carry a wide range of products, they usually place import orders for containers with mixed contents sourced from a number of different suppliers. Exporters of food and beverages are thus usually obliged to consolidate their orders with those of other shippers.

7.2

Most preferred distribution channels

The competitive nature of the food and beverage sector in the UAE and the presence of many well-known international brands can make it difficult for newcomers to break into the market. As price, quality and a positive shopping experience are all important inducements to buy, foreign suppliers need to select distribution channels that deliver on these requirements. Exporting consumer-ready products to a local (UAE-based) distributor which has the right connections at the retail level and understands the competitive environment, is the recommended approach for medium to large producers. Choosing the right distributor is crucial to the long-term sustainability of an export venture of this nature and should be the result of a systematic screening process. In years gone by, it used to be very difficult for principals in other countries to discharge their UAE-based agents or distributors if the business relationship with such entities ran aground. Rules surrounding agency and distributorship agreements have been relaxed in recent years but it can be disruptive to a market development initiative if distributors change too frequently. Another convenient channel (particularly for SMEs which may lack the capacity to supply fully-processed food and beverages to the Emirates) is to sell raw materials/ingredients to a UAE-based food manufacturer which then assumes the responsibility for selling final goods to retailers in different parts of the country, or beyond. Thus, Western Cape companies might supply dried fruit and nuts for snack bars, fresh fruit for yoghurt, and wheat for bread. If a foreign producer deals directly with retailers in the UAE, it often means that the producer is a foreign parent company with influence and satellite operations in different parts of the world.

7.3

Regulations on distribution channels

Although the UAE Government has adopted a relatively non-interventionist stance vis--vis the way in which the private sector conducts its local and international marketing activities, there are certain restrictions which foreign suppliers need to be aware of as they could impact on the feasibility of certain market entry strategies.
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The importation and sale of alcohol, pork and other foodstuffs which are not acceptable according to Islamic teachings, is strictly controlled. For example, only a few licensed dealers are permitted to import alcoholic beverages (wine, beer and spirits) and the latter can only be made available to the public at hotels, restaurants, bars and selected sports clubs. Non-Muslims wishing to purchase alcoholic beverages for home consumption need to obtain a liquor licence which entitles them to purchase such beverages from a few designated outlets. General retail stores are not permitted to sell alcohol. Pork, in turn, can be purchased at selected retailers but the word Pork must be clearly and prominently displayed on the product label. When a foreign company is evaluating different distribution options for the marketing of its product range in the UAE, there is a statutory requirement obliging such a company to sell to a local distributor, i.e. either a UAE national or a company with an Emirati shareholding of at least 51%. The distributor must also be registered with the Ministry of Economy and Commerce. The local ownership rule falls away, however, if the distributor is registered in, and conducts its business from, one of the countrys free trade zones.

trade fact sheet uae

8.
8.1

Trade Regulations, Requirements And Standards


Tariffs

South Africa does not have any bilateral trade agreement with the UAE and as a result does not enjoy any preferential rates of duty. However, as a member of the WTO, South Africa is entitled to the UAEs MFN (most favoured nation) rates. The tariff policy of the UAE (and, by association, that of the other members of the GCC) has been designed to stimulate food and beverage imports, thereby supplementing local agricultural production and providing essential raw materials for local manufacture and/or value-added processing. At present, the GCC applies a standard 5% duty on most food and beverage imports originating in countries outside the customs union. Products which attract no duty generally fall into the category of basic or staple foodstuffs (including fresh vegetables, fruit and chilled meat cuts), or are shipped to a free trade zone and therefore do not officially enter the country in question or pass through Customs. Alcoholic beverages, in contrast, are subject to very high import duty, i.e. up to 50% of the customs value of the product concerned, as well as an excise duty of 50%. The customs valuation for duty purposes is based on the value of the goods at the point of entry to a GCC member country, i.e. the CIF value. This means that duty at the applicable rate is levied on the value of the product inclusive of all the delivery-related costs and the insurance premium. In a regional context, products exported from the Emirates to any other member country in the GCC (and vice versa) enter the market duty-free in terms of the customs union agreement. (See APPENDIX : UAE tariff structure for selected South African food and beverage products.)

8.2

Import requirements and documentation

The following documents are required for importation into the UAE: Copy of a valid trade licence. The UAE Government requires all importers to be both licensed by their local municipality and in possession of a local Chamber of Commerce trade licence covering the commodities they are importing. Delivery order from the shipping line or line agent, or air waybill, depending on the transport mode. Commercial invoice. This should contain complete shipper and consignee information including telephone and fax numbers, as well as the quantity, and a comprehensive description, of the goods. Individual values for each listed item must be shown, as well as the country of manufacture/production of each item, regardless of the origin of the shipment. Clearance will be delayed and/or subject to customs fines if the shipper incorrectly declares the country of manufacture/production. Furthermore, the currency type must be specified, and the invoice signed by the shipper with his designation and the date. Packing list. There is no prescribed format for this document; however, the details contained in it should be identical to those in the transport document. Certificate of origin. This must contain the name and address of the manufacturer, and must be certified by the UAE Embassy in South Africa with the words: We certify that the goods itemised herein are of South African origin. It should be noted that the fees for this service are generally high. Health and slaughter certificates. All imported food and beverages must be accompanied by a health certificate, issued by the UAE Embassy in the country of origin, which evidences that the products are fit for human consumption. In addition, all beef and poultry products require a Halal slaughter certificate issued by an approved Islamic centre in the country of origin. Customs bill of entry (import declaration)

10

In order for the consignee to secure the release of the cargo from the carrier, the air waybill or, in the case of seafreight, a minimum of two original copies of the ocean bill of lading which have been endorsed by the shipper, must be furnished. If the latter have not been so endorsed, a full set of original bills (usually three) must be surrendered to the shipping line.

trade fact sheet uae


According to the World Bank, the import procedure, i.e. preparation of documents, customs clearance and technical control, port and terminal handling, and inland transportation to destination in the UAE, will take approximately nine days and cost in total around USD580.

8.3

Standards and regulations

The UAEs standards and regulations pertaining to food and beverage imports are stringent and exporters must be fully compliant if they wish to avoid delays or complications. Most standards and regulations have been introduced to ensure that consumers health and wellbeing are upheld and no discernible protectionist motive is evident. In 2007, the UAE adopted two new standards (which were developed by the Gulf Standards Organisation [GSO]) for food labelling and shelf-life, respectively. GSO 9/2007 applies to food labelling and GSO 150/2007 applies to shelf-life duration. 8.3.1 Labelling requirements

The labels appearing on imported food items and beverages must contain the following standard information: Product name and brand Ingredients in descending order of proportion Additives The origin of any animal fats (which must be Halaal-compliant) Net weight or volume (in metric units) Production and expiry dates Country of origin Manufacturers/exporters name and address Special storage and preparation instructions, if any Any ingredients known to cause allergic reactions. Imported pork items must comply with the standard labelling requirements specified above with each label also clearly identifying a products pork content. In addition, labels for pork products and alcohol must not contain images or recipes that draw attention to the products content. Each label must reflect Arabic text and may either be affixed to the product in the form of a sticker or imprinted on the packaging. Bilingual, i.e. Arabic-English, labels are permitted. 8.3.2 Shelf-life requirements

The UAE has more stringent requirements in respect of shelf-life duration than those generally accepted internationally. For example, with a few exemptions, foodstuffs need to have at least half their permissible shelf-life remaining at the time of import. Frozen meat and poultry must be imported within four months of their specified date of production, irrespective of any shelf-life allowance. Furthermore, certain products are exempt from shelf-life expiry dates, e.g. salt, white sugar, dried vegetables, spices and other condiments, tea and rice.
11

8.3.3

Other

The following should also be noted: Only a few licensed dealers are permitted to import alcoholic beverages into the UAE. Kosher products, or any other food or beverage originating in Israel, may not be imported into the UAE. There are quantitative restrictions on food additives in imported products. These relate to the use of food colouring, preservatives and non-nutritive sweeteners. Food safety has been placed high on the agenda of UAE policy makers as there are growing fears that food-borne pollutants are spreading throughout the world and threatening the health of communities and the sustainability of the planet as a whole.

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8.4

Logistics

A recent survey conducted by the World Bank into global trade logistics revealed that the UAE surpasses the other GCC countries in terms of quality of transport infrastructure, competence of logistics service providers and efficiency of customs administration. In fact, it is the only country in the Gulf region which features amongst the top 25 countries globally ranked according to logistics and trade facilitation performance ahead of large emerging economies such as China, India and Brazil. Much of the UAEs success in this regard can be attributed to the Governments long-term vision for the countrys economic sustainability, and the frequent technological enhancements that are made to the countrys port, airport, telecommunications and warehousing facilities. In 2008, for example, the UAE was handling, on a daily basis, 63mn tons of imports, 35 million tons of exports and 9 million tons of re-exports. This equates to approximately 15 tons of cargo being handled per second. Food and beverages enter the country primarily via the Emirates modern sea ports, all of which have free trade zone facilities. Abu Dhabis port, Mina Zayed falls under the control of the Seaports Authority and has 21 deep-water berths and warehousing for imported cargo. In Dubai, Jebel Ali Port and Port Rashid are operated by the Dubai Port Authority, and have 63 berths and 35 berths, respectively. These two ports also have extensive warehousing facilities for imports. Jebel Ali Port is the worlds largest man-made port and is highly regarded for its cargo-handling capacity and efficiency. Large containerised consignments that are shipped to the UAE are often broken down into smaller consignments and transhipped to neighbouring countries such as Oman, Qatar and Bahrain. The destuffing and reconsolidation of cargo are typically carried out in the countrys various free trade zones. The Cape Town-Dubai sea route is served mainly by Maersk and MSC, and there are about eight sailings per month. The voyage time is approximately 16 days. The UAE has several modern airports and sophisticated cargo-handling facilities called villages. Dubai Village handles more cargo than any other airport in the region with much of it destined for Europe after having entered the country by sea. The construction of the new Dubai International Airport (Al Maktoum International Airport) is well underway and the first phase was opened during 2009. On completion, the airport will have 16 cargo terminals and a 12 mn ton annual cargo handling capacity. The airport will be served by the Dubai Metro as well as a dedicated light rail system linking the airport with Dubais city centre. Emirates Airline operates a daily cargo flight from Cape Town to Dubai. The UAEs seaport and airport facilities have been specially designed to cope with the very high summer temperatures and humidity but export cargo destined for the country still needs to be carefully prepared to minimise the risk of spoilage. Road transport is used regularly within the Emirates to move cargo between cities as well as to more remote areas, but the distances travelled are relatively short given the extensive desert conditions in the country.

12

9.
9.1

Price
Price developments

With the food and beverage sector in the UAE being so competitive, retailers and operators in the food service industry cannot afford to set prices too high because they will lose customers. The average consumer in the country looks for value for money and is prepared to shop around for the best deals. Another point to note is that the countrys ambitious plans to become a global mecca for business and entertainment will not be realised if the cost of living (which is heavily influenced by food and drinks prices) is too high.

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The difficult trading conditions which most countries have been facing in the aftermath of the global financial crisis have led to price reductions in various industry sectors in the UAE, including food and beverages. However, these have not been consistent across all product groups and prices are likely to normalise again as prospects for growth in the country improve.
(See APPENDIX : Price comparisons for selected food and beverage products.)

9.2

Price influencing factors

In general, the UAE has experienced a food deficit in recent years and this has put upward pressure on the countrys inflation rate. As a result, consumers have become more discriminating in their purchase of foodstuffs, both at retailers and in restaurants and other eating establishments. Inflation stood at 11% and 12% in 2007 and 2008, respectively. However, it dropped to 4% in 2009 in the face of weaker demand and expenditure. The UAE currency, the dirham, is pegged to the US dollar which is weaker than other major currencies, such as the euro and British pound. This makes food and beverage imports more expensive than they would otherwise be if the dirham had a higher value. It should be noted that US exporters benefit from the absence of exchange risk in their dealings with the Emirates market and can price with certainty, unlike South African and other producers. The modest import duties which food and non-alcoholic beverages attract have helped to counteract the adverse effects of the relatively weak local currency. Imported alcoholic beverages, on the other hand, attract very high duty clearly meant to deter the regular consumption of alcohol in the country. Well-known international food and beverage brands generally command higher prices than lesser known ones, while speciality products also carry premium prices. Finally, whereas some countries are hampered in their international business efforts by inefficient distribution networks and infrastructure, the UAE has world-class facilities which help to contain distribution costs and consequently prices.

9.3

Methods of payment

Studies have shown that about a third of shipments going into the UAE are covered by letters of credit and a third by sight or usance drafts, while the rest involve open account payment. At a macro level, the UAEs economy does not pose too great a risk for foreign suppliers, even though it has been under pressure recently from the global economic downturn. For example, the Government instituted a large stimulus package to keep the countrys banks liquid, there are no exchange controls in place which could delay payment for export shipments, exchange risk is minimised because the local currency is pegged to the US dollar, and there are clear signs that economic growth is moving once more into positive territory. At a micro level, however, the creditworthiness and trading ethics of individual buyers are always in question. It is therefore better to take the necessary precautions up front to secure payment than to be sorry and out of pocket later. Invoking the law to collect bad debts is invariably a costly exercise and instituting an action against a foreigner in a Middle Eastern country is not something that most companies would relish. First-time exporters are strongly advised to transact under a letter of credit (preferably confirmed) or to secure advance payment if their buyer is agreeable to this. Payment by open account or bank collection is only appropriate when importers and their foreign suppliers have developed a strong and trusting relationship.

13

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10. Doing Business


10.1 Promotion
With so many companies vying for a share of the Emirates food and beverage market, effective promotion has become critical for business success. Furthermore, new entrants to the market need to be particularly creative in their promotional campaigns if their products are to stand a chance against well-entrenched international brands. Two major considerations when formulating a promotional strategy for the UAE market are that successful business is seen to be founded on relationships, and consumers are very price- and quality-conscious and therefore expect value for money. The UAE is not only a sizeable market in its own right but a regional trading hub with established distribution networks throughout the Middle East. Thus promotional activities should be considered with an extended, Middle Eastern audience in mind. Companies which are serious about penetrating the UAE market (and beyond) should visit the Dubai-hosted Gulfood Show, which is held in February every year, or, better still, exhibit their products there. The Gulfood Show is the most important food trade fair in the Middle East (both for networking and generating sales) and attracts about 37,000 visitors from throughout the region. Another promising food trade fair, which was inaugurated in 2009, is the World of Perishables fair. From September to May (excluding the month of Ramadan) is the period during which most of the countrys trade exhibitions take place and while the major regional events are staged in Abu Dhabi and Dubai, smaller, more specialised fairs are held from time to time in Sharjah, Ras al-Khaimah and Fujairah. Amongst the most effective media for promoting food and beverages are print advertising in regional publications and in-store promotions. TV advertising is a useful promotional channel when targeting a regional audience but it is very expensive. Newcomers to the market must be prepared to offer promotional support to their buyers as the latter are unlikely to invest in new-to-market product promotion without a producers active involvement. At the end of the day, what constitutes the best promotional formula depends on the product and the competitive conditions in the market. However, any promotional activity which helps to raise consumer awareness, is valuable. Furthermore, it is important to note that, according to the latest World Bank Doing Business 2010 data, the UAE was placed in 33rd position out of 183 economies in terms of the overall ease of doing business. The countrys ranking in terms of the ease of trading across borders was even higher, coming in at 5th position of the 183 economies. According to the Trading Across Borders section of the report, the average number of days to export to the UAE is 9 days and the average cost is USD179 per container. Table 1: Import procedures of the UAE
14
Nature of Import Procedures Documents preparation Customs clearance and technical control Inland transportation and handling Totals: Source: Doing Business, 2010 Duration (days) 5 1 1 9 USD Cost 167 100 175 579

trade fact sheet uae

10.2 Business culture


The UAE has a very cosmopolitan character, its residents are well educated and, while Arabic is the official language, English is widely spoken. The country is also viewed as more modern and western than any of the other countries in the Middle East making it an attractive country with which to do business. However, those who are unfamiliar with the Arab business culture need to keep several things in mind if their marketing efforts are to bear fruit. According to Arabic culture, business flows from personal relationships and mutual trust. Personal contact is an important ingredient in this regard, and is far more effective than telephone calls and e-mails. Even after the negotiations underpinning a particular deal have been concluded, it is wise for a foreign supplier to make repeat visits to the market as this demonstrates commitment. With a large proportion of UAE residents being Muslim, Islamic beliefs and traditions strongly influence the way in which people conduct themselves in business and social circles. Foreigners who, for example, have had a secular upbringing, need to be sensitive to the pervasive influence of Islam in all aspects of life. Although the way in which businesses are structured in the UAE is similar to that in other parts of the world, it is often the case that a company is a family affair with the ultimate decision-maker being the head of the family. Organisations are run along hierarchical lines in this part of the world, and individuals holding very senior positions, as well as the head of the organisation, must be treated in a deferent, respectful manner. It is also important to know peoples professional status and use the correct title/s when addressing them. Given the formal, rather conservative nature of the business environment in the UAE, it is important to have links with one or more well-connected individuals in the country who can make the necessary overtures and arrange introductions with prospective local businessmen. Attempting to make in-roads into the market on ones own could be an exercise in frustration. Business meetings can be challenging because they are often the spawning ground for embarrassing or offensive cultural faux pas. For example, the up-front, hard-hitting western business style is generally not appreciated in Arabic business culture. Rather, good manners and a courteous demeanour are expected. To the generally hurried western businessman, the apparently aimless small talk and frequent interruptions (by family, friends and colleagues) that characterise business meetings can be very frustrating. Yet the often lengthy exchange of pleasantries is an important part of the get-to-know-each-other phase of the negotiations, without which trust and mutual respect could not be built. The frequent interruptions, in turn, are understandable if one remembers that in the Middle East, relationships (particularly with family members and friends) take precedence over the minutiae of a business deal. Other courtesies which can help to smooth the way for productive business dealings in this part of the world are dressing conservatively, being punctual for meetings, using only the right hand to shake hands and accept drinks, and having bilingual (English-Arabic) business cards and promotional material available for distribution. It is not uncommon for several meetings to take place before the parties begin to discuss the practical dimensions of a business deal or partnership. Once the negotiations have been concluded, the resulting agreement is not necessarily committed to writing. To an Arab businessman, his word is his bond written agreement or otherwise. This can be disconcerting to a westerner steeped in a culture of latent mistrust of other people and heavy reliance on contract documents which clearly specify parties rights and obligations. Having become acquainted with the cultural nuances associated with doing business in the Emirates, foreigners might be inclined to think that the market poses few obstacles to entry. However, definite challenges exist - from meeting the countrys strict shelf-life requirements to securing a suitable local distributor. In addition, those who are impatient by nature and expect quick returns should probably turn their attention to another market.

15

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11. Contacts
Table 2: Key Government amd Embassy contacts
SECTOR/INDUSTRY Physical address Emirates Authority for Standards and Metrology P.O. Box 2166 Abu Dhabi UAE Abu Dhabi Chamber of Commerce and Industry P.O. Box 662 Abu Dhabi UAE Dubai Chamber of Commerce and Industry P.O. Box 1457 Dubai Telephone number Tel: +971 2 671 1110 Fax: +971 2 671 5999 Website and e-mail address E-mail: sultan@esma.ae

Tel: +971 2 621 4000 Fax: +971 2 621 5867

E-mail: mohd.almehairbi@adcci.gov.ae

Tel: +971 4 228 0000 Fax: +971 4 221 1646

E-mail: dcciinfo@dcci.org

EMBASSIES AND CONSULATES Embassies Physical address UAE Embassy P.O. Box 57090 Arcadia Pretoria South Africa 0083 Embassy of the Republic of South Africa P.O. Box 29446 Abu Dhabi UAE Telephone number Tel: +27 12 342 7736 Fax: +27 12 342 7738 Website and e-mail address E-mail: uae@mweb.co.za

Tel: +971 2 447 3446 Fax: +971 2 447 3031

E-mail: saemb@emirates.net.ae

Consulate Physical address South African Consulate-General: Dubai P.O. Box 34800 Dubai UAE Telephone number Tel: +971 4 397 5222 Fax: +971 4 397 6975 Website and e-mail address E-mail: satrade@thedti.ae

16

trade fact sheet uae

12. Sources and References


2010. 2009. 2009. 2009. 2009. 2009. 2009. 2009. 2009. 2009. 2008. 2007. The World Bank Group. Trading Across Borders in the UAE. Business Monitor International. Selected articles on the food and beverage industry in the UAE. USDA Foreign Agricultural Service. United Arab Emirates Fairs Country Report. USDA Foreign Agricultural Service. United Arab Emirates Retail Sector Report. Agriculture and Agri-Food Canada. Trends - food in the United Arab Emirates. Austrade. United Arab Emirates Profile. Austrade. Food to the United Arab Emirates. CIA World Fact Book. Middle East United Arab Emirates. USDA Foreign Agricultural Service. United Arab Emirates Agricultural Situation Exporter Guide for 2008. New Zealand Trade & Enterprise. Market Profile for Food and Beverage in UAE Market. Datamonitor Consumer Products Database. Microeconomics of Competitiveness Group Project. The Transport and Logistics Cluster in the United Arab Emirates.

17

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trade fact sheet uae

13. Appendix
Figure 1: Western Capes main food and beverage exports to the UAE 2004 - 2008 (ZARm)
400! 360.4! 350! 300! 250! 200!

2004! 2005! 2006! 2007! 2008!

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!"#$"%&'()*"+#',)-&'.//0')&0'1"2"%)3"'"4*/%$#'$/'$5"'6/%70'899:';'899< !"#$%&'($%"# )$*+,& -++.,&/'+,*$&'0'1%"23,& 4$,+*$,565$",5'($%"#'0'2%#& 7"&8 )$*+,'9"2,& 150! ::=>?= =@A;?B =<>B?C CC=?: =BA:?A BB<> 112! ::B:?C =@@:?C =B><?D C@@?< =<>=?< BAAB 100! :<=;?> =A@;?B =BAA?D C<C?A =B::?> B<>B 36.7! 46.7! 41.7! 50! BB@A?D ::<>?= :=A<?: CA>?A =@=>?: <DC@ 7.4! <BDD?@ :AB@?A :A>:?: =::A :;>;?A A==:?@
0! Citrus fruit! Grapes! Apples, pears & quinces! Stone fruit! Fruit & vegetable juices! Grape wines!

Figure 2: Western Capes main food and beverage exports to the world 2004 - 2008 (ZARm)
7000! 6112.7! 6000! 5000! 4000! 3000! 2000! 1226! 1000! 0! Citrus fruit! Grapes! Apples, pears & quinces! Prepared/dried fruit & nuts! Fish! Grape wines! 2637.6! 2682.2! 2080.6!

4355.7! 2004! 2005! 2006! 2007! 2008!

Source: Quantec, 2010

18

trade fact sheet uae


Table 3: UAE tariff structure for selected South African food and beverage products
Selected product codes (HS2) 0201 0202 0203 0204 0205 0206 0207 0208 0209 0210 0301 0302 0303 0304 0305 Number of lines Total ad valorem equivalent tariff (estimated) 0.00% 5.00% 5.00% 3.28% 0.00% 4.95% 5.00% 3.70% 5.00% 5.00% 0.00% 0.00% 5.00% 0.00% 5.00%

Product description

Meat of bovine animals, fresh or chilled Meat of bovine animals, frozen Meat of swine, fresh, chilled or frozen Meat of sheep or goats, fresh, chilled or frozen Meat of horses, asses, mules or hinnies, fresh, chilled or frozen Edible offal of bovine animals, swine, sheep, goats, horses, asses, mules or hinnies, fresh, chilled or frozen Meat and edible offal, of the poultry of heading No 0105, fresh, chilled or frozen Other meat and edible meat offal, fresh, chilled or frozen Pig fat, free of lean meat, and poultry fat, not rendered or otherwise extracted, fresh, chilled, frozen, salted, in brine, dried or smoked Meat and edible meat offal, salted, in brine, dried or smoked; edible flours and meals of meat or meat offal Live fish Fish, fresh or chilled, excluding fish fillets and other fish meat of heading No 0304 Fish, frozen, excluding fish fillets and other fish meat of heading 0304 Fish fillets and other fish meat (whether or not minced), fresh, chilled or frozen Fish, dried, salted or in brine; smoked fish, whether or not cooked before or during the smoking process; flours, meals and pellets of fish, fit for human consumption Crustaceans, whether in shell or not, live, fresh, chilled, frozen, dried, salted or in brine; crustaceans, in shell, cooked by steaming or by boiling in water, whether or not chilled, frozen, dried, salted or in brine; flours, meals and pellets of crusta Molluscs, whether in shell or not, live, fresh, chilled, frozen, dried, salted or in brine; aquatic invertebrates other than crustaceans and molluscs, live, fresh, chilled, frozen, dried, salted or in brine; flours, meals and pellets of aquatic invertebra Milk and cream, not concentrated nor containing added sugar or other sweetening matter Milk and cream, concentrated or containing added sugar or other sweetening matter Buttermilk, curdled milk and cream, yogurt, kephir and other fermented or acidified milk and cream, whether or not concentrated or containing added sugar or other sweetening matter or flavoured or containing added fruit, nuts or cocoa Whey, whether or not concentrated or containing added sugar or other sweetening matter; products consisting of natural milk constituents, whether or not containing added sugar or other sweetening matter, not elsewhere specified or included Butter and other fats and oils derived from milk; dairy spreads Cheese and curd Birds eggs, in shell, fresh, preserved or cooked Birds eggs, not in shell, and egg yolks, fresh, dried, cooked by steaming or by boiling in water, moulded, frozen or otherwise preserved, whether or not containing added sugar or other sweetening matter

3 4 6 15 2 13 13 13 2 8 11 37 43 13 14

0306

10

0.00%

0307 0401

12 6 10 5

5.00% 5.00% 5.00% 5.00%

19

0402 0403

0404 0405 0406 0407 0408

2 3 7 3 4

5.00% 5.00% 5.00% 3.33% 5.00%

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0409 0410 0701 0702 0703 0704 0705 0706 0707 0708 0709 0710 0711 0712 0713 0714 0801 0802 0803 0804 0805 0806 0807 0808 Natural honey Edible products of animal origin, not elsewhere specified or included Potatoes, fresh or chilled Tomatoes, fresh or chilled Onions, shallots, garlic, leeks and other alliaceous vegetables, fresh or chilled Cabbages, cauliflowers, kohlrabi, kale and similar edible brassicas, fresh or chilled Lettuce (Lactuca sativa) and chicory (Cichorium spp.), fresh or chilled Carrots, turnips, salad beetroot, salsify, celeriac, radishes and similar edible roots, fresh or chilled Cucumbers and gherkins, fresh or chilled Leguminous vegetables, shelled or unshelled, fresh or chilled Other vegetables, fresh or chilled Vegetables (uncooked or cooked by steaming or boiling in water), frozen Vegetables provisionally preserved (for example, by sulphur dioxide gas, in brine, in sulphur water or in other preservative solutions), but unsuitable in that state for immediate consumption Dried vegetables, whole, cut, sliced, broken or in powder, but not further prepared Dried leguminous vegetables, shelled, whether or not skinned or split Manioc, arrowroot, salep, Jerusalem artichokes, sweet potatoes and similar roots and tubers with high starch or inulin content, fresh, chilled, frozen or dried, whether or not sliced or in the form of pellets; sago pith Coconuts, Brazil nuts and cashew nuts, fresh or dried, whether or not shelled or peeled Other nuts, fresh or dried, whether or not shelled or peeled Bananas, including plantains, fresh or dried Dates, figs, pineapples, avocados, guavas, mangoes and mangosteens, fresh or dried Citrus fruit, fresh or dried Grapes, fresh or dried Melons (including watermelons) and papaws (papayas), fresh Apples, pears and quinces, fresh Apricots, cherries, peaches (including nectarines), plums and sloes, fresh Other fruit, fresh Fruit and nuts, uncooked or cooked by steaming or boiling in water, frozen, whether or not containing added sugar or other sweetening matter Fruit and nuts, provisionally preserved (for example, by sulphur dioxide gas, in brine, in sulphur water or in other preservative solutions), but unsuitable in that state for immediate consumption Fruit, dried, other than that of headings 0801 to 0806; mixtures of nuts or dried fruits of this chapter Peel of citrus fruit or melons (including watermelons), fresh, frozen, dried or provisionally preserved in brine, in sulphur water or in other preservative solutions 1 3 2 1 5 3 4 2 1 4 15 8 5 6 13 5 6 15 1 11 6 2 4 3 4 9 3 5.00% 5.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 5.00% 5.00% 5.00% 4.71% 5.00% 5.00% 5.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 5.00%

20

0809 0810 0811

0812

5.00%

0813 0814

8 1

5.00% 5.00%

trade fact sheet uae


0901 0902 0903 0904 0905 0906 0907 0908 0909 0910 1001 1002 1003 1004 1005 1006 1007 1008 1507 1508 1509 1510 1511 1512 Coffee, whether or not roasted or decaffeinated; coffee husks and skins; coffee substitutes containing coffee in any proportion Tea, whether or not flavoured Mat Pepper of the genus Piper; dried or crushed or ground fruits of the genus Capsicum or of the genus Pimenta Vanilla Cinnamon and cinnamon-tree flowers Cloves (whole fruit, cloves and stems) Nutmeg, mace and cardamoms Seeds of anise, badian, fennel, coriander, cumin or caraway; juniper berries Ginger, saffron, turmeric (curcuma), thyme, bay leaves, curry and other spices Wheat and meslin Rye Barley Oats Maize (corn) Rice Grain sorghum Buckwheat, millet and canary seed; other cereals Soya-bean oil and its fractions, whether or not refined, but not chemically modified Ground-nut oil and its fractions, whether or not refined, but not chemically modified Olive oil and its fractions, whether or not refined, but not chemically modified Other oils and their fractions, obtained solely from olives, whether or not refined, but not chemically modified, including blends of these oils or fractions with oils or fractions of heading No 1509 Palm oil and its fractions, whether or not refined, but not chemically modified Sunflower-seed, safflower or cotton-seed oil and fractions thereof, whether or not refined, but not chemically modified Coconut (copra), palm kernel or babassu oil and fractions thereof, whether or not refined, but not chemically modified Rape, colza or mustard oil and fractions thereof, whether or not refined, but not chemically modified Margarine; edible mixtures or preparations of animal or vegetable fats or oils or of fractions of different fats or oils of this chapter, other than edible fats or oils or their fractions of heading No 1516 Sausages and similar products, of meat, meat offal or blood; food preparations based on these products Other prepared or preserved meat, meat offal or blood Extracts and juices of meat, fish or crustaceans, molluscs or other aquatic invertebrates 5 5 1 3 1 3 1 2 5 8 4 1 1 2 5 4 1 4 2 2 2 1 2 4 4 4 0.00% 0.00% 5.00% 5.00% 5.00% 5.00% 5.00% 0.26% 5.00% 5.00% 0.00% 5.00% 0.00% 0.00% 0.00% 0.00% 5.00% 0.00% 5.00% 5.00% 5.00% 5.00% 5.00% 5.00% 5.00% 5.00%

21
1513 1514

1517

5.00%

1601 1602 1603

6 16 2

5.00% 5.00% 5.00%

trade fact sheet uae


1604 1605 1701 1702 1703 1704 1801 1802 1803 1804 1805 1806 1901 Prepared or preserved fish; caviar and caviar substitutes prepared from fish eggs Crustaceans, molluscs and other aquatic invertebrates, prepared or preserved Cane or beet sugar and chemically pure sucrose, in solid form Other sugars, including chemically pure lactose, maltose, glucose and fructose, in solid form; sugar syrups not containing added flavouring or colouring matter; artificial honey, whether or not mixed with natural honey; caramel Molasses resulting from the extraction or refining of sugar Sugar confectionery (including white chocolate), not containing cocoa Cocoa beans, whole or broken, raw or roasted Cocoa shells, husks, skins and other cocoa waste Cocoa paste, whether or not defatted Cocoa butter, fat and oil Cocoa powder, not containing added sugar or other sweetening matter Chocolate and other food preparations containing cocoa Malt extract; food preparations of flour, groats, meal, starch or malt extract, not containing cocoa or containing less than 40 % by weight of cocoa calculated on a totally defatted basis, not elsewhere specified or included; food preparations of goods of Pasta, whether or not cooked or stuffed (with meat or other substances) or otherwise prepared, such as spaghetti, macaroni, noodles, lasagne, gnocchi, ravioli, cannelloni; couscous, whether or not prepared Tapioca and substitutes therefor prepared from starch, in the form of flakes, grains, pearls, siftings or similar forms Prepared foods obtained by the swelling or roasting of cereals or cereal products (for example, corn flakes); cereals (other than maize (corn)) in grain form or in the form of flakes or other worked grains (except flour, groats and meal), pre-cooked or ot Bread, pastry, cakes, biscuits and other bakers wares, whether or not containing cocoa; communion wafers, empty cachets of a kind suitable for pharmaceutical use, sealing wafers, rice paper and similar products Vegetables, fruit, nuts and other edible parts of plants, prepared or preserved by vinegar or acetic acid Tomatoes prepared or preserved otherwise than by vinegar or acetic acid Mushrooms and truffles, prepared or preserved otherwise than by vinegar or acetic acid Other vegetables prepared or preserved otherwise than by vinegar or acetic acid, frozen, other than products of heading 2006 Other vegetables prepared or preserved otherwise than by vinegar or acetic acid, not frozen, other than products of heading No 2006 Vegetables, fruit, nuts, fruit-peel and other parts of plants, preserved by sugar (drained, glac or crystallised) Jams, fruit jellies, marmalades, fruit or nut pure and fruit or nut pastes, obtained by cooking, whether or not containing added sugar or other sweetening matter Fruit, nuts and other edible parts of plants, otherwise prepared or preserved, whether or not containing added sugar or other sweetening matter or spirit, not elsewhere specified or included Fruit juices (including grape must) and vegetable juices, unfermented and not containing added spirit, whether or not containing added sugar or other sweetening matter 9 5 11 15 2 10 1 1 2 1 1 14 10 5.00% 5.00% 0.00% 5.00% 5.00% 5.00% 5.00% 5.00% 5.00% 5.00% 5.00% 5.00% 1.31%

1902

13

5.00%

1903

5.00%

1904

11

5.00%

1905

18

5.00%

2001 2002 2003

8 3 3 10 23 1 16

5.00% 5.00% 5.00% 5.00% 5.00% 5.00% 5.00%

22

2004 2005 2006 2007

2008

17

5.00%

2009

25

5.00%

trade fact sheet uae


Extracts, essences and concentrates, of coffee, tea or mat and preparations with a basis of these products or with a basis of coffee, tea or mat; roasted chicory and other roasted coffee substitutes, and extracts, essences and concentrates thereof Yeasts (active or inactive); other single-cell micro-organisms, dead (but not including vaccines of heading No 3002); prepared baking powders Sauces and preparations therefor; mixed condiments and mixed seasonings; mustard flour and meal and prepared mustard Soups and broths and preparations therefor; homogenised composite food preparations Ice cream and other edible ice, whether or not containing cocoa Food preparations not elsewhere specified or included Waters, including natural or artificial mineral waters and aerated waters, not containing added sugar or other sweetening matter nor flavoured; ice and snow Waters, including mineral waters and aerated waters, containing added sugar or other sweetening matter or flavoured, and other non-alcoholic beverages, not including fruit or vegetable juices of heading No 2009 Beer made from malt Wine of fresh grapes, including fortified wines; grape must other than that of heading No 2009 Vermouth and other wine of fresh grapes flavoured with plants or aromatic substances Other fermented beverages (for example, cider, perry, mead); mixtures of fermented beverages and mixtures of fermented beverages and non-alcoholic beverages, not elsewhere specified or included Undenatured ethyl alcohol of an alcoholic strength by volume of 80 % vol or higher; ethyl alcohol and other spirits, denatured, of any strength Undenatured ethyl alcohol of an alcoholic strength by volume of less than 80 % vol; spirits, liqueurs and other spirituous beverages

2101

5.00%

2102 2103 2104 2105 2106 2201

7 8 2 1 15 5

5.00% 5.00% 5.00% 5.00% 4.65% 5.00%

2202 2203 2204 2205 2206

11 1 4 2 1

5.00% 50.00% 50.00% 50.00% 50.00%

2207 2208

5 9

7.93% 48.30%

Source: Market Access Map, 2008

23

trade fact sheet uae


Table 4: Price comparisons for selected food and beverage products
HS code 0401 Saudi Arabia Milk or cream, not concentrated or sweetened Kuwait Germany 0402 Netherlands Saudi Arabia Milk & cream, concentrated or sweetened New Zealand Oman 0406 Saudi Arabia Cheese & curd Denmark Australia 0407 Brazil Eggs in shells Netherlands Oman 1901 Ireland Malt extract, food preparations of flour, meal, starch or malt Iran Netherlands Germany 1902 21772 11648 9028 6639 2157 1341 2078 1912 10094 8686 4345 3472 26551 15168 6307 14570 8862 2421 1822 1712 2605 34932 19009 13973 7307 5468 2895 4781 3476 4827 63447 30835 14634 5491 4336 5616 126395 100376 55292 110117 2286 912 22584 3605 3400 28917 2090 1337 781 1725 2543 Supplying country Imported value in 2008 (USD) Imported quantity in 2008 (metric tons) Unit value per metric ton (USD)

24
Pasta & couscous

Turkey Saudi Arabia Italy 1904 United Kingdom Breakfast cereals & cereal bars Germany France

10842 9778 8423

10363 5175 5830

1046 1889 1445

11959 9257 3959

3092 2327 678

3868 3978 5839

trade fact sheet uae


1905 Saudi Arabia Bread, biscuits, wafers, cakes & pastries United Kingdom Oman 2002 China Tomatoes, prepared or preserved US Iran 2005 Other Prepared or preserved vegetables nes (excluding frozen) Italy US 2008 China Prepared fruits nes India Thailand 2009 Saudi Arabia Fruit & vegetable juices, unfermented Germany US 2201 France Mineral & aerated waters Italy Saudi Arabia 2202 Japan 28745 18115 5943 22708 10204 4428 1266 1775 1342 13853 4141 2371 16742 6122 7504 827 676 316 50552 15354 6494 49778 7420 2798 1016 2069 2321 16269 11805 9860 18989 14397 12995 857 820 759 8214 8138 6156 15210 12416 2658 540 655 2316 30967 7713 5431 37975 6454 4687 815 1195 1159 40165 21581 14577 13153 5791 7414 3054 3727 1966

25

Non-alcoholic beverages (excl water, fruit or vegetable juice)

Germany Netherlands

2203 Australia Beer made from malt Netherlands Mexico 5990 5085 1848 10038 9034 2955 597 563 625

trade fact sheet uae


2204 France Wine of fresh grapes Australia Argentina 2207 South Africa Ethyl alcohol & other spirits Pakistan France 2208 United Kingdom Spirits, liqueurs, other spirit beverages, alcoholic preparations India Indonesia 2209 Italy Vinegar & substitutes for vinegar US Philippines Source: Trademap, 2008 766 304 171 326 232 225 2350 1310 760 21239 14845 7530 6404 22095 10163 3317 672 741 10004 2759 1231 10502 3460 753 953 797 1635 46436 12710 4687 4138 3506 1172 11222 3625 3999

26

Disclaimer
Wesgro has taken every effort to ensure that the information in this publication is accurate. We provide said information without representation, or warranty whatsoever, whether expressed or implied. It is the responsibility of users of this publication to satisfy themselves of the accuracy of information contained herein. Wesgro, 2010