AFRICA – As the world moves closer to achieving a global economy, Africa is fast emerging as one of the most important markets for the United Arab Emirates.
Dubai’s food and beverage (F&B) trade with Africa hit a four-year high at US$2.4 billion in 2020, according to a recent analysis by the Dubai Chamber of Commerce and Industry.
The value of trade last year, which doesn’t include tobacco, was 18 percent higher compared to the previous year and the highest since 2017.
During the five-year period 2015 – 2020, the total F&B trade between Dubai and Africa amounted to US$13.9 billion.
The emirate’s biggest trading partner in the continent is North Africa, which accounted for the lion’s share of the F&B trade in 2020, reaching a value of US$971.2 million, followed by East Africa (US$828.3 million) and Southern Africa (US$362.9 million).
Overall, Dubai’s F&B trade with Africa last year accounted for around 13 percent of the emirate’s total trade volume with the continent, excluding trade in gold, jewellery and precious stones.
In its analysis, Dubai Chamber noted that Africa’s growing urban F&B market offers “vast opportunities” for investors in Dubai, particularly those engaged in warehousing and cold storage for agricultural products, farm equipment, transport and repair services.
UNCTAD data showcasing that Africa registered a negative trade balance of US$20.1 billion in F&B products with the world, and this trend was most prevalent in North, Middle, and Western Africa, indicating sizeable business opportunities in those regions.
Despite the region having arable land for food production, Africa is a net food-importer especially of commodities such as cereals, meat, dairy products, fats, oils and sugar, importing about US$ 80 billion worth of agricultural and food products annually.
The import bill is projected to increase to about €92.41 billion per year by 2025.
The African countries with the largest import volumes are Egypt, Algeria, South Africa, Morocco and Kenya, which together account for almost 50% of imports.
The main exporter of food and beverages is the EU, closely followed by Brazil and India.
But the recently launched African Continental Free Trade Area (AfCFTA) seeks to change the narrative by expanding agricultural trade between African countries and aims to unlock the potential of the sector to contribute to sustainable and inclusive growth for Africa.