Plastics exports in Saudi Arabia valued at SR5.6 billion
Plastics remain the largest category by contribution on the exports side of the Saudi economy valued at SR5.6 billion ($1.49 billion)
Plastics remain the largest category by contribution on the exports side of the Saudi economy valued at SR5.6 billion ($1.49 billion), the National Commercial Bank said in its “Saudi Economic Review” report last month.
Despite the downward-trending oil prices, plastics surged by 9.2 percent year-on-year in September, accounting for 34.7 percent of the monthly non-oil exports return.
Exports of chemical industry products were valued at SR5.4 billion, accounting for 30.4 percent of non-oil exports.
On an annual basis, however, exports of chemical products retracted by 13.9 percent, affected mainly by the dwindling oil prices, and the slowing demand from China.
Exports of base metals recorded SR1.4 billion, thus surging by 25 percent over last year, a possible indicator that some aluminum refineries are entering the production phase.
The kingdom’s largest trade partner remains China, which accounts for about 12.9 percent of the export revenue. Although China’s share remains the highest, it tumbled by 12.9 percent in value terms, recording SR2.2 billion.
Non-oil exports to the United Arab Emirates also marked a 7.4 percent decline compared to last year, totaling SR2.1 billion. India came as the third largest trade partner instead of Singapore in September, accounting for 6.8 percent of the monthly total, worth SR1.2 billion. Non-oil exports to India surged by 64.3 percent compared to last year, while Singapore made a downturn of 11.7 percent to SR1.1 billion.
Analysis of the kingdom’s import bill shows that machinery and electrical equipment, which account for almost a quarter of imports, fell by 6 percent year-on-year in September to SR12.2 billion. Imports of transport equipment recorded a surge of 16.4 percent, amounting to SR10.5 billion, while base metal imports slid by 7.5 percent year-on-year to SR6.2 billion. According to countries of origin, the largest trade partners were China, the United States and Germany.
Chinese imports represent 14.2 percent of the Kingdom’s import bill, which advanced by 12.3 percent year-on-year, amounting to SR7.3 billion. U.S. imports contracted by 5.9 percent in value terms compared to September last year, standing at SR6.6 billion. Moreover, German imports contracted by 18.9 percent year-on-year, to SR3.4 billion.
Meanwhile, although SAMA’s monetary policy is constrained by the dollar peg, it retains adequate control on liquidity via Tbills issuing and reserve requirements.
Current statutory deposits with SAMA amount to SR90.5 billion, up by 13.4 percent from last year. SAMA bills reached SR235.4 billion by the end of September, surging by 31.6 percent YY, issuing bills worth SR15.7 billion in Q3. In Q3, short-term loans accounted for less than 50 percent for the first time as medium and long-term loans accounted for 18.1 percent and 32.2 percent, respectively.
The pace of short-term loans growth averaged 3.1 percent compared with a respective 10.6 percent and an 11.3 percent annualized growth in medium and long-term loans.
This article was first published in the Saudi Gazette on Sunday, Dec. 7, 2014.