Food and drink exporting opportunities in The United Arab Emirates

Richard Cuda, Director - Strategic Banking Alliances, International, Santander UK says UK food and drink manufacturers should seriously consider the United Arab Emirates (UAE) as a primary export market.

The UAE has become one of the UK’s most significant trading partners, and both domestic and expatriate consumers in the United Arab Emirates are looking for high-quality UK products, including food and drink.

The UAE – and the wider Gulf region – continues to grow in terms of economic prowess. The award of the World Expo 2020 to Dubai, for instance, is forecast to boost the economy further and result in opportunities across many sectors, including hospitality.

Santander has recently set up a partnership with the Dubai-based British Centre for Business (BCB) – a business-to-business professional services company and a member of the Overseas Business Network Initiative – aimed at helping UK businesses seek out exporting opportunities in the UAE and get in contact with prospects.

According to the BCB, the UAE food and drink sector is growing rapidly: major prospects exist in categories such as confectionery, dairy, gourmet food, organic food, seafood, halal meat products and health foods, among others. The “Made in Britain” brand is very popular and continues to drive significant demand.

The size of the UAE food and drink sector is, says the BCB, estimated at £19.88 billion (as of 2014), based on consumer expenditure, which is forecast to grow 30% to £25.81 billion by 2018. Some 85 percent of food and drink is imported in the UAE, providing major opportunities for UK companies. UK food and drink firms exported £417 million worth of products in 2014, underlining that while there is already a strong flow of exports, there remains significant potential for further growth.

In addition to more traditional sectors, there are growth opportunities in more niche ones. The UAE has very high rates of obesity and diabetes both in the local and expat communities, for instance, and the government is under increasing pressure to reduce this rate and treats the situation as a priority issue. These trends have resulted in huge demand for healthy product lines such as reduced fat and gluten free.

The largest chain of supermarkets across the Middle East

Santander believes that the UAE represents a major opportunity for UK food and drink businesses and is increasing the number of targeted initiatives it runs helping UK firms seek out these opportunities.

In July this year, for instance, Santander organised a UK buyer’s roadshow with Birmingham-based Y International Ltd, the UK buying arm of LuLu Group International, the largest chain of hyper- and supermarkets across the Middle East. In October, it organised for 10 food and drink producers, wholesalers and distributors to meet with Spinneys, one of the largest chains of hypermarkets in the UAE, with a view to the chain selling the business’s products. And in February next year Santander will also support British food and drink businesses connect to the right people and businesses at the Gulfoods trade show in Dubai.

Fast-developing export and trading opportunities

The domestic UK food and drink sector is already a major contributor to the UK economy: the sector grew by 6% in 2014 to a total of 8,225 firms, according to analysis of ONS data by Santander. The Food and Drink Federation says the sector is the largest manufacturing sector in the UK, with a turnover of £95.4 billion in 2014.

It is good, therefore, to see this growth reflected in fast-developing export and trading opportunities too – the potential to expand internationally is profound.

While the UAE is already a key export market for the UK – it was the 11th most important export market for all UK goods in 2015, worth £6.236 billion in 2015 – it is clear that food and drink is a key part of further export growth.