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Industrial emirate becomes hub for Chinese goods

posted 19 Mar 2012, 08:37 by Mpelembe   [ updated 19 Mar 2012, 08:37 ]

The Emirate of Sharjah has carved out an import-export market for itself from its trade with China -- becoming a hub for cheap Chinese automobile and electrical parts and accessories, sought by businessmen from Iraq, Egypt, Iran and elsewhere in the Middle East.

SHARJAH, UNITED ARAB EMIRATES  (REUTERS) - Traders are flocking to the emirate of Sharjah to do business with the economic superpower China.

Car accessory shops in the industrial part of the emirate are stacked up with Chinese goods which are sold to businessmen coming from as far as Russia to buy cheap goods wholesale.

The director-general of Sharjah Chamber of Commerce, Hussain Mohamed al-Mahmoudi, is proud of the relationship the emirate has cultivated with China.

"The emirate of Sharjah has a special relationship with the People's Republic of China. It was one of the first cities in the region to open communication lines with China. The first plane to land in the Gulf landed in Sharjah, the first Chinese business and trade council in the region opened in Sharjah," Mahmoudi said. He was speaking on the sidelines of a workshop organised by the Chamber of Commerce to encourage more trade between the two sides.

Among the businessmen and investors was the chairman of China's Council for Promotion of International trade, Tie Jianshe, who was representing his province of Zhejiang.

"Our trip here is to focus mainly on the export of small commodities. Sharjah imports a large amount of small commodities from China, especially in Zhejiang province. Sharjah is also an important transfer port for some of Zhejiang small commodity products when they come to Sharjah they can also ship to other countries in the region. The main export products include light industries and textiles and electronics," Tie said.

Trade volume between China and Sharjah reached six billion dollars in 2011, said Tie, adding that the figure grows every year.

Sharjah is hoping to carve out a niche by focusing on attracting small to medium size businesses.

China is the second biggest exporter to the UAE, after India. Chinese imports into the UAE totalled 41.8 billion dirhams ($11.4 billion) in the first nine months of last year, according to the latest UAE customs figures.

In Sharjah's industrial zone, the reputation in some countries of Chinese goods being of inferior quality is long gone as manufacturing quality improves, without necessarily being matched by an increase in price, said Iranian car accessories shop owner Gholam Ridha Qaed.

"Chinese products improve every year, every year the quality is newer and nicer than the year before. There are different product grades -- there is first grade which comes with slightly higher prices, second grade is cheaper, it all depends on the car parts demands in UAE and rest of the Gulf countries," Qaed said. He buys from wholesale importers and sells wholesale and individual items to local and international customers who come from as far away as Russia to buy Chinese goods.

"For single unit sales, youth from the Gulf are the biggest clients but for wholesales it's foreigners; Iran, Iraq, Libya, Yemen though less, even Africa they buy a lot of wholesale, Russia too, they take big orders, these are mostly the wholesale clients," he added.

Qaed put the reasons for his wide international client base down to the free trade between China and Sharjah.

In January 2012, Chinese premier Wen Jiabao made an unprecedented trip to the region, paying a special visit to Sharjah while in the UAE, reflecting the strong economic ties between the two sides.

"Chinese economic power is very influential and it has major impact internationally. We in the UAE and Sharjah specifically, we look to and have ambition to take advantage of this economic power and to make it work for us through this special relationship between the UAE and our friend China," said Mahmoudi.

And the relationship works both ways. Sharjah is home to a number of Chinese shopping outlets like Chinamex, a mall filled with Chinese shops.

There are estimated to be 4,000 Chinese companies in the UAE working in hospitality, furniture and electronics.