Middle East is Addicted to Global Trade

United Arab Emirates, Bahrain & Qatar Overweighted on Oil Exports

© Daniel Workman

Jan 16, 2009

Most people understand that wealthy Middle East countries generate most of their money from oil exports. Today, many nations couldn’t function for long without inflows of imported Middle Eastern oil.

This analysis focuses on the total value of exports and imports for each of 20 Middle Eastern economies. Those amounts are then divided by the country’s Gross Domestic Product (GDP) to calculate a percentage that shows the share of a nation’s production that global trade generates.

Based on estimated 2007 statistics from the CIA World Factbook, overall global trade from all Middle Eastern countries was about US$1.8 billion in 2007. That figure represents 43% of that geographic region’s total GDP which amounted to some $4.1 billion. North America’s global trade percentage is 27.1% and South America’s is 21%.

Mideast Countries Most Open to Global Trade

The following 10 nations have the highest global trade percentages for 2007, together representing 34% of Mideast GDP.

1. United Arab Emirates ... 179.7% driven by global trade (US$295.5 billion divided by GDP of $164.4 billion)
2. Bahrain ... 103% driven by global trade ($24.7 billion divided by $24.01 billion)
3. Qatar ... 86.6% driven by global trade ($61.9 billion divided by $71.42 billion)
4. Libya ... 76.8% driven by global trade ($57.4 billion divided by $74.72 billion)
5. Iraq ... 62.3% driven by global trade ($63.8 billion divided by $102.4 billion)
6. Jordan ... 62.3% driven by global trade ($17.7 billion divided by $28.45 billion)
7. Kuwait ... 60.3% driven by global trade ($84.4 billion divided by $140 billion)
8. Israel ... 57.1% driven by global trade ($106.2 billion divided by $185.8 billion)
9. Saudi Arabia ... 56.7% driven by global trade ($309.3 billion divided by $546 billion)
10. Oman ... 56% driven by global trade ($34.1 billion divided by $60.89 billion).

United Arab Emirates and Bahrain do much more business through global trade than the combined total of their other GDP components, namely domestic consumption plus private investment plus government spending.

Mideast Countries Least Developed in Global Trade

Led by Egypt (population 82 million) and Iran (66 million), the 11 countries below represent 66% of Mideast GDP. Yet only 40.6% of overall Mideast global trade originates from these countries, which are sorted by global trade percentage from lowest to highest.

1. Egypt ... 17.1% driven by global trade ($69.4 billion divided by $405.4 billion)
2. Iran ... 18.6% driven by global trade ($142.1 billion divided by $762.9 billion)
3. Sudan ... 20.5% driven by global trade ($16.6 billion divided by $81 billion)
4. Syria ... 23.9% driven by global trade ($21.6 billion divided by $90.4 billion)
5. Yemen ... 25% driven by global trade ($14 billion divided by $56.2 billion)
6. Turkey ... 32.5% driven by global trade ($277.3 billion divided by $853.9 billion)
7. Morocco ... 33% driven by global trade ($41.3 billion divided by $125 billion)
8. Algeria ... 39% driven by global trade ($86.8 billion divided by $222.3 billion)
9. Lebanon ... 39.6% driven by global trade ($16 billion divided by $40.4 billion)
10. Tunisia ... 43.6% driven by global trade ($33.2 billion divided by $76.1 billion)
11. West Bank (Palestine) ... 54.4% driven by global trade ($2.7 billion divided by $5 billion).

Mideast Global Trade by Country

Below are top 10 Middle Eastern countries that contributed the most to that region’s overall $1.8 billion in global trade during 2007.

1. Saudi Arabia ... US$309.3 billion (17.4% of total Middle Eastern global trade)
2. United Arab Emirates ... $295.5 billion (16.6%)
3. Turkey ... $277.3 billion (15.6%)
4. Iran ... $142.1 billion (8%)
5. Israel ... $106.2 billion (6%)
6. Algeria ... $86.8 billion (4.9%)
7. Kuwait ... $84.4 billion (4.7%)
8. Egypt ... $69.4 billion (3.9%)
9. Iraq ... $63.8 billion (3.6%)
10. Qatar ... $61.9 billion (3.5%).

Mideast Global Exports

Below is a summary of the estimated $1.03 billion in Middle Eastern exports during 2007 for the top 10 Middle East countries.

1. Saudi Arabia ... US$226.7 billion (21.9% of total Middle Eastern exports)
2. United Arab Emirates ... $178.9 billion (17.3%)
3. Turkey ... $277.3 billion (11.2%)
4. Iran ... $88.3 billion (8.5%)
5. Kuwait ... $63.8 billion (6.2%)
6. Algeria ... $60.5 billion (5.9%)
7. Israel ... $50.4 billion (4.9%)
8. Libya ... $43 billion (4.2%)
9. Qatar ... $42 billion (4.1%)
10. Iraq ... $38.1 billion (3.7%).

Mideast Global Imports

Total Middle Eastern imports were $742.5 million in 2007. The following top 10 countries contributed most to that total.

1. Turkey ... US$162 billion (21.8% of total Middle Eastern imports)
2. Saudi Arabia ... US$116.6 billion (15.7%)
3. United Arab Emirates ... $82.6 billion (11.1%)
4. Israel ... $55.8 billion (7.5%)
5. Iran ... $53.9 billion (7.3%)
6. Egypt ... $45 billion (6.1%)
7. Morocco ... $28.5 billion (3.8%)
8. Algeria ... $26.3 billion (3.5%)
9. Iraq ... $25.7 billion (3.4%)
10. Kuwait ... $20.6 billion (2.8%).

Mideast Needs to Develop Other Exports

Middle Eastern wealth is so tied to oil exports that the development of alternative energy sources poses a severe threat to the Mideast's economic future.

The balance of trade may well swing to other areas of the world that can develop cleaner fuels. Electric cars, hybrid vehicles and even solar or wind-powered technologies may lead to innovative nations funnelling revenues previously destined to the Middle East oil into their own coffers.

Sources for this Article

This article presents independent calculations and insights based on estimated 2007 data drawn from the CIA World Factbook and Carbaugh’s International Economics, 12th edition.

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