Japan imported 31.80 million barrels of oil from the UAE in October 2024, representing 47.8 percent of its total imports for that month, as reported by the Agency for Natural Resources and Energy under Japan’s Ministry of Economy, Trade and Industry. According to the data, Japan’s overall oil imports in October reached around 66.53 million barrels, with an impressive 97.8 percent, or approximately 65.06 million barrels, sourced from Arab nations, including the UAE.
In September 2024, Japan’s total crude oil imports amounted to 72.87 million barrels, predominantly from Gulf Cooperation Council (GCC) countries: the United Arab Emirates, Saudi Arabia, Kuwait, Qatar, and Oman. Data from the Agency for Natural Resources and Energy indicates that oil remains a crucial energy source for Japan, meeting about one-third of the country’s total energy needs.
Read more: 81.4 percent of Japan’s oil imports sourced from UAE, Saudi Arabia in September
Strengthening bilateral relations
The economic relationship between the UAE and Japan is marked by robust trade and investment ties that have evolved over several decades, offering mutual benefits.
In November 2024, to enhance UAE-Japan relations, His Highness Sheikh Khaled bin Mohamed bin Zayed Al Nahyan, the Crown Prince of Abu Dhabi and Chairman of the Abu Dhabi Executive Council, welcomed Yuriko Koike, the governor of Tokyo, during her visit to the UAE. The two leaders discussed strategies to further fortify bilateral relations and expand collaboration between Abu Dhabi and Tokyo across various sectors of shared interest.
This meeting aligns with the UAE’s ongoing efforts to deepen its cooperation with Japan. In September 2024, the two nations initiated discussions aimed at establishing a Comprehensive Economic Partnership Agreement (CEPA). This announcement was part of the Comprehensive Strategic Partnership Initiative, which was launched during Sheikh Khaled’s visit to Japan in September 2022. This initiative also supports the UAE’s strategy to broaden its network of trade partners through the CEPA program, aiming for sustainable economic growth by dismantling trade barriers and enhancing market access for services, which includes the reduction or elimination of customs duties.
Recent oil supply statistics
In September 2024, Japan imported a total of 72.87 million barrels of crude oil, primarily from the GCC countries, including the UAE, Saudi Arabia, Kuwait, Qatar, and Oman. Data from Japan’s Agency for Natural Resources and Energy confirmed that oil remains a vital energy resource for the country, fulfilling about one-third of its overall energy requirements. In that month, the UAE and Saudi Arabia emerged as the leading oil suppliers to Japan, together making up 81.4 percent of the country’s imports, with the UAE contributing 31.33 million barrels and Saudi Arabia supplying 27.98 million barrels.
Launch of CEPA talks
In September, the UAE and Japan launched talks to reach a Comprehensive Economic Partnership Agreement (CEPA).
In a post on his X account, Japanese Prime Minister Fumio Kishida highlighted the significance of the commencement of CEPA negotiations, saying: “I expect that the conclusion of an ambitious, balanced, and comprehensive economic partnership agreement between Japan and the UAE, in addition to the Japan-GCC Free Trade Agreement, whose negotiations will proceed in parallel with the Japan-UAE negotiations, will contribute to the strengthening of economic relations and other fields between the two countries.”
The announcement of the talks comes within the framework of the Comprehensive Strategic Partnership Initiative, launched during the visit of Sheikh Khaled bin Mohamed bin Zayed Al Nahyan, Crown Prince of Abu Dhabi, to Japan in September 2022. It also aligns with the UAE’s strategy to expand its network of trade partners through the Comprehensive Economic Partnership Agreement programme, which was launched in September 2021 to achieve sustainable economic growth by removing unnecessary barriers to trade and improving market access for services, including the elimination or reduction of customs duties.
The CEPA talks announced today are built on flourishing trade relations. The UAE is Japan’s top trading partner in the Arab world in terms of exports and imports, with the UAE receiving 40 percent of Japan’s exports to Arab countries. Meanwhile, Japan is among the UAE’s top 10 trading partners globally.
Growth in non-oil trade
During the first half of 2023, non-oil trade between the UAE and Japan hit $7.4 billion, demonstrating a 4.2 percent increase from the same period in 2022. Notably, UAE’s non-oil exports to Japan reached $718 million, whereas imports from Japan exceeded $6.3 million. Additionally, re-exports from the UAE to Japan totaled $421 million.
Significantly, the UAE stands as Japan’s primary trading partner in the Arab world for both exports and imports, receiving 40 percent of Japan’s exports to Arab nations. Conversely, Japan ranks among the UAE’s top 10 trading partners globally. Non-oil trade between the two countries remained strong in the first half of 2024, reaching $8.1 billion, while total trade for 2023 was recorded at $17.3 billion, reflecting a 17.4 percent increase compared to 2022.
Investment landscape between nations
Regarding investment, data from 2022 indicates that Japan is one of the UAE’s key investment partners, with Japanese investments in the UAE surpassing $3.3 billion. This figure represents 3 percent of the total foreign direct investment (FDI) inflow and 13 percent of investments received from non-Arab Asian countries. On the flip side, the UAE’s investments in Japan were valued at $1.2 billion by the end of the previous year, accounting for 42 percent of the total investments from the Middle East and North Africa (MENA) region in Japan.
