E-Commerce Growth & Predictions
The e-commerce market of the UAE has been ranked with the most growth in 2022 as global online sales keep growing at an exponential rate.
With a projected increase in e-commerce spending of 22.32% in 2022 and an estimated 1.5 billion people online, the UAE is expected to surpass $8 billion in online sales by 2025, up from $5 billion in 2021.
Statista’s Research Report
Global e-commerce retail sales reached around $4.9 trillion in 2021, a figure that Statista predicts will increase by 50% over the next four years, reaching approximately $7.4 trillion by 2025.
Statista data shows that since 2021, the UAE’s e-commerce spending as a percentage of GDP has increased by 1.10%. By 2022, e-commerce is predicted to represent 7.0% of all retail spending.
After the UAE, South Korea and Argentina have the second and third fastest-growing e-commerce markets, respectively. However, according to Statista’s list for mobile shopping, the Philippines ranks at the top, with 70% of all e-commerce conducted on mobile devices. China comes in second place with 69%, followed by South Korea with 66.6%.
Statista’s research report showed that, except for the UK, every nation in the top 10 is in Asia, highlighting the significance of this region for the expansion of m-commerce and overall e-commerce.
According to the research, $57.3 billion was invested in startup companies in the automotive sector in 2021. Following this, travel and fashion received $26.2 billion and $24.7 billion, respectively, ranking second and third in terms of the highest funding.
The Commercial Landscape
“E-commerce has, without a doubt, fundamentally changed the commercial landscape in the UAE. Businesses must adapt and develop new strategies for conducting online business due to this exponential growth and the shift towards e-commerce in the future. However, this is a simple mission because of the numerous opportunities the UAE government provides, particularly for startups,” according to Hatem El Safty, CEO of Business Link, who spoke to Khaleej Times.
EZDubai Report
According to a report released by EZDubai, Middle Eastern nations are well-positioned to support further e-commerce development because of their high GDP per capita and internet adoption rates. With a GDP per capita above $40,000 and a 90% internet penetration rate, the UAE and Qatar are in the best position.
With many online retailers stepping up services during COVID-19, e-commerce in the Mena region is quickly catching up to global powerhouses like China. According to data from EZDubai, the total market size was estimated at $31.7 billion in 2021.
A report by Research and Markets said that the Middle East and Africa B2C e-commerce market would grow by 22.38% per year and reach $104.1 billion in 2022.
In the past, the UAE was a cash-based society. Still, the global pandemic has forced consumers to adopt digital payment methods.
Market Expansion Factors
The UAE has become a driving force in expanding the region’s e-commerce market. The increasing internet penetration rates primarily drive it. Rising incomes, high smartphone ownership, a growing presence of global players, and improved supply chain solutions have contributed to the market’s expansion over the past two years.