Dubai CommerCity e-com report shows Middle East has highest global growth

Dubai CommerCity e-com report shows Middle East has highest global growth
Published: 20 January 2019 - 7:08 a.m.
By: Logistics Middle East Staff

The MENASA region accounted for US $51-billion or 3% of the global e-commerce market, with a growth rate of 24.6%, making it the fastest growing in the world, according to a new report by Dubai CommerCity.

The ‘MENASA e-commerce landscape report’ is issued annually in Arabic and English, provides a comprehensive and global overview of the e-commerce sector alongside the role of technology and how it will shape this sector over the next 20 years.

Dubai CommerCity is a joint project between the Dubai Airport Freezone Authority (DAFZA) and wasl Asset Management Group intended to create a freezone specific to the needs of e-commerce companies and their logistics partners.

According to the report, South Asia represents the biggest e-commerce market in size, while the GCC represents the fastest growing and highest spending market in the region.

India stands out as the biggest and most mature e-commerce market with US $39-billion in estimated e-commerce sales in 2017, while the UAE represents the biggest spending per online shopper at US $1,648, with the third highest growth projected through 2020 at 29.6%.

The report has identified seven key growth drivers that include: huge latent demand; high internet/ mobile adoption; a young/ internet savvy population; high social media usage; cross-border e-commerce; entrepreneurship and growing government support.

The e-commerce sector in the Middle East, North Africa, and South Asia is witnessing considerable growth due to the development of infrastructure, both in terms of modern technology such as AI, the Internet of things (IoT), and e-payment, and in terms of services, logistics, and shipping.

The report also presents a first-ever listing of the Top 100 B2C e-commerce companies in the MENASA region. Out of the top 100, 76 companies are based in the MENASA region which is a very healthy sign of local e-commerce development.

Turkey has the most e-commerce companies on the list with 24 companies represented, followed by US 14, India 12 and UAE 11.

In order to meet the expected growth within the e-commerce sector in the region, Dubai CommerCity is being developed in Dubai’s Umm Ramool area, which represents 2.1-million square feet at a cost of AED 2.7 billion.

Dubai CommerCity will strengthen Dubai's presence as a main center of global e-commerce, establishing zones that support economic diversification and smart transformation, through attracting direct foreign investments in the sector.

DAFZA had recently announced increasing the investment value in Dubai CommerCity by 18.5%, to around AED 3.2 billion, as it is based on a unique operating system combined with the attractive investment benefits provided within the free zone. The high-tech features allow clients to establish and launch their businesses in the free zone efficiently and quickly.

It also has logistical features that suit the needs of e-commerce companies and enhance their operating experience, namely in terms of its excellent infrastructure, proximity to Dubai International Airport and main UAE roads, making it easily accessible by land, air and sea ports.

Dubai CommerCity is divided into three modern and innovatively-designed clusters: the Business Cluster containing 13 modern office buildings and green spaces; the Logistic Cluster consisting of 84 logistic units equipped with the latest technology to meet the needs of logistic services provided and of clients; and the Social Cluster containing galleries, stylish restaurants and cafés, and vital facilities that meet the expectations of ecommerce companies that wish to establish regional offices in Dubai.

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