Today's Edition
MAYS IBRAHIM (ABU DHABI)
The UAE retail industry is projected to grow at a compounded annual growth rate (CAGR) of 5.4 percent from 2023 to 2028, according to a recent report by investment banking advisory firm Alpen Capital.
By 2028, retail sales in the UAE are projected to reach $139.1 billion.
This growth will be driven by the UAE’s diverse and growing population along with vibrant infrastructure, which make the country the top shopping destination in the world.
The retail industry in the Gulf Cooperation Council (GCC) is projected to grow at a CAGR of 4.6 percent from 2023 to 2028, according to the report.
The UAE and Saudi Arabia are set to lead this growth, with expected CAGRs of 5.4 percent and 5.1 percent, respectively.
Alpen Capital’s report forecasts that retail sales in the GCC will surge from $309.6 billion in 2023 to $386.9 billion by 2028, fuelled by a growing population, rising per capita incomes, and a revitalised tourism sector.
E-commerce is expected to play an increasingly pivotal role.
New market entrants are gaining traction, and there is significant potential for niche platforms to innovate and enhance competitiveness in the GCC retail scene, according to the report.
It also revealed that Saudi Arabia and the UAE cumulatively account for an estimated 75.3 percent of the GCC retail market in 2023, a figure that is expected to grow to 77.7 percent by 2028.
Meanwhile, Kuwait and Bahrain are forecast to experience steady growth at a CAGR of 3.1 percent, while Qatar and Oman are expected to grow at more modest rates of 2.2 percent and 1.0 percent, respectively.
Duty-free sales at GCC airports – including Dubai, Abu Dhabi, Qatar, and Bahrain – are projected to grow significantly, reaching $4.7 billion by 2028 with a CAGR of 9.3 percent.
“This growth can be attributed to the anticipated rise in passenger traffic, largely driven by government initiatives to promote tourism,” the report said.
It also highlighted several trends that are reshaping the retail environment in the GCC.
Consumer expectations are evolving, with shoppers increasingly demanding seamless and integrated experiences.
This shift is prompting traditional retailers to adopt omni-channel strategies and leverage influencer marketing to build brand loyalty.
Additionally, the sector is embracing advanced technologies and predictive analytics, enhancing operational efficiencies and customer experiences.
Amid rising inflation, FinTech companies are stepping in to offer flexible payment solutions like “Buy Now Pay Later,” which not only aid consumers but also foster market growth.
In the wake of the pandemic, health-conscious choices are on the rise, leading to increased demand for organic products-an area ripe with opportunities for retailers.
The UAE and Saudi Arabia cumulatively account for 75.3 percent of the GCC retail market in 2023, a figure that is expected to grow to 77.7 percent by 2028 Alpen Capital’s report forecasts that retail sales in the GCC will surge from $309.6 billion in 2023 to $386.9 billion by 2028.
