The country is the second fastest growing country in the Gulf

38.3% expected growth in the e-commerce sector in the UAE until 2022

Dubai Economy: The e-commerce sector is a major enabler for business growth.

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A Dubai Economic Department report stated that the e-commerce sector is one of the main sectors in the UAE economy, and it is expected that its value will reach 148.5 billion dollars (546.5 billion dirhams) by 2022 in the Middle East, Africa and South Asia region, indicating that the Gulf Cooperation Council region is the fastest growing In the e-commerce sector, the UAE comes second in the Gulf, as it is expected to grow in it at a compound annual growth rate of 38.3% until 2022.

The report prepared by the Executive Director of the Corporate Strategic Affairs Sector in Dubai Economy, Muhammad Sha`il Al Saadi, said, “The UAE is ranked fifth among the largest e-commerce markets for products for selling companies to consumers in the Middle East, Africa and South Asia, with a sales value of four billion. Dollars (14.7 billion dirhams) ».

E-Commerce

The report indicated that the e-commerce sector has proven to be a major enabler for the growth of trade for companies, especially during the outbreak of the Corona pandemic, as global e-commerce sales growth in the retail sector was strong, and is expected to remain so. The value of e-commerce sales is estimated at $ 4.2 trillion in 2020, up from $ 2.4 trillion in 2017, growing at a compound annual growth rate of 20.9%. The report said that by 2023, the e-commerce market is expected to represent 22% of total global retail sales, up from 10.4% in 2017.

The report pointed out that the fourth industrial revolution has shaped the features of the digital economy to a large extent since the recent financial crisis, and its importance has been strengthened with the spread of the Corona virus and the associated lockdown measures around the world due to the trends and motives that followed, such as the global rise of e-commerce and the boom in digital payments. The emergence of unicorn platforms, and the era of abundant data, through the expansion of cloud services in the region, including data collection and analytics, the emergence of digital systems and increased connectivity.

Other contributing trends, such as artificial intelligence, blockchain, 5G, and the Internet of Things have also played a catalytic role.

Digital payments

The report pointed to the boom in digital payments, as consumer demand for electronic payments increased, and this trend is expected to continue in the wake of the pandemic in the UAE.

Digital payments are the almost instantaneous transfer of value from one payment account to another using a digital device, such as a smartphone, point of sale, or computer.

Examples of digital payment platforms include Apple Pay, Alipay, Google Pay, and PayPal.

The global digital payments market is expected to reach 28 trillion dirhams ($ 7.6 trillion) by 2024, and digital payments, cryptocurrencies and digital banking platforms are growing steadily.

New fuel

The report stated that data has become a new fuel for the digital economy, as it moves various industrial activities from retail and manufacturing to infrastructure and transportation.

Data centers serve the vital functions of fuel storage and supply systems.

The global data service Global Datasphere, which provides a measure of the volume of new data that is generated and reproduced each year, will grow more than five-fold over the next seven years.

This number is expected to increase to 175 zettabytes by 2025. The value of EMEA data will rise to 48.3 zettabytes, or 27.6% of global data.

The report showed that the big data and analytics market has grown exponentially over the past few years, and is expected to be worth more than $ 68 billion by 2025, at a compound annual growth rate of 28.9%.

He pointed out that the emergence of global "unicorn" companies is one of the main driving forces of digital trade.

According to April 2021 data, there are more than 650 "unicorn" companies worldwide, with a total cumulative value of about $ 2.17 trillion.

There are currently three companies worth more than one billion dollars operating in the Arab world, all of them headquartered in the UAE.

This number is expected to grow more rapidly thanks to the strong entrepreneurial ecosystem.

Digitalization of trade

Digital trade offers new opportunities for local companies to sell more products to regional and global markets, which leads to Dubai diversifying its export base.

It also increases trade in goods and services in all sectors, and allows us to benefit more from our trading partners.

However, the barriers to digitally enabled services and business transactions are also growing.

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