In 2020, the retail e-commerce sector of the UAE achieved a significant milestone, reaching a total market value of $3.9 billion. This marked a remarkable 53 percent increase compared to the previous year. Notably, e-commerce constituted an 8 percent slice of the entire retail market during the same year, a finding uncovered through analysis conducted by the Dubai Chamber of Commerce and Industry. Looking ahead, their research anticipates substantial growth, forecasting that the market's value will surge to $8 billion by the year 2025.
This projected expansion is underpinned by a constellation of influential factors. The report underscores the potential of high-income demographics, a remarkably high Internet penetration rate of 99 percent, a well-developed transportation and logistics network, modern and efficient digital payment systems, a burgeoning population of tech-savvy young individuals, and robust governmental support within the UAE. Particularly noteworthy is the UAE's distinction in boasting the highest smartphone penetration rate in the MENA region. This technological prowess has played a pivotal role in the advancement of mobile-commerce (m-commerce), which has grown from 29 percent in 2015 to a substantial 42 percent in 2020 (Middle East Retail & E-commerce Summit, 2023).
Furthermore, in the same year, the UAE's retail m-commerce sector also achieved remarkable growth, recording a market value of $1.6 billion. This represented an impressive 56 percent surge compared to the preceding year. Looking forward, projections indicate that the retail m-commerce market of the UAE will continue its upward trajectory, with an estimated value of $3.9 billion by 2025. This growth is anticipated to follow a compounded annual growth rate (CAGR) of 18.9 percent between 2020 and 2025 (Middle East Retail & E-commerce Summit, 2023).
