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UAE logistics industry is concentrated with top 5 players contributing about 50% of the domestic express revenues in 2019- How will the 3 growth drivers help the market become sustainable in future? : Ken Research
1. UAE oil and gas logistics market is driven by high contribution of exports to UAE governmentThe Abu Dhabi National Oil and Gas Company is looking to raise crude production capacity to 5 million barrel per day (bpd) by 2030. Enhanced production provides an opportunity for Oil and Gas logistics firms to capitalize.
Currently ongoing and upcoming projects such as Upper Zakum- Production Capacity Enhancement nearly $ 21 bn, Ruwais Refinery Complex around $ 20 bn and Abu Dhabi North West Development - Hail and Ghasha Sour Gas around $ 15 bn are expected to be the driving force for Oil and Gas logistics going forward.
2. Growth in Online Selling and Increasing propensity of consumers to buy online is propelling growth in E-Commerce Logistics
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UAE E-Commerce Logistics Market accounts for nearly 2.5% share in the logistics revenues in the country in 2019. High internet penetration, more concentration of millennial among new buyers and a rise in SMEs selling online have driven E-Commerce growth in the UAE.
E-Commerce business activities among express companies such as DHL and Emirates Post have been growing with nearly 40% Y-o-Y, since last 2-3 years.
COVID-19 induced lockdowns in the country, gave an opportunity to retailers and shopkeepers to sell products online, hence establishing a large need for delivery and e-commerce logistics.
3. Demand for COVID-19 related Medication, expected to drive Pharmaceutical Logistics Market growth
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High rate of population growth, increased life expectancy and prevalence of lifestyle-related diseases such as diabetes have led to growth in the pharma industry in the UAE. The COVID-19 situation has led growth in pharma logistics with drugs such as Remdesivir and HCQ being imported into the country.
Around $1.2 Bn was allocated to healthcare in 2019 budget in the UAE, on top of the funds allocated in the ($ 540 Mn) innovation fund set up by Sheikh Mohammed bin Rashid Al Maktoum For more insights on market intelligence, refer to the link below: - https://www.kenresearch.com/automotive-transportation-and-warehousing/logistics-and-shipping/competition-benchmarking-in-uae-logistics-market-outlook-to-2025/373315-100.html
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Ken Research is a Market Research and Consulting Firm, based out of India, Indonesia and UAE. Since 2011, we have been assisting clients globally with our Syndicate and Bespoke Market Research and Advisory Services.
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