Opportunities in the logistics sector in the UAE

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Strategic location between East and West 61 per cent of cargo destined for GCC states arrives via the UAE’s seaports The UAE E-Commerce market is expected to grow by 23% annually between 2019 – 2022 Logistics Companies in UAE Strategic…

by | Dec 9, 2020 | 0 comments

  • Strategic location between East and West
  • 61 per cent of cargo destined for GCC states arrives via the UAE’s seaports
  • The UAE E-Commerce market is expected to grow by 23% annually between 2019 – 2022

Logistics Companies in UAE

Strategic Location

Strategically positioned between East and West, the UAE is now recognised as a world-class hub for international commerce. Of note its focus on logistics. This strategic geographical location has led to the emergence of UAE as a major multimodal transit and re-export hub.

Exploiting the opportunity afforded by being placed on a transcontinental trade route, the UAE has become the regional leader in logistics and caters to the trade demand from Europe, Asia, Africa, USA and the Middle East. A progressive approach to foreign investment and an extensive double taxation treaty regime the UAE has become a highly enticing country of opportunity for foreign businesses.

Air Freight

The success of the country’s two primary airlines, Emirates and Etihad in international travel and as world leaders in freight has helped propel the nation forward in the eyes of the international community.

Despite a recent global downturn in the demand for air freight (as a result of the trade war between the US and China), industry leaders remain hopeful that the market will bounce back in 2021 as the global political landscape shifts once more. With that in mind, the UAE’s two leading airports have been investing and expanding their facilities whilst Dubai has recently opened a third cargo and passenger airport, Al Maktoum international Airport. Once complete it will become the world’s largest airport with a capacity of more than 160 million passengers and 12 million tons of cargo per annum. The airport forms the heart of a greater project, a 140 square kilometre multiphase development of six clustered zones including Dubai Logistics City (DLC), Commercial City, Aviation City Residential City, and Golf City.

Sea Ports

In conjunction with the air freight sector the UAE has established a robust seaport infrastructure. According to the World Shipping Council, two of the world’s top 50 container ports are in the UAE, with Dubai featuring among the top ten. Overall, 61 per cent of cargo destined for GCC states arrives via the UAE’s seaports emphasising the country’s importance in the region.

E-Commerce logistics companies in uae

One of the fastest growing sub sectors of the logistical industry is the E-Commerce sector. The UAE E-Commerce market is expected to grow annually by 23% between 2019 – 2022 because of economic diversification, increasing digitalization, expected rise in manufacturing industries and rising purchasing power of the population in UAE. As a result, the UAE has identified that investment in new technology will be key to the growth of the logistics sector and to keep up with the growing demand from the domestic and international markets. Examples of this are automation of warehouses with the aid of robotics, autonomous vehicles, and drone deliveries.

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Sources:

https://u.ae/en/about-the-uae/science-and-technology/key-sectors-in-science-and-technology/information-and-communication-technology

https://www.tra.gov.ae/en/media-hub/press-releases/2019/10/17/the-uae-ict-sector-achieves-significant-progress.aspx

https://www.trade.gov/knowledge-product/united-arab-emirates-information-and-telecommunications

https://oxfordbusinessgroup.com/overview/smart-cookie-innovative-ict-solutions-are-set-cut-costs-and-transform-government-services

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