EZDubai – A catalyst to the UAE’s vision, redefining the future of e-commerce in the region
By Mohsen Ahmad, CEO, Logistics District, Dubai South
Mohsen Ahmad oversees Dubai South’s entire Logistics District as its chief executive officer (CEO). He leads the overall execution of the District’s operations, manages its financial planning, and is responsible for setting the District’s strategic directions and goals. As an industry veteran, Mohsen played an instrumental role in developing Dubai’s overall e-commerce strategy to consolidate the Emirates’ position as a hub for global e-commerce and the development of EZDubai, a purpose built e-commerce zone at Dubai South that supports the growth of the sector. He holds a bachelor’s degree in Logistics and Transportation from the University of Tennessee in the U.S., and a Master of Science degree in Logistics and Supply Chain Management from Cranfield School of Management in the U.K.
The current pandemic has changed the way in which business is conducted, and its impact has been monumental in the Middle East. Due to the lockdown, consumers have opted to shop online more than ever before. Hygiene, skincare and makeup products have witnessed a drastic hike in online sales since mid-February. We are now witnessing a number of trends that are going to boost the e-commerce sector. These include the “buy now pay later” platforms (BNPL) that are considered a financial disruption model and the next big payment trend in the online retail world. The Middle East is continuing to experience rapid growth in e-commerce, with an estimated market value of $28.5 billion by 2022, a value that is expected to increase fourfold over the coming years.
The United Arab Emirates (UAE) is taking giant strides toward becoming one of the fastest-growing e-commerce markets in the Middle East, with the local e-commerce sector set to contribute AED 12 billion (approximately €2.8 billion) to the local GDP by 2023. Exceptional logistics facilities and seamless connectivity are game-changers that reinforce growth in the industry. Being a focal point for distribution, with low-cost margins for logistics and infrastructure, the UAE is an ideal place for e-commerce to thrive.
As the future of trade in the UAE is emphasizing digitalization, in line with the nation’s drive toward creating smart cities, the growth of e-commerce is occurring in tandem. Cashless payments and e-commerce are top government priorities, as outlined in the UAE Vision 2021 Strategy. Government policies and consumer behaviors seem to be merging as UAE consumers increasingly trust digital payments over cash – and, according to the latest reports, 84% of surveyed consumers prefer digital payments.
The UAE’s pivotal position in the global trade map, its large storage capacity and its extensive logistics networks, coupled with the support of its government, are all contributing to the growth of the sector. The e-commerce market has gained momentum, with customers today able to get their hands on a vast range of consumer goods and services, all via a tap, click or swipe on their devices. In the immediate future, we will see an uptick in demand for this model. Startups have realized this innovation and will integrate it into their business lifeline.
With the UAE advancing on its compound annual growth rate (CAGR) by 11%, Dubai has bridged the gap in e-commerce in the emirate and across the Gulf Cooperation Council (GCC). Ultramodern infrastructure, the regulatory framework, connectivity and facilitated logistics have placed the country at the forefront of the global e-commerce industry. A purpose-built, operational e-commerce zone, such as EZDubai, would also demonstrate the ability of the region to manage and facilitate the growth in e-commerce.
The 920,000-square-meter zone within Dubai South’s Logistics District was launched to unlock the vast potential in online commerce. The intention behind setting up a sophisticated e-commerce zone is to support and complement the Dubai eCommerce Strategy, which was launched in 2019 by HH Sheikh Hamdan bin Mohammed bin Rashid Al Maktoum, Crown Prince of Dubai and Chairman of the Dubai Executive Council, to attract more foreign direct investments to the e-commerce sector and consolidate the emirate’s position as a hub for global e-commerce.
EZDubai provides a range of logistics facilities and customized business solutions designed for startups, SMEs and multinationals. The aim is to support local, regional and transcontinental businesses serving both business-to-business and end-consumers. Logistics movers benefit from the optimal solutions and unparalleled access to cross-continental distribution networks, extending their reach to the high-growth markets of the Middle East, North Africa and South Asia (MENASA) region.
Published: December 2020
Images: Mostafa ElGameil; DHL; private