Exciting times ahead for retail market

19 May 2015

Dubai retains 2nd position for international retailer representation for 4th consecutive year.

Dubai: The UAE’s retail market is vibrant and has promising outlook as major retail groups are expanding their footprints across the emirate, according to a top official of Dubai Chamber of Commerce and Industry.

President and chief executive of the chamber Hamad Buamim said the retail sector is contributing around one third to the country’s gross domestic product and is expected to add another five- to six per cent in next five-year time.

“Retail and tourism are interlinked and will contribute heavily to the country’s growth as major retail expansions are in the offing. The sector was estimated to be worth Dh120.8 billion in 2014, of which Dh70.6 billion was spent on non-grocery items and Dh50.3 billion on groceries,” Buamim said on Monday.

Buamim made his observations on retail sector growth at unveiling of the 2015 edition of “How global is the business of retail?” by leading global property advisor CBRE Middle East.

He said that the recently concluded ‘Dubai Week in China’ was one of the initiatives to bolster its ties with China in retail and tourism sector and both the countries would jointly work to enhance the bilateral relationship.

Meanwhile, Dubai has retained second position for international retailer representation for fourth consecutive year, according to the CBRE ME’s retail report. Abu Dhabi ranked third place in top target market by new entrants while London retains top position as international shopping destination.

The key findings of the report states that Dubai provides unparalleled level of opportunities for foreign businesses and remains focal point for tourism and business in the region. Aligned with its Vision 2020, the Dubai government is boosting its tourism sector, through which it aims to attract 20 million visitors per year that will eventually provide further impetus to the retail industry.

The emirate has a presence of 55.7 per cent of international retailers followed by Shanghai with 53.4 per cent. Whilst New York and Singapore make up the rest of the top five international cities for retail representation with 46.3 per cent and 46 per cent respectively. During the course of 2014, Dubai attracted 45 new international brands, with high profile retailers including Hollister, Cavalli Caffe and McQ Alexander McQueen opening outlets in the emirate.

“Dubai Chamber welcomes news that the city has retained its position as the second most important international shopping destination globally for the fourth consecutive year. Dubai’s retail sector is vibrant and continues to be driven by strong economic growth, increased consumer spending and tourist arrivals which hit a record high of 11.6 million last year,” Buamim said.

He said the quality of available retail space is an added incentive for global retailers looking for expansion and key projects, such as Mall of the World promise a healthy future outlook.

“Dubai Chamber supports the retail sector through various initiatives and activities and as the voice of the business community we will continue to facilitate growth and developments in this important sector,” added Buamim.

Nick Maclean, managing director, CBRE Middle East, said Dubai continues to remain the clear destination of choice for the majority of the brands looking to enter the region for the first time, frequently using the emirate as a stepping stone to wider regional expansion programmes.

Retailer globalisation remained a key theme with half of the 164 cities surveyed attracting at least five new retailers. Markedly, Abu Dhabi featured prominently on the list of target cities with 55 new brands, ranking the emirate in third place for new retail entrants during 2014. Tokyo took the coveted top spot with 63 new retailers entering the market followed by Singapore.

Ahmed Galal Ismail, chief executive of Majid Al Futtaim Ventures, said Dubai’s economic growth remains strong and the emirate retains its position as a leading leisure and shopping destination in the world.

“The UAE retail sector will continue to see strong growth in 2015, driven by robust inbound tourist numbers and demand for new brands in the region, with almost all retailers using the UAE as a hub for their entry into the GCC. At Majid Al Futtaim, we have witnessed high growth last year, and with our regional expansion plans, we remain committed to growing this further.”