Executives in the Gulf region, particularly the UAE and Saudi Arabia, are brimming with optimism regarding the region’s trade outlook for 2024, according to a study conducted by Economist Impact and supported by DP World, which polled trade experts and senior executives across the globe.
The research showed that experts predicted “double-digit exports growth” for the GCC nations, particularly Saudi Arabia and the UAE in 2024.
The Middle East is expected to record growth of 2.3% in 2024 as the region continues to benefit from favourable commodity prices, the study found. Export growth is expected to reach 3.8% in 2024, the third fastest-growing market after Asia Pacific and Africa. Meanwhile, the region’s strong growth in imports for 2023 is expected to slow to 4.6% growth in 2024.
According to 42% of surveyed supply-chain executives in the Middle East, the leading factor driving growth in their firm’s exports is increasing output levels driven by growing levels of demand.
The paper also highlighted the rising interest in diversification in the region, as the Gulf economies increasingly invest in hydrocarbon profits to boost other export-oriented sectors such as technology, logistics, tourism and renewable energy.
As a result of these investments, non-oil trade in the UAE grew 14.4% in the first half of 2023, compared with the same period in 2022. Similarly, since the launch of Saudi Arabia’s Vision 2030, the country is attracting significant amounts of foreign investment, particularly into its construction and manufacturing sectors.
In addition, 43% of executive respondents in the Middle East said they are diversifying their firm’s supplier base and carrying significant additional inventory to prioritise resilience. Nearly half (45%) of executives are factoring one- to three-month buffer times into their supply chains, the highest across all regions surveyed.
Moreover, 33% of businesses surveyed believe the primary growth driver of their firm’s exports in 2024 will be the expansion of operations into new markets. Currently, China was named the second most important export market after the GCC and the most important import market.
Almost two-thirds (63%) of survey respondents indicate that bilateral trade agreements such as the one signed between India and the UAE help their business’s supply-chain strategy.
“As we navigate the evolving geopolitical and economic landscape in 2024, companies are aligning their strategies with initiatives like Dubai’s D33 and Saudi Arabia’s Vision 2030 to tap into new markets and boost opportunities in trade,” said Abdulla bin Damithan, CEO and Managing Director at DP World GCC.
“Our research underscores the critical role of technology in strengthening supply chains and anticipating disruptions. Embracing emerging technologies is not only about overcoming challenges; it’s about resilience, adaptability and a firm commitment to a future where innovation drives success.”