Market Size of GCC Contract Logistics Industry
Study Period | 2020 - 2029 |
Base Year For Estimation | 2023 |
Forecast Data Period | 2024 - 2029 |
Market Size (2024) | USD 9.16 Billion |
Market Size (2029) | USD 12.88 Billion |
CAGR (2024 - 2029) | 7.00 % |
Major Players*Disclaimer: Major Players sorted in no particular order |
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Gulf Cooperation Council (GCC) Contract Logistics Analysis
The GCC Contract Logistics Market size is estimated at USD 9.16 billion in 2024, and is expected to reach USD 12.88 billion by 2029, growing at a CAGR of 7% during the forecast period (2024-2029).
Following the onset of COVID-19, various logistics companies experienced obstacles, including supply-chain capacity bottlenecks and government restrictions, which resulted in the suspension of important services on particular routes and cost pressure and supply-chain management issues. On the other hand, contract logistics service providers who have used automated technology had advantages in dealing with the epidemic and the subsequent lockdowns.
- The United Arab Emirates is part of several multilateral and bilateral trade agreements. The United Arab Emirates has strong economic ties with Saudi Arabia, Kuwait, Bahrain, and Oman in the GCC. Under the Greater Arab Free Trade Area Agreement (GAFTA), the United Arab Emirates has free trade access to Bahrain, Egypt, Iraq, Jordan, Kuwait, Lebanon, Libya, Morocco, Oman, Palestine, Qatar, Saudi Arabia, Syria, Tunisia, and Yemen.
- The Emirates also has signed agreements with other countries, including Pakistan, Algeria, India, South Korea, and the Netherlands. The United Arab Emirates has been focusing on improving its trade agreements to develop the level of trade and economic cooperation as per the laws prevailing in each country and diversify sources of the economy and sustainable development.
- The UAE Ministry of Economy has recently published the full text of the CEPA signed between the Government of the United Arab Emirates (UAE) and the Government of the Republic of India (India). The landmark agreement was signed on 18 February 2022, and has officially entered into force on 1 May 2022. Under the CEPA, both countries expect to boost bilateral trade from USD 60 Billion to USD 100 Billion within the next 5 years; key products that will immediately benefit from the Agreement include oil & gas, petrochemicals, minerals, textiles, agriculture, jewellery and gems, metals and more.
- In October 2022, The Crown Prince Mohammed bin Salman had launched the Global Supply Chain Resilience Initiative (GSCRI) to attract local and international investments in the supply chain sector. Aiming to raise SR40 billion (USD 10.64 billion) in its first two years, the initiative has set SR10 billion in financial and non-financial incentives for investors.
- The approach also relies on effective governance models to improve institutional work in the transportation and logistics sector. The strategy aims to boost the transport and logistics sector's contribution to national GDP to 10% by 2030 and the sector's non-oil earnings to the state's general budget by around SAR 45 billion. Saudi Arabia intends to raise the number of international aircraft routes from 99 to over 250 by 2030.
- Bahrain launched the region's fastest sea-to-air logistics hub as the Kingdom seeks to diversify its economy. The hub is expected to cut costs by 40% and reduce the turnaround time for containers, allowing customers to get their shipment in half the time. Bahrain will capitalize on its geographic position between Europe and Asia and on its proximity to regional target markets through its new multi-modal trans-shipment hub.
Gulf Cooperation Council (GCC) Contract Logistics Industry Segmentation
The outsourcing of resource management tasks to a third-party organization is known as contract logistics. Developing and planning supply chains, designing facilities, warehousing, delivering and distributing goods, processing orders and collecting payments, maintaining inventory, and providing certain aspects of customer support are tasks done by contract logistics businesses.
A comprehensive background analysis of the GCC Contract Logistics Market, covering the current market trends, restraints, technological updates, and detailed information on various segments and the competitive landscape of the industry. The impact of COVID-19 has also been incorporated and considered during the study.
The GCC Contract Logistics Market is segmented By Type (Outsourced and Insourced), End User (Manufacturing and Automotive, Consumer Goods and Retail, High-Tech, Healthcare and Pharmaceuticals, and Other End Users), and By Country (Saudi Arabia, United Arab Emirates, Qatar, Kuwait, Oman, and Bahrain). The report offers market size and forecasts for the GCC contract logistics market in value (USD) for all the above segments.
By Type | |
Insourced | |
Outsourced |
By End User | |
Manufacturing and Automotive | |
Consumer Goods and Retail | |
High-tech | |
Healthcare and Pharmaceuticals | |
Other End Users |
By Country | |
Saudi Arabia | |
United Arab Emirates | |
Qatar | |
Kuwait | |
Oman | |
Bahrain |
GCC Contract Logistics Market Size Summary
The GCC contract logistics market is poised for significant growth, driven by the region's strategic economic initiatives and increasing demand for efficient supply chain solutions. The market is characterized by its fragmented nature, with numerous specialized service providers contributing to its expansion. The United Arab Emirates plays a pivotal role in this growth, bolstered by its extensive trade agreements and initiatives like the CEPA with India, which aims to significantly boost bilateral trade. The UAE's focus on enhancing its logistics infrastructure and technology is expected to support the burgeoning e-commerce sector, further driving the demand for contract logistics services. Similarly, Saudi Arabia's efforts to strengthen its supply chain sector through initiatives like the Global Supply Chain Resilience Initiative underscore the region's commitment to enhancing its logistics capabilities.
Bahrain's strategic geographic position and its new sea-to-air logistics hub are set to enhance its role in the GCC logistics market, offering cost-effective and efficient solutions for regional trade. The country's efforts to diversify its economy through such initiatives are expected to attract more investments in the logistics sector. The GCC region's industrialization and the establishment of industrial zones are also contributing to the market's growth, providing businesses with the necessary infrastructure to manage cross-border trade effectively. As the demand for logistics services continues to rise, the market is expected to see increased investments and expansions, as evidenced by recent developments in Bahrain and Kuwait.
GCC Contract Logistics Market Size - Table of Contents
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1. MARKET DYNAMICS AND INSIGHTS
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1.1 Current Market Scenario
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1.2 Market Dynamics
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1.2.1 Drivers
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1.2.1.1 Increase in Trade Activities
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1.2.1.2 Growth in the manufacturing industry
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1.2.2 Restraints
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1.2.2.1 Regulatory Challenges
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1.2.3 Opportunities
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1.2.3.1 Adoptive of Advanced Technology
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1.3 Industry Attractiveness - Porter's Five Forces Analysis
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1.3.1 Threat of New Entrants
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1.3.2 Threat of Substitute Products
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1.3.3 Bargaining Power of Buyers/Consumers
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1.3.4 Bargaining Power of Suppliers
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1.3.5 Intensity of Competitive Rivalry
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1.4 Value Chain/Supply Chain Analysis
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1.5 Government Regulations and Initiatives
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1.6 Technological Trends
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1.7 Insights on E-commerce Industry in the Region (Domestic and Cross-border)
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1.8 Insights on Contract Logistics in the Context of After-sales/Reverse Logistics
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1.9 Brief on Different Services Provided by Contract Logistics Players (Integrated Warehousing and Transportation, Supply Chain Services, and Other Value-added Services)
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1.10 Spotlight - Freight Transportation Costs/Freight Rates
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1.11 Insights on Free Trade Zones in GCC
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1.12 Impact of COVID-19
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2. MARKET SEGMENTATION
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2.1 By Type
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2.1.1 Insourced
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2.1.2 Outsourced
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2.2 By End User
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2.2.1 Manufacturing and Automotive
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2.2.2 Consumer Goods and Retail
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2.2.3 High-tech
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2.2.4 Healthcare and Pharmaceuticals
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2.2.5 Other End Users
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2.3 By Country
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2.3.1 Saudi Arabia
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2.3.2 United Arab Emirates
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2.3.3 Qatar
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2.3.4 Kuwait
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2.3.5 Oman
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2.3.6 Bahrain
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GCC Contract Logistics Market Size FAQs
How big is the GCC Contract Logistics Market?
The GCC Contract Logistics Market size is expected to reach USD 9.16 billion in 2024 and grow at a CAGR of 7% to reach USD 12.88 billion by 2029.
What is the current GCC Contract Logistics Market size?
In 2024, the GCC Contract Logistics Market size is expected to reach USD 9.16 billion.