13/05/2024
Explore the top three consumer trends shaping the Middle East and African markets in 2024. Learn how digital transformation, sustainability, and the rising middle class are creating opportunities for international buyers, especially those sourcing from Southeast Asia and China.
BUSINESS NEWS | 19
Middle East & African Markets in 2024 and Beyond: 3 Must-know Consumer Trends for Buyers and Exporters
As we moved into 2024, the Middle East and African (MEA) markets continue to emerge as pivotal regions in the global trade landscape. Both regions are experiencing rapid economic growth, driven by urbanization, technological advancements, and a rising middle class. These markets present vast opportunities for international buyers, especially those sourcing from Southeast Asia and China.
Why Understanding Consumer Trends is Crucial: For businesses engaged in international trade, staying ahead of consumer trends in these regions is crucial. Understanding these trends will help buyers make informed sourcing decisions and tap into the growing demand.
Digital Transformation & E-commerce Growth
Statistics & Data:
- Internet Penetration: By 2024, internet penetration in the Middle East is expected to surpass 80%, with countries like the UAE and Qatar maintaining rates above 95%. In Africa, internet usage is forecasted to grow at an annual rate of 12%, reaching over 60% of the population by 2025 [Statista, 2023].
- E-commerce Growth: The e-commerce market in the Middle East is projected to reach $55 billion by 2025, growing at a CAGR of 18% [Mordor Intelligence, 2023]. Africa’s e-commerce sector is anticipated to hit $85 billion by 2025, with significant growth driven by Nigeria, Kenya, and South Africa [McKinsey & Company, 2023].
Trends:
- Mobile-First Shopping: The preference for mobile-first shopping is set to continue its upward trajectory. In Africa, mobile commerce is projected to account for 75% of all online sales by 2025, while in the Middle East, mobile shopping is expected to dominate the e-commerce space [GSMA Mobile Economy Report, 2023].
- Social Media Influence: The influence of social media on shopping habits is increasing, particularly among younger demographics. Platforms like TikTok, Instagram, and emerging social commerce apps will play a crucial role in product discovery and purchasing decisions [PwC Global Consumer Insights Survey, 2023].
Developments:
- Government Initiatives: In 2024, governments in the Middle East, such as Saudi Arabia under Vision 2030, and African nations like Egypt, are expected to continue investing in digital infrastructure. These initiatives aim to support the burgeoning e-commerce ecosystem and enhance the digital economy [Saudi Vision 2030, 2023].
- Logistics & Payment Gateways: The development of logistics networks and payment gateways will be critical to sustaining e-commerce growth. Companies like Aramex and Paystack are expected to expand their operations, making cross-border transactions more seamless [Reuters, 2023]. Southeast Asia and China will remain key partners, providing technological expertise and products.
Forecast:
- Continued E-commerce Growth: E-commerce in these regions is expected to grow exponentially, with China and Southeast Asia remaining crucial suppliers. By 2024, imports from China and Southeast Asia are projected to constitute over 35% of e-commerce goods in the Middle East and Africa [International Trade Centre (ITC), 2023].
- Increased Trade with Southeast Asia: As digital transformation accelerates, Southeast Asian countries like Vietnam, Indonesia, and Thailand are likely to become even more significant exporters to the MEA markets, particularly in electronics, fashion, and consumer goods [World Bank, 2023].
Sustainability & Ethical Consumerism
Statistics & Data:
- Consumer Preference: In 2024, 60% of consumers in the UAE and 65% in South Africa are expected to prioritize brands that align with sustainability and ethical practices. The demand for products with eco-friendly packaging and sustainably sourced materials will continue to rise [Euromonitor International, 2023].
- Government Regulations: Governments in the Middle East, particularly in the Gulf Cooperation Council (GCC) countries, are likely to introduce stricter regulations to promote sustainability. In Africa, nations like Kenya and Rwanda will continue leading the charge with green certifications and bans on non-biodegradable products [GCC Environmental Report, 2
- 023].
Trends:
- Demand for Eco-friendly Products: The demand for eco-friendly products is projected to grow by 30% in 2024 compared to the previous year. Consumers are increasingly seeking out products that reduce environmental impact, with a particular interest in sustainable fashion, electronics, and home goods [Sustainable Development Goals Report, 2023].
- Transparency in Supply Chains: There will be a heightened demand for transparency in supply chains, with consumers expecting brands to disclose the origins and production processes of their products. Southeast Asia and China, as major suppliers, will need to adapt to these expectations to maintain their market positions [United Nations Conference on Trade and Development (UNCTAD), 2023].
Developments:
- Rise of Local Sustainable Brands: The MEA markets will continue to see the rise of local brands emphasizing sustainability. Many of these brands source raw materials from Southeast Asia, particularly from countries like Malaysia and Indonesia, known for their sustainable practices [Global Sustainability Index Institute, 2023].
- Green Energy Solutions: The adoption of green energy solutions in manufacturing is expected to increase, with solar and wind energy powering factories in Egypt, South Africa, and the UAE. These efforts will support the production of sustainably sourced goods, some of which are exported back to Asia [International Renewable Energy Agency (IRENA), 2023].
Forecast:
- Sustainability as a Market Driver: Sustainability will remain a key driver of consumer behavior in 2024 and beyond. Suppliers from China and Southeast Asia will need to ensure their products align with the growing demand for sustainability in these markets [McKinsey & Company, 2023].
- Growth in Eco-friendly Imports: Products such as bamboo-based packaging from China and organic textiles from Southeast Asia are expected to see significant growth in demand, with imports projected to increase by 20% annually [World Trade Organization (WTO), 2023].
Rising Middle-Class & Demand for Premium Products
Statistics & Data:
- Middle-Class Growth: The middle class in Africa is expected to grow significantly, with estimates suggesting it will reach 1.2 billion by 2060. The Middle East is also seeing a rapid expansion, with Egypt and Saudi Arabia projected to have substantial middle-class populations by 2030 [African Development Bank Group, 2023].
- Spending Patterns: As disposable incomes rise, the demand for premium products is expected to increase. In the UAE, luxury goods sales are projected to grow by 25% in 2024, with a significant portion of these products being imported from China and Southeast Asia [Deloitte Global Powers of Luxury Goods Report, 2023].
Trends:
- Premium Product Demand: There is an increasing appetite for luxury items, particularly in sectors like fashion, electronics, and automobiles. In Africa, demand for premium smartphones, often sourced from China and South Korea, is expected to rise sharply [Statista, 2023].
- Value-driven Purchasing: Consumers are becoming more value-driven, seeking high-quality products that offer the best return on investment. This trend is particularly evident in the Middle East, where established brands from Southeast Asia and China are gaining market share [Nielsen Consumer Trends Report, 2023].
Developments:
- Expansion of Retail Chains: Global retail chains are likely to continue expanding into the MEA markets to cater to the growing middle class. Brands like Xiaomi, Huawei, and Samsung are expected to increase their presence, offering a range of premium products [Forbes, 2023].
- Local Production of Premium Goods: There is a trend towards local production of premium goods, particularly in North Africa. Partnerships between local manufacturers and Southeast Asian companies are expected to grow, helping to meet the rising demand for high-quality products [KPMG Global Retail Trends, 2023].
Forecast:
- Sustained Growth in Premium Markets: The premium segment is anticipated to experience sustained growth in 2024 and beyond, with imports from China and Southeast Asia playing a crucial role. By 2025, luxury imports from these regions to the MEA markets are expected to grow at an annual rate of 18% [World Trade Organization (WTO), 2023].
- Strategic Partnerships: Businesses in Southeast Asia and China are likely to form strategic partnerships with MEA companies to strengthen their market positions, particularly in the premium goods segment [OECD Trade Policy Papers, 2023].
Conclusion
As we look ahead, the Middle East and African markets are poised for continued growth, with increasing integration into the global supply chain. Suppliers from Southeast Asia and China will remain key players, driving the economic and consumer landscape in 2024 and beyond.
Key Takeaways for Buyers: To capitalize on these trends, focus on sourcing digital-friendly, sustainable, and premium products that align with the growing consumer demand in these regions.
Future Outlook: The MEA markets will continue to offer vast opportunities for international buyers, with a strong emphasis on e-commerce, sustainability, and premium products.
