Dubai leads the way as GCC retail spending set to hit $300bn by 2028

Dubai is primed to lead the GCC retail spending surge that will hit $300 billion by 2028, according to the ‘Shopping for growth: how to build an urban retail destination’ report published by Strategy& Middle East, part of the PwC network, earlier this week.

The Gulf Cooperation Council (GCC) member states comprise of Bahrain, Kuwait, Oman, Qatar, Saudi Arabia, and the United Arab Emirates.

In the retail spend per capita, Dubai leads the list of GCC representative cities and boasts an amount of approximately $14,000 – second only to New York City.

The report stated that as GCC cities pursue urban transformation and mega projects, they should seize the unrealised opportunity for growth in the retail sectors of their major cities.

“The region’s annual retail sales are expected to grow to $300 billion by 2028, a 37% increase from 2022. With the right steps, these retail sectors can become global shopping destinations,” the report added.

Globally, six shopping destinations (Dubai, London, Milan, New York City, Seoul, and Tokyo) have significant direct retail spending per capita ranging from $8,000 to $18,000 annually.

However, the emirate is fast catching up. Last year, Dubai Mall, located in the heart of the city’s downtown, witnessed a record 105 million visitors – making it the “most visited place on earth”. It is also set to undergo an AED1.5 billion expansion, further entrenching itself as a global shopping destination.

Its airport, which is among the world’s busiest for international travellers, also handled a record 44.9 million in the first half of the year – an eight percent increase from 41.6 million passengers in the same period of 2023 – as the post-pandemic recovery continued.

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Meanwhile, the report added that GCC cities’ retail sectors contribute as much as 24% to urban GDP and employ up to 20% of the urban workforce, boosting their overall reputation.

Within Dubai, 21% of the workforce is employed in retail, the highest among all six cities, and the sector contributes an impressive 24% to urban GDP, added the report.

The report also pointed to several characteristics that make cities global shopping destinations.

Among those, providing a holistic experience with culinary, entertainment, cultural, and other kinds of venues are listed as features that enhance the shopper’s journey.

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These were some of the points highlighted: modern retail infrastructure; strong brand identity and global recognition; compelling retail; seamless omnichannel experience; and policies and regulations.

The report noted that retail sectors in GCC cities also support growth of other local businesses, especially in creative industries such as design and fashion, and subsequently boost progress towards broader economic goals, including economic diversification and resilience.

The report also pointed out what Dubai is doing differently to stay ahead, such as a curated retail calendar which includes initiatives like the popular Dubai Shopping Festival (DSF) and catering to Ramadan and Eid holidays, school summer breaks, and peak tourism seasons.

The report concluded that GCC cities can enter the ranks of global shopping destinations, rivaling leading centers in Europe and North America.