Page 24 - July/August 2019

UAE apparel sales reach over
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$12billion in 2018

According to Dubai Chamber of Commerce and conditions become more favorable, while consumer
Industry, the value of apparel sales in the UAE confidence strengthens. Despite the dominance of
amounted to $12.3bn in 2018, registering an annual store-based retail, online retail sales are witnessing a
growth rate of about 4.8pc, while the sector is strong growth as many well-established brands
expected to see stronger performance over explore Omni-channel retailing, either through third
2019-2023 period. parties, their own digital storefronts, or both.

The apparel market is the major segment and key Over the next five years, menswear is expected to
contributor to UAE’s retail sector. Although UAE register a compound annual growth rate (CAGR) of
positions itself as a world class retail hub but the about 3.8pc between 2019 and 2023 to reach
global fashion brands still view the country as a US$7.8bn in 2023 as retailers adjust to consumers’
preferred entry point for establishing their presence in preferences and correct supply within the market.
Women-wear is expected to see a CAGR of 4.9pc in
the MENA region.
sales over the same period to reach $5.2bn in 2023,
largely driven by stable footfall and an increasing in
The analysis identified menswear as the spend on modest fashion.
top-performing category with the segment
accounting for $6.2bn worth of sales last year or Meanwhile, the children’s apparel segment is
53pc of the market value, followed by women-wear expected to remain highly competitive, supported by
with 34pc and children’s apparel 7pc. good quality products and affordable prices offered AD
by well-established brands. Sales within this category
The outlook for UAE apparel sales is expected to are projected to register a CAGR of 3.7pc over the
improve over the next five years as economic 2019-2023 period to reach $1billion by 2023.

Imported Cotton: Government levies 3pc regulatory duty

The government has levied 3pc regulatory duty on rate to 3pc.
the import of cotton to facilitate the growers
blighted by high production cost and low market They further said another reason behind keeping the
prices. The Federal Board of Revenue (FBR) issued rate lower is the import of cotton fell sharply during the
SRO 949(I)/2019 in compliance to the decision taken last fiscal year. The country imported raw cotton worth
by the Economic Coordination Committee (ECC) of $767 million during fiscal year 2018/2019 as
the Cabinet in its meeting held on July 31, 2019. compared to $1.07 billion in the preceding fiscal year,
posting 29pc decline. Cotton ginning declined by
Initially, the authorities were unanimous on 12.74pc due to decrease in production. The situation
imposing 10pc regulatory duty in a bid to provide in Punjab, which contributes over 70pc of the crop, is
farmers with a cover as the ECC was informed that more worrisome.
area under cultivation as well as cotton production
was continuously shrinking. Interestingly, the The government has set a production target of 15
government imposed only 3 percent regulatory million bales this year with a goal of 25m bales by
duty on cotton import instead of 10 percent. 2025. Therefore, Punjab has been told to jack up its
production to 10m bales from 6.8m bales last year
According to FBR officials, certain quarters were — a 32pc increase.
not happy with the levy of 10pc regulatory duty on
import of cotton; therefore, a strong lobby of Also, the recent Indian ban on imports means
importers influenced the government to restrict the cotton may have to be sourced from the US.

July/August 2019