The GCC has long been a stronghold for cross-border e-commerce. Over the past few years, that momentum only grew stronger with the likes of Shein, Trendyol, and Temu doubling down on the region. But 2024 brought a surprising twist: Cross-border trade volumes declined, even as these players continued to perform well. 

So, what’s really going on? Let’s break it down.

1. Cross-border players are powering Fashion E-commerce growth in UAE & KSA 

At one point, cross-border trade accounted for more than 60% of the UAE’s total e-commerce. Over time, that share declined as local players scaled up and tailored their offerings to regional preferences. But in the past two years, CBT made a strong comeback, led by fast fashion giants. 
Shein led the charge, but 2023 saw Trendyol and Temu enter with heavy promotions, making the UAE and KSA priority markets. 

UAE & KSA Fashion E-tail Market

2. Yet in 2024, the cross-border trade (CBT) share dipped in both the UAE and KSA

When we did our annual e-commerce update earlier this year, a curious trend stood out: cross-border trade declined as a share of total e-commerce. This seemed at odds with what we were hearing that CBT players were still growing fast. 

A deeper look offered clarity: major players like Shein and Trendyol have now set up local warehouses, shifting large parts of their GMV to local fulfilment. Shein currently operates a UAE-based warehouse, while Trendyol has local warehouses in the UAE & KSA, signalling an aggressive local push. As a result, much of their business is no longer being categorized as cross-border, even though the players themselves continue to grow. 

UAE & KSA Fashion E-tail Market - CBT" vs Local

3. 2025 could flip the trend again — CBT may rise 

Early in 2025, Amazon and Noon began ramping up their Global Store strategies to counter the fast-fashion surge. While the full impact remains to be seen, we expect to see momentum build in the second half of the year. 

Another wildcard: US tariffs. If rolled out, these could result in a push of inventory into the GCC, leading to a renewed spike in cross-border buying. That means lower prices, stiffer competition, and tighter margins but we believe the consumption engine will stay strong.  

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Author

  • Akshay advises clients on mandates across growth strategy, competitive positioning, due diligence, market entry and digitization. He has worked extensively on across e-tailing, eB2B, logistics, healthcare to name a few sectors. His expertise pans India, SEA & MENA regions.