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Jul, 2021     

Ground Zero 5.0 – MENA Internet Economy Coming Of Age – A Recap

MENA Digital Economy to reach new heights


1. MENA Digital Economy to reach new heights

The MENA Digital Economy is being boosted by some of the most positive digital metrics across the world. Over 85% of the population has access to internet (this number is over 95% in UAE and KSA). And E-tail penetration is over 5% (8-10% in UAE and KSA). This has led to a digital economy of ~$45Bn value which will reach ~$100Bn by 2023.

Digital Economy – MENA, $ Bn, 2018 – 2023

Note: Non-Exhaustive list – eB2B and Edtech. not included here

2. E-tail Growth to play a key role

There was a drop in the size of the digital economy in 2020 but that was mostly due to online travel. E-tail’s contribution rose to over 40% from 27% before. And we expect this to remain sticky for the times to come.

Digital Economy by Sectors – MENA, $ Bn, 2018 – 2023

Note: Non-Exhaustive list – eB2B and Edtech. not included here

3. White spaces in funding

However, e-tail penetration in UAE and KSA is still behind other mature countries (USA:20%+). This could be in part due to the lack of larger ticket investments in the segment. There is a significant skew in investment values less than $100Mn. The boost that the sector needs could very well be in the form of funding based liquidity.

Funding Values (2014-present)

Note: Non-Exhaustive list