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Luxury Market in the UAE: Great Opportunity for New Business Ventures6 min read

Author: Uwe Hohmann
Managing Partner, MBA Tax Law / Commercial- & Tax Consultant

According to a new report from Chalhoub Group, the luxury sector in the Gulf region is booming. It is growing twice as fast as the global market and has hit USD 12.5 billion. This surge is fuelled by strong economic factors and a tourism boom.

The report predicts more growth, thanks to sweeping economic reforms expected to boost consumer confidence. An impressive 93 percent of people surveyed feel financially secure, reflecting a bright outlook on the region’s economy.

In Saudi Arabia, confidence is particularly high, with 60 percent of people sensing a stronger economy and 70 percent of wealthier consumers noticing recent economic improvements.

Even with rising living costs and other global concerns, the general mood among GCC consumers remains upbeat, with many feeling hopeful and confident.

Both the UAE and Saudi Arabia are propelling this growth, with high demand for luxury fashion, watches, jewelry, and beauty products. Fashion leads the charge, valued at USD 5.2 billion, followed closely by watches at USD 5.1 billion.

The high-end fashion sector alone grew by 10 percent in 2023, far outpacing the global average. The first quarter of 2024 continued strong, with a 7 percent increase from last year. The UAE dominates the luxury fashion market, thanks to its thriving tourism and the influx of wealthy individuals.

The beauty sector is also thriving, with a 15 percent increase in 2023 and another 10 percent in early 2024. The UAE is at the forefront, particularly in prestige beauty products, closely followed by Saudi Arabia.

Is it a good time to start a luxury fashion business in the UAE?

Given the rapid growth and robust economic outlook in the UAE, now is the perfect time to start a luxury fashion business in the region. The thriving tourism industry and the influx of wealthy individuals ensure a strong market demand. Additionally, the UAE’s leading position in the luxury market highlights its potential for new ventures. Entrepreneurs looking to capitalize on this opportunity can benefit from the favorable conditions and high consumer confidence.


How TME Services Can Support Your Business

To handle the challenges of establishing a presence in the Middle East, TME Services provides expert assistance to help you set up and succeed in this dynamic market.

With over 18 years of experience in the UAE and the Middle East, we specialize in legal, tax, accounting, and compliance matters. Visit our services page to learn more about everything we do.


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