Business / #ForbesBusiness

October 29, 2017,   12:27 PM

Dubai Launches Region’s First E-Commerce Free Zone

Samuel Wendel


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Eyeing growth in the Middle East’s e-commerce sector, Dubai has launched the region’s first free zone dedicated to the industry, according to a statement from Emirates News Agency (WAM).

Called Dubai CommerCity, the project is a $740 million joint venture between Dubai Airport Free Zone Authority (DAFZA) and wasl Asset Management Group. The free zone will cover 2.1-million square feet, and be located near the Dubai International Airport in the Umm Ramool area.

Dubai CommerCity will include more than a dozen office buildings, as well as logistics facilities and an area consisting of restaurants, cafes and art galleries. It’s designed to attract direct foreign investment from e-commerce players looking to expand in the Middle East and in South Asia, and will help companies meet current and future needs in logistics, electronic payments, IT solutions and customer services, according to WAM’s statement.

The project will be implemented in two phases, where 50% will be completed at each stage—although no timeline was given for the development. “Through Dubai CommerCity, we aim to play an organizational, operational and knowledge-based role that will contribute to the building of a new world-class free zone,” said Mohammed Al Zarooni, Director General of DAFZA, in the statement.

The free zone is an effort to tap into regional e-commerce growth, which is expected to reach $20 billion by 2020 in GCC countries. Over the next five years, the e-commerce sector is projected to account for 10% of Dubai’s retail sales, which are in turn expected to reach $54 billion by the end of 2017, according to WAM.

Dubai’s new free zone is the latest in a string of developments to occur in the region’s e-commerce sector. Earlier this year, Dubai-based online retailer was purchased by North American e-commerce juggernaut Amazon; then in early October, Noon, the e-commerce website created by Emirati businessman Mohamed Alabbar, finally went live.

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