DEC 2017
Economic advancement coupled with increasing population in the Middle East and African nations is the major driver to the packaging industry as a whole and in turn active and intelligent packaging. Countries like UAE, Turkey and Egypt, etc. have huge growth potential and are expected to lead the market in the coming years.
The Middle East and Africa active and intelligent packaging market is estimated to grow from USD 280 million in 2016 to USD 504.76 million by the end of 2021 at a CAGR of 10.32%. UAE has the largest market share followed by the South Africa and Israel.
The economy of the Middle East countries grew from 3% to more than 5% in 2012 and the inflation rate has remained relatively constant. This gives the consumer more money in hand to spend on products from the markets. Packaging and lifestyle issues go hand in hand. Middle East has one of the highest GDP per capita, so the consumers have more disposable income to spend on e-commerce retail, luxury retail and retail in stores. With the increase in sales of products, the packaging market will be growing to cater to the needs of both the consumers and retailers. Countries like Qatar have GDP per capita more than USD 100,000 so as the purchasing power increases so does the packaging market.
Africa’s GDP growth from 4.7% in 2013 to 5.2% in 2014 and the FDI growth of 16%, reaching USD 43 billion in 2014, show a positive economic trend. With inflation in the region going down from 10.7% in 2013 to 6.2% in 2014, domestic spending is on the rise. Retail, from e-commerce to mom and pop stores, has racked up the biggest gains. Packaging in Africa is fast catching up to meet the growing needs of a continent that is booming with investment from a vast number of foreign players.
The Middle East and Africa active and intelligent packaging market is witnessing a remarkable growth. Increasing demand for these packaging products because of changing lifestyles and demand from manufacturers for longer shelf life is driving this market growth. Government’s strict regulations regarding food packaging and safety standards are other such factors which are contributing to the market growth.
In Africa, missing and underdeveloped supply chains remain an obstacle for rapid growth in demand for active and intelligent packaging in the region. The opportunities for vertical growth in manufacturing and food processing are tremendous.
The concerns for the Middle East area are that the region is prone to be unstable. This instability caused due to extremism and terrorism affects the companies investing in the market and also spooks the future investors. With the USA providing a lot of support to countries from this region these fears should be allayed. As sanctions against Iran are being lifted gradually this region will grow and prosper.
Some of the vendors mentioned in the report are BASF, Amcor Limited, Landec Corporation, Bemis, Rexam Plc and Sonoco.
DRIVERS
Changing lifestyle of people, demand for packaging solutions with longer sustainability, demand for fresh and quality food are the major drivers for the growth of this market. Further, increase in counterfeit products in developing countries has also compelled companies to use technologies like RFID during packaging.
RESTRAINTS
Issues regarding the effect of packaging materials on the human body, security and privacy issues in case of intelligent packaging systems are expected to be major challenges for the market’s growth over the next five years.
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