The UAE was ranked first within the market compatibility sub-index, while Oman was ranked third, Bahrain (fourth), Saudi Arabia (seventh) and Kuwait (10th), according to the index – now in its eighth year – which offers an annual snapshot of industry sentiment and ranks the world’s leading emerging markets by size, business conditions, and transport infrastructure and connections.
Seven of the top 10 ranked markets for compatibility now come from the Middle East and North Africa (Mena) region, compared to just five last year, said the index that carried out a survey of more than 800 global logistics executives.
Although the UAE retains its position at the top for a third consecutive year, with its abundance of free trade zones, no corporation tax, the offer of full ownership and unlimited repatriation of profits still setting the benchmark for emerging markets, Agility said "Qatar has more or less halved the gap between itself and the UAE in terms of score, as trade barriers continue to be diminished."
While Oman’s score also improved, Bahrain’s gain was much more pronounced as it has moved from 11th to 4th on the back of lower trade barriers and business costs.
Overall, Qatar ranked 12th among the EMs in the 2017 index, where other Gulf Cooperation Council (GCC) countries the UAE and Saudi Arabia were ranked third and fifth respectively; while Oman was ranked 13th, Bahrain 23rd and Kuwait 26th, it said.
Within 34 countries with less than $300bn gross domestic product, Qatar was ranked third, Oman fourth, Bahrain 10th and Kuwait 12th; whereas the UAE and Saudi Arabia figured in countries with more than $300bn GDP, where they ranked third and fourth respectively among 16 countries.
In terms of market connectedness, Qatar was ranked 10th, while the UAE came in first position, followed by Saudi Arabia (fifth), Oman (sixth), Bahrain (seventh) and Kuwait (31st).
The index also found that Qatar was ranked 19th among 20 countries that are perceived to have the most potential to grow as logistics market in the next five years, thus slipping from its 16th position in the index in 2016. In comparison, the UAE was ranked sixth (seventh in 2016) and Saudi Arabia 14th (13th).
Terming that Mena region continues to be a strong performer, the index said the most significant development in the region focuses on how it will adjust to the “new normal” of low oil prices.
"Even with the possibility that a new Opec (Organisation of Petroleum Exporting Countries) production agreement will take hold in 2017, low oil prices have had a major effect across the region," it said, adding governments have been forced to diversify their economies and introduce new methods of revenue collection.
Increased competition within the region is also likely to become a feature of the economic diversification process, it added.
On Qatar, Agility said the country's "energy exposure is mainly on the natural gas side, so the decline in oil prices has had a limited impact."
Having won the 2022 FIFA World Cup, it is focused on hosting showcase international sporting events as it seeks to grow its tourism industry, it said, highlighting that Qatar’s World Cup plans involve $70bn worth of projects.
