(MENAFN- The Peninsula)
The Peninsula
Doha: The value of electronic commerce (e-commerce) in Qatar exceeded $ 2.2 billion in 2020 compared to $ 1.5 billion in 2019, showing an increase of 47 percent, a recent study conducted by Qatar Chamber revealed.
The study titled 'E-Commerce in the State of Qatar: Reality, Challenges and Solutions' also said that the volume of e-commerce in the state is expected to hit $2.3 billion in the current year.
The reports touched on the emergence of e-Commerce, its related concepts and advantage, as well as the infrastructure of e-commerce in Qatar and how it contributes to achieving the Qatar National Vision 2030.
It also discussed current expenditure and growth of e-commerce sector in Qatar, in addition to the legislation, laws, and facilities provided by the state to facilitate and support e-commerce. It also highlighted the initiatives adopted by the state to encourage and stimulate this sector, challenges facing e-commerce.
Accelerated development
According to the study, the volume of online shopping is estimated at $25 trillion in sales globally in 2018, with the number of e-shoppers reaching 1.66 billion worldwide, including nearly 9% of the international retail market.
It indicated that e-commerce has become more necessary to carry out business than it was before due to the increase of consumer awareness in light of the increasing penetration rate of the use of internet services with broadband and high-frequency, as well as the availability of advanced infrastructure for the internet and smart phone, which contributes to having a significant impact on how to carry out business between the business-to-consumer sector and the business-to-business sector.
It confirmed that the State of Qatar was not far from this development, as the E-Commerce document, which is the first of its kind in the State of Qatar, drew the broad lines of the current situation of e-commerce in the State of Qatar.
The study confirmed that Qatar has a suitable environment for the adoption of e-Commerce and has a developed infrastructure for the internet. It ranks first among the highest countries in the world in terms of the deployment of fixed fiber networks and occupies a leading position in the implementation of mobile networks and the fifth generation. It also ranks second globally out of 175 countries in the internet speed test via mobile networks, and its citizens and residents enjoy high levels of income. Being at the top resulted in a high rate of per capita spending on luxury products, especially in electronic purchases.
It said that the availability of online accounts for citizens over the age of 15, the spread of bank accounts, postal reliability, the increasing use of e-applications at the level of ministries and government institutions in the framework of e-government development and the advanced legislation in this field, which enhances confidence and reliability in electronic services; all have helped in the great spread in the use of means of communication and information technology, where the average single purchase transaction carried out by a Qatari citizen amounted 260 dollars.
Qatar ranked first in the Gulf and fifth globally in the mobile internet flow speed index, with a rate of 59.90 megabytes. It also ranked first in the Gulf and 39 globally in the level of fixed broadband internet, according to the“Speed Test” website.
Currently, Qatar ranks seventh in e-commerce among the business-to-consumer sector in terms of the volume of transactions in the Middle East and North Africa.
Significant growth
The study also said that the e-commerce sector in Qatar saw a significant growth, as it rose in 2019 to rank 47 compared to 59 in 2018, to join the list of the top 50, which includes 152 countries, which means that Qatar is better than 105 countries according to the 2019 E-Commerce Index issued by the United Nations Conference on Trade and Development (UNCTAD), an indicator that monitors the progress of countries according to 4 sub-indicators, including: the prevalence of internet use, the availability of electronic accounts for citizens over the age of 15, the spread of bank accounts, and postal reliability.
It referred to the expectations of the Planning and Statistics Authority that indicated to a growth in the transactions of the e-commerce sector at a compound annual growth rate of 17% until 2025.
Corona virus
The study pointed out to the outbreak of the Corona virus epidemic in all countries of the world which had a negative impact on large sectors of the international and local economy in many countries, but in return some sectors were able to achieve great rise and growth such as“E-Commerce” and E-Commerce flourished in various countries of the world.
It indicated that most large, medium, and even small companies have made a qualitative leap in terms of spread, marketing and pumping into the markets within the framework of the economic closure that occurred to confront the outbreak of the virus.
It assured that e-commerce witnessed a strong renaissance in Qatar during 2020, the year of the Corona epidemic, during which the State of Qatar went through a partial and comprehensive economic closure like other countries of the world.
It referred to a study prepared by the Arab Monetary Fund which indicated that the pandemic has been accompanied by an increase in the use of mobile phones by 50%, and an increase in the use of online data by 40%, which has allowed many companies operating in Qatar to prove themselves in light of the crisis, which has increased their presence and increased their shares in the active local market. The prevalence of e-commerce in Qatar is estimated at 14%.
$ 2.2 billion
The Qatar Chamber's study showed that the size of the e-commerce market in Qatar during 2020 amounted $2.2 billion, distributed almost equally between businesses' dealings with each other and between businesses and consumers.
Local companies accounted for about 38% of the total value of these transactions, while the share of foreign companies accounted for 62%. Qatar is the seventh largest online market in the Middle East and North Africa, and the Ministry of Transport and Communications expects the market size to reach 12 billion riyals by 2022, and the value of e-commerce transactions is expected to jump over the next three years to about 150%.
It said that the transactions of this sector account for more than $2 trillion of total commercial transactions around the world, and Qatar leads the Middle East countries in terms of the average value of a single transaction, which amounts $264 per transaction. E-Commerce companies witnessed an increase in their numbers during 2020, as it was 350 companies at the end of June, and their number reached 416 companies in December 2020, which means the establishment of 66 new e-commerce companies in 6 months.
The most important activities in this sector are food products and food delivery, groceries, clothes, gifts, electronics, and products related to beauty and fashion equipment, health in addition to technical games and sports, travel, digital books, hotel reservations, household items, and spare parts of cars.
Challenges
The study also elaborated the challenges facing e-commerce in Qatar which include the weak coordination between the relevant authorities to set a clear system and policy for e-commerce to facilitate the registration and establishment of small and medium-sized companies for local and international investors.
Challenges also include the consumers' low awareness of the options available in e-commerce and the weak spread of e-commerce among large numbers of temporary low-wage workers, which hinders efforts to promote e-commerce among these categories.
They also include the complexity of e-payment rules and systems and the high-cost collection process which constitutes an obstacle for SMEs, as most payments in Qatar are made by the method of cash on delivery, which is the most common and acceptable among shoppers, and represents 75% of the total e-commerce payments according to official statistics, in addition to limited number of e-payment methods such as credit cards, which represent 19%, then PayPal accounting for 6%, and others.
Recommendations
The study recommended to develop policies, regulations, systems, and laws that support the practice of e-commerce in the State.
It also recommended to activate and encourage e-payment by facilitating the ability of merchants to collect and activate prepaid bank cards and digital wallet technology, evaluate opportunities to provide simplified procedures for accrediting payment institutions and electronic financial institutions, facilitate the issuance of e-payment tools such as prepaid cards and digital wallets, and study the development of the“E-Payment Law”, which could contribute to regulating the e-commerce market, and simultaneously would allow payment service providers to obtain the licenses required to conduct their business.
It also recommended to motivate the consumer to practice and use e-commerce and develop a single-window shop portal for workers in a simple way to help them use the portal and benefit from e-services via the internet on demand.
It urged to empower merchants by facilitating and supporting the registration process of start-ups and related activities to help SMEs increase their presence on the internet.
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