MIDDLE EAST- According to the United Nations World Tourism Organization (UNWTO), the food service sectors of the United Arab Emirates (UAE) and Saudi Arabia involving catering, restaurants and cloud kitchens have recorded impressive growth over the past few years. 

The UNTWO report reveals that in 2023, there were more than 60,000 food service establishments in Saudi Arabia, a significant increase from the 40,000 establishments recorded in 2019. 

Employment in the sector has also increased significantly. The report reveals that 608,700 people were actively employed in the country’s food service sector. This represents a 16.9% growth on a year-over-year basis compared to the 306,500 employees recorded in 2019. 

The report also revealed the food service sector (wholesale, retail, restaurant & hotels) contributed an estimated 8.3% to the country’s GDP between 2021 and 2023. 

This growth is attributed to easing of social restrictions that has led to the opening of a plethora of new cafes and restaurants in the country. 

UNTWO also revealed robust economic growth is set to fuel this expected expansion as more households have higher disposable incomes to order in or eat out. 

The report also suggests that government-led initiatives to expand domestic tourism are expected to expand the domestic tourism sector. 

The UAE 

According to the UNTWO, there were in excess of 30,000 food service establishments in the UAE in 2023. The report revealed 18,000 of these establishments are located in Dubai, while the rest are mostly in Abu Dhabi. 

The report also quoted a market analysis from Mordor Intelligence that revealed the UAE food service market is expected to reach US$19.98 billion valuation by the end of 2024 and is predicted to grow at a combined annual growth rate (CAGR) of 17.1% to US$43.98 billion by 2029. 

Although the Saudi food service market is larger than the UAE, it has more food service outlets per capita compared to KSA. 

This reflects a larger leisure tourism sector, higher GDP contribution per capita and a longer-established norm of eating out. 

The report suggests a possible paradigm shift in the region’s food service sector, which suggests a significant opportunity for potential investors.  

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