GCC Alcoholic Drinks Market Research Report: Forecast (2024-2030)

Market Definition

Alcoholic drinks are fermented beverages that consist of ethyl alcohol or ethanol as a primary intoxicating ingredient. These drinks are fermented from fruits, berries or grains, and other ingredients, and as a byproduct a chemical compound ethanol is formed. These drinks come in a wide variety of flavors and types due to different ingredients and production methods resulting in a wide range of tastes and different levels of alcohol by percentage. Some common types of alcoholic drinks are beer, wine, spirits, etc.

Market Insights & Analysis: GCC Alcoholic Drinks Market (2024-30):

The GCC Alcoholic Drinks Market size is estimated to be around 300 million liters in 2023 and estimated to grow at a CAGR of around 7.5% during the forecast period, i.e., 2024-30. The market growth imputes to the growing number of hotels across the region that cater to on-trade outlets such as restaurants, pubs and night clubs. Effective tourism strategies attract more international tourists from diverse backgrounds to visit this region which would lead to the increasing demand for various beverages including alcoholic drinks, as tourists seek cuisine and beverages to enjoy local experiences.

Governments constructing hotels and luxurious resorts in their nations and providing licenses to them for authorizing the sale of such beverages which increases the accessibility of alcoholic drinks for the consumers. Moreover, revenue generated from the tourism sector including the consumption of such beverages contributes to the government initiatives of economic diversification. Furthermore, boosting the opportunities for the local and global alcoholic drink producers in the market would accelerate the growth of market in the forthcoming years.

Moreover, the GCC region has an increasing youth population around one-third to one-half of their population is under 25 years. The growing youth population indicates a larger segment of the population entering into the legal age of drinking. Young populations with diverse drinking preferences foster the demand for bars and clubs in the region. For instance, the UAE-based Sunset Hospitality Group in 2022, announced the opening of a new entertainment-based hotel offering international beers, wines, and cocktails. Several hospitality companies are opening nightlife venues to cater to the upcoming demand for entertainment from the younger generation.

These bars offering a variety of alcoholic beverages including premium drinks could encourage the distributor or retailer to introduce new product offerings into the market. Additionally, bar opening and seeking the attention of local and international tourists to experience nightlife resulting in the increasing demand for alcoholic drinks is anticipated to gain momentum in the coming years which would positively enhance the requirement for alcoholic beverages across the GCC region.

GCC Alcoholic Drinks Market Driver:

Rising Expatriate Population in GCC Region Fueling the Growth of the Alcoholic Drinks Market – The expatriate population in the GCC region is attributed to various factors including the expanding economy, and continuous investment for diversification leading to the rapid growth of various industries, resulting in the increasing demand for workforce in the region. Over the years, the non-GCC citizen population has increased due to job opportunities and employment benefits. According to the ISI World Statistics Congress in 2021, the expatriates made up more than half around 50.9% of the total population in the GCC region which was around 46.6% of the total population in 2010.

Expatriates coming from diverse regions have different preferences due to their cultural background has led to the demand for various food & beverages including alcoholic drinks such as beer, wine, etc. Hence, to meet the demand for these beverages, alcoholic drinks manufacturers extended the import and distribution activities in this region. GCC region’s growing economy and rising non-GCC population would further accelerate the market in the forecast period.

GCC Alcoholic Drinks Market Challenge:

Stringent Government Regulations and Exorbitant Taxes Impac

ting the Alcoholic Drinks Market Negatively – In the GCC region, many restrictions and higher taxes & tariffs are imposed on alcoholic products due to strong religious beliefs resulting in the reduced accessibility of these beverages. In the UAE and Qatar, the sale and distribution of alcohol products are restricted to licensed outlets with limited operating hours within authorized locations. Also, Qatar in 2022, introduced ‘Sin Taxes’ which doubles the alcohol prices in the country.

These exorbitant taxes, import duties, and licensing fee for the sale of alcoholic drinks increases the prices of these beverages in this region. Higher prices also affect the tourism and hospitality sector. Such taxation policies reduce the market size due to the lower consumer base, further affecting the producers of alcoholic drinks. Thus, higher pricing and restrictive policies negatively impacted the market for the past couple of years and also acted as a barrier for the new entrants in the market leading to limited product variety which would affect the market growth in the near future as well.

GCC Alcoholic Drinks Market Trend:

Increasing Demand for Premium Alcoholic Drinks Driving the Market – Over the years, the increase in disposable income among the GCC region’s population has had a positive impact on the GCC nation's continuous efforts for economic expansion. A rise in lifestyle and income increases the spending capacity of consumers to spend on high-quality premium products. Premium alcoholic beverages are often associated with sophistication thus consumers are more inclined towards premium brands.

As the number of international tourists and expatriates is increasing in the region, demand for premium brands has been increasing due to the taste preferences for international or premium brands leading to the increasing demand for high-quality alcoholic drinks. As the status and lifestyle standards are increasing in the GCC region, so does the demand for such beverages which is resulting in new premium or specialty product launches in these countries by the biggest alcoholic drinks companies. The increasing demand for these high-quality premium beverages leading to the growth of alcoholic drinks in the coming years across the GCC region.

GCC Alcoholic Drinks Market (2024-30): Segmentation Analysis

The GCC Alcoholic Drinks Market study of MarkNtel Advisors evaluates & highlights the major trends & influencing factors in each segment. It includes predictions for the period 2024–2030 at the regional level. According to the analysis, the market has been further classified as:

Based on Product Type:

• Beer
• Spirits
• Cider
• Wines
• Pre-Mixed Drinks

Based on product type, spirits are expected to witness significant growth during the forecast period. This growth could be attributed to various factors including higher alcohol content, which makes it preferable for the individual as its smaller quantity is efficient for potent effect. Spirits in comparison to other product types, come in various flavors & types and could be paired with other drinks as they provide customization according to individual’s taste preferences. Spirits contain fewer calories and carbohydrates per serving, compared to beer and wine. Due to the versatile nature of spirits and serve as a base of many cocktails drinks are also increasing the demand for spirits in the youth generation who likes experimentation with diverse spirits options. Thus, the wide variety of flavors offered and the accessibility of spirits across the region are expected to drive market size in the coming years.

Based on the Distribution Channel:

• On-Trade
• Off-Trade

The on-trade segment is expected to hold a major share of the GCC Alcoholic Drinks Market in the forthcoming period. On-trade refers to the case of consumption of alcohol at designated areas such as hotels, bars, night clubs etc. The on-trade distribution channel is one of the major contributors to the GCC region's total sale of alcoholic drinks owing to governments’ strict regulation on the other channels of distribution.

As per the law of some countries, in the GCC region it is mandatory to obtain a license for drinking at home which results in some additional costs to the consumers but under on-trade channel such costs are not required. Drinking in authorized spaces such as bars, clubs, and hotels does not require licensing which makes it less expensive. Therefore, due to affordability, on-trade distribution channels are more preferred by the consumers.

Moreover, tourists and expatriates who want to enjoy the nightlife experiences of the city and social gatherings prefer on-trade channels such as bars, and hotels for the consumption of alcoholic beverages. The government regulations coupled with tourist preferences, are expected to drive growth of this segment in the market in forecast period.

GCC Alcoholic Drinks Market (2024-30): Regional Analysis

Geographically, the GCC Alcoholic Drinks Market expands across:

• The UAE
• Qatar
• Oman
• Bahrain

The UAE is anticipated to hold a significant share of the market in the upcoming years. Due to the government’s introduction of progressive regulation by decriminalizing alcohol consumption and providing relaxation in the existing strict regulation related to alcohol across the country. In 2020, according to the general authority of statistics, the total population of UAE accounted to approximately 9.7 million, among them Emiratis made up 10% of the population, while expatriates accounted for the remaining 90%. Thus, to cater to the alcohol need of expatriates living in the UAE, the government liberalized regulation related to purchase & consumption of alcohol, which resulted in the increasing market growth during the historical years.

Furthermore, the UAE government underwent a significant change in seeking the attention of international tourists by revising its existing law, by eliminating the alcohol consumption penalty for non-Muslim citizens, and limiting the prejudice penalties. Along with this, the opening of several clubs & bars, and a strong commitment to the expansion of the economy by including tourism strategy into its “Vision 2030” initiatives, is expected to enhance the market share during 2024-2030.

GCC Alcoholic Drinks Industry Recent Development:

• In 2023, The UAE removed 30% municipality tax from all alcoholic beverages as well as the personal liquor licensing fees. Personal liquor licences are free-to-obtain for those eligible to legally purchase alcoholic beverages in Dubai.

Gain a Competitive Edge with Our GCC Alcoholic Drinks Market Report

1. GCC Alcoholic Drinks Market Report by Markntel Advisors provides a detailed & thorough analysis of market size, growth rate, competitive landscape, and key players. This comprehensive analysis helps business organizations to gain a holistic understanding of the market dynamics & make informed decisions.
2. This report also highlights current market trends & future projections, allowing business organizations to identify emerging opportunities & potential challenges. By understanding market forecasts, companies can align their strategies & stay ahead of the competition.
3. GCC Alcoholic Drinks Market Report aids in assessing & mitigating risks associated with entering or operating in the market. By understanding market dynamics, regulatory frameworks, and potential challenges, business organizations can develop strategies to minimize risks & optimize their operations.