The United Arab Emirates logistics sector is closing out 2025 with strong momentum, buoyed by infrastructure investment, expanding air-cargo capacity, and steady non-oil economic growth, according to the latest Well Go Logistics market update.
The UAE is positioning itself not just as a transport hub, but as a fully integrated global logistics gateway linking Asia, Africa, Europe and emerging trade flows.
Global Conditions Supporting Regional Activity
Global GDP growth projections have been revised upward to around 2.72% for 2025, while air freight has risen approximately 4% year-on-year. This stable global demand backdrop is strengthening inbound and outbound logistics flows to the UAE - particularly for high-value cargo and trade-lane reconfigurations in response to tariff uncertainty.
Aviation Sector: The Power Engine of UAE Logistics
Air-cargo continues to be a core growth driver. Etihad Airways is launching new routes to Medan, Phnom Penh and Addis Ababa (in partnership with Ethiopian Airlines), with a Kabul connection scheduled by year-end. It reported record profit for Q1–Q3 2025, with cargo revenue rising 8% and fleet strength now at 115 aircraft including fresh freighter investment.
Emirates Airline transported 1.25 million tonnes of cargo in H1 2025–26 - up 4% - while adding three new Boeing 777 freighters. The airline is expanding services to Cairo and deploying A350 aircraft on its Dubai–Hangzhou route, strengthening UAE connectivity to China.
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Flydubai is widening interline agreements and preparing for long-haul capability through its Boeing 787-9 wide-body fleet, supported by new GE GEnx engines, which will enhance cargo flexibility in secondary trade markets.
Seaports, Rail Integration and Multimodal Transition
A major development in UAE logistics landscape is the planned bonded rail corridor connecting Khalifa Port in Abu Dhabi with Fujairah Terminals. Set for pilot operations in Q4 2025, the project is expected to reduce customs delays and streamline movement of goods for export, transit and domestic markets.
Khalifa Port itself handled 9.6 million TEU in H1 2025 - an impressive 21% year-on-year growth - and now accounts for 85% of its parent group’s throughput. Its performance has elevated it into the top 40 globally in Lloyd's List port rankings 2025.
Market Structure: Growth in Freight, Warehousing and CEP Services
Industry estimates value the UAE logistics market at approximately US$41 billion in 2025, expecting 6-7% annual growth through 2030. Freight forwarding continues to dominate, but the fastest growth is now seen in courier-express-parcel (CEP) services, driven by e-commerce expansion and cross-border online purchases.
Non-temperature-controlled warehousing accounts for nearly 90 per cent of sector revenue. However, the cold-chain segment - especially pharmaceuticals, perishables and high-value food logistics - is forecast to grow at nearly 8% CAGR as companies upgrade facilities in Dubai South, Jebel Ali Free Zone and KIZAD.
Geographical Spread and Specialised Roles
Dubai: Largest hub for air-cargo, express logistics, regional distribution centres and e-commerce fulfilment.
Abu Dhabi: Gaining strategic traction in deep-sea logistics, industrial cargo and multimodal integration (rail and energy-linked cargo).
Northern Emirates (Sharjah, Fujairah, Ras Al Khaimah): Positioning as niche logistics bases for bulk cargo, relief and humanitarian goods, feeder shipping and alternative corridor development.
Challenges and Risks
Despite the positive outlook, headwinds persist. Well Go cites tariff volatility, modal-capacity constraints and rising carbon compliance costs as notable risks. Increased digitalisation, real-time visibility platforms and cargo-manifest accuracy (particularly for lithium batteries and hazardous items) are seen as critical resilience tools.
A Shift Toward Integrated, Value-Added Logistics
Rather than competing solely on transit speed, the UAE logistics market is shifting toward integrated service models, offering value-added solutions such as bonded warehousing, cold-chain optimisation, free-zone processing and multimodal re-routing options.
With strategic infrastructure rollouts, expanding long-haul air connectivity, and sustained economic diversification, the UAE is strengthening its role as the logistics of choice for Asia-Africa-Europe trade corridors. November 2025 confirms that the sector is not only growing - but evolving.
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