New Mega Trends

Macro to Micro Opportunities on Future Business,

Cultures and Personal Lives

Source: Frost & Sullivan

Top Mega Trends

What is a Mega Trend?

Mega trends are
transformative, global
forces that define the
future world with their far
reaching impact on
business, societies,
economies, cultures and
personal lives.
lives

Urbanization
City as a
Customer

Bricks and
Clicks

Future
Infrastructure
Development

Smart is the
New Green

Innovating to
Zero

Health,
Wellness and
Well Being

Social Trends

New Business
Models: Value
for Many

Future of
Mobility

Connectivity
and
Convergence

Beyond BRIC:
The Next
Game
Changers

Regional
Trends

Source: Frost & Sullivan

Mega Trend 1:
Urbanization - City
as a Customer

Source: Frost & Sullivan

Source: Frost & Sullivan

By 2025, Four MENA countries will be more than 90 per cent urban
Bahrain (90 per cent), Kuwait (98.6 per cent), Lebanon (90 per cent), and Qatar
(96.97per cent)

Aleppo

Tunisia

Damascus

Lebanon

Algiers

Morocco
Casablanca

Libya

Iraq

Baghdad (9.1)

Jordan

Alexandria

Algeria

Tehran (8.6)

Syria

Iran
Kuwait
Bahrain
Qatar

Cairo (14.7)

Egypt

Dubai

Riyadh (8.1)
Jeddah

UAE
Oman
Saudi Arabia
Yemen
Sanaa

Urbanization Rate
Note: Mega City is defined as a city with population of over
8 million and GDP of $250 billion or more
Mega Cities in 2025
Potential Mega cities in 2025 ( 3 - 8 Million population)

>80%
70 79 %
60 - 69%
50 - 59%
< 50 %

Source:
Frost
& Sullivan
Source: UNDESA,
Frost
& Sullivan

Transportation Corridors to Foster InterInter-Regional Trade

Despite no landlocked countries, intraintra-trade at less than 10% of total trade
MENA to Have 2 Mega Corridors and 3 Transportation Corridors in 2025

Tunis
Beirut
Algiers

Damascus

Rabat
Casablanca
Agadir

Tripoli

Cairo-Dakar (33)

Alexandri
a

Cairo Damascus - Doha (42)

Amman
Baghdad

Cairo Amman - Doha (33)

Kuwait City

Cairo

Doha
Riyadh

Cairo-Jeddah (25)

Abu
Dhabi

Muscat

Beirut Doha (18)

Jeddah

Duqm

Baghdad- Muscat (25)

Dakar
Note: The figures in brackets represent population in Million

Mega Corridor:
Mega Transportation Corridor:

Mega Corridors are corridors that connect two major cities or Mega Regions (60 km or more apart, and with a combined
population of 25 million or more). The corridors can be planned economic corridors (with planned investment in
transport infrastructure, industrial zones, energy, or real-estate) or naturally evolving urban corridors
Transportation Corridors are those corridors that connect Mega Cities or Mega Regions by transport links eg. Highways,
rail, etc
Source: ISDB; UNHABITAT, Frost
& Sullivan
Analysis.
Source:
Frost & Sullivan

Cities, and Not Countries,

Will Drive Wealth Creation In the Future
Cities like Cairo (Egypt) will
account for more than 77% of the
countrys GDP by 2020; Abu Dhabi
(UAE) around 48% (2020); and
Dubai (UAE) and Tehran (Iran)
around 26% (2020).
What are the Micro Implications?
High Economic Power
Hub and Spoke Business Model
Transit oriented development
New Mobility Solutions
City as a Customer
Source: PwC, IMF, and UAEinteract.com

Source: Frost & Sullivan

Mega Trend 2:
Social Trends

Source: Frost & Sullivan

Surge in
Asian Work
Pool

Geo

Gen Y

Socialization

Middle
Bulge

Generational
Political Shift

SheSheconomy
conomy
Ageing
Population

Reverse
Brain Drain

Source: Frost & Sullivan

MENA's GenY Will Continue to Account for Over 1/3rd of the Regions
Population by 2025
Total Population: 394.8 Million
>64 Years

8.51

35-64 Years

56.19

Total Population: 472.4 Million

9.42

15-34 Years

76.22

<14 Years

61.53

17.05

51.47

81.01

85.71

73.32

77.07

72.88

60.27

58.88

63.16

150

100

50

50

Female

100

Male

150

150

100

50

50

100

150

2012

14.80

2025
Source: United Nations Population Database, Frost
Source:
& Sullivan
Frost & Sullivan
Analysis.

10

Employment Growth (%)

Sheconomy
Sheconomy MENA Makes Significant Progress in Reducing Gender
Gaps in Human Development
6
5
4
3
2
1
0

Female employment grows while growth in male employment declines

2009

2010
Female

2011

2012

Male

A new vision of the roles of women in both education and the workplace are bringing
beneficial changes across the region.

Female representation from

KSA & Iran in the Olympics

Princess Nora Bint AbdulRahman

University - KSA, one of the Worlds
largest university for Women

Saudi King grants women seats

on advisory council - A new
Shura Council member

Source:
Frost & Sullivan
Source: United Nations Population Database, Frost
& Sullivan
Analysis.

11

Six Degrees Apart: Geo Socialisation in 2020

Used For:

Used For:

Meet Ups, Restaurant and

Nightclub Reviews, Concert
Events

Digital Marketing: Receiving

Updates on Promotion and
Offers

Used For:

Used For:

Networking in Business
Conferences: Updates on
Potential Contacts

Local Real Estate News, Geo

Socialising with Friends

Source: Frost & Sullivan

12

Six Degrees Apart:

Apart: Social Networking Users to Reach 488
Million in MENA by 2015
Around 75% of MENAs Online Population will be Involved in Social Networking
Services
2011
Total: 390 Million
NonNon-Internet Users

2015

Facebook MENAs Leading Social Network

Regional Breakdown (2011)

30 Million Facebook Users

75 million
internet users

Top Facebook Markets

Egypt

Non Social
Networking
Users

1
2

45
million

Social
Networking
Users

NonNon-Internet Users

255 million

315 million

30
million

Total: 415million

Non Social
Networking
Users

40
million

Social
Networking
Users

120
million

8 million
Saudi Arabia
4.2 million
Morocco

160 million
internet users

3.8 million
Algeria
2.6 million
Source: Frost & Sullivan

13

Arab Spring Revolution Wave

A gradual shift from Imperial Regimes to Democracy and Reforms
Focusing More on Inclusiveness and SocioSocio-Economic Parity
Morocco : First
Parliamentary elections
in 9 Years

Syria

Tunisia
Lebanon

Morocco

Iraq
Jordan

Algeria

Kuwait
Kuwait
Bahrain
Qatar

Libya
Egypt

Iran

Saudi Arabia

Egypt - New democraticallydemocraticallyelected Parliament and

President

UAE
Oman

Yemen
YemenYemen- New President Elected
Old Regimes Replaced by
Democracy

Regimes with high

vulnerability

Regimes in political
turmoil

Rise of the
periphery

Mass Protests
(2010 -2011)

Source: CSS, Zurich and FrostSource:

and Sullivan
Frost & Sullivan
Analysis

14

Mega Trend 3:
Economic Trends :
Diversification

Source: Frost & Sullivan

Top 10 Countries Contributing to MENA GDP :

UAE to Advance One Rank in 2020

7
Iraq
2011 - $114.23 billion
2020 - $159.76 billion

Kuwait
2011 - $160.9 billion
2020 - $173.27 billion

Iran
2011 - $482.43 billion
2020 - $582.83 billion

Morocco
2011 - $99.28 billion
2020 - $136.32 billion

Algeria
2011 - $197.86 billion
2020 - $247.94 billion

2
Egypt
2011 - $235.72 billion
2020 - $374.58 billion

10
1

KSA
2011 - $597.09 billion
2020 - $834.67 billion

Qatar
2011 - $173.52 billion
2020 - $233.84 billion

UAE
2011 - $338.69 billion
2020 - $650.29 billion

Oman
2011 - $72.68 billion
2020 - $88.26 billion

Source:
Frost & Analysis
Sullivan
Source: IMF, OPEC, Frost and
Sullivan

16

The contribution from oil exports to the GDP for most major oil
exporters of MENA is expected to decline significantly by 2020
Projected Oil Exports as per cent of GDP
100%

94%

94%

90%
80%
68%

70%

61%

60%

60%

53%

53%

51%

50%
40%
30%

46%
36%

35%

34%

31%

35%

35%

33%

25%

24%

23%

20%

16%
8%

10%

6%

0%
Algeria

Bahrain

Iran

Iraq

Kuwait

2011

Libya

Oman

Qatar

KSA

UAE

Yemen

2020
Source:
Frost & Analysis
Sullivan
Source: IMF, OPEC, Frost and
Sullivan

17

Mega Trend 4:
Connectivity &
Convergence

Source: Frost & Sullivan

80 Billion Connected Devices By 2020

10 Connected Devices for
Every Household by 2020

5 connected devices for every

user by 2020

5 billion internet users by

2020

500 devices with unique

digital IDs (Internet of things)
per square kilometre by 2020
Source: Frost & Sullivan

19

MENA To be Linked Through 360 Million Connected Devices

By 2020

2 connected devices for every user by 2020

36 Million 4G LTE subscriptions in MENA

by 2020

390 Million internet users by 2020

15 Gigabytes per capita monthly data

consumption in countries like KSA, Qatar and
UAE by 2020
Source: Frost & Sullivan

20

SPACE JAM - New Satellites Launched By 2020:

2020
Over 1,213 Satellites to Be Launched Globally This Decade
Creating Multiple Innovative Applications

By 2020, there will

be approximately
1,213 Satellites
(Communication
559; Earth
Observation 225;
Navigation 107;
Reconnaissance
102 and R&D 220)

Source: Frost & Sullivan

Source: Frost & Sullivan, 2012

21

Augmented Reality
Augmented Reality (AR) is defined as a real-time augmented view of the environment through digital data
through use of text, sound, graphics, video, and navigation systems that increases users interactivity with the
local environment . This extends business and mobility options, social interactions and experiences which has
implications on personal lives, businesses and even day-to-day activities.

Reality

Augmented
Reality

Augmented Virtuality

Virtual World

Source: Frost & Sullivan

22

Augmented Reality Impacting Different Personal Experiences

Source: Frost & Sullivan

23

Mega Trend 5:
New Business Models

Source: Frost & Sullivan

Personalization &
Customization
Nike
Personalization and
Customization
CoCo-Creation
Quirky .com

New Business
Models
Pay as you Fly
Unmanned
Aerial
Vehicles
OneOne-off Experience
(Thales)
(red letter Days)
Source: Frost & Sullivan

25

Free

Premium

Freemium

Value for Many

Will Replace

Value for Money

Source: Frost & Sullivan

26

Mega Trend 6:
Health, Wellness and
Wellbeing

Source: Frost & Sullivan

The 3 Cornerstones - The Body, Mind and Soul - Contribute To

Humans Definition of Health, Wellness and Well Being
Mood
Stress levels
Mental health
Sense of optimism
Attitude
Security
Safety

Personal values
Personal fulfilment
Self image / self
actualisation

Sight / vision
Touch & feel
Smell / breathing
Sound
Temperature
Wellness

Source: Frost & Sullivan

Source: Frost & Sullivan, 2012

Emerging Healthcare needs in the region gives rise to multiple

investment opportunities
Healthcare Market: Investment Opportunities (GCC), 2010-2018
Market Maturity Needed
Nascent

High

Mature

Unattractive

HMO
e-Health

Substitutive
Insurance

Commercial/C
linical R&D

Economic Value Add

Other Pharma/
In-vitro Diagnostics

Imaging/Diagnostic
Services
Laboratory
Services

Radiation/Proton
Therapy

Tertiary Care

Single
Specialty
Centres

Medium Risk
Medical
Devices

Preferred
Provider
Organization

Generic
Pharmaceuticals

Prescription
Pharma

Ambulatory
Care

Pharmaceutical
Education
Facility Low-risk Medical Fine Chemicals
Devices
Healthcare SEZ
Secondary
Care

Most
attractive
Moderately
attractive
High RiskRiskHigh Value

Day Care
Centers

Over-the-counter
Pharmaceuticals
Supplemental
Insurance
Clinical Management
Services

High-risk
Medical
Devices

Long-term
Care

Low

Non-clinical Management Services

Nascent Market High

Value

Mature Market
High Value

Mature Market
Low Value

Nascent Market
Low Value

Source: Frost & Sullivan

29

Demand for healthcare in the GCC region is expected to demonstrate

double digit growth
Health Expenditure Forecast (US$ Billion), GCC, 20102010-2018
133.2

Cardiovascular Diseases
Diabetes
Sense Organ Diseases
Musculoskeletal Diseases
Cancer
Other Injuries
Urogenital Diseases
Mental Disorders

84.4
46.1

2011

2015F

High Growth Disease Markets, GCC, 2025

2018F

Healthcare market growth driven by rapidly growing population, rising income levels, increased
insurance penetration and an increased prevalence of lifestylelifestyle-related diseases.

Over 100,000
Doctors
Required by
2020

Over 170,000
Nurses
Required by
2020

Nearly $10
billion
estimated
expenditure on
hospital beds
by 2020

Source: Frost & Sullivan

30

Mega Trend 7:
Future Infrastructure

Source: Frost & Sullivan

In Future, HS Rail will not only Connect Cities

and Countries but will also Connect Continents
China : 25,000 kms by 2025 (7,431 kms in 2010)
2020 Trans Siberian Link: New Route 66
Biggest Project: $68 billion California HSR
UK project: 33 billion (by 2026)

What are the Opportunities?

Copper-silver and copper-magnesium wires

Steel Companies
Construction tooling, spare parts
Condition monitoring, security, surveillance,
Data handling, Passenger information
systems
High Speed Logistics
Mergers and Acquisitions

Source: Frost & Sullivan

32

MENA High Speed Rail Projects

Saudi Arabia: New HighHigh-Speed Train
Project

Total Estimated Cost: $6.7 billion

Length of Railway: 450 km
Maximum speed: 360 kmph

Morocco: New HighHigh-Speed Train

Project

Total Estimated Cost: $4 billion

Length of Railway: 350 km
Maximum speed: 320 kmph
Source: Frost & Sullivan

33

MENAs Mega Projects Focus on Creating StateState-ofof-the Art Transport

Infrastructure

34

Source: Frost & Sullivan

Regional Specific
Trends

Source: Frost & Sullivan

Transcontinental
Power
Generation

WaterWater-Energy
Nexus

Food Security

Regional Trends

Source: Frost & Sullivan

36

Transcontinental
Power Generation

Source: Frost & Sullivan

The Desertec Initiative

The objective of Mediterranean Solar Plan is to achieve 20 GW of renewable energy generating
capacity in the region by 2020.The Desertec Initiative aims to provide 15per cent of European
Electricity and a significant proportion of domestic demand of North Africa.

Source: Frost & Sullivan

Source: Desertec Foundation

38

Transcontinental Energy and Power linking : Over the past twenty

years the total investment in the various Arab Interconnection
Projects has reached two billion US dollars

GCC Power Grid Interconnection Project linking

the grids of Kuwait, Saudi Arabia, Bahrain and
Qatar, UAE and Oman.

39

Arab gas line connecting the western Iraqi gas

fields to the gas processing centres in Syria,
Egypt and Jordan, to facilitate marketing Arab
gas (Egypt and Iraq) in Turkey and Europe.
Source:
Frost & Analysis
Sullivan
Source: Arab Fund, Frost and
Sullivan

39

WaterWater-Energy Nexus

Source: Frost & Sullivan

Glass Half Empty: Over 1/3rd of Water Scarce Nations Globally to be

From the MENA Region
Water stress and economic growth outlook in Arab-TI countries

Projected water stress index (%), 2050

160

Jordon Libya Egypt

Syria
Gulf +
States

Tunisia

Sudan

120

Somalia

Algeria
Water scarcity
(Water stress levels
above 40%)

Iraq
80

Iran
Morocco
Water Stress
(an index of water
withdrawals as a
share of renewable water
resources)

40

Turkey
Djibouti
0

Lebanon
2

Projected GDP per capita growth (% ), 201050

Size of bubble = total internal renewable water resources per capita in 2010

Source: International Food Policy Research Institute, Frost

andFrost
Sullivan
Research
Source:
& Sullivan

41

The Water Energy Nexus:

Groundwater and Desalination are the Two Major Sources of Water
Both of Which are very Energy Intensive.
Intensive.
Water and Energy are tied together closely..

About 31 billion barrels of fuel is

needed to desalinate about 150 BCM of
water per year by 2050.

Libya and Saudi Arabia use 14% and

10% of the total fuel consumption for
groundwater pumping

Source: International Food Policy Research Institute, Frost

andFrost
Sullivan
Research
Source:
& Sullivan

42

New Business Models in the Water Industry

Rejuvenation of the PPP Model BOO, BOOT, DBFO

Water Trading

Water as a Service (WaaS) (Example: Aqua America project for Shale Gas)

Waste for Value

Note:
PPP Public Private Partnership
BOO Build, Own, Operate
BOOT- Build, Own, Operate, Transfer
DBFO- Design, Build, Finance, Operate
Source: Frost & Sullivan

43

Food Security

Source: Frost & Sullivan

The Middle East with a 58% dependency on food imports is one of the
most vulnerable regions in the world with regard to food security.
Arab Countries Are the Largest Net Importers of Cereal in the World

Europe
+17.5

+91.2

-58.8

North America

Asia

-65.8

2010 Global Trade (in

million metric tonnes)
Net Exporter
Net Importer

+6.3

-18.0
SubSub-Saharan
Africa

Arab
Countries
+18.6

Will the Middle East now look at investing in Food production in the countries from
where food is imported, to secure its food supplies?
Source: Frost & Sullivan

45

Internal Development Strategies for Combating Food Insecurities The Rise of AgriAgri-Food Technopoles in the Middle East and North
Africa
Food Technopoles,
Technopoles are shared facilities and services (e.g. transport, storage and packaging) built
explicitly for the processing of agricultural products. A food technopole is a structured community
dedicated to the development of agrifood innovation, bringing together in one location (or in
multiple nearby interrelated locations) the necessary elements for making innovation happen:
agro-industries, research and training institutions, and related input and service providers

Packing of Citrus

Modern Banana Handling in KSA

Modern Grape Grading and Handling,

Egypt

Source: Regional Agro-industries Forum,

Mena
(FAO,
UNIDO)
Source:
Frost
& Sullivan

46

So what will the future look like in 2025

1. You will most likely live in a MegaMega-city which wants to be Smart or Sustainable
2. Every second mineral water bottle would be from desalinated sources
3. There will be no gender gap in the region
4. Around 75% of MENA netizens will be involved in social networking services
5. The contribution of nonnon-Oil sectors will form a major part of GDP of the
prosperous countries in the region
6. A gradual shift in the political scenario will strengthen focus on impartial
democracy and sociosocio-economic parity
7. Cars will have many autonomous functions which will provide advanced driver
assistance functions
Source: Frost & Sullivan

47

From Macro to Micro: Taking Mega Trends from Information to

Strategy Implementation
To
Macro

Micro

Mega Trend

Analysis of Opportunities and

Unmet Needs

Selected trends that impact your

business and markets

Sub Trend

Impact on Future Product/

Technology

A sub-layer of trends that has a

wide ranging impact

Impact to Your Industry

Visualising the roadmap of these
critical forces through scenariobuilding and macro economic
forecasts

Source: Frost & Sullivan

48

Learn More About New Mega Trends

Upcoming Book:

New Mega Trends

Implications for our Future Lives

By Sarwant Singh

Publisher: Palgrave Macmillan

http://www.palgrave.com/products/title.aspx?pid=5774
23

Join Our Mega Trend Group On

Mega Trends: Strategic Planning and Innovation Based on
Frost & Sullivan Research
Source: Frost & Sullivan

49

Contact Information

Sarwant Singh

Archana Amarnath

Partner & Practice Director, Visionary Innovation

Research Group and Automotive & Transportation

Program Manager, Visionary Innovation Research

Group

(+44) 2079157843

(+44) 2079157893

sarwant.singh@frost.com

aamarnath@frost.com

Dormon Followill
Partner & Practice Director, Economic Impact Analysis
(EIA)
+44.1865.398620
dorman.followwill@frost.com

Source: Frost & Sullivan

50