The impact of the situation in the Middle East on the LCD market 

I. Demand status of monochrome industrial LCD in the Middle East
1. Market size and growth drivers
Overall demand growth is steady: The Middle East and Africa industrial display market is expected to grow at a CAGR of 8% from 2021 to 2028, with a size of over $310 million in 2028. Among them, monochrome LCD and LCM account for more than 60% of the industrial scene due to their low cost Low Cost LCD, low power LCD (more than 30% energy saving than TFT color screen) and strong environmental adaptability.
Core application areas:
-Manufacturing automation: For human-machine interface (HMI) and control systems, Saudi Arabia’s Vision 2030 initiative to build smart factories is driving demand for 14-21 inch monochrome LCD screens (45% of panel size segment).
Energy and Medical: Oil monitoring equipment requires high temperature resistant dust screen, and medical equipment relies on high contrast High contrast LCD monochrome screen LCD (such as patient monitor), accounting for 25% of end user demand.
Regional demand stratification:
Gulf states (Saudi Arabia, UAE): high-end industrial upgrading leads the way, focusing on touch screen integration (60% of touch usability segment).
Egypt and North Africa: The rise of local manufacturing. Hisense’s Egyptian factory produces 2.5 million display devices annually, 70% of which are exported to Africa and Europe, promoting the localization of low-cost LCD monochrome screens at the middle and low end.

2. Technology preference and competitive pattern
LCD dominance: Due to the lack of motion delay, long life and low cost, LCD dominates the Middle East industrial display market with more than 60% share. OLED penetration is slow (limited to high-end scenarios).
International and local brand competition: Samsung and LG dominate the high-end market; Eastern Display and other enterprises enter the middle and low-end market with ultra-wide temperature Ultra-wide temperature and anti-interference monochrome COG screen to cover medical and industrial equipment in the Middle East.
Second, the promotion and restriction of demand by the Situation in the Middle East
promoting agent
1. Economic diversification policy
Saudi Arabia’s Vision 2030 and the United Arab Emirates’ Industry 4.0 have made electronics manufacturing a priority, offering tax breaks to attract foreign investment (such as Hisense’s Egyptian plant, which received land support from the Suez Economic Zone).
Egypt relies on the EU-Africa Free Trade Agreement (AfCFTA) to become a springboard for Chinese companies to reach Europe and Africa, avoiding European and American tariffs (such as the potential 60% tariff on Chinese panels imposed by the United States).

2. Infrastructure and digital investment
Saudi Arabia plans to build 90 infrastructure projects by 2025, promoting intelligent transportation and medical care, and increasing industrial display demand by 10% annually.
The penetration of the Internet of Things (IoT) in industry is increasing, and monochrome screens have become the first choice for sensor terminals due to their low power consumption (Low power LCD), especially in energy meter LCD and remote monitoring.

restraining factor
1. Geopolitical and supply chain risks
Red Sea crisis: The surge in transportation costs in 2024 led to fluctuations in panel inventory, and brands were forced to stock up in advance, causing price fluctuations.
Palestinian technology dependence: Political unrest limits OLED technology imports, and weak local research and development restricts high-end development.

2. External policy chain reaction
U.S. tariff policy has pushed up the cost of Chinese panels, and Middle East import prices have been passed on (China accounts for 70% of global LCD production capacity).
Local conflicts disrupt the supply of raw materials (such as production lines in Israel that are highly dependent on technology), resulting in delivery delays.

Iii. Future trends and enterprise strategy suggestions
1. Demand continues to differentiate and technology upgrades
Gulf States: Upgrade to large size (over 41 inches) and 4K resolution touch screens to meet visualization needs in control rooms (8% annual increase).
North Africa export center: Egypt focuses on the manufacturing of low-end modules, with obvious cost advantages (labor costs are 30% lower than China), and accelerates coverage of the African market.

2. Green and intelligent transformation
Energy-saving monochrome screens are in line with environmental policies in the Middle East (such as Saudi Arabia’s requirement for panel factories to increase water recycling rates), and Eastern Display’s low-power LCMs for flow meters are well received by customers.
The increasing demand for event stream processing (ESP) and AI integration is driving the evolution of monochrome LCD screens to real-time data interaction terminals.

3. Geopolitical adaptation strategies
Supply chain multi-centralization: enterprises are distributed in Egypt, Vietnam and Mexico to decentralize production capacity (such as TCL strategy), and use the Middle East free trade network (such as GCC) to optimize export routes.
Localization cooperation: joint venture with local enterprises in the Gulf (such as Hisense joint venture FBB Tech) to avoid trade barriers and obtain policy dividends.

Summary and investment advice
The market of monochrome industrial LCD screens in the Middle East presents two tracks of “high-end upgrading” and “mid-and low-end manufacturing” running in parallel:
Short-term opportunities: Saudi Arabia and the United Arab Emirates are generating high-end demand for infrastructure and automation projects; Egypt is strengthening its position as a manufacturing and export hub.
Long-term risks: Geopolitical conflicts may push up supply chain costs; attention should be paid to the impact of US tariff policies on transit trade.

Enterprise strategy priorities:
1. Technology localization: set up factories in Egypt or Saudi Arabia, and reduce tariff costs by combining free trade agreements;
2. Product adaptation: develop wide temperature (wide temperature), dustproof monochrome screen (such as Eastern Display ultra-wide temperature Ultra-wide temperature technology) to match the industrial environment in the Middle East;
3. Supply chain resilience: Establish regional storage centers (such as Dubai, UAE) to deal with the risk of transportation disruptions.