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Rising consumer confidence to boost UAE economy

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The spending power of UAE residents remains strong during challenging times and they remain eager to spend more for their personal well-being.

Consumers in the UAE are becoming more confident and spending more despite rising global inflation and interest rates, which will boost economic growth, experts say.

Analysts, corporate executives and business consultancies said the UAE market has ramped up activity very quickly to overcome the impact of the Covid-19 pandemic. Despite the turbulent global macroeconomic environment, consumer spending has remained strong throughout the pandemic and similar trends are expected to continue this year, they said.

Saad Manair, senior partner at Crowe UAE, said UAE residents are better able to manage the effects of inflation than certain other Western countries, provided they plan and manage their finances in a proper manner and keep spending moderate.

“Consumers in the UAE spend a lot and they need to allocate their income wisely,” Manair told Khaleej Times.

Hatem ElSafty, CEO of Business Link, said consumers in the UAE are increasingly confident and spending more, which is driving economic growth and bodes well for businesses in the country. bright future.

“With rising disposable income and a desire for the latest technology and fashion, consumers are increasingly willing to spend, driving the overall economy,” he said.

Despite concerns about the global macroeconomic environment, spending power among UAE consumers remains strong as they do not expect to reduce spending in the next six months, according to a recent study by leading management consultancy firm Kearney.

“While most retail categories have seen price increases, some 16% of consumers say they will spend more on discretionary items compared to 2021. More than half (56%) of consumers plan to spend more on major Goods to spend on household purchases (Dh1,000+) for the next six months,” according to the study.

Ravi Krishnan, managing director at Ascent Partners, said pent-up demand during the pandemic continues to shine through.

“Consumers who embraced e-commerce during the pandemic continued to make strong online purchases while increasing retail purchases due to a renewed appreciation for the brick-and-mortar shopping experience. This may explain even against the backdrop of rising prices,” Krishnan said. told the Khaleej Times.

Sameer K Mohamed, managing director of Jaleel Holdings, said that for a number of reasons, global financial sector challenges have not affected the UAE economy as much as the rest of the world.

“While the prices of almost all products in the UAE market have increased, compared to consumers in other markets around the world, consumers’ spending power has remained strong due to rising incomes. This is because the UAE economy has grown despite the Covid-19 pandemic. challenges, but remained stable. The lives of residents were not affected by the pandemic as it caused job losses and income cuts in other markets,” Mohammad told Khaleej Times.

“The UAE market ramped up activity very quickly to overcome the impact of the pandemic while maintaining standard protocols and gradually easing restrictions. In fact, the UAE market took advantage of the situation by stepping up its game to maintain consumer spending power. This It has had a positive impact on the economy without significant government intervention in the market,” he added.

Abdul Jebbar, group managing director of Hotpack Global, said despite the challenges, consumer spending remains strong in the current global macroeconomic environment.

“In fact, consumers have amassed more wealth than before through the pandemic because they don’t have the same opportunity to spend it. One of the ways retailers are capitalizing on the increased purchasing power of consumers is by adopting an omnichannel model, taking advantage of e-commerce in recent years. rise,” he said.

“It also enables retail store expansion, special offers and discount events, and other channels to reach consumers. Consumers today are also more concerned about their carbon footprint than before. They are willing to pay a higher premium for sustainable and environmentally friendly products , even in the current economic environment,” Jebbar said.

Jobilal M Vavachan, CEO of Life Healthcare Group, said the spending power of UAE residents remains strong during challenging times and they remain eager to spend more on their personal well-being.

“We understand that the lives of consumers in the UAE have not been affected compared to other countries, so despite the supply chain issues, consumer spending remains strong. We have observed that UAE residents care about their health and wellbeing, they are very concerned personal well-being, and are very actively investing in self-improvement, whether through changes in their lifestyle or otherwise,” he said.

“At Life Pharmacy, we are able to largely address supply chain issues through proper planning and forecasting. We also absorb cost increases so the end consumer doesn’t have to spend more,” concludes Vavachan.

Copyright © 2022 Khaleej Times. all rights reserved. Provided by SyndiGate Media Inc. (Syndigate.info).

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