UAE consumer confidence rises as the economy recovers steadily-News

According to data from Majid Al Futtaim, compared with the first quarter of 2021, consumer spending in the second quarter of the UAE retail economy increased by 4%, while the corresponding quarterly growth in 2019 increased by only 3%. UAE Retail Economy Report.

Research data confirms that the retail recovery found in the first quarter of 2021 is still evident in the second quarter of 2021, as consumers are cautiously optimistic about the future.

“The general sentiment in the UAE retail industry in the second quarter of 2021 is cautiously optimistic. As the economy recovers steadily, confidence is rising. Over time, the success of the UAE’s response measures and vaccination program will restore positive sentiment and recovery. Power is fully restored,” the report said.

Data shows that e-commerce will continue to exist. Compared with the first half of 2020, overall e-commerce sales in the UAE increased by 17% in the first half of 2021.

Comparing the first half of 2021 with the same period in 2019, consumer spending fell by only 3%. Most of the decline was borne by the industries most severely hit by lockdowns and restrictions (leisure and entertainment, fashion, hypermarkets/supermarkets). According to the report, leisure and entertainment spending fell by 51% in the first half of 2021.

Alain Bejjani, CEO of Majid Al Futtaim-Holding, said that in the past six months, the UAE retail economy may see positive trends and, in some areas, significant progress has been made in returning to pre-pandemic levels . “We see this cautious optimism being strongly promoted by the strong vaccination measures taken by the UAE government and local health authorities, which help protect our communities and provide additional confidence at home and abroad.”

“Leave aside the most severely impacted industries, the retail general category experienced a moderate but noteworthy growth of 0.3% from the first half of 2019 to the first half of 2021, which implies that by the end of this year,” the report said.

“The composition of the tourism industry is changing: fewer tourists travel to the UAE, but they stay longer and spend more. The average length of stay increased from 3.5 nights in 2019 to 5 nights in 2021, while spending increased In the era of telecommuting, compared with the first half of 2019, household items, books and stationery increased by 18% and 46% respectively in the first half of 2021,” the report said.

Elsewhere, fashion sales fell by 4.0% over the same period, which may be due to fewer goods purchased under lockdown conditions.

Looking at other general retail categories (including food and beverages, electronics, household goods, hotels), we can see that there was a mild 0.3% between the first half of 2019 and the first half of 2021 before the pandemic, but it is worth noting growth of. This growth implies a very real prospect of returning to pre-Covid retail activity levels by the end of the year. This data combines POS data from multiple sources in the UAE and more in-depth POS and mall traffic data in our assets, showing that the UAE retail economy is approaching the level of 2019 every month, and even surpassing the level of the same month in 2019. In May 2021, consumer spending increased by 0.2%. This weak growth was driven by the steady performance of retail general categories and leisure and entertainment categories. Naturally, growth within the general retail category is not homogeneous.

“Looking forward, as digital and technological solutions are further integrated into daily life, we will continue to see consumer expectations for omnichannel experiences continue to increase. We also look forward to the promotion of tourism-related The industry is recovering further. Speaking of our collective efforts to rebuild after Covid-19 and the impressive resilience of the UAE market, this quarter’s data analysis confirms the budding of sustainable growth. Majid Al Futtaim still believes that the UAE’s retail economy is promising. Full recovery,” Bejjani said.

In some industries, relaxation of restrictions has released strong, pent-up demand.

The residential property sector is a typical example. Between May 2020 and May 2021, the number of residential property transactions in Dubai increased by 215% and the value of transactions increased by 357%.

Studies have shown that shoppers show higher levels of comfort in public places, with 64% of shoppers admitting that shopping in the mall feels comfortable. According to the report, although in Majid Al Futtaim’s own shopping mall network, compared with the first quarter of 2021, total passenger traffic in the second quarter of 2021 increased by 11%.

Compared with the second quarter of 2021 and the same period before the pandemic (the second quarter of 2019), consumer spending in non-mall retail destinations increased by 3.0%. Food and beverage sales increased by 41%, and household goods sales increased by 28%. — Issacjohn@khaleejtimes.com

Isaac John

The editorial director of Khaleej Times is a well-connected Indian journalist and economic and financial commentator. He has worked in mainstream journalism in the UAE for 35 years, including 23 years in Khaleej Times. He is a graduate of English major and a graduate of economics major, and has won more than 20 awards. He is widely praised for his real and insightful analysis of global and regional business and economic trends, and is respected for his keen understanding of local business scenarios.