UAE consumers 4th most upbeat in the world

UAE consumer confidence ranked fourth in the world and first in the region in the fourth quarter 2014

UAE residents are more willing to open their wallets this year than most of the world, with the country’s consumer confidence score edging up two index points in the last quarter, a report released on Monday suggests.

According to the latest Nielsen Global Consumer Confidence Index that surveyed 60 countries, UAE consumer confidence ranked fourth in the world and first in the region in the fourth quarter 2014, with 114 points, up by two points from the previous quarter.

Indians emerged as the most upbeat consumers today, as it took the first spot in the consumer confidence ranking. Consumers from Indonesia and the Philippines bagged the second and third spots, respectively.

Nielsen’s study polled more than 30,000 online consumers throughout the Asia Pacific, Europe, Latin America, the Middle East, Africa and North America last November.

Nearly seven out of 10 residents (69 per cent) questioned in the country are upbeat about the employment situation, believing that the UAE job market would be “good or excellent” in the next 12 months, up from 66 per cent in the fourth quarter 2013.

At the same time, spending intentions inched up to 51 per cent from 42 per cent, although perceptions of personal finances dropped slightly to 64 per cent from 65 per cent.

“The consumer sentiment in the UAE remains steady and optimistic,” said Arslan Ashraf, managing director, Nielsen Arabian Peninsula. “There were small steps back in the second and third quarter reflecting some increased consumer apprehension but these doubts have been dispelled in the fourth quarter.”

Ashraf said the increase is related to the consumers' confidence on the fundamentals of the UAE economy. "Though black gold is on the decline, however, UAE respondents are more excited with the steady flow of tourists, stabilizing rental market and government's commitment to continue investments in mega projects.,"

Although the overall consumer confidence in UAE has improved, recessionary sentiment is still prevalent among a small proportion of the residents.

As of the fourth quarter, about 36 per cent of UAE consumers believe they are in a recession, a one-percentage point increase from the previous quarter, but an eight-point rise from the previous year.

Half of the consumers also intend to set aside their spare cash for later use, while 24 per cent expect to spend their money on holidays or vacations, new clothes (23 per cent) and out-of-home entertainment (21 per cent).

Only a small proportion (21 per cent) have thought about paying off their borrowings, while 14 per said they have no spare cash.

Confidence scores in all Africa and Middle East markets also improved year over year. UAE increased by four points, while Egypt registered a substantial 14-point jump. Pakistan posted a four-point rise, while South Africa went up by two points and Saudi Arabia, one.