Retail consumer spending in UAE jumped by 14 per cent in Q1 2022

The non-oil economy is expected to grow by 3.9 per cent this year.

Majid Al Futtaim, the leading shopping mall, communities, retail and leisure pioneer across the Middle East, Africa and Asia, today launched the latest in a series of quarterly reports titled State of the UAE Retail Economy, uncovering key economic data, trends and insights into consumers’ behaviour patterns, spending habits and sentiment in the UAE.

The report highlights a 14 per cent jump in Q1 2022 retail consumer spending in the UAE compared with the same period in 2019, indicating that the nation’s post-pandemic economy continues to recover strongly.

The latest collection of data demonstrates that resilience, confidence and stability have returned, along with growth that exceeds pre-pandemic numbers. While the economic recovery is on a firm footing, challenges remain; foremost among them is inflation. However, rising prices have had little impact on consumer confidence in the economy, with 89 per cent of respondents to a survey by Majid Al Futtaim’s Happiness Lab expressing optimism. This same survey revealed that the month of Ramadan is expected to boost spending on food and beverages, with groceries topping the list of anticipated increased expenditures by households.

Indeed, the non-oil economy is expected to grow by 3.9 per cent this year, as a result of consumer spending and rising tourist numbers, and the broader economy is forecast to expand by 6.2 per cent in 2022. Online retail spending tripled in the first quarter compared with the first three months of 2019, led by the food and beverage and hypermarket/supermarket sectors. At the same time, e-commerce accounted for 11 per cent of all retail spending in the quarter, up from 5 per cent before the pandemic.

Similarly, the UAE’s hotels enjoyed strong demand from October to March and improved performance on an average daily rate and revenue per available room, thanks in part to the success of Expo 2020 Dubai. UAE hotels also had the highest occupancy rate in the world for four straight weeks in February and March, with 85 per cent occupancy in mid-March.

The research further indicates that the forecasted growth in 2022 will be supported by the Government’s ongoing focus on pandemic management and its introduction of a range of growth-friendly initiatives. The decision to adopt a more global Monday-to-Friday working week has further strengthened Dubai’s status as a financial hub, and government reforms promoting business development also played a significant role in driving private-sector growth. This included a new law permitting full foreign ownership of companies boosting foreign direct investment, which increased to USD 20.7 billion in 2021, up 4 per cent from the previous year.

— business@khaleejtimes.com