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UAE’s consumer confidence returns to stability in Q2

DUBAI - Consumer confidence in the UAE has stabilised during the second quarter of 2010, according to the findings of a survey.

Around 43 per cent of the UAE respondents have positive expectations about the country’s economy, a study conducted by job website Bayt.com in conjunction with research specialists YouGov Siraj said.

Following a drop in consumer confidence felt at the end of last year now it appears to be stabilising in the country, according to the latest Consumer Confidence Index (CCI).

The UAE declined by only 0.5 points over the last quarter. This decline was the lowest recorded across all countries since March 2010, with the highest being Egypt, which saw a drop of 5.5 points, indicating that consumer confidence in the UAE is stabilising.

In the Gulf region, Kuwait, Saudi Arabia and Bahrain all dropped in consumer confidence this quarter, moving down the index by four, 3.2 and 1.7 points respectively. Qatar, however, saw an increase of 1.7 points. In North Africa, Egypt recorded the highest drop, while consumer confidence in Morocco improved by 3.9 points.

“The figures are interesting because there is little correlation between the countries of particular areas of the Middle East, demonstrating clearly how each country’s economy is increasingly independent. There are also some key changes in the figures since the last wave which perhaps signals traces of the instability that was felt across the Middle East region during the recession,” Rabea Ataya, chief executive officer, Bayt.com, said.

Overall, 35 per cent of the region’s respondents said their financial position is the same as last year and just over a quarter — 27 per cent — said they are better off. In the UAE, 20 per cent said they are better off than last year; 38 per cent are in the same position as last year; and 37 per cent are in a worse position than last year.

Among the countries surveyed, 37 per cent of respondents in Qatar said they are doing better than last year compared to 30 per cent in Saudi Arabia and 25 per cent in both Bahrain and Kuwait. However in Jordan, 41 per cent of respondents actually feel that their financial position is worse than last year.

In addition to financial position, consumer confidence is assessed by asking the respondents about their level of optimism towards the future, which forms the Consumer Expectations Index. The surveyed countries varied widely in terms of their consumer expectations. The UAE remains stable reporting only a slight decrease of 0.2 points since the last quarter with Bahrain reporting the biggest decrease, moving down the index by 8.1 points.

On the whole, respondents are expecting to be in a better financial position next year. Overall, 49 per cent of respondents believe that their personal financial position will be better next year. By contrast, just seven per cent of the region’s respondents believe that their financial position will 
become worse.

In the UAE, 47 per cent of respondents believe that their personal finances will be better a year from now, compared to just nine per cent that believe they will become worse. Most optimistic that their personal financial position will be better in a year’s time are respondents in Qatar and Saudi Arabia with 51 per cent and 50 per cent confirming this statement.

Respondents also remain largely optimistic that their country’s economy will be better in a year’s time. Overall, 38 per cent said that their country’s economy will be better; 20 per cent said it will remain the same; and 23 per cent said it will become worse. In the UAE, 43 per cent of respondents expect things to be better in a year’s time.

abdulbasit@khaleejtimes.com