UAE retail sales seen growing by 37% by 2013

Sales in the UAE's retail sector is predicted to grow to nearly $165bn by 2013, driven by economic growth, expat spending power and increasing household consumption, a new report has said.

Sales are seen increasing by 37 percent from a 2008 figure of $103.5bn and sub-sectors seen leading the growth will be pharmaceuticals, automotive and consumer electronics, Business Monitor International (BMI) said in its UAE Retail Report Q3.

The report highlighted future economic growth, a rise in tourist numbers and an increase in the country's population as key factors leading the improved retail conditions.

BMI said that while the UAE's nominal GDP was expected to contract by 1.7 percent in 2009 amid the impact of the global economic crisis, it predicted average annual GDP growth in the country of 3.8 percent between 2008 and 2013.

"With the population increasing from 4.7m in 2008 to an estimated 5.4m by 2013, GDP per capita is forecast to rise by almost 21 percent by the end of the forecast period [2013], reaching $68,740," the report added.

The report also said that "growing urbanisation" would be a factor in the buoyancy of the retail sector in the UAE, with more than 86 percent of its population classified by the UN as ruban by next year.

It also said that the 20-44 age group - crucial to the retail sector - was expected to hit nearly 58 percent in 2010, up from just over 30 percent in 2005.

In a recent survey of leading retailers in the UAE, more than 90 percent expected reasonable growth in 2010, after a year of struggle amid the impact of the global downturn.

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