By Elsa Baxter
Luxury brands eyeing sales outside of Gulf, growth still lower than pre-crash levels
The Middle East’s luxury retail market is forecast to
grow by eight percent this year, a senior manager from Bain & Company Middle East said on Tuesday.
The region is poised to outperform the global luxury
retail market, which is estimated to see six percent growth this year, said
Cyrill Fabre, senior manager.
The region’s reviving tourism industry and the return of
consumer confidence was cited by the analyst as main drivers behind growth.
The latest regional HSBC consumer confidence index for
the first half of 2010 saw confidence increase to 69 percent – almost matching
the level seen pre-crisis.
However, while the Middle East’s anticipated growth is
strong, it will remain more moderate than that seen prior to 2008, Fabre said.
“It’s a new reality. We have moved on from a period of
hyper growth between 2005 and 2008, it was exuberant hyper growth during this
time,” said Fabre on the sidelines of the Luxury Forum in Dubai.
“2010 is the beginning of a new era of moderate growth of
eight to ten percent.”
Fabre said the luxury brand market had moved its focus
for growth away from the GCC and into the wider Middle East region, as more new
malls are built in emerging markets.
Dubai-based Majid Al Futtaim Group, the largest developer
of malls in the Middle East, operates shopping centres in Lebanon, Syria and
Egypt, in addition to two in the UAE.
“As the malls
expand outside the GCC, the luxury brand market will move with them,” Fabre said.
“Dubai was the absolute centre for luxury brands for some time. But these brands
now feel that they want to have a presence in other big cities in the region.”