UAE consumers feel the region's economic pressures may be lifting, with the first recorded upward shift in consumer confidence in a year, a new survey revealed on Sunday.
UAE results from the latest Consumer Confidence Index (CCI) moved up by 15.9 index points as compared to the previous poll in Feb and represented the largest improvement among all the countries surveyed in the quarterly survey conducted by bayt.com and YouGov.
While respondents remained largely pessimistic about their current financial position, the country's economy and whether or not it's a good time to buy goods, optimism reigned, with 44 percent believing business conditions - and 37 percent believing their country's economy - will be better in a year's time.
On the whole, consumer confidence improved across all of the surveyed countries with the exception of Algeria - with the top two countries being UAE followed by Kuwait at 14.2 points. Saudi Arabia marked an improvement of 6.4 points and Qatar of 3.9 points.
Around the Levant, Syria and Lebanon both reported improvements of 8 and 3.3 points respectively.
The CCI is a measure of consumer expectations and satisfaction of various elements of the economy including inflation, job opportunities and the cost of living.
"Recent news reports have reported relative stability - if not improvements - in some sectors of both the local and global economy. News of this stability - and presumably improvements on a grass roots level in most countries in the Middle East, are starting to impact professionals, which therefore accounts for the improvement we are seeing in the CCI," said Amer Zureikat, Bayt.com's regional manager.
The CCI asked respondents whether they feel that they are better, or worse off, compared to 12 months ago. One fifth of the UAE's respondents felt they were better off now than last year, while 32 percent stated their situation was the same and 41 percent felt it was worse.
Across the region, a quarter of respondents felt they were better off, 34 percent felt they were worse off and 33 percent felt no change in their financial position.
Within the GCC, Saudi Arabia (28 percent), Qatar and Bahrain (27 percent each) recorded the most significant improvements in the region regarding respondents saying their personal financial position had improved.
By contrast, Jordan's respondents were most negatively hit in terms of their financial position, with 44 percent stating that their financial situation had worsened over the past year.
Regarding consumer confidence, the UAE moved up the index by 17.7 points - the highest of all the surveyed countries, with Kuwait, Saudi Arabia and Qatar close behind.
"The greater degree of optimism we are seeing among consumers, is in line with reports around the globe that the 'green shoots' of recovery are being felt, however people remain cautious about their own spending and this trend may remain for the long-term", said Nassim Ghrayeb, CEO, YouGov.
In terms of respondents' optimism for the future - overall, 44 percent believed that their financial position would be better in a year's time; with just 9 percent saying that it will be worse.
Confidence in the local job market and attitudes towards availability of jobs and salary satisfaction also improved across the Gulf. In this index, Kuwait showed the biggest improvement of 11.1 points, followed by the UAE which moved up 8.1 index points.
"As a direct consequence of the global economic downturn, respondents feel that salary increases haven't kept pace with the cost of living, with 63 percent saying that increases are not in line. However, working professionals across the region have high hopes towards the future with an overwhelming 44 percent firmly believing their financial positions will be better in a year's time", added Zureikat.
"The doom and gloom of the last three quarters has gripped the region, but now, there are signs that the global recession and its effects on the region might finally be starting to ease," said Zureikat.
Data for the May/June 2009 Consumer Confidence Index Survey was collected online from more than 11,000 people from the UAE, Saudi Arabia, Qatar, Oman, Kuwait, Bahrain, Syria, Jordan, Lebanon, Egypt, Morocco, Tunisia, Algeria and Pakistan.For all the latest retail news from the UAE and Gulf countries, follow us on Twitter and Linkedin, like us on Facebook and subscribe to our YouTube page, which is updated daily.
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