By Amy Glass
Foreigners living in Gulf states feeling pinch has rising prices eat into disposable incomes, survey finds.
The Gulf’s rocketing inflation is impacting the lifestyles of expatriates, with research revealing a drop in spending on extras such as eating out and holidays, research released on Tuesday has revealed.Insurance firm Zurich International Life said in a report that the overwhelming majority of expatriates across the Gulf believed the current economic climate was causing them to tighten their purse strings and focus more on saving for the future.
The firm's Expatriate Wealth Monitor report found 85% of expatriates in Qatar, 82% of expats in Bahrain and 65% in the UAE felt rising prices were forcing them to change their financial priorities.
Inflation has hit record highs across the GCC due to rising global commodity prices and the falling value of the US dollar, to which all Gulf states, bar Kuwait, peg their currencies.
Zurich said fewer people were spending their money on their lifestyle compared to 2007, especially in the UAE where 30% fewer people said they were splashing out on eating out and holidays.
The research showed expatriates' priorities had shifted toward saving for their children's education, retirement and to send money home.
Paul Haran, regional director at Zurich Middle East, said continued economic uncertainty worldwide had seen everyone “tighten their belts” and the Gulf region no exception.
“What is interesting is that in a region associated with widespread wealth and booming economic growth, expats are now starting to feel the pinch,” Haran said in a statement.
Despite the impact of rising costs, the majority of expatriates surveyed said they enjoyed a better quality of life in the Gulf then in their home countries.
Just over 70% of expatriates in Bahrain said they had a much better lifestyle in the Gulf, followed by around 68% of expats in the UAE and Qatar.
The Zurich Wealth Monitor surveyed 700 expatriate professionals living in the UAE, Bahrain and Qatar on their approaches to financial planning and examined their views on the impact of the current economic climate on their financial affairs.
In the UAE the respondents were split 49% Asian, 25% Arab and Western 26%; in Bahrain 57% Asian, 30% Arab and 13% Western; and in Qatar 76% Asian, 18% Arab and 6% Western.
Well, I wish that we examine such issues but from the locals perspective! Why don't researchers shed the light on the inflation affect on the localsâ€™ lifestyles? How things are getting really hard for someone to live in his own country? How the basic needs can't be met? How the parents are worried in the mid of the month not having any remaining in their salaries to feed their children? Most of the things in the gulf are expats' driven and that is a shame because if they governments did not think twice of the situation then this inflation will cause a lot, the thing that no one is in favor of. We used to bring expat's to the gulf due to the fact that they have the knowledge and experience, but do we still need that?! We have new generations in the gulf that are well educated and proved to be better than the expatâ€™s in many fields. We have witnessed a lot of examples were the expat comes to learn from us and get the knowledge and experience and go a step higher in another country and so on so forth, and he keeps in mind that he should never teach a local citizen to take his place once he moves, as this is part of the expat game. Not forgetting to mention that with a small calculation on the cost side, the cost of an expat is much higher than the local and what is really required at this time is a big move towards localization. Regards, Bader
I beg to disagree with the comments of Mr.Bader regarding this subject, yes, there may be some locals who are better and well educated than the expats but it all boils down to work ethics,work culture and work attitude. Sorry to say that expats work harder than locals because they know that their status in their host country is only temporary so they need to save as much as they can to secure their future in their home country, whereas, the locals take for granted the many privilleges that their own government provides for them. In Bahrain maybe, the expats are paid higher than the locals but here in the UAE, expats are paid less than the locals even when the expat is highly skilled than the locals. Yes, localization will be a great move here in the GCC as it will take a lot of change in mindset and paradigm shift of its people towards work ethics, work culture and work attitude. Regards, Renz