UAE Reports Biggest Consumer Confidence Decline in Six Years

UAE Reports Biggest Consumer Confidence Decline in Six Years

Consumer confidence in the United Arab Emirates (UAE) had the highest index of five countries measured by Nielsen in Middle East/Africa region (108), but the country’s confidence decreased seven points from the first quarter—the biggest quarterly decline in six years. Confidence also declined in Egypt by five points to 85 and in Saudi Arabia by two points to 105. Confidence levels in Pakistan (102) and South Africa (87) were unchanged from the first quarter.

“In the United Arab Emirates, job security concerns are amplifying as lower oil prices can fuel expectations of government spending cuts,” said Arslan Ashraf, managing director, Nielsen Arabian Peninsula. “Additionally, two key sectors of the economy—real estate and tourism—are showing signs of softening. As such, consumers are saving more and spending less, intending to pull back spending on new clothes, out-of-home entertainment and home improvements expenses.”

Regionally, while sentiment about job prospects edged up one percentage point to 45%, personal finances sentiment declined two percentage points to 58%, and immediate spending intentions declined three percentage points to 36% from the first quarter. Recessionary sentiment increased in four of five Middle East/Africa markets: Egypt and South Africa each increased three percentage points to 82% and 73%, respectively, and Saudi Arabia and the United Arab Emirates increased two percentage points to 45% and 41%, respectively. The lone quarterly relief was found in Pakistan, where 71% of those surveyed felt that their country was currently in an economic recession, three points lower than the previous quarter.

Quarter-on-quarter discretionary spending and saving intentions changed marginally in the region across most lifestyle categories. Intentions to save declined two percentage points to 37%, but plans to invest increased two percentage points to 12%. Paying debts was the priority for 22% of respondents, an increase of three percentage points, and spending on new clothes (27%) and holidays/vacations (19%) increased one percentage point each from the first quarter.

Other findings include:

  • Recessionary sentiment improved in 31 of 60 measured markets from the first quarter.
  • European consumer confidence increased two points to an index score of 97.
  • Worries about the economy, job security and health issues are top global concerns.
  • A closer look at country-level insights within global regions.
  • Confidence in North America remained optimistic at an index score of 101.

For more detail and insight, download Nielsen’s Q2 2015 Global Consumer Confidence Report. For a historical look at global consumer confidence by region, country and time period, explore the Nielsen Global Consumer Confidence Trend Tracker. If you would like more detailed country-level data, it is available for sale in the new Consumer Insights section of the Nielsen Store.

About the Nielsen Global Survey

The Nielsen Global Survey of Consumer Confidence and Spending Intentions was conducted May 11-29, 2015, and polled more than 30,000 online consumers in 60 countries throughout Asia-Pacific, Europe, Latin America, the Middle East/Africa and North America. The sample has quotas based on age and sex for each country based on its Internet users and is weighted to be representative of Internet consumers. It has a margin of error of ±0.6%. This Nielsen survey is based only on the behavior of respondents with online access. Internet penetration rates vary by country. Nielsen uses a minimum reporting standard of 60% Internet penetration or an online population of 10 million for survey inclusion. The China Consumer Confidence Index is compiled from a separate mixed methodology survey among 3,500 respondents in China. The sub-Saharan African countries in this study are compiled from a separate mobile methodology survey among 1,600 respondents in Ghana, Kenya and Nigeria. The Nielsen Global Survey, which includes the Global Consumer Confidence Index, was established in 2005.