MasterCard survey: UAE only country in survey to demonstrate increased consumer confidence

The Index revealed that consumer confidence in the United Arab Emirates (UAE) has increased and going strong at 85.4, the only country among those surveyed to have an increase in consumer confidence.

Overall consumer confidence across the Middle East & Levant (ME&L) has slightly decreased, likely influenced by the global economic slow down, sub prime crisis, increasing oil prices and rising inflation.

Commissioned by MasterCard Worldwide and conducted bi-annually in select markets in SAMEA, the survey analyses consumers' perceptions of economic conditions over the six months ahead.

The scores, ranging from 0 to 100, are based on responses on five variables: employment, economy, regular income, stock market and quality of life. A score of 50 represents the mid-point.

A score above 50 indicates that consumers are optimistic about the economic climate, while a score below 50 signals that consumer are pessimistic about the economic situation.

The markets surveyed are the UAE, Egypt, Kuwait, Lebanon, Qatar, Saudi Arabia, India and South Africa.

The current UAE Index score of 85.4 out of a possible score of 100 increased from 78.5 six months ago.

Indications for the UAE are that consumer sentiment is overall positive and optimistic.

In the latest survey, the Index reveals that this market has picked up from and can be compared to the confidence level from a year ago (88.8).

Scores for most of the key indicators increased with a significant improvement in consumer sentiments on Regular Income at 90.7, an increase of 20.4 points from 70.3 in the first half of 2008.

Sentiment on Employment sharply increased to 95.8 as compared to 85.6 in the first half of 2008, as well as Quality of Life with an Index score of 85.3 as compared to 75.9 in the first half of 2008.

Sentiment on Stock Market has declined from 73.4 in the first half of 2008 to 65.2 in the current survey.

In the Middle East and Levant (ME&L), the UAE ranked third in consumer confidence with Kuwait (89.4) and Qatar (88.6) currently ranked in first and second position.

On a market basis, the UAE sees an increase in confidence with an Index score of 85.4 vs. 78.5 six months ago. Consumers in Kuwait remain highly optimistic but a little less so than six month ago (89.4 vs. 93.3).

However, it still tops the list with the highest consumer confidence. Qatar, which was surveyed for the first time, comes second with an Index score of 88.6.

India (82.1 vs. 86.6 six months ago) ranks fourth, followed by Saudi Arabia (80.1 vs. 92.2 six months ago), South Africa (74.3 vs. 83.7 six months ago), Egypt (32.3 vs. 65.9 six months ago) and Lebanon (32.0 vs. 38.7 a period ago).

Denzil Lawson, General Manager, Middle East and Levant, MasterCard Worldwide said, 'We are pleased to announce the MasterCard Worldwide Index of Consumer Confidence for the second half of 2008. The results indicate that consumer confidence across the Gulf States is still going strong despite an overall decrease in this survey. With the addition of Qatar to this survey, MasterCard continues its commitment to be a source of knowledge for its customers, associates, and merchants as they grow their businesses across the region.'

He continued 'The Index of Consumer Confidence is a credible, tried and tested barometer for historical consumer sentiment trends and analysis. When leveraged as a barometer of consumer sentiment, the Index provides valuable understanding in shifts in consumer sentiments, as well as the identification of market trends over time. With the survey being one of the region's most comprehensive assessments of consumer sentiment, we are confident that the results will continue to deliver comprehensive information that will help both the private and public sectors in their decision making and strategic planning.'

The overall confidence across ME&L decreased from 73.6 in the first half of 2008 to 66.4 in the current survey.

Since this MasterCard knowledge leadership initiative was introduced in 2004, overall consumer confidence in ME&L has increased steadily from the first score of 66.1 (2004) and its current historical average of 77.2.

The SAMEA Region as a group of markets (70.6) remains fairly optimistic about the next months even though the consumer sentiments are slightly weaker than a period ago (78.4), a year ago (79.3) and its Historical Average (76.4).

SAMEA consumers are now less optimistic than a period and a year ago on Employment (73.0 vs. 82.8 six months ago), Economy (71.4 vs. 82.6), Regular Income (77.6 vs. 81.7) and Stock Market (61.8 vs. 78.0).

They maybe slightly more upbeat on Quality of Life (69.3 vs. 66.7) but they are less positive than they were a year ago (75.3).

They are also less exuberant about the Stock Market, Regular Income and Economy than they had generally been in the past.