MasterCard survey reveals consumer confidence in Qatar remains optimistic

While confidence is slightly lower compared to the last reporting period of 2H 2008, overall results show that consumers in Qatar are still optimistic about Regular Income, the Economy and Quality of Life in the six months ahead. In line with the latest Index, MasterCard has also launched the inaugural MasterCard Worldwide Index of Consumer Purchasing Priorities.

The MasterCard Worldwide Index of Consumer Confidence and MasterCard Worldwide Index of Consumer Purchasing Priorities are based on consumer surveys conducted by MasterCard across seven markets in the Middle East and Africa. A total of 3,200 consumers were surveyed between 14 October and 11 November 2008. Data collection was via personal, telephone and Computer Aided Telephone interviews, with the questionnaire translated to the local language wherever appropriate and necessary. The Index and its accompanying reports do not represent MasterCard financial performance.

The MasterCard Worldwide Index of Consumer Confidence, now in its 5th year in the Middle East and released twice a year; provides information on consumer sentiment across the region. The Index is based on a survey which measures consumer confidence on prevailing expectation in the market for the next six months. It is calculated based upon percentage response figures, with zero as the most pessimistic, 100 as most optimistic and 50 as neutral.

In Qatar, consumers remain rather optimistic [76.2] about the next six months; however less so than they were in the preceding period [88.6]. The drop in consumer confidence is reflected most sharply in the area of Employment which is 78.4 vs 98.8 a period ago. Confidence in the Stock Market (49.7 vs 63.0 a period ago) and Quality of Life (76.3 vs 94 a period ago) both decreased with consumers. Less impacted are indicators of Economy (86.3 vs 91.7 a period ago) and Regular Income (90.2 vs 94.5 a period ago).

The new MasterCard Worldwide Index of Consumer Purchasing Priorities, which will be also released twice a year, provides valuable insights into consumers' savings and expenditure behavior and their discretionary spending priorities for the six months ahead.

Raghu Malhotra, Area Business Head - Middle East (Gulf Countries), MasterCard Worldwide, said:

"In Qatar, consumers remain rather optimistic about the future, which is fairly significant given the economic challenges of today. For purchasing priorities, it is interesting that in Qatar children's education, fashion and accessories, dining and entertainment emerged as some of the most important priorities for consumers."

"The Qatari business community should see opportunities in these results as consumers are optimistic and plan to maintain their level of spending. For us at MasterCard, we are very pleased to continue conducting these Index surveys as they are integral assets in MasterCard's efforts to provide knowledge for our customers, associates, and merchants as they grow their businesses," Malhotra added.

In support of the MasterCard Worldwide Index of Consumer Confidence and MasterCard Worldwide Index of Consumer Purchasing Priorities, a team of MasterCard executives briefed Qatari customers on the survey results. The MasterCard team included Raghu Malhotra, Area Business Head - Middle East (Gulf Countries), MasterCard Worldwide, Mohamed Manzoor, Associate Vice President - Qatar & Oman, MasterCard Worldwide and Karen Hargreaves, vice president marketing, MasterCard Worldwide.

MasterCard Worldwide Index of Consumer Confidence:

The Index is calculated based upon percentage response figures, with zero as the most pessimistic, 100 as most optimistic and 50 as neutral. Five economic factors are measured: Employment, the Economy, Regular Income, Stock Market and Quality of Life.

Amidst the global financial and stock market turbulence of the past six months, consumer confidence in the Middle East continues to be fairly optimistic. The Index in the Middle East, which currently stands at 72.7 shows that consumers have in fact become a little more optimistic than period ago (66.4) and slightly less so from the optimism of year ago (73.7) and the Middle East historical average (76.0).

• Consumer confidence in Saudi Arabia [72.4], Qatar [76.2] and the United Arab Emirates (UAE) (75.4) remains fairly to very optimistic. However, current consumer sentiments are lower than a period ago and, in the case of Qatar and the UAE, lower than the markets' historical average. The overall decline in the Index in Qatar and Saudi Arabia is due largely to erosion of confidence in the stock market, which as it stands now, is slightly pessimistic; while United Arab Emirates sees a sharp decline in Employment sentiments.
• Lebanon [69.1] and Egypt [55.6] have both moved from their rather pessimistic outlook from the previous Index to an optimistic position in the case of the former and a slightly optimistic one in the case of the latter, which was actually boosted by the surge of consumer confidence in Alexandria (72.8 vs 35.6 a period ago]. In Cairo consumer sentiments have improved significantly (47.3 vs 30.9 a period ago), though consumers still remain cautiously pessimistic.
• Kuwait [96.6] hits a high with its current Index of 96.6 Its score has increased from a period ago 89.4, a year ago 93.3, and is more than the market's historical average of 92.1.

MasterCard Worldwide Index of Consumer Purchasing Priorities:

• Currently a majority of consumers in the Middle East, as well as in Qatar, are spending between 41 - 60% of their total annual household income on household expenses.
• A majority of consumers in the Middle East do not believe their expectations on the increase in inflation will affect their spending. The same sentiment is also felt in Qatar with a majority of consumers not planning on cutting back their expenses.
• Across the Middle East, a majority of consumers are expecting to spend on their children's education and dining & entertainment in the next 12 months ahead. In Qatar, consumers seem to be most focused on their children's education, fashion & accessories and dining & entertainment.
• More than half of the respondents in the Middle East believe that saving is very important, with a majority of consumers planning to save between 11-20% of their total income in the next 12 months. In Qatar, saving is also a top priority with 64.8% of the respondents deeming it very important and 85.6% of the respondents planning to save up to 30% of their income in the coming 12 months.
• Over the 12 months ahead, both males and females across the Middle East equally expect to save between 11 - 20 % of their total income. This trend also holds true for Qatar.