UAE ushers in the festive season

Shoppers in the UAE seem to be little affected by talk of an impending economic downturn in Europe and its likely impact on the country and the region.

If residents are thronging shopping malls in preparation for the festive season, then an increasing number of visitors to the Emirates is also contributing to mall revenues. 

The ubiquitous shopping arenas that were less crowded nearly one year back have sprung into action, with retailers and malls reporting an increase in the number of visitors. With Eid round the corner and Christmas approaching, malls are more hopeful about an increase in consumer spending.

Majid Al Futtaim Properties, which runs popular malls such as Deira City Centre and Mall of the Emirates, expects an increase in shoppers due to the upcoming festive season.

“Eid and the festive holidays are a key highlight in the retail calendar for Majid Al Futtaim Properties. We expect to see a positive increase in the level of footfall and sales across our portfolio of malls in the UAE: Deira City Centre, Mall of the Emirates, Mirdif City Centre, Sharjah Centre and Ajman City Centre as residents, families and tourists flock to the malls during this peak gift-giving period. Shopping malls have become a traditional pastime in the UAE and with our diverse offer of leisure and entertainment attractions, cinemas and world-class dining opportunities. We have enjoyed consistent, year-on-year increases in traffic during this festive period,” Peter Walichnowski, CEO Majid Al Futtaim Properties told 'Emirates24|7'.

Landmark Group has registered a 28 per cent growth for the year 2010-11. From annual revenue of $1.1 billion in 2006, the group has garnered a consistent annual growth of 25 per cent every year, in the last five years and hopes to achieve revenue of over $5bn by 2015, underlining the strong retail growth the country has witnessed.

According to Business Monitor International (BMI), Q311 UAE Retail Report, the country’s retail sales are forecasted to grow from an estimated Dh113.87bn ($31.01bn) in 2011 to Dh151.36bn ($41.22bn) by 2015, whereas, AT Kearney’s 2011 Retail Apparel Index found that the UAE had the highest fashion clothing sales per capita per annum in the developing world, at $785.

And it isn’t just the residents who are flocking to the malls. Visitors to the country are also contributing to the increase in mall revenues. According to media reports, Visa reported a 37 per cent increase in spending from overseas visitors at the Dubai Shopping Festival 2011 compared to last year. The total amount spent on internationally-issued Visa cards in the UAE came to just over $406m throughout the duration of the DSF, compared to $297m for the same period last year.

Department stores benefited the most from this increase, recording a 57 per cent growth in spending over 2010, at $13.7m. Retail outlets came out tops in the merchant category, with a total of $133.4m, up 49 per cent from last year. Accommodation (hotels and apartments) reported a 25 per cent increase, at $90.6m; while travel and entertainment also featured highly, with a total spend of just over $29m, up 40 per cent from last year, as quoted in the media.

However, according to a survey released last month by Bayt.com and YouGov, consumer confidence in the UAE recorded a slight dip. The findings stated that UAE residents still have a positive outlook of the country’s economy, as well as their financial future despite moving down the consumer confidence index by 1.3 points. The survey revealed that 62 per cent feel that the current salary is not in line with the cost of living, with 33 per cent stating buying consumer durables is not practical in the present situation.

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