UAE retailers ‘cautiously optimistic’ as sales first exceed pre-COVID-19 levels
DUBAI: UAE’s retail sector showed signs of recovery in Q3 2021 as shoppers returned to malls or embraced e-commerce to send sales above pandemic levels before COVID-19 for the first time.
Point-of-sale transactions rose 7% in the third quarter of the year, according to a recent report by retail giant Majid Al Futtaim.
The company, which operates major shopping centers in the region, such as the Mall of the Emirates in Dubai, said the change was significant because it was the first time that “consumer spending exceeded levels last seen. in 2019 “.
Alain Bejjani, CEO of MAF Group, said: “Our research shows continued dynamism in consumer sentiment, with new positive indicators pointing to solid growth and momentum in the non-oil sector. “
Despite the COVID-19 health crisis that crippled consumer spending amid wage cuts and job losses, Dubai Economy, a government agency set up to diversify the emirate’s economy, recorded the highest level of consumer confidence in a decade in the third quarter, according to the MAF report. noted.
However, the results of the investigation were compiled before the emergence of the omicron COVID-19 variant, which could delay progress in the last quarter of this year.
According to MAF, footfall to its outlets in the third quarter jumped 18% from the same period a year ago, while online shopping was up 34% from the same quarter.
“The adoption and acceleration of e-commerce and food delivery services is a prime example of how changes in consumer behavior have become a pervasive part of post-pandemic daily life for all of us,” said added Bejjani.
He stressed that the recovery of retailers would depend heavily on innovation “in order to respond effectively to both new preferences and old habits”.
Dubai’s hosting of Expo 2020 helped economic recovery (Shutterstock)
Bejjani noted that many factors led to this “cautious optimism,” including an aggressive vaccination campaign against COVID-19 that allowed the UAE to lift restrictions relatively faster than other countries.
The revival of trade and tourism has also helped retailers, MAF added, and the positive economic outlook could apply to the Gulf neighbors of the United Arab Emirates, citing the Oxford Economics data organization’s projection of growth. of regional gross domestic product, which could reach 5.1% in 2022.
Other factors driving the retail recovery include Dubai’s hosting of Expo 2020, as well as growing real estate transactions in the emirate, whose official figures claim to be the “highest since 2015 “.
Bejjani said: “While there are undoubtedly risks ahead, overall we see a lot of areas on which to draw strength, as the economic recovery continues to gain momentum and our communities grow. ‘adapt to life in a new post-pandemic world. “