While the Global Consumer Confidence Index dropped three points in the third quarter, UAE has maintained its ranking as the 10th most optimistic nation according to the latest Nielsen Research released today. The UAE's Consumer Confidence Index has remained steady at 101 points in the third quarter of 2010.
Nielsen's Global Consumer Confidence Index tracks consumer confidence, major concerns and spending intentions among approximately 26,000 Internet users in 53 countries throughout Asia Pacific, Europe, Latin America, the Middle East and North America.
Globally, following an upbeat start to the year with two consecutive quarters of increases in optimism, global consumer confidence fell three points in September to 90 points as consumers' hopes for a full economic recovery this year faded in most parts of the world. Consumer confidence declined in 20 of 53 global markets in the third quarter, mainly in countries in North America and Europe.
Consumer Confidence Index levels above and below a baseline of 100 indicate degrees of optimism and pessimism. The 90 Index mark reflects the reality that consumers around the world remain largely pessimistic about job prospects, personal finances and their ability to buy the things they want and need over the next year.
Regionally, Middle East and Africa was the second most confident region after Asia reporting an Index of 97 points, which is an 8 point rise from the last quarter. Saudi Arabia witnessed a significant increase of 7 points in its Consumer Confidence Index, making it the 3rd most optimistic nation globally.
Consumers in Saudi Arabia are more positive this quarter about the state of their personal finances (67 percent) and job prospects (62 percent) compared to other countries globally.
"It is a positive sign that Middle Eastern countries (UAE and Saudi Arabia) rank amongst the top 10 most optimistic nations." said Himanshu Vashishtha, Regional Managing Director, Middle East, Pakistan, The Nielsen Company. "There is a broad realization that the road to full economic recovery is going to take longer than expected and that consumers need to remain cautious about their spending habits and job security."
In the UAE, three quarters of consumers continue to perceive the country to be in a recession. The 3rd quarter of 2010 saw a decline in the number of consumers who see hope of a recovery soon, with only 28 percent of those surveyed in the UAE believing the recession will be over in next 12 months. The survey revealed that about 76 percent of the nation's consumers have changed their spending habits to save on household expenses, even though 61 percent of consumers surveyed said that their state of personal finance was 'excellent' or 'good' for the next 12 months.
"In the UAE, consumers are still focused on repairing their household balance sheets with 50 percent allotting any remaining income to savings and paying off debt (35 percent), while focusing on reducing purchases of new clothes and entertainment expenses," explained Sevil Ermin, Managing Director, UAE, The Nielsen Company. "Consumers are taking a step forward and are now ready to put their money in investments and look at retirement schemes," she added.
Job security still remains a main concern in UAE with 29 percent of consumers citing job security as a top concern, but this number has decreased since the previous quarter when it stood at 31 percent. More than half (54 percent) of consumers believe that the job prospects in UAE over the next 12 months will be 'excellent' or 'good.'
India (129 index points) and Thailand (117) were the most optimistic nations in the third quarter of 2010. Meanwhile, Portugal (44) and Japan (52) were the most pessimistic nations.