MANAMA: With American Express Middle East survey shows a little slowdown in consumer spending but overall the new economic realities are impacting the spending trends in the oil rich Gulf nations.
Findings from a survey commissioned by American Express Middle East across five GCC countries showed little slowdown in consumer spending in Bahrain in 2015, despite economic uncertainties in the region.
In Bahrain, nearly two thirds of respondents (61%) indicated they had spent the same or more than planned in 2015, according to the American Express Middle East Spending Survey which was conducted by GfK and involved high income households in the UAE, Oman, Bahrain, Qatar and Kuwait. However, there was a noticeable shift in spending habits with many focusing more on the necessities of life. 68% said they spent more on transport while 62% allocated more to eating and drinking at home, and 55% spent less on dining out.
These shifting patterns also impacted the amount respondents contributed towards their savings and pensions with 43% cutting back in this area, and a further 68% indicated they spent more on rent.
“Despite the economic headwinds across the region, our research shows little slowdown in the volume of spending but we have seen a significant switch in how people are spending their disposable income,” said Mazin Khoury, Chief Executive Officer, American Express Middle East. “It is evident that people are spending more cautiously and are focusing on essentials,” he continued.
The story is also broadly similar across all five countries surveyed. In Kuwait, for example, 81% spent more on rent and 56% spent less on socialising and going out – a clear shift in spending habits. Similarly, in Oman 88% spent more on food and drinks for home consumption, while 56% cut back on savings.
Despite the shift in everyday spending, Bahraini residents still have room for luxury spending with around 6% – equivalent to around $730 – of monthly household income spent on the good things in life. This is less than the regional average of around 9% or $2,000, and some way behind Qatar, the region’s highest spenders, where the monthly average spend on luxury is more than $4,000.
As with a previous survey carried out in 2014, holidays rank as the number one category for luxury spending in Bahrain. For nearly a quarter of residents (23%), this is the priority area in 2016 with a further fifth (19%) planning to spend their money on fine dining.
“American Express has been in the Middle East for over 50 years and throughout this time we have helped our Card members manage their finances through the ups and downs of economic change. Whether they use their cards to pay for their weekly shopping or a holiday, they have confidence knowing that our organisation is behind them providing them with world class benefits, customer service and security,” Mr Khoury added.
