Consumer spending in the UAE was up 19 per cent last year compared to 2021, says Majid Al Futtaim.
The data was revealed on Friday in its ‘State of the UAE Retail Economy’ Q4 report.
There was a 13 per cent increase in spending across the retail sector for 2022.
Fashion grew by 25 per cent, hypermarkets and supermarkets by 11 per cent and general retail by nine per cent.
“This increase was driven by the rise in international visitors to the UAE, which more than doubled to 14 million in 2022, bolstered by major events including in the Fifa World Cup in neighbouring Qatar,” the report said.
Last year, people became more cautious with their spending, opting for discounts and deals for essential items and cut back on non-essentials such as electronics.
The average spend per transaction in hypermarkets and supermarkets was down three per cent.
Overall spending in the segment was up 11 per cent in 2021, showing movement towards smaller basket value and more frequent transaction.
Weekend retail sales increased by 11.3 per cent in 2022 compared to the previous year, thanks to the UAE’s two-and-a-half-day weekend which came into force at the beginning of the year.
This translated to additional spending of approximately AED5.5 billion, according to Majid Al Futtaim Point of Sales data.
The UAE has the world’s fastest-growing e-commerce market, with sales forecast to reach $9.2 billion by 2026.
Spending in this area peaked in Q4 2022 and grew by 20 per cent for the full year compared to 2021, with three quarters of consumers saying that digital payment methods are the preferred option, according to POS data.
Fintech solutions such as buy-now-pay-later gained pace, with 45 per cent of consumers using BNPL financing in the past year, up from 21 per cent from the previous year.
A majority of online spending by residents was in the hypermarket and supermarket sector, which witnessed spending growth of 40 per cent.
Ahmed Galal Ismail, chief executive officer at Majid Al Futtaim Holding, said: “The UAE’s unwavering ability to triumph in times of economic adversity has led to the highest annual GDP growth since 2006. Majid Al Futtaim’s latest State of the UAE Economy Report highlights the strength and resilience that underpins the country’s position as a beacon of social and economic prosperity for the Mena region.
Driven by its leaders’ clear vision, progressive policies and a steadfast commitment to the long-term success of the nation’s people, the United Arab Emirates is well-placed to continue to deliver sustained growth for the long-term.”