The second-largest economy in the GCC according to population size appears to not be impacted by the emergence of the new COVID-19 variant, sustaining a steady improvement in consumer confidence – from 75.8% in October to 78.2% in November. This substantial rise of 2.4% follows September’s figure of 74.6% and places the UAE above the pre-pandemic net positivity and consumer confidence level of 75.5%, which translates to a robust economy with overall positive sentiment towards all of the items covered in our survey.
UNITED ARAB EMIRATES – BUSINESS
Business confidence currently sits at a series high of 77.1% – the uppermost rating in the history of the consumer sentiment index. Net positivity is up 3.1% from 74% October, at a level that has nearly breached the 74.3% recorded prior to the pandemic. The figure is complemented by robust business sector confidence. Although our survey includes the one-week period that saw the new COVID-19 variant first discovered and announced in the global media, there has not been a substantial increase in negativity – certainly not one comparable to what accompanied the arrival of the Delta variant. As we permit ourselves to be cautiously bullish at the moment, only time will determine the impact on travel across the GCC in December.
UNITED ARAB EMIRATES – ECONOMY
Turning our attention to the confidence index for the economy as a whole, November’s reading stands at a net positive of 61.7% – a substantial increase from 59.9% in October. Over the past six months, nominal surges of between 0.1 and 0.4% make the most recent 1.8% significant indeed, especially in light of the vastly divergent pre-pandemic values displayed by the same index. It should be emphasised that legal, fiscal, and business reforms implemented by the UAE government are largely responsible for this considerable improvement in economic confidence. Business activity has thrived, a reflection of the UAE government policies initiated to offset the effects of the pandemic. Confidence is also buoyed by the higher oil prices experienced during this period of time.
The trend in employment confidence was essentially flat, but still demonstrates a net positive at 87.6% despite remaining slightly off the pre-pandemic high of 89.5% in February 2020. The rating nonetheless provides confidence that a notable portion of the economy is assured by their employment prospects going forward – a sentiment echoed by increases in discretionary spending.
In all, the outlook for the UAE economy is optimistic, with resilient gains in November and the consumer sentiment exhibiting net positivity across all measures. While the new COVID-19 variant is yet to make an impression on sentiment readings, the UAE appears to be generally upbeat about its chances in this regard.
