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Lebanon's consumer confidence declines slightly - survey

30 September 2010

BEIRUT: Consumer confidence has dropped in Lebanon, following the rise in consumer confidence felt at the end of last year, according to the latest Consumer Confidence Index (CCI).

The Consumer Confidence Index, a quarterly survey conducted by the region’s number one job site Bayt.com in conjunction with research specialists YouGov Siraj, found that Lebanon, which last quarter saw the largest increase moving up by 7.6 index points, now saw a slight drop of 2.3 points.

The largest drop was recorded from Bahrain which went down 14.8 points. Syria rose in consumer confidence this quarter, moving up the index by 3.4 points. Kuwait saw the largest rise, moving up the index by 6.7 points. In North Africa, consumer confidence in Morocco and Egypt dropped by 1.4 and 2.8 points respectively.

The Consumer Confidence Index (CCI) is a measure of consumer expectations and satisfaction of various elements of the economy including inflation, job opportunities and the cost of living.

As part of the CCI, respondents are asked questions about their personal financial circumstances and how they compare to the same period last year. Overall, 35 percent of the region’s respondents say their financial position is the same as last year and just over a quarter, 27 percent, say it has gotten better. In Lebanon, 22 percent say they are better off than last year, 38 percent say they are in the same position as last year and 32 percent say they are in a worse position than last year.

Among the countries surveyed, 34 percent of respondents in Qatar say they are doing better than last year. However in Jordan, 44 percent of respondents actually feel that their financial position is worse than last year.

“The figures are interesting because there is little correlation between the countries of particular areas of the Middle East, demonstrating clearly how each country’s economy is completely independent. There are also some key changes in the figures since the last wave which perhaps signals traces of the instability that was felt across the Middle East region during the recession,” commented Amer Zureikat,Vice President Sales, Bayt.com .

In addition to financial position, consumer confidence is assessed by asking the respondents about their level of optimism toward the future, which forms the Consumer Expectations Index (CEI).

The countries varied widely in terms of their consumer expectations. Lebanon reported a decrease of 1.4 points.

Kuwait and Syria reported the biggest increase, moving up the index by 5 and 4.9 points respectively. The largest decrease is seen in Bahrain, with a drop of 12.5 index points since the last quarter.

On the whole, respondents expect to be in a better financial position next year. Overall, 48 percent of respondents believe their personal financial position will be better next year. By contrast, just 8 percent of the region’s respondents believe their financial position will be worse. In Lebanon, 51 percent of respondents believe their personal finances will be better a year from now, compared to just 7 percent that believe they will become worse. Most of those optimistic that their personal financial position will be better in a year’s time are respondents in Qatar with 53 percent confirming this statement.

Asked whether they would invest in property, the respondents largely agree that they would not. The trend continues from the previous quarter with a majority of respondents (62 percent) stating they are not interested in making any investment in property. Within Lebanon, 70 percent say they will not be buying any property. Of those wishing to purchase a property, 68 percent say they are likely to opt for a new property.

When asked whether they believe more jobs will be available in a year’s time, respondents are roughly divided: 27 percent say more will be available, 28 percent say the job situation will remain the same and 30 percent say the availability of jobs will be worse. In Lebanon, 21 percent believe the availability of jobs will get better while 28 percent of respondents believe the availability of jobs will become worse.

In terms of salaries and whether they have kept pace with the cost of living, as in the previous wave, the majority feel that they have not kept pace with the cost of living, with 62 percent agreeing that there is a disparity, while just 19 percent agree that they have increased in line with the cost of living, and 5 percent say they have increased more than the cost of living.

“We conduct our quarterly Middle East Consumer Confidence Index Survey in order to chart how consumer confidence levels are changing as the region goes through different economic cycles, and faces the challenges and pressures wrought by economic trends and events across the globe. This seeks to provide all stakeholders, from regional businesses to local organizations and HR professionals with up-to-date information that is both relevant and reliable as a snapshot of current market trends,” concluded Zureikat.

Data for the September 2010 Consumer Confidence Index Survey was collected online between August 22 and September 8, 2010, with 8,528 respondents from the UAE, KSA, Qatar, Oman, Kuwait, Bahrain, Syria, Jordan, Lebanon, Egypt, Morocco, Tunisia, Algeria and Pakistan.

Males and females aged over 18 years old, of all nationalities, were included in the survey. –The Daily Star

© Copyright The Daily Star 2010.