Gulf retail on the rise
The GCC retail sector is poised for growth, bolstered by young, eager consumers and the influx of foreign brands.
May 11, 2010 8:14 by Katherine Azmeh
A robust retail sector lends vigor to related industries, and the GCC construction sector is on the receiving end of rising sentiment in retail. Currently, mall projects comprising an estimated 6 million square meters of gross leasable area are in progress, according Alpen’s report. Additionally, foreign retailers are looking to the region to capitalize on the strong industry potential and to expand their markets.
The youthful and growing population in the GCC is steering the course for business in a number of sectors. Combined with rising per-capita expenditures in the Gulf, the changing regional demographics are expected to be a strong determinant of industry trends and momentum. Non residents will impact retail sales as the tourism industry continues to develop. Analysts expect retail industry growth to be enhanced by spending from tourists and transiting travelers.
Commercial initiatives like festivals and events are expected to boost the profile of the retail industry, and highlight newcomers to the sector. The continued movement of foreign retailers into the GCC should augment the sophistication factor and overall buzz surrounding up and coming retail in the GCC.
More legislative and regulatory oversight will also provide a boost to consumer confidence. New regulatory efforts by UAE’s Ministry of Economy announced last week aim to crack down on fake goods, while bolstering consumer protections. These efforts to protect intellectual property and consumers, while suppressing commercial fraud in transactions, are expected to lift the profile of the retailing environment in the GCC.
Retailers have the headwind behind them, with growing ranks of young, eager-to-spend consumers. Strong regulatory oversight, promising tourism potential, and ranks of interested international retailers will all add freshness and support to the sector.
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