(MENAFN- Arab Times) The affluent in the UAE are optimistic and confident about local economic fortunes and anticipate household and personal incomes to increase in the coming year, a new study revealed.
The Visa Affluent Study 2013 also shows that the well-off in the UAE are motivated by a need to help others through charitable donations as much as spending on family holidays, dining out and enjoying the finer things in life.
The study, conducted across Asia Pacific and the Middle East, looked at affluent consumers' spending habits, priorities, and optimism about the future and indexed their propensity to spend on discretionary items in the future.
The study found that although having a cautious outlook on the prospects for the global economy, the affluent in the UAE are optimistic and confident about local economic fortunes. They also expect household and personal incomes to increase in the coming year.
A MasterCard Index of Consumer Confidence, released a few months ago, also indicates that consumer confidence in the UAE is steadily rising, with a score of 91.4 as compared to 86.0 in the previous edition of the Index released six months ago.
Consumers in the UAE are extremely optimistic in their overall consumer confidence score, and are positive about all five indicators measured in the index, the MasterCard study said.
The Visa study showed that the UAE ranked fifth among the surveyed countries in terms of individual plans for future discretionary spending with increased spending to be dominated by charity donations and holidays.
"The countries with the most positive outlook on the economy included China, India and Indonesia. Respondents in those countries said that they were planning to spend more on discretionary items over the coming year," according to the study.
While Japan, where they are more pessimistic about economic growth, ranked the lowest in terms of future discretionary spending. Regionally, family holidays, donations to charity and evenings out emerged as the top drivers of future discretionary spend.
In the UAE, the study also showed that credit cards are the most preferred method of payment for most discretionary spending but with cash playing a greater role in making donations. In addition, 50 per cent will shop online using their credit cards every month with the average spending per month reaching Dh2,749.
Important life goals for the affluent in the UAE are also identified as staying healthy and providing for their children's education, while over 90 per cent took an overseas holiday in the last year and plan to travel again in the coming year.
"The Visa Affluent Study shows a strong correlation between the expectation of positive economic performance in the region and the likelihood to spend more on discretionary items. This, of course, is natural, as affluent consumers may expect more disposable income with a stable or growing economy," said Marcello Baricordi, GM for Visa in the UAE and global accounts lead.
"What is perhaps surprising is that most of the affluent agree that one of the most important aspects of wealth is to make sure that they use this position of responsibility to contribute to society. This is shown by the amount donated to good causes and the commitment to increase donations in the future," he said.
"What is also encouraging is that apart from family holidays the bulk of discretionary spending is made within the UAE and therefore helping to boost economic prosperity within the country. There is also clearly a very positive feeling about life from the UAE affluent who believe they have the opportunity to learn new things, enjoy new experiences and share them with loved ones," said Baricordi.
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