Friday, August 1, 2014

Strong Eid Sales Confirm Nielsen's Consumer Confidence Data on Pakistan

Eid and Ramzan sales, making up over 40% of annual revenue of retailers in Pakistan, are estimated to have jumped 10-15% this year, according to early data reported in the news media.

Nielsen, a global provider of data on consumers, reports that Pakistan consumer confidence has held steady at 99 for two consecutive quarters. This compares favorably with consumer confidence figures which declined over the previous quarter in the overall Middle East/Africa region. Among the region, UAE led the way for Middle East/Africa consumer confidence with an index of 109, a decline of five points from first-quarter 2014. Egypt (81) reported a drop of six points compared to the first quarter. South Africa posted the only regional confidence increase, climbing three points to 85, and confidence held steady in Saudi Arabia (102).

Global Consumer Confidence Index Report. Source: Nielsen 

More than half (56%) of Middle East/ Africa respondents in Nielsen consumer surveys viewed their personal finances in a positive light which held steady from the first quarter. In Pakistan, 59 percent of the respondents believed the state of their finances was good or excellent, up from 57 percent in the first quarter of this year.

“Pakistani consumers are generally optimistic as seen by mostly high consumer confidence scores over the last three years. However, a score of 99 in the first as well as the second quarter of this year, is the highest we’ve seen since the second quarter of 2011,” said Mustafa Moosajee, Managing Director, Nielsen Pakistan. “This reflects the overall mood in the country, especially relating to economic conditions. The economy is showing signs of recovery but macro challenges remain.”

Pakistan's Nielsen consumer confidence index of 99 is just below 100, a level that indicates optimism. Countries at or above 100 are: China (111), India (121), Indonesia (124), UAE (114), Philippines (111), Thailand (108), Brazil (106), Switzerland (104),  Saudi Arabia (102), Peru (101), United States (100), Denmark (100) and New Zealand (100).

Consumer spending in Pakistan has increased at a 26 percent average pace the past three years, compared with 7.7 percent for Asia, according to data compiled by Euromonitor International, a consumer research firm. Pakistan's rising middle class consumers  in major cities like Karachi, Lahore and Islamabad are driving sales of international brand name products and services.  Real estate developers and retailers are responding to it by opening new mega shopping malls such as Dolmen in Karachi and Centaurus in Islamabad.

Dolmen City, Clifton, Karachi
Here's a recent video of a CNN report on "British Brand Invasion" from Dolmen Mall in Clifton district of Karachi:

Pakistan has continued to offer much greater upward economic and social mobility to its citizens than neighboring India over the last two decades. Since 1990, Pakistan's middle class had expanded by 36.5% and India's by only 12.8%, according to an ADB report titled "Asia's Emerging Middle Class: Past, Present And Future.


Dolmen Mall Clifton Featured on CNN from DHAToday on Vimeo.

Rising consumer confidence is good but not sufficient to boost economic growth to meet the needs of growing population. What Pakistan requires badly now is significant new investments, both foreign and domestic, to overcome the ongoing energy crisis and rejuvenate the manufacturing sector.

Related Links:

Haq's Musings

Upwardly Mobile Pakistan

Educational Attainment in Pakistan

Foreign Visitors to Pakistan Pleasantly Surprised

Pakistan's Infrastructure and M2 Motorway

India Pakistan Comparison 2011

Resilient Pakistan Defies Doomsayers

FMCG Consumption Boom in Rural Pakistan

Pakistan Visits Open  Indian Eyes


CanadianBoy said...

“Pakistani consumers are generally optimistic as seen by mostly high consumer confidence scores over the last three years. However, a score of 99 in the first as well as the second quarter of this year, is the highest we’ve seen since the second quarter of 2011"

Wait! wait! wait! I thought Pakistan is a failed state? how on earth does a failed state has high consumer confidence.Somebody better ask a Hindu economist,they know everything,apparently.

"Consumer spending in Pakistan has increased at a 26 percent average pace the past three years, compared with 7.7 percent for Asia, according to data compiled by Euromonitor International,"

Whaaaat? a failed state where consumer spending has increased!!!!
Doesn't the spending in failed states collapse and the population is forced to barter with each other for bare necessitates? somebody please verify this with a Hindu economist,they claim to be very smart,hopefully they can explain.

" Real estate developers and retailers are responding to it by opening new mega shopping malls such as Dolmen in Karachi and Centaurus in Islamabad."

Enough Mr. Haq! Enough! In what kind of a universe does mega shopping malls get constructed in failed-states, somebody please consult a Hindu economist, they are very smart with numbers, they can explain.

Hasnain said...

For readers, SBP and IBA Karachi have already been running their own CCI survey for almost 3 years now, the survey is done bi-monthly. They have recently developed a dedicated website for the survey.

Hamid said...

I visited after 10 years and I see development but too many people not doing anything because of no electric power. I think economy is not very good and lot of middle class people borrow money or get money from foreign countries. God willing people will do better.

Umaima said...

but is this consumer confidence only building up in urban areas, or are rural areas experiencing this as well. if not, then Pakistan is going through serious income inequality issues that must be adressed- the disappearance of middle class in rural areas could offset the growth of middle class in urban areas.

Riaz Haq said...

Umaima: "but is this consumer confidence only building up in urban areas, or are rural areas experiencing this as well..."

Away from the violence and the troubles of the big cities, the economy of rural Pakistan is booming. Flush with cash from bumper crops at record commodity prices, the farmers are spending on tractors, cars, motorcycles, mobile phones, personal grooming items, packaged foods and beverages and other consumer products like never before.

Higher crop prices have increased farmers’ incomes in Pakistan by Rs. 342 billion in the 12 months through June, according to a government economic survey. That was higher than the gain of Rs. 329 billion in the preceding eight years, according to a report by Bloomberg News. Companies like Millat tractors, Honda Atlas Motorcycles, Pak Suzuki Motors, Engro Foods, Telnor, Nestle, Colgate-Palmolive, Proctor and Gamble and Unilever have been big beneficiaries of the current rural consumption boom.

Hopewins said...


Put our country into the comparison shown in the paper.

Where do we stand?

Hopewins said...

QUOTE: "A people indulging in ostentation and show-off cannot save; they rather get entangled in debt incurred to fulfill their expensive habits. This frame of mind also leads to gross wastage of resources and indifference to the future.......

.....The Pakistani nation has been distinguishing itself by its ruthlessness, indifference and disregard for the future. If one has the money, one would eat to kill himself; dress himself uncomfortable and tasteless clothes; walk in most weird shoes; travel in vulgarly expensive vehicles. We have gotten into every bad habit that we cannot afford. Palatial homes and gaudy decorations have become our symbols of distinction...."


What have I been telling you? Higher Savings & Investment rates is what Pakistan needs.

What already-very-low-savings-rate Pakistan does NOT need is rising consumption-rates.

If we eat our seed corn this year, we may feel happy for now, but we will starve next year as their will be nothing left to plant or harvest.

It is really that simple.

Riaz Haq said...

International shoe manufacturer and retailer, Clarks, entered Pakistan by launching its first ever store in Karachi on April, 11. The expertly crafted footwear is now available at The Forum mall. The stores are also being opened up in Lahore and Islamabad.

The brand has a unique heritage of almost 200 years in remarkable shoe design. Shoeaholics, both men and women, will get finest retail experience with the brand’s signature collections and styles. Nancy Huang, C&J Clark International President of Asia Pacific, said, “It’s always great to see a new store open, especially when it’s in such a good position within a premium shopping mall. The Pakistan team and our partners have done a magnificent job in setting up the store. We are in great company here; this mall is an impressive shopping destination with a fantastic mix of brand names and customers. We are delighted to be a part of it.”

The brand is also well-known for its celebrity clientele and collaborations with high-fashion designers. It has been successful in becoming the leading shoe company in the UK and a global business in over 100 markets worldwide. With their latest franchise in Pakistan, the brand intends to penetrate the markets and set impeccable shoe-trends.

One of the leading groups in the textile industry, Umer Group of Companies is behind the successful launch of the franchise. The store was inaugurated by the acting Deputy High Commissioner of the British High Commission Gillian Atkinson. The event was followed by a fashion showcase. Sleekly styled, renowned models adorned the latest in-store collection.

Published in The Express Tribune, April 15th, 2015.

Riaz Haq said...

Okra Restaurant in #Karachi Serves Upscale Clientele in Zamzama. #Pakistan #DHA - via @FT

Where 2-C, 10th Zamzama Commercial Lane, Ph-V, DHA
Plug sockets No/WiFi Yes
Espresso Rps245 ($2.30)
Open 12.30-3pm; 7.30-11.30pm; closed Mon
Privacy 3/5
Meeting at Okra café, just off Karachi’s upmarket Zamzama Boulevard, will place your client at ease over security in what is often described as Pakistan’s most violent city, with some 20m inhabitants.

High quality global journalism requires investment. Please share this article with others using the link below, do not cut & paste the article. See our Ts&Cs and Copyright Policy for more detail. Email to buy additional rights.

It is no more than a 15-minute drive from Karachi’s downtown five-star hotels — on a route well removed from areas previously beset by the violence among Karachi’s political rivals.
Okra prides itself on serving a range of European cuisine including vegetarian, chicken, seafood and beef options — offering a break from the world of Pakistani curries.
Although generally in demand by locals, such dishes may not be suitable for clients averse to typical south Asian spicy and greasy food. Many wealthy Pakistanis visit Okra for a change from local cuisine.
The café — named after the vegetable that is known in many English-speaking countries as ladies’ fingers — consists of a ground floor and a top floor. Unlike other, more spacious, upmarket restaurants in Karachi, Okra’s limited capacity of 40 customers often means that guests need to book, while walk-in customers are discouraged.
Ayaz Khan, the owner, is unwilling to expand Okra or set up another branch for fear that the quality may be diluted. “Right now, we offer exclusivity in quality of our food and our service. We don’t want to lose that,” he says.

Riaz Haq said...

#Pakistan’s tallest building ‘Bahria Town Icon’ inaugurated in #Karachi via @sharethis

Pakistan’s tallest building ‘Bahria Town Icon’ was inaugurated with a splendid display of fireworks here on Monday night.

Built by Bahria Town, the sky-scrapper soars 62 floors up in the sky in the Clifton area of the port city.

‘Karachi Icon’ houses residential apartments, a big shopping mall and hundreds of corporate offices.

A large number of people turned up to witness the fireworks that sparkled the sky just above the brilliantly lit tower.

Riaz Haq said...

BBC News - #Pakistan fashion enters #London spotlight with new #EidCollection

Dozens of Pakistani designers have been showcasing their latest trends in a Pakistan Fashion Week event in London.
Hundreds attended the two day event, spending thousands of pounds on the latest trends ahead of the Muslim festival of Eid next month.

Anonymous said...

A study by trade organizations puts the total value of Eid shopping this year at Rs 1000 billion (US $ 10 billion).

This trend coincides with a rise in the prices of clothes, shoes and fashion accessories. The prices have registered a 20 percent increase as compared to the previous year.

Economists attribute these trends to both traditional surge in prices and uptick in economic activity related to industrial, services, infrastructure development, domestic tourism, and growth of modern IT sectors. Only this week, Pakistan has found its way back into the category of emerging economies on the back of expanding GDP, robust performance of Karachi Stock Exchange, foreign remittances inflows, and macroeconomic stability.

Discussions with traders and entrepreneurs reveal that the trends bode well for the country, which has to pull large populations in far-off areas out of poverty.

In addition to conventional shopping like clothes, citizens are also purchasing new furniture and home appliances during the Eid season.

Except for high-end brands and the imported commodities, prices are generally stated to be slightly above last year’s level. But the children’s garments are expensive due to rising demand and traditional profiteering on part of sellers.

Riaz Haq said...

QUARTER 2, 2017

By The Nielsen Co.

In the Africa / Middle East region, countries that posted scores at or above the optimism baseline of 100 include United Arab Emirates (110) and Pakistan (102)

In India, confidence declined seven points to 128. Sentiment declined
for all of the confidence indicators measured. One in eight respondents
(83%) expressed confidence in the state of their personal finances in the
coming year, a decline of two percentage points from the fourth quarter
of 2016. Roughly two thirds of respondents (66%) said it’s a good time
to spend, down three percentage points. Three-quarters (75%) felt
optimistic about the job outlook, down nine percentage points. Despite
weakening consumer sentiment, India held the second highest index in
Asia Pacific, remaining one of the most optimistic markets in the region
and globally.
Meanwhile, among the region’s developed economies, confidence
increased significantly in South Korea (63, up 20 points) and Japan
(87, up 13 points). In Hong Kong (102), Taiwan (79) and Singapore
(89), confidence increased by nine, six and four points, respectively.
New Zealand’s score (103) was flat from the fourth quarter of 2016. In
contrast, confidence in Australia declined two points to a score of 89.

Confidence in the Asia-Pacific region strengthened modestly, rising
three points to 114. Consumer confidence scores ranged from a high
of 130 in the Philippines to a low of 63 in South Korea. Confidence
gains were seen in nine out of 14 measured markets, with the biggest
increase in South Korea (up 20 points), followed by Japan (up 13 points)
and Malaysia (up 10 points). Countries that showed confidence declines
include India (down seven points) and Thailand (down three points).

Riaz Haq said...

As one of the most important occasions in Pakistan, Eid al-Adha generated an estimated revenue of over 1.74 billion U.S. dollars in sacrifices and related economic activities, with the sales of sacrificial animals and decorations witnessing a rise this year.

According to the latest statistics from Pakistan Tanners Association, Eid al-Adha generated estimated economic activity to the tune of 329 billion rupees (1.15 billion U.S. dollars) in 2022 in the country from sacrifices alone, with the amount surpassing 500 billion rupees (1.74 billion dollars) if related economic activities are included.

Talking to Xinhua, Mushtaq Malik, an animal trader at a make-shift animal market in eastern Rawalpindi district, said that a large number of buyers with their families are visiting the market and showing keen interest in sacrificial animals while indulging in hard bargaining and negotiations.

"We raised these animals with love and affection. They (customers) try to choose the best animal to sacrifice on this special occasion. Some affluent people don't care too much about the prices as their focus is to buy the best," Malik said.

He said that the price of each animal depends on age, weight and health, adding that the animal with the right weight and health would be sold at a higher price, and buyers know all about their options before purchasing the animals.

As the hustle and bustle is gradually increasing at cattle markets, some of the buyers seem rather unhappy about the unrealistically high prices of the animals, complaining that the prices have gone up substantially compared to last year.