Long-term outlook for Middle East retail sector remains strong driven by high GDP per capita and infrastructure projects, a report said.

Following a year that saw oil prices drop, the region has remained an attractive destination for retailers, added the Global Retail Development Index (GRDI) released today (June 2) by A T Kearney, a global management consulting firm.

The report places six Middle Eastern countries -- Qatar, UAE, Saudi Arabia, Jordan, Oman, and Kuwait -- in the top 30 most-attractive markets for development opportunities in retail.

Martin Fabel, partner and global head of the Strategy Practice, A.T. Kearney Middle East, said: “Despite the record drop in oil prices, our work with consumer industries and retail clients show that retail sales growth is expected to continue. Indeed, the retail space pipeline remains strong, with several major projects under way in Qatar, the UAE, and Oman.”

Qatar makes an impressive GRDI debut, in fourth place, highest in the Middle East behind a stable economy, high GDP per capita, high levels of retail spending, and increased retail space. With population growth and an increasing number of expats, Qatar is no longer a market to ignore. The country’s economic strength also lies in infrastructure projects that will benefit the economy in the long term, such as the airport expansion and the construction of Doha Metro.

Shamail Siddiqi, principal of the Consumer and Retail Practice, A.T. Kearney Middle East, stated: “The Middle East has once again demonstrated its strength as a region of opportunity for the retail sector. It’s clear that strategies implemented by each country has allowed it to flourish. The demographics and mega-projects make this is a very exciting time for retailers in the region to develop long-term success in the Middle East.”

The 2015 GRDI includes a special feature on the prospects for luxury goods in developing markets. “Luxury remains a relatively bright spot in emerging markets, as the wealthy have proven less vulnerable to economic woes than the general population,” asserted Fabel.
 
The feature includes an analysis of the 15 leading luxury brands and their presence in the GRDI’s top 30 countries. The analysis shows that emerging markets fall into three tiers of luxury development, with different implications for brands looking to enter or expand in these markets.

Overall, the region represents an established luxury market, with four out of the six countries hosting 13 or more top 15 brands. There are opportunities for luxury retailers in the region to ensure they fully serve the regional luxury demand. – TradeArabia News Service