Dubai remains the second most important shopping destination in the world, CBRE report says

Dubai welcomed 59 new retailers in 2016, a third of them specialist retailers for athletic-leisure brands including Under Armor, Jordan, New Balance and GapFit. (Reuters)
Updated 06 July 2017

Dubai remains the second most important shopping destination in the world, CBRE report says

DUBAI: Dubai remained the second most important shopping destination in the world for a sixth consecutive year, just closely behind London, according to CBRE’s latest report on the global retail industry.
In its How Global is the Business of Retail? report, the property consultant said that Dubai now has a presence of 57.3 percent of international retailers, compared with 57 percent in 2016, as against London’s 57.9 percent. The study analyzed the operational networks of global retailers in 51 countries and 166 cities.
The emirate welcomed 59 new international retailers in 2016, a third of them specialist sellers for athletic-leisure brands including Under Armour, Jordan, New Balance and GapFit, attracted by sustained consumer demand from both overseas tourists and residents.
“These fashion-infused sportswear retailers are targeting the young working population of the emirate,” CBRE said.
Elsewhere in the region, Doha jumped six places in the new entrants’ ranking with 58 new brands in 2016, compared with 29 previously, as global retailers positioned themselves in anticipation of the 2022 FIFA World Cup which Qatar estimates will attract at least 1 million visitors.
The 500,000-square meter Mall of Qatar, which opened in late 2016, welcomed 66 percent of the new international retailers, most of them in the food and beverage sector. Major brands that were introduced at the mall include Victoria’s Secret and Abercrombie & Fitch.
CBRE meanwhile cautioned that Dubai’s retail sector is starting to show signs of stress despite a steady rise in the number of prime bricks-and-mortar retailers.

“Sustained economic pressures, the strong US dollar and lower growth in tourism are impacting sales figures,” the consultancy said, adding Dubai’s ballooning retail developments on the pipeline could likely bloat the emirate’s retail vacancy rates.
A JLL study reported that 350,000 square meters of retail space are scheduled for release in Dubai this year, with another 367,000 square meters listed for completion in 2018.
CBRE also took note of the rapid evolution of e-commerce in the region, which is complimenting “bricks-and-mortar stores and aiding the physical shopping experience for consumers”.
A study from Dubai’s Department of Economic Development and Visa reported that 56 per cent of consumers shop frequently online, making a purchase at least once a week at an average basket price of Dh1,479.
“With a dynamic, young population and one of the highest global per capita internet penetration levels, the online spending potential is quickly emerging as one of the highest in the world,” CBRE said.
Amazon this week completed its $650 million (SR2.44 billion) acquisition of Souq.com, a Dubai-based online retailer which accounts for as much as 78 percent of the e-commerce market in the Middle East and North Africa region.
Emaar Malls Group, which operates the world’s largest retail hub, was set to acquire a majority stake in online fashion retailer Namshi after failing to grab a stake at Souq.com earlier this year.
The retail giant Majid Al Futtaim took a significant equity stake in the Dubai-based logistics provider fetchr, while noon.com acquired JadoPado, a local e-commerce platform.
Noon, a $1 billion joint venture backed by Emaar Properties chairman Mohamed Alabbar and Saudi Arabia’s Public Investment Fund, was originally slated to launch in January with 20 million products on its platform but has been pushed back.


Saudi Arabia looks to cut spending in bid to shrink deficit

Updated 4 min 15 sec ago

Saudi Arabia looks to cut spending in bid to shrink deficit

  • Saudi Arabia has issued about SR84 billion in sukuk in the year to date

LONDON: Saudi Arabia plans to reduce spending next year by about 7.5 percent to SR990 billion ($263.9 billion) as it seeks to reduce its deficit. This compares to spending of SR1.07 trillion this year, it said in a preliminary budget statement.

The Kingdom anticipates a budget deficit of about 12 percent this year falling to 5.1 percent next year.

Saudi Arabia released data on Wednesday showing that the economy contracted by about 7 percent in the second quarter as regional economies faced the twin blow of the coronavirus pandemic and continued oil price weakness.

The unemployment rate among Saudis increased to 15.4 percent in the second quarter compared with 11.8 percent in the first quarter of the year.

The challenging headwinds facing regional economies is expected to spur activity across debt markets as countries sell bonds to help fund spending.

Saudi Arabia has already issued about SR84 billion in sukuk in the year to date.

“Over the past three years, the government has developed (from scratch) a well-functioning and increasingly deeper domestic sukuk market that has allowed it to tap into growing domestic and international demand for Shariah-compliant fixed income assets,” Moody’s said in a statement on Wednesday. 

“This, in turn, has helped diversify its funding sources compared with what was available during the oil price shock of 2015-16 and ease liquidity pressures amid a more than doubling of government financing needs this year,” the ratings agency added.