General Index
 
104 
 
Current Economic Situation   Future Economic situation   Current Personal Income   Expected Personal Income   Current Employment opportunity   Purchase of Durable goods
 
99    107    96    106    122     105 
 
 

The Central Banks’ Interest Cap has Become a Dilemma

ARA Research & Consultancy has released its Consumer Confidence Index in Kuwait for February 2023, in collaboration with Arab Times Newspaper and under the sponsorship of Lexus.

The General Index registered a ratio of 104 points, boosting its monthly balance by 2 points, while dropping by 10 points on annual basis.

The annual decline of the General Index embodies the most important basic intersections at the levels of global security, economy and finance, raising difficulties for specialized international agencies and institutions in determining the global economic path. The markets activity has started while expectations are subject to ongoing change. As an example, the path of oil prices and its derivatives and the factors that determine prices. As prices have become subject to very complex political and economic factors, price expectations fell short. Thus, the law of supply and demand is no longer the only scientific measure for the oil market activity, but rather several factors, revenues and policies contribute in determining the prices.

The issue of high interest levels on deposits gradually emerged in most central banks in the world, with the aim of confronting the high level of monetary inflation and rising prices. This led to an additional increase in the cost of production and another increase based on the sharp rise in the levels of bank interest rates, especially in developing countries. On the other hand, reciprocal political sanctions added building of barriers in the face of world trade activity and supply chains.

These daily variables revealed and led to the existence and spread of divergent opinions and convictions, which led to ambiguity in determining current and future consumers' convictions.

Noting that the Consumer Confidence research in Kuwait, conducted by ARA Research & Consultancy at annual and monthly levels, proved the extent of Kuwait’s consumers’ confidence in the security and political stability, financial solvency, and the development and strengthening of economic infrastructure in Kuwait.

Within this atmosphere, the governorates registered:

Mubarak Al-Kabeer Governorate lost 11 points from its monthly balance, and it is noteworthy that the Capital's ratio decreased by 7 points, while the ratios of the remaining four governorates increased between 3 and 8 points. Also to note the decline in the ratio of the working group with intermediate level of education and below, whereby its General Index ratio declined by 30 points, registering the highest levels of decline.

The ratio of citizens has stabilized at its previous monthly level, while among Arab residents it has increased by 6 points.

 

Increase of Consumer Confidence in the Current Economic Situation

The Current Economic Situation Index registered 99 points, adding 4 points to its previous monthly balance. Noting the decline of 5 consumer index ratios in the Capital: The Current Economic Situation Index decreased by 8 points, the Expected Economic Situation Index by 21 points, the Current Personal Income Index by 11 points, and the General Index by 7 points. This decline requires more scrutiny and research due to the importance of the Capital's executive, economic and financial role.

On the other hand, this ratio increased in the other governorates between 2 and 8 points.

It seems that the economic and financial conditions in Kuwait are favorable in terms of investment in production and infrastructure. Adding to that overcoming the prolonged budget deficit, as well as the relative stability of oil prices and expectations of increased demand for oil during 2023, to exceed the oil demand volume at the beginning of 2019, before the spread of the epidemic.

These factors are in addition to limiting monetary inflation in Kuwait not to exceed 4% and the monitoring by the Ministry of Commerce and those concerned with consumer affairs in terms of price control and holding accountable for non-compliance.

In addition to the relative retention of the national currency’s purchasing power.

Within these climates, the Expected Economic Situation Index registered 107 points, adding 3 points to its previous balance and lagging 3 points on an annual basis.

 

Discrepancy between the two Personal Income Index Ratios

The Current Personal Income Index registered 96 points, dropping by 3 points from its previous balance and lagging 18 points on an annual basis.

While the Expected Personal Income Index registered 106 points, raising its monthly balance by 4 points. Thus, the ratio of expectations exceeds the current situation with personal income by 10 points.

It should be noted here that expectations are positively influenced by desires and wishes without building on solid reasons.

Noting that a number of facts sometimes put pressure on the extent of the respondent's confidence and satisfaction with the personal income, most notably:

The decrease in the purchasing power of the salary, i.e. the monthly income. Due to the unaccounted rises in several foodstuffs and commodities, despite the government’s subsidies and price monitoring, some doubts might arise about the possibility of further price hikes. Thus, the material facts concerning wages overlap between these realities and the aspirations and desires of the labor force.

 

Positive Ratio for the Current Employment Opportunities Index

The Current Employment Opportunities Index recorded a ratio of 122 points, adding 4 points to its monthly balance, down 33 points compared to February 2022.

These positive results on a monthly basis and negative ones by a high ratio on the basis of the annual comparison, call for a pause to assess and reveal the causes.

The increase in the demand for the workforce by 4 points within a month reflects the positive tendency of the extent to which the Kuwaiti economy has recovered in most of its sectors, albeit at a slow rate due to the challenges it faces.

On the other hand, February 2022 was characterized by overcoming the spread of the Corona epidemic in Kuwait and the gradual return of all sectors that were partially or completely closed. Similarly, the volume of work in all fields has also increased and expanded, and to meet the needs of the market, waves of expatriate workers have returned. Moreover, some urgent needs have emerged for more professionally qualified workers in various economic fields.

This high demand in the labor market raised the index during February 2022 to high levels, while it stabilized during February 2023 to its usual ratios.

Noting that the labor markets in Kuwait and other countries need employees with high professional competencies and labor capable of meeting the needs of the technically and professionally developed market.

As a proof for this:

The oil corporation in Kuwait, the banking sector and many companies seek to secure workers with modern and professional capabilities who are able to deliver the work, when necessary, with priority given to preparing citizens and developing their educational and technical qualifications, to engage in work in various sectors.

 

Kuwait is among the Countries with Lowest Inflation in the World

The Purchase of Durable Goods Index has stabilized at 105 points, adding 2 points to its previous monthly ratio and lagging 9 points on an annual basis.

The comparison of Kuwait's current consumption activity with most other countries confirms, based on consumption criteria, incomes, the level of monetary inflation and other scientific measures, that Kuwait represents one of the countries with the least monetary inflation and stability of the volume of consumption.

According to official research, the average monthly Kuwaiti family expenditures are 3296 dinars, of which an average of 111 dinars is spent on entertainment and sports and 196 dinars on restaurants.

Of course, the volumes of expenditures vary, but the average ratio of expenditure is considered one of the highest in the world.

Nevertheless, there are sometimes divergent convictions and different evaluations among the research components. As an example, the ratio   of this indicator declined among workers with intermediate degree of education and below, as well as among high-school graduates, by 97 and 25 points, respectively.

At the regional level, the ratio of Hawalli governorate declined by 15 points, while the balance of the remaining five governorates boosted by a maximum of 18 points and a minimum of 1 point.

Evaluating the demand for buying in Kuwait in the current circumstances, good preservation of the purchasing value of the dinar, business continuity and government support for the prices of fuel and some goods and foodstuffs, compared to the difficulties faced by most countries of the world, confirms the extent of Kuwait's ability to face the challenges.

 

LEXUS REINVENTS THE LUXURY CROSSOVER

The all-new RX 2023 was unveiled during one of its kind signature events organized by Lexus team exclusively for its elite customers at the flagship Lexus Center Shuwaikh.  

  • Fifth-generation Lexus RX comes with a choice of two electrified powertrains to accelerate the realization of a carbon-neutral society.
  • RX 500h F SPORT Performance grade introduces Lexus’ first-ever turbo Hybrid Electric Vehicle (HEV)

Mohamed Naser Al Sayer & Sons Est Co and Lexus are bringing unparalleled levels of elegance and refinement to the high-end crossover market with the launch of the all-new RX 2023.

According to Mubarak Naser Al Sayer “The frequently asked question is “why Lexus is special?”. Lexus is considered a respected luxurious brand for several reasons; it is known for making high-quality sophisticated cars that tend to retain its value for a long time, not to mention its talented and sophisticated design. Moreover, in accordance to most experts in the industry; if you wish to own a reliable vehicle with full features; then Lexus is your answer”.

Bengt Shultz said “I take this opportunity to thank our valued customers for their loyalty and patiently waiting for their Lexus. We had severe shortages of supply especially LX, and NX. We are working diligently with the manufacturer to ease the pressure. We offer the best service but we intend to become even better.”

The company is on track to achieve a full lineup of electrified vehicles in all categories by 2030 and aims to sell 100% BEVs globally by 2035.

Speaking during the event Bedour Faisal Al Sayer said “Lexus RX has become admired globally, and its design is famous for its exceptional boldness that combines luxury and sporty performance in keeping with a rapidly changing world. I can confidently tell you that Lexus RX is elegant, appealing, smooth, sporty, and embodies the values and attributes adored by ambitious youth who are into luxury.”

Commenting on the launch of the all-new Lexus RX, Koji Sato, President of Lexus International, said: “For the all-new RX, we were determined to keep the Lexus DNA of supreme quality, ride comfort, and refinement and elevate the driving experience to the next level, delivering a unique Lexus driving signature.”

Kei Fujita, Chief Representative of Middle East & Central Asia Representative Office, Toyota Motor Corporation, said: “We are pleased to launch the 2023 Lexus RX as the latest step in our drive to create innovative and amazing experiences for owners and passengers in the Middle East by developing vehicles that offer a highly engaging driving experience.”

Complementing the all-new RX’s distinctive design is a thrilling drive personality imbued by three powertrain options. A newly developed inline 4-cylinder, 2.4-liter turbocharged engine that produces 275 hp and 430 nm of torque ‎is mated to a new 8-speed Direct-Shift automatic transmission (8AT).

The vehicle’s inviting interior provides drivers and passengers with a host of advanced features for a refined cabin experience. These include a new 14-inch touchscreen multimedia system with Apple CarPlay® and Android Auto™ compatibility, a 7-inch color multi-information display (MID), a color head-up display (HUD), a wireless charging system for smartphones, six USB chargers, and one 12 Volt charger. In addition, the 2023 RX offers the Lexus Climate Concierge system with Triple Zone Independent Temperature Controls, which includes rear vents and control panels for the back seats to ensure the cabin temperature is perfectly adjusted for each occupant. The system uses S-Flow control to recognize which seats are occupied and directs cooling performance based on the setting selected, cabin temperature, outside temperature, and the effect of sunlight coming through the windows.

 

 
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