General Index
 
103 
 
Current Economic Situation   Future Economic situation   Current Personal Income   Expected Personal Income   Current Employment opportunity   Purchase of Durable goods
 
97    110    89    106    124    105 
 
 

Consumer Confidence is Quite Stable Despite Geopolitical Pressures

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

Amid the security and political conflict in the occupied Palestinian territories and the level of aggression committed by the Israeli army against civilians, with its repercussions on the region on security, political, and economic aspects, and the resulting concerns and pain in the social conscience.

In these unstable climates, the General Index recorded a ratio of 103 points, losing two points within a month and 14 points on an annual basis.

Going back to the current facts and data, it appears that the Kuwaiti financial and economic trend is currently on the rise. For example:

  1. Oil markets faced periods of instability and price declines in recent months but ultimately achieved tangible increases. The price of an oil barrel reached 95 USD, benefiting from the decrease in U.S. oil reserves and a relative increase in Chinese economic growth level. The current international conditions on all fronts complicate the possibility of arriving at firm forecasts in various markets, especially in the oil and gas markets. Nevertheless, several multi-source forecasts have emerged that the expected oil price by the end of this year will rise to 100 USD per barrel.

  2. Kuwait's foreign investments income jumped to about 5 billion dinars.

  3. The average increase in oil prices reached 50% in the last few months.

  4. Total foreign investments in Kuwait increased to approximately 5 billion USD, an 8.7% increase.

This rise in the volume of investments indicates the extent of the Kuwaiti financial market’s stability.

These are some indicators that contribute to stabilizing consumer confidence levels in Kuwait, while many other countries are experiencing a sharp decline in consumer confidence levels due to monetary inflation, rise in bank’s interest rates, economic contraction, and rising prices.

Within the Kuwaiti internal factors, most of which boost consumer confidence, what is happening in Palestine must be reflected in the souls and convictions of consumers. Citizens granted the General Index a ratio of 108 points, an increase of 7 points compared to September, while the ratio of Arab residents declined by 9 points.

It is noted that the Capital's General Index ratio increased to 103 points, enhancing its previous balance by 13 points, while the ratio of Al-Jahra Governorate decreased by 17 points and Mubarak Al-Kabeer Governorate by 6 points.

Rise in the Capital’s Confidence in the Economic Situations

The respondents awarded the Current Economic Situation Index a ratio of 97 points, an increase of three points within a month. This reflects their satisfaction with the current economic reality, fortified by several factors, including:

  1. Expectations for increase in revenues for the current fiscal year to approximately 23 billion dinars.
  2. The success of the Kuwaiti official policy in defining the quality and size of investments in general and in the oil sector in particular, while giving additional and special importance to the construction, maintenance, and renewal of infrastructure.

These facts, coupled with the development of some economic sectors and non-oil production, indicate the Kuwaiti economy's ability to diversify and generate additional revenue from various sources.

These factors and others increased the ratios of the economic indices in the Capital, whereby The Current Economic Situation Index recorded 107 points, enhancing its previous monthly ratio by 22 points.

Additionally, the Capital component in the survey increased the Expected Economic Situation Index to 118 points, adding and enhancing its previous balance by 28 points. Meanwhile, the ratio for those with below-intermediate education level decreased by 16 points, and for high school degree holders decreased by 8 points within a month.

Also noting a decline in Al-Jahra Governorate ratio by 20 points and in Mubarak Al-Kabeer Governorate by 21 points.

It is natural for some variations to occur in evaluating the Current Economic Situation Index rate due to the diversity of work sectors and professions.

The Expected Economic Situation Index Remains Stable

It is natural that external conditions impact consumers’ confidence in expected economic situations, but the respondents maintained their confidence in this index, recording 110 points, a decrease of one point within a month.

Noting that the losses recorded by the Kuwait Stock Exchange during the first 9 months of this year, amounting to 1.3 billion dinars, affected a certain proportion of the research components. The Capital increased its previous ratio by 28 points. Additionally, high-income groups affirmed their convictions about the expected economic situations, increasing their ratios by 27, 20, and 24 points, respectively.

Logical and Slow Decline in the Two Personal Income Ratios

This ratio has occupied a low position in the past months, whereby the Personal Income Index recorded a ratio of 89 points, a decrease of two points within a month, and lagging behind by 18 points, on an annual basis. Meanwhile, the Expected Personal Income Index stopped at 106 points, losing two points from its previous balance and declining by 7 points, on an annual basis.

Several reasons contribute to this decline in confidence in individual incomes, such as annual monetary inflation, despite being controlled within levels that have not touched 4% in the past period. In addition to the psychological repercussions pressuring the respondents due to the armed Israeli aggression on Palestine.

In these circumstances, it is logical for variations to occur in the assessment of personal incomes among the different components.

The level of Personal Income ratio for those with limited incomes decreased, while it increased in higher-income groups.

Ratios also varied between governorates, with the Capital's ratios rising by 15 points while Hawalli Governorate's ratio decreased by 15 points. This variation stems from various factors, including:

- The social structure and the multiplicity of professions and sectors, whereby the Central Bank of Kuwait’s policy succeeded in reconciling between controlling and preserving inflation levels, and even attracting foreign capital given the importance of the economic activity in Kuwait on the one hand and the guaranteed financial solvency on the other hand. Therefore, this policy was able to protect the purchasing power of the Kuwaiti dinar.

- Price control, especially for foodstuffs, essential goods and services, cannot be totally managed due to external variables such as rise in supply chain costs, insurance expenses, and fuel costs… etc. When prices rise and consequently every family’s budget increases, despite the various support provided by Kuwaiti authorities, consumers feel a decrease in the personal income value.

Citizens' Engagement in the Private Sector Employment

The Current Employment Opportunities Index decreased to 124 points, dropping by 19 points compared to September and decreasing by 40 points on an annual basis.

This decline raises several questions:

  1. What are the reasons for the drop in demand for the job market?
  2. Is there a lack of alignment between academic and professional qualifications and the needs of the market characterized by modernity and technological and scientific advancements?
  3. Is the economic activity going through a period of anticipation of the current regional and international conditions before launching its action plans?
  4. Or has the workforce supply surpassed the current needs of the job market?

These and other questions require field monitoring and a forward-looking vision to develop a system for selecting the type and qualifications of expatriate workers to meet the actual market needs.

Noting citizens' positive inclination to engage in private sector work, and the direction to establish medium and/or small enterprises in various and emerging sectors. There is a noticeable expansion in the range of work for citizens in the private sector, moving to new fields beyond banking and insurance to the tourism and hospitality sectors, and various commercial and self-employed professions.

This positive inclination towards diversifying work and increasing income sources aligns with the government's policy to encourage citizens to work outside the public sector, reducing expenses on one hand and diversifying the economy on the other.

The research findings highlight a sharp decline in the rate of Arab residents who recorded a ratio of 140 points, losing 45 points in a month.

Regional ratios in the governorates also lagged behind between 43 points as the maximum and 15 points as the minimum.

The Purchase Index Ratio Increased by 9 Points

The Purchase of Durable Goods Index increased by 9 points in October, recording a ratio of 105 points, based on the level of demand for consumption. The data confirms that the value of purchases made by citizens and residents using credit cards within six months amounted to one billion dinars.

Kuwaitis' expenditure on tourism during six months reached 2.37 billion dinars, marking a 20% increase.

The value of goods imported into Kuwait during six months reached 5.8 billion dinars, showing a 14% increase compared to the six months of the previous year.

The daily value of purchases by citizens and residents reached 125 million dinars.

The value of purchases by Kuwaitis from abroad increased by 33%.

The consumption and spending activity surpassed the barrier of increase in the prices of some goods, materials, and beverages by 5.58% due to rising transportation costs and increased insurance premiums which doubled in the recent period.

These data confirm the expansion and diversification of consumption areas in Kuwait, serving as a driving force in the development of economic activity in the country.

 

LEXUS ORGANIZED

BREAST CANCER AWARENESS CAMPAIGN

IN ASSIMA MALL

 

The Lexus L-finesse boutique in the Assima Mall recently hosted a medical team from Dar Al Shifa Hospital, as part of a health awareness program about the importance of early detection for breast cancer.

It is worth noting that Lexus is keen to organize such programs to promote the concepts of preventive health among people in general and among women in particular.

As part of this awareness program, Dr. Reem Al-Saif - Diagnostic Radiology Consultant at Dar Al Shifa Hospital provided explanation and health awareness about the importance of early screening for breast cancer to avoid the risks of its development. She stated that one in every 8 women is at risk of contracting breast cancer. The team also conducted preliminary examinations for the visitors who were interested.

A representative at Lexus said “We at Lexus Al Sayer have taken all necessary preventive measures, including tests and diagnosis, with the aim of caring for women in general, so that will reflect positively on their elegance, health, home and community”.

As a gesture of appreciation to the ladies who visited the boutique and listened to the explanation about breast cancer, members of “Lexus L-finesse” boutique team in Assima Mall distributed bouquets of flowers and souvenirs to the attendees.

Lexus, as a luxury Japanese brand, adopts such awareness activities, to reflect the extent of interest in women’s health and their role in society, and the need to commit to providing the support they deserve in accordance with the highest levels of exceptional hospitality within a special and distinguished atmosphere.

 

 

 

 


 
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