Egypt’s consumer confidence remains at 103 in Q3 2012; Nielsen report

Consumer Confidence among Egyptians remained at 103 in Q3 2012, for the second consecutive quarter, Nielsen report revealed.

Global consumer confidence increased one point to 92 in Q3 2012, according to global consumer confidence findings from Nielsen, a leading global provider of information and insights into what consumers watch and buy.

In the latest round of the survey, conducted between August 10 and September 7, 2012, overall confidence rose in 52 percent of global markets[1] measured by Nielsen, compared to a 41 percent increase in the previous quarter. Consumer confidence in Q3 2012 increased in 30 of 58 markets, declined in 19 and remained flat in seven.

“The subdued third quarter results reflect an overall trend that is neither positive nor negative as consumers are treading water very carefully,” said Dr. Venkatesh Bala, chief economist at The Cambridge Group, a part of Nielsen. “Consumers played it safe in Q3, especially in Europe, which still faces a very precarious economic situation despite some recent stabilizing policy initiatives by the European Central Bank. Export growth from China, especially to the Euro zone, has slowed substantially accompanied by restraint among consumers there. Consumers in the U.S., while less directly impacted by Europe, continue to be cautious in the face of an uneven recovery, marked by still-elevated unemployment levels and disappointing payroll growth.”

The Nielsen Global Survey of Consumer Confidence and Spending Intentions, established in 2005, measures consumer confidence, major concerns and spending intentions among more
than 29,000 Internet consumers in 58 countries. Consumer confidence levels above and below a baseline of 100 indicate degrees of optimism and pessimism.

Optimism continues among Egyptians about Job Prospects, & Personal Finances – but this feeling is weakening

Optimism about local job prospects among online consumers in Egypt declined by 2 percentage points to 59% from the previous quarter. Despite the decline Egypt is ranked as the 8th most optimistic country globally in this respect, which is 2 ranks up compared to last quarter. Confidence for the next 12 months in their personal finance security went up one percentage point among Egyptians to reach 64 percent.

The bulk of the Egyptians (80%) still believe that Egypt is in a state of recession – though this declined marginally since the previous quarter.  Despite this, Egypt tops the list of the global top 10 countries to think their country will be out of the economic recession in the coming 12 months. ”This optimism seems to be fading having dipped by 5% since the previous quarter. People would like to believe that the regime change will gradually improve the economic situation – but the slight dip in their optimism in this quarter is a bit worrying – the new regime needs to act quickly and send out positive messages that they are indeed taking concrete steps to improve the economy.” said Ram Mohan Rao, Managing Director Nielsen Egypt.

Worry about Political Stability declines among Egyptians – but concerns about the state of the economy worsens

The concern about Political Stability witnessed a big drop of 16 percentage points in Q3.  However, Egypt continues to be among the top 10 countries most concerned with political stability. For Egyptians, the biggest concern rises to be the economy (31%), which places Egypt in second rank globally after Venezuela with this concern. Job security comes as second concern (27%) Terrorism comes as the fourth main concern with 15% which places Egypt as the second globally after Turkey. The other concerns among Egyptians are about Crime, followed by War. The concern about increasing food prices dropped from 15 percent in Q2 to 10 percent in Q3 2012.

“Having a president and a new government have reduced Egyptians’ concerns about political stability – their concern now is about the economy.  Obviously the government needs to play a key role quickly in sending out the right signals to people that the economy is being nursed back to health” added Ram.

Global Consumers Continued to Cut Back

Seven in 10 global online respondents (69%) changed their spending habits to save on household expenses, an increase of two percentage points from last quarter and three percentage points from a year ago. Half of global respondents (52%) said they spent less on new clothes and cut back on out-of-home entertainment expenses (48%). Other actions taken by global respondents include saving on gas and electricity (47%), switching to cheaper grocery brands (39%) and cutting down on telephone expenses (33%).
Respondents Changed Spending Habits to Save Money

As the global trend, 66 percent of Egyptian online consumers said that they changed their spending to save on household expenses with a one percentage point increase than Q2 2012.
Thirty-five percent said they spent less on take-away meals, on new clothes and on telephone expenses. 34 percent cut down spending on out-of-home entertainment and 26 percent reduced spending on holidays while 23 percent decided to delay upgrading technology equipment and 22 percent tried to save on gas and electricity.

Regional Roundup

Nielsen’s survey shows that North America and Europe reported the only quarterly consumer confidence increases, rising three index points to 91 and one point to 74, respectively. Asia-Pacific (100) and Middle East/Africa (98) regions remained flat in Q3 and Latin America decreased two index points to 94.

India (119) and Indonesia (119) reported the highest index scores in Q3 while China’s index score remained stable at 106 and the U.S. increased three points to 90.

The biggest quarterly consumer confidence gains in Q3 were reported in Switzerland (+10), Belgium (+9), Australia (+8), Thailand (+8), Hungary (+7), Norway (+7), United Arab Emirates (+6), Italy (+5) and Canada (+5).

The biggest quarterly consumer confidence declines in Q3 were reported in Hong Kong (-15), Argentina (-11), South Korea (-10), Vietnam (-8), Colombia (-8), Israel (-7), Venezuela, (-7), Malaysia (-6) and Finland (-5).

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