Norconsult Telematics

Jobs, News and Information for Jobseekers in the Gulf

Upload Your CV

Go Back


Personal Wealth Higher in Saudi Arabia as Consumer Confidence Increases in UAE and the Emirates Remain Most Prosperous Nation in Arab World


Middle East : 02 November 2012

Personal Wealth Surges in Saudi Arabia

Saudi Arabia’s level of GDP per capita income surged last year and is expected to surpass existing records this year, driven by robust oil prices and increases in crude production in the largest economy of the Arab world.

The global oil superpower reported per capita income of $16,612 back in 2010. That figure increased to $20,651 the following year and forecasts report that an all time record of almost $22,573 is expected for this year, according to Jadwa Investments of Riyadh.
Although Saudi Arabia’s population is expected to grow by around 2.9 percent, moving from a population of 27.1mn in 2011 to 27.9mn at the end of this year, these per capita income levels are expected to break existing records.

Credit for the increase went to the rise in the kingdom’s nominal GDP, which increased by 12.7 percent and moved from SR 2.16tr last year to SA 2.43tr this year.

Jadwa Investment’s report stated that further GDP increases, after a surge of 28 percent last year, would be driven by increases in oil output and prices by the kingdom.

Estimates put the average price for Saudi Arabian crude at $109 per barrel, a significant rise from $103.5 per barrel reported in 2011. Crude output is also forecasted to soar to a new high, moving from 9.3mn barrels per day last year, to 9.9mn bpd this year.

Jadwa reported that increased prices and output would push earnings from crude exports to a new high this year, reaching about $322bn in nominal prices. According to the report, Riyadh will record $167bn in current account surplus, increasing the budget surplus from SR 291bn last year to SR 348bn this year.

These figures are forecasted to increase foreign assets by almost $80bn, surpassing the $700bn mark by the close of 2012.

Saudi Arabia relies heavily on oil earnings. Lower levels of crude prices pushed the GDP per capita down in years past, hitting $13,503 back in 2005. As prices increased, so did the per capita numbers, moving to $14,806 in 2006 and increasing to $15,523 the following year. By 2008, when crude prices were $95 per barrel, the per capita figure increased to $18,651.

The population of Saudi Arabia continues to grow, moving from 23.4mn in 2005 to 27.9mn last year. Jadwa forecasted a marked increase for 2012, reaching 28.8 million.

Consumer Confidence Higher in the UAE

Consumer confidence surged in the UAE, helping the nation to rank third place as the most optimistic nation in the world, according to Nielsen’s recent Global Consumer Confidence Index. Optimism levels in the UAE moved up six points from the previous quarter’s index.

The UAE scored 114 for this quarter, up from 108 in the previous quarter. Last year’s result for the third quarter equalled 105 points, nine points lower than the 2012 result.

Saudi Arabia was the only other Gulf nation within the top ten on this index. Although Saudi Arabia scored 113 points, it lost two points over the previous quarter’s score.

Indonesia and India shared the top spot, with 119 points each in the third quarter. Second place went to the Philippines. India maintained top position for nine years in a row, falling to second place in Q2 2012 results.

Thailand landed in fifth, scoring 112 points, and Brazil ranked sixth at 110 points. China scored 106 points for seventh, and Malaysia nabbed eighth place with 105 points. Switzerland moved up 10 points to reach 104 and ninth position.

Improvements in the US economy pushed consumer confidence higher during the third quarter. After dropping three points in second quarter, third quarter results were up by one point to 92, four points higher than the previous year. A result of lower than 100 indicates consumers remain pessimistic.

Over 60 percent of respondents expressed a belief that their national economies remain in a state of recession, which represents an increase from the previous report. More than 70 percent of those taking part in the survey plan to save more by altering their spending habits.

UAE Maintains Top Position for Prosperity in the Arab World

Ranked as the most prosperous nation in the Arab world again, the UAE also ranks within the top thirty global “Top Performers,” based on an index released by Legatum Institute. Taking 29th spot in the recent index, the UAE fell two places from the previous year’s ranking, yet remained the highest MENA nation. The UAE captured 47th place in the 2009 global index.

This index is based on analysis and assessment of worldwide wealth and well-being, and ranks 142 nations from across the globe within eight unique categories, such as social capital, safety and security, economy, governance, education, health, entrepreneurship and opportunity, and personal freedoms.

As the MENA region feels the impact of the Arab Spring, fewer citizens believe that help and support can be found with family and friends and social cohesion has declined. With adjustments occurring around the region, Legatum Institute CEO and president Jeffrey Gedmin noted that special attention should be paid to two key factors closely linked to a nation’s prosperity over the long term. These include governance, specifically accountable and effective government, and the entrepreneurship and opportunity rating.

National policies should be linked to these factors that drive prosperity upward.

Tunisia was hit hard, dropping 32 places to 122 for Social Capital, in a survey involving 142 nations. Syria also fell 30 places since 2010 to reach 131st place. Social Capital rankings declined in many MENA nations, even those not directly involved in Arab Spring. Saudi Arabia dropped 21 spots, ranking at 43 within the sub-index.

In the meantime, the Entrepreneurship and Opportunities category rose around the MENA region, due to declining start up costs and better connectivity from the Internet, mobile phones and security.

Business start up costs in Egypt declined from 2009 levels of 16 percent of the nation’s GNI per capita, to just 6 percent this year. Saudi Arabia’s index scores for Entrepreneurship and Opportunities increased from 46 to 54 in one year.

Paul Holdsworth, Staff Writer, Gulf Jobs Market News
Bookmark or share this page:

  • del.icio.us
  • E-mail this story to a friend!
  • LinkedIn
  • StumbleUpon
  • Technorati
  • TwitThis