Pakistan started the year with a consumer confidence score of 104, for the first quarter, reaching its highest level since 2008, according to consumer confidence findings from Nielsen released today.
Consumer confidence level is moving on a steady stride since Q3 2014, reporting a one-point increase from Q4 2015 and a two-point increase from a year ago (Q1 2015).
Recessionary sentiment has lessened from 71% (Q4 2015) to 69% (Q1 2016) and one in every two respondents is optimistic about their job prospects in the next 12 months. Six in every 10 Pakistani respondents were confident that personal finances (64%) would be good or excellent in the next 12 months—a rise of four percentage points from the previous quarter.
Mustafa Moosajee, Managing Director, Nielsen Pakistan, said:
We have witnessed consumer confidence going around the same range in the past year, with the index consistently reported being above the optimism baseline, as Pakistan economic reform progress and security conditions improve, which have resulted in an increase of foreign investment. Pakistan is a key beneficiary of low global oil prices, due to its high level of oil import. This has led to a low inflation environment, and allowed consumers to benefit from low domestic petrol prices, low interest rates and a reduced electricity bill.
He further added:
As a result, consumers feel more secure about their personal finances as they are left with more extra cash and have the capacity to save. The findings also showed that consumers’ immediate spending intentions rose by one-point (42%) from the previous quarter. Pakistan’s improved business environment and positive consumer sentiments have led to a favourable atmosphere as depicted by the consumer confidence index.
When asked about spending patterns, more respondents admitted to have changed their spending patterns to cut down on household expenses compared to last year (74% Q1 2016 vs. 66% Q4 2015); spending less on new clothes, out-of-home entertainment and new technology items, while putting more of the extra cash into savings as the concerns for safety and future wellbeing of their family increases.
The Nielsen Global Survey of Consumer Confidence and Spending Intentions, established in 2005, measures consumer confidence, major concerns, and spending intentions among more than 30,000 respondents with Internet access in 63 countries. Consumer confidence levels above and below a baseline of 100 indicate degrees of optimism and pessimism.
Around the Africa/Middle East Region in Consumer Confidence
Three countries from Middle East region reported a consumer confidence score of 104 for Q1 2016; UAE, Saudi Arabia and Pakistan. These countries are also amongst the top 10 countries with highest consumer confidence scores globally. For the UAE, the score was a four-point drop from the previous quarter; Saudi Arabia showed a two-point decrease; and Pakistan increased by one point from the previous quarter. Consumer confidence in South Africa declined seven points to 75 from the previous quarter, and Morocco’s score declined one point to 84.
Consumer Confidence Around the World
Global consumer confidence remained stable in the first quarter and below the optimism baseline score of 100, edging up one index point to 98. The score reflected mixed confidence levels in every region. In the latest Nielsen Global Survey of Consumer Confidence and Spending Intentions, consumer confidence increased in 33% of measured markets (20 of 61 markets), compared to 43% of measured markets showing an increase in the fourth quarter of 2015. The Nielsen consumer confidence index measures perceptions of local job prospects, personal finances and immediate spending intentions.
About the Survey
The Nielsen Global Survey of Consumer Confidence and Spending Intentions was conducted March 1–23, 2016, and polled more than 30,000 online consumers in 63 countries throughout Asia-Pacific, Europe, Latin America, the Middle East/Africa and North America.
The sample includes Internet users who agreed to participate in this survey and has quotas based on age and sex for each country. It is weighted to be representative of Internet consumers by country. Because the sample is based on those who agreed to participate, no estimates of theoretical sampling error can be calculated.
However, a probability sample of equivalent size would have a margin of error of ±0.6% at the global level. This Nielsen survey is based only on the behaviour of respondents with online access. Internet penetration rates vary by country. Nielsen uses a minimum reporting standard of 60% Internet penetration or an online population of 10 million for survey inclusion.
The China Consumer Confidence Index is compiled from a separate mixed methodology survey among 3,500 respondents in China. The sub-Saharan African countries in this study are compiled from a separate mobile methodology survey among 1,600 respondents in Ghana, Kenya and Nigeria. The Nielsen Global Survey, which includes the Global Consumer Confidence Index, was established in 2005.