Peninsula On-line:
Some big Dubai retailers, accustomed to giddy spending in the Gulf Arab tax-free haven, are grappling with a drop in sales as consumers worry about the impact of the global financial crisis on their wallets.
The Gulf has not been as heavily hit by the credit crisis as Europe and the United States, but the contagion has led to stock market routs, tight lending conditions and a range of government and central bank attempts to mitigate its impact.
In the United Arab Emirates, home to the glitzy financial hub of Dubai where shopping is virtually a national sport, a frisson of fear has seeped into consumers’ minds.
“Business is 20 percent down in the last week in retail,†Mohi-din Bin Hendi, president of Bin Hendi Enterprises, told Reuters.
“In the beginning, people did not take it seriously. When they start to get their ATM cards refused from the bank, that’s when sense comes back… that this is serious.â€
Bin Hendi, whose retail-based conglomerate operates in the Gulf Arab region and India and offers everything from jewellery to sofas, said the firm would take steps to ready for a further decline in consumer spending and would “cut the desirables, go to the essentials.â€