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45% of Emirati families' income spent on basics

Abu Dhabi - Increase in expenditures of Emirati families in line with inflationary trends

An ordinary Emirati household's spending on food, housing rental, water, electricity, gas, phone bills, furniture fixtures, salaries of domestic servants and other essential supplies represented about 45 per cent of its total spending, on average, according to a survey of income and expenditure carried out at the end of first quarter of this year.
The spending is in contrast with 55 per cent spent by an Emirati family in 2007-08 on the same heads of accounts, according to the Department of Economic Development Abu Dhabi survey.
The survey finding says that 47.5 per cent of Emirati families have children studying at their own expense which has reached to Dh66,364 per annum within the UAE and Dh102,364 in case they are studying abroad.
About 24.5 per cent families have children receiving private lessons, due to which their spending has reached Dh7942 in the three months survey.
The average expenditure on the fixed telephone bills was about Dh964, while the mobile phone bills for the family amounted to Dh6,945, on average.
On an average, an Emirati family's monthly expenditure rose to Dh29,705 in February 2015 compared with Dh24,068 in the month of November 2014.
The increase in expenditures was in line with the inflationary trends reported during the period, the survey said. The survey showed that 64 per cent of UAE nationals witnessed increase in their monthly expenditure during the second quarter of 2015, against 33.8 per cent who were positive not to increase their expenditures.
Compared to the results of the survey for the month of December 2014, where 50.3 per cent and 44.4 per cent, respectively, the expectations of Emirati families for the expenditure in the second quarter of 2015 were influenced by fears of rise in inflation.
The bank borrowing continued to drop at the end of the first quarter after a slight surge seen in December 2014, to reach the lowest level i.e. 18.3 per cent of the surveyed families.
The majority of the Emirati households surveyed reported that they are not borrowers. This shows the positive impact of the efforts and initiatives aimed at raising awareness on negative impact of excessive borrowing, which has turned several families bankrupted after the 2008 financial crisis.
A big majority of 43 per cent who borrowed money from banks and financial institutions said they availed auto loans, followed by 38 per cent who borrowed money to own a house while 4.9 per cent used bank loans to travel, marriage and for investment purposes.
- haseeb@khaleejtimes.com

• Abu Dhabi