Tremors were felt in the Greek capital of Athens and as far away as the southern island of Crete
Dubai — Driven by a surge in transactions by credit cards issued by UAE banks, total card spending in the UAE jumped 10.2 per cent in five months to May compared to the same 2014 period.
The value of card transactions over the five-month period reached Dh34.3 billion, according to data compiled by Network International, which covers about 60 per cent of the UAE market for e-commerce and point-of-sale (POS) transactions.
Most of the growth in spending in the first five months of this year was on cards issued by UAE banks (mainly residents), which rose 14.9 per cent year-on-year and accounted for over 70 per cent of total POS transactions.
The value of foreign spending — on cards issued by non-UAE banks — was unchanged year-on-year in January-May 2015, at Dh9.8 billion.
“We assume that the country in which a credit card is issued reflects the spender’s nationality. While there will be exceptions where people use credit cards of countries in which they are not citizens and/or residents, as well as cases of dual citizenship, we believe this is a reasonable assumption,” said the report.
A statement issued by Network International said spending on US-issued cards accounted for about 20 per cent of all foreign spending in the UAE in the year to May, and was up 9.2 per cent year on year.
Saudis are the second biggest foreign spenders in the UAE, accounting for 12.7 per cent of total non-UAE POS transactions. Spending on Saudi-issued cards surged 24.9 per cent since January, followed by the UK-issued cards, accounting for 9.2 per cent of foreign sales but growth in spending was just 1.4 per cent, likely reflecting the relative weakness of the British pound relative to the dollar and dollar-pegged currencies.
Russian spending declined 52 per cent in the five-month period.
“The impact of dollar strength on foreign spending in the UAE becomes even more apparent in the geographic breakdown of spending beyond the top three source countries. Russian spending declined 52 per cent, taking the Russian Federation down to sixth place from fourth place last year. China moved up from fifth place to fourth in the list of top foreign spenders, although even Chinese spending was -5.4 per cent lower in the first five months of this year relative to the same period in 2014,” Network International said.
Qatari spending rose 14 per cent, ranking the country fifth overall, followed by Kuwait (up six per cent year-on-year, ranking seventh overall). Switzerland and Nigeria ranked among the top 10 foreign spenders year-to-date, displacing Angola (where spending on cards declined by a third) and France (down 11.2 per cent).
“Interestingly, despite India being the second largest source market in terms of the number of tourists to Dubai, it ranks 14th in terms of spending on cards. There are several factors that may explain this, including the use of non-Indian bank issued credit cards by Indian tourists, a higher propensity to use cash rather than cards or simply lower per capita spend in the UAE compared with other nationalities.”
The sector which saw the largest annual increase in card spending in January-May was restaurants (up 21.6 per cent), followed by airlines and travel (up 15.4 per cent). Spending on hotels and duty free rose by 7.1 per cent. The value of jewellery and watches sold in the first five months of this year was 7.4 per cent lower than in the same period of 2014, while clothing and boutique spending was down -2.3 per cent, said the report.
— issacjohn@khaleejtimes.com
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