Rosy growth as sales soar during Holy Month and tourists flock in

Growth in tourism to the UAE is driving increased retail sales during Ramadan, says Sana Toukan, the research manager for the Middle East at Euromonitor International.

Arab tourists have helped to boost sales during the Holy Month as unrest in parts of the region puts people off visiting destinations such as Egypt and Lebanon. Ms Toukan explains what this means for sales of clothes, jewellery and food.

How is the UAE retail market performing during Ramadan?

Retail sales are higher than any other month of the year. But it's also higher than Ramadan last year. It is linked to tourism. Tourism has gone up in the country as a whole pre-Ramadan and is continuing in Ramadan. The Arab Spring is pushing a lot of people away from Syria, Lebanon and Egypt. Those people are now coming to the UAE for shopping.

What kind of tourists are visiting and what are they buying?

Dubai is a favourite place for Arab tourists during Ramadan. Appealing [products], especially during Eid, include new clothes, jewellery and consumer appliances. It's all looking rosy. Sales are soaring in consumer appliances like food processors, for example. Sales of jewellery, gold and diamonds also go up substantially during the month.

What other factors are driving it?

You see a lot of people coming back as residents to the UAE now the economy is recovering, it's politically stable. More jobs are being created and rent prices are going up so people are interested in investing in the property market now.

What about food sales?

We've seen a surge in purchases of grocery items. People consume much more than they do normally. It's also driven by promotions - things like 'buy one, get one free' or special Ramadan packages. People are happy to spend more, to splash out during one month of the year.

Why are there more promotions this year?

The Government has capped [the prices of] around 6,000 food items. They're mostly staple items.

But retailers and manufacturers are looking to make up for that by upping their game on more premium and luxury items.

* Ben Flanagan