Africa and the Middle East’s growing population and high levels of unmet potential all make the region an exciting prospect. However, despite a growing middle class, the largest population growth in 15 out of 20 countries is the lowest income group. There are extreme income inequalities which are set to increase – necessitating a granular approach to targeting consumers. The gender income gap is set to narrow and spending on family goods and services are particularly bright.
Total disposable income is set to rise by just under 40% in real terms over the forecast period. This puts the Middle East and Africa (MEA) region in second place globally in terms of real gain behind Asia Pacific. However total income per household remains the lowest globally, at less than USD10,000. The region also has the highest spending on essential goods.
Spending on essentials such as food and drink, housing and clothing accounts for almost 60% of spending across the region. With the rapid expansion of the lowest economic classes, this is not set to change significantly in the forecast period – with 15 out of 20 key countries seeing the most dynamic growth in consumer group E. In many countries, close to 70% of the population live on less than USD5,000 per year.
Huge levels of income inequality exist across the region, and this is set to increase to 2030, leading to more polarised consumption. Companies wanting to implement successful business strategies will need to adopt a targeted, granular strategy.
A combination of economic growth, urbanisation, a shift from oil dependency, growth in educational opportunities for women and other societal changes across the region has meant that more women are entering the workforce, and the gender gap is decline.
Extended households and families remain the leading types of households, despite dynamic growth in single-person households. This presents opportunities for family-oriented goods and services.
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