135m mil­len­ni­als turn Pak­istan into fastest re­tail mar­ket

Khaleej Times - - PAKISTAN -

karachi — Pak­istan’s bur­geon­ing youth and their free­wheel­ing at­ti­tude to­wards ris­ing in­comes have turned the na­tion into the world’s fastest grow­ing re­tail mar­ket.

The mar­ket is pre­dicted to ex­pand 8.2 per cent per an­num through 2016-2021 as dis­pos­able in­come has dou­bled since 2010, ac­cord­ing to re­search group Euromon­i­tor In­ter­na­tional. The size of the mid­dle class is es­ti­mated to surpass that of the UK and Italy in the fore­cast pe­riod, it said.

Pak­istan’s im­prov­ing se­cu­rity en­vi­ron­ment, eco­nomic ex­pan­sion at near 5 per cent and cheap consumer prices are driv­ing shop­pers to spend up big.

Al­most two-thirds of the na­tion’s 207.8 mil­lion peo­ple are aged un­der 30, ac­cord­ing to the Jin­nah In­sti­tute, an Is­lam­abad-based think tank. “We have a new mil­len­nial shop­per at hand. They don’t mind spend­ing to have the kind of life­style they would like,” said Sha­bori Das, se­nior re­search an­a­lyst at Euromon­i­tor. “It’s not like the Baby Boomer gen­er­a­tion where sav­ings for the fu­ture gen­er­a­tion was im­por­tant.”

Pak­istan is buck­ing the trend in the US — where stores are clos­ing at a record pace as e-com­merce un­der­mines bricks-and-mor­tar. It’s also at­tract­ing for­eign op­er­a­tors: Turk­ish home ap­pli­ance maker Arce­lik AS and Dutch dairy gi­ant Royal Fries­landCamp­ina NV en­tered the mar­ket last year via ac­qui­si­tions.

Mean­while, Hyundai Mo­tor Co., Kia Mo­tors Corp. and Re­nault SA are all build­ing plants in the South Asian na­tion.

Pak­istan’s re­tail stores are ex­pected to in­crease by 50 per cent to 1 mil­lion out­lets in the five years through 2021, Euromon­i­tor said. Its three big­gest malls, Lucky One in Karachi and Pack­ages Mall and Em­po­rium Mall in La­hore, opened in the past two years. Pak­istan is mir­ror­ing what In­dia went through about four years ago. Both coun­tries have young pop­u­la­tions with more in­come and less in­cli­na­tion to­wards sav­ing which is a dis­tinct dif­fer­ence to what re­tail­ers else­where are deal­ing with, said Das. — Bloomberg

A view of the newly-opened Em­po­ri­oum Mall in La­hore.

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