Pakistan’s retail sector is where the action is

Pakistan’s burgeoning youth and their freewheeling attitude toward 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 2016-21 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.”

Foreign operators

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 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.