Expo Expectations Dulled by Global Concerns

The expected Expo rise in sentiment has failed to happen in 2019 according to the Happiness Survey, with UAE residents cautious regarding the extent of its impact on the UAE economy.
This article is part of an editorial series on Happiness Survey 2019
Happiness Survey 2019
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Happiness Survey 2019
This article is part of an editorial series on Happiness Survey 2019

In just 11 months Dubai Expo 2020 will have, finally, begun. Those of us who were in the UAE on November 27, 2013, when we won the bid, will be aware of just how long the last six and a half years have felt - from the initial explosion of excitement, to the long, drawn out realisation that all was not going to change overnight.

But we are almost there. So close you can almost feel it. In eight weeks we will be counting down from within 2020 itself. The excitement is palpable...

Or is it? In truth, our Happiness Survey reveals the Expo effect has yet to kick in, at least in terms of how we feel it will affect the economy. In fact, while we had expected business excitement to heighten through 2018 into 2019, we are even more measured this year than we were last year as to how much impact, we believe, the Expo can have.

Our survey asks a very simple question: Does Expo 2020 give you a) a great deal more confidence in the UAE economy, b) A little more confidence in the UAE economy or c) Makes no difference to the UAE economy.

Last year just 58% of respondents told us they believe Expo was impacting the UAE economy to a greater or lesser degree. We have edged up one percent on last year. In 2019, 59% think the Expo is having 'some' effect on the economy. However, only 16% of you have a great deal more confidence in the UAE economy because of Expo, down from almost 23% last year.

We believe there are two main reasons for this. Firstly, the UAE is a highly connected economy, especially so Dubai, and whatever it does will be amplified, or muted, by the health of the wider global economy which feeds it. As we come to the end of the 2019, the world looks, at best, nervy, unsure of itself as Brexit, economic trade wars and tariffs, Middle East unrest and a sclerosis in the traditional powerhouses of Japan and Germany hold back FDI flows and business sentiment in general. The UAE may have committed 61 billion to its domestic economy for next year, but that's a drop in the ocean when it comes to El Nino scale macroeconomic forces.

Secondly, while everyone always thinks this time it will be different, all projects end up playing catch in the last mile to delivery. The $10.2 billion dollars of Expo projects are clearly no exception. All businesses involved, especially those supplying manpower to build and to construct pavilions, will see a lot of business they expected this year, rolled over into 2020. The expected impact on sentiment too will be carried over.

As with last year, break down the data and there are interesting nuggets to be found in the details. Proving it was no anomaly in the data, this year's survey, like last, reveals that residents outside of Dubai, are the most bullish when it comes to the impact of the Expo. Sharjah residents have seen the biggest positive swell of sentiment, with 36% of its respondents saying the Expo gives them a great deal more confidence in the UAE economy - up 13% on last year. This compares to 13% in Dubai (down 6%) and 23% in Abu Dhabi (down 3%).

Income also impacts attitudes towards the Expo. In general, the higher the household income, the less of an impact respondents think the Expo will have. It's not a completely linear progression. As with last year, there is a definite pick up point, this year after a household income of 50,000 AED and above, where attitudes towards the Expo do become slightly more bullish. Those households earning between 30 and 40K AED remain the most skeptical of the 'Expo Effect'.

See Chart: Income and the Expo Effect

Finally, age makes a big difference. The under 18s are the most positive by far, not seeing shades of grey but going all out in their belief the Expo 2020 will have a significant impact on the UAE. As the population moves to 18 to 24, so we see the biggest number of respondents thinking the Expo will have some effect on the economy. There is a fairly linear rise in those believing the Expo will have no effect whatsoever. 20% of under 18s think this, compared to 72 percent of those over 55.

See Chart: Age and the Expo Effect

Who will be right - our wise elders, or our blue sky thinking youth? With less than 12 months to go before the Expo gates open, we don't have to wait that long to find out.

 

Happiness 2019 Index
Happiness Rises Across the UAE
Why You Choose to Live in the UAE
Your Biggest Worries Living in the UAE
Who is the Happiest in the UAE?
The UAE and Kids, a Great Mix
Property Ownership - Happiness and Stress
Happiness and Money in 2019
Happiness and Employment in 2019
Happiness and the Expo Effect

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