Why we can cope without those material luxuries in the UAE

Expats living the high life help raise the UAE's profile as a luxury goods destination. The only problem is that many can't afford their high life, writes Nima Abu Wardeh.

Gary Clement for The National

Elizabeth Taylor once said: "Success is a great deodorant. It takes away all your past smells".
Olfactory sensibilities aside, success allows lives to be remodelled. People change and take on the high life once they get to these shores. It seems that having access to more money, along with becoming desensitised to the way of life and luxuries on offer here - through exposure - create an urge, a need to go lux, if not ultra-lux. Past lives, and sometimes past values, get brushed aside with gusto. A new mantra evolves:
Success equals luxury. Luxury equals success.
It's not for nothing that Dubai is one of the world's top luxury goods destinations.
You see evidence of it every day: the gleaming new turbocharged fully loaded four-wheel drive, the bags, shoes and watches. The dining out. And more. All fine and dandy if you can afford it. But many can't. I would wager that most can't - because when I say "afford", I mean that the money spent is disposable cash that you do not need to use for anything at all in your life.
You are financially stable and sustainable, have zero debt, and are not relying on any future payments (salary or bonus) to pay for what you are doing or buying today.
Here are a few factoids - some could be urban myths, but we won't let that spoil things:
Dubai is rumoured to have the most Hermès Birkin bags per person in the world - these things cost between US$10,500 and $150,000 a bag.
The UAE is the ninth-biggest importer of Swiss watches globally.
GCC residents spend $28,800 a year on fashion, beauty and gifts.
Tourists account for 55 per cent of luxury sales in the UK; it is 60 per cent in France, 50 per cent in Italy, and 40 per cent in Dubai.
I'm sharing this last one with you to bring home the point that most people doing the buying here are people who live in the UAE. People like you and me. And that retailers will look to residents to buy more because of the fallout from the weak euro, low oil prices and absent Russian tourists.
A weaker euro means buying these goods in Europe is even cheaper than before, and low oil prices bring about concern over the future spending power of governments and people. The Russians have their own problems to contend with at the moment, and they, and their wallets, are sorely missed.
And so local outlets selling lux brands are counting on you to keep them in business. Great if you're on the hunt for a specific bargain, not so great if you get sucked into retail tactics.
And it seems many are. One word sums up our spending patterns here: "frequent". I wonder how many of us would be frequent shoppers, let alone frequent shoppers for luxury labels back home.
This is how people living in the GCC spent their money according to a white paper released by the Chalhoub group last year.
Of those surveyed, 42 per cent buy luxury clothes every one to two months, 41 per cent spend on luxury shoes, and 37 per cent on luxury bags every two to three months. This adds up to a lot of dirhams. Many of those doing the buying are what the industry calls "aspirational" shoppers. It's a term I do not like - it refers to someone who wants to own luxury items, but cannot afford to on a regular basis, or one who spends a large chunk of their disposable income on designer labels but cannot stretch to the most expensive items.
Many of these people go for things such as perfumes - called luxury beauty. These "small" buys make up 25 per cent of the total GCC luxury market.
These seemingly innocuous things add up, and are the reason the GCC luxury sector is expected to keep growing at 8 per cent until 2017, with worldwide luxury goods revenues set to grow 50 per cent faster than the global GDP growth.
Yes, the number of ultra-high net worth individuals in the Middle East is expected to grow 35 per cent by 2023, but you won't get to be one of them if you don't keep your money. So stop spending big money on small things - the hint of attainability works to enrich the lives of people making and selling these products, not yours.
As for success, it's whatever you decide it is. While you're figuring it out for yourself, be a darling and pass me your branded deodorant.
Nima Abu Wardeh is the founder of the personal finance website cashy.me. You can reach her at [e-mail].
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