Mixed Consumer Sentiments Across West Africa
Ghana’s consumer confidence declines by five points
Improved perception of Nigerian finances, job prospects & spending intentions
Nielsen Consumer Confidence Index for West Africa shows mixed sentiments in the fourth quarter of 2018. Ghana’s Consumer Confidence Index (CCI) shows a five point decrease to 108, while Nigeria’s CCI has dropped one point to 117, presenting a diverse picture of consumer sentiment across West Africa.
Continued inflationary pressures and uncertainties around the elections could have impacted consumer sentiment, leading to a one point drop in the consumer confidence index in Nigeria in Q4'18. However, despite the drop, consumers showed increased propensity towards stocking up on the necessities as a result of year end festivities.
When it comes to job prospects, 62% Nigerians view their prospects as excellent or good (a 6 point increase from the previous quarter) and 31% view them as not so good or bad. In terms of the state of their personal finances over the next 12 months, the same amount as the previous quarter (79%) say excellent or good. In addition, the number of Nigerian consumers who feel now is a good or excellent time to purchase what they need or want has increased three points to 46%.
Looking at whether Nigerians have spare cash, exactly half (50%) say yes, down five points from the previous quarter. In terms of what their spending priorities are once they meet their essential living expenses, the highest number of consumers (73%) would put their spare cash into savings, followed by 71% on home improvements and 68% who would invest in stocks and mutual funds.
Ghanaians less positive
While Nigeria showed a slight decline in confidence; Ghana’s CCI figure dropped a substantial five points to 108. The continued depreciation of the Cedi, the collapse of certain banks leading to job losses, and the high cost of credit and an inability to access credit have led to a drop in consumer sentiment in Ghana.
This decline in sentiment is clearly reflected in Ghanaian consumers’ immediate-spending intentions. Only 40% Ghanaians say now is a good or excellent time to purchase what they want or need, a substantial eight point drop compared to the previous quarter. Negative sentiment is also reflected in Ghanaian’s job prospects. Only 58% Ghanaians view their job prospects as excellent or good, experiencing a six point drop compared to the previous quarter.
Sentiment around the state of personal finances has also taken a slight hit with Ghanaians who think the state of their personal finances would be excellent or good over the next year having dropped nine points from the previous quarter to 67%. This in comparison to 31% who think that the state of their personal finances is not so good or bad, which represents a substantial 13% increase in this negative sentiment.
Looking at whether Ghanaians have spare cash to spend, 42% said yes, versus 53% in the previous quarter. In terms of their spending priorities once they meet their essential living expenses, the highest number of consumers (77%) would put their spare cash into savings and the same number will spend on home improvements, while 70% said they would invest in shares/mutual funds.
Consumer confidence in West Africa declined in the last quarter of 2018. However, it still falls on the positive side of the spectrum and we hope to see a rebound in confidence levels in 2019.