Middle East Conflict Disrupts Luxury and Fashion Retail Across Gulf Region

The intensifying conflict in the Middle East has had a profound impact on luxury and fashion retail across the Gulf, resulting in store closures, staff reductions, and supply chain interruptions. While Chalhoub Group shuttered its stores in Bahrain, it continued operations in the UAE, Saudi Arabia, and Jordan with a leaner workforce. Following an incident on February 28, Amazon's Abu Dhabi facility ceased operations on March 2 due to connectivity issues. Kering has also temporarily closed its outlets in the UAE, Kuwait, Bahrain, and Qatar. The region, which contributes 5–10% to global luxury spending, largely relies on tourist activity, now threatened by airport closures and missile strikes. Major brands like Cartier and Zegna have recently made significant investments here, yet shares of leading companies have declined amid a sector slowdown that began in 2023.