Economic impacts of Ramadan

Ramadan, the holiest month in the Islamic calendar, has a significant impact on economic activity worldwide, particularly in Muslim-majority countries. Consumer spending habits during this month are distinct, characterised by increased expenditure on food, shopping, and charity. Despite fasting, overall consumption rises as families prepare elaborate pre-dawn (Suhoor) and evening (Iftar) meals, leading to higher demand for staple foods such as dates, milk, meat, and sweets. Restaurants and takeaway outlets experience a surge in sales, especially during Iftar.

Beyond food consumption, shopping malls witness increased spending on Eid-ul-Fitr clothing, gifts, and home décor. Online businesses also thrive as retailers introduce discounts and promotions to attract buyers, resulting in a rise in e-commerce sales. The demand for electronics and luxury goods accelerates as consumers take advantage of festival offers. Additionally, charitable giving increases significantly, with Muslims fulfilling their religious obligations of Zakat and Sadaqah, benefiting charities, NGOs, and corporate social responsibility (CSR) initiatives. However, while many businesses flourish during Ramadan, others face challenges due to reduced productivity caused by shorter working hours and altered consumption patterns. Sectors such as banking and recreational services may experience lower efficiency as businesses adjust schedules to accommodate fasting employees. Financial markets in Muslim-majority countries also tend to see lower turnover and a temporary slowdown in economic activity due to seasonal influences.

Understanding these market dynamics enables companies to align their marketing efforts, supply chain operations, and workforce planning, allowing them to capitalise on opportunities without facing disruptions.

Md. Minhazul Islam

Student

Bachelor of Business Administration

North South University

islam.minhazul.232@northsouth.edu