CONSUMER MARKETS

ASIA: Growth in Chinese consumption.

In 2006 Credit Suisse conducted a survey amongst 2,700 respondents in 8 Chinese cities.

Further estimates state that Chinese consumption would grow to 8.6% by 2010 to be ranked third after the United States and Japan. The figure is estimated to be 21.8% by 2020 when the United States is estimated at 34.6%.

In 2006 China's consumption accounted for 5.4% of total consumption out of the major economies in 2006, ranking joint fifth with Italy, with the United States at 42%, Japan 11.1%, Germany 7.3% and Britain 6.6%.

CONSUMER MARKETS

EUROPE: Latvia is currently a nation of borrowers not savers.

In an interview with Republika.lv magazine Uldis Cerps, head of the Latvian Finance and Market Commission (FKTK), said that Latvia's financial market is primarily based on the banking sector which accounts for more than 96% of the whole financial sector; the insurance market constitutes about 3% while the share of other segments does not exceed 1%.

He states that this state of affairs indicates the low level of domestic savings which is typical of a transitional economy. The Latvian market is dominated by a borrowing rather than an accruing culture fostered by high global liquidity resulting in low interest rates.

CONSUMER MARKETS

EUROPE: Effects of smoking bans.

On 1 July 2007 a smoking ban will be imposed on all public places in England; in Wales the ban will take effect on 2 April 2007. Bingo clubs will be included within the ban.

A ban on smoking has been in place in Scotland since March 2006. The Scotsman newspaper reported in February 2007 that at least 8 bingo clubs had subsequently closed in Scotland and Rank Plc (owners of Mecca Bingo) reported on 2 March 2007 that revenue from its Scottish clubs had fallen 15% since its introduction.

However a survey conducted by Littlewoods Bingo Online (who run online bingo games) discovered that 76% of participants in England agreed that smoking should be banned in bingo clubs.

CHINA AUTOMOTIVE

ASIA: China is now a net passenger vehicle exporter.

In a survey conducted by Deloittes, Chinese automotive executives estimated that the proportion of exports to total sales of automotive products will grow from 14% in 2006 to 28% in 2010.

China first became a net exporter of passenger vehicles in 2005 when exports grew 224% over the previous year. The majority of vehicles went to developing countries.

Several factors identified by Deloittes have served to dent industry optimism:

excess capacity resulting in a steep drop in prices;

reduction in profitability as cost reductions lag price reductions;

reduction in vehicle import duties.

AUTOMOTIVE

EUROPE: EU strategies for the European automotive industry.

European Union President José Manuel Barroso stated in February 2007 that, "The EU car industries are at the core of our economies. By positively taking up the climate change challenge, they will preserve and enhance their competitiveness in the long term. This is of crucial importance for consumers and workers alike. The strategy we adopted today covers the strategic issues - from road safety to the environment to research - that if addressed in a timely fashion will make sure that the EU car industries will remain strong and innovative world leaders."

The strategy he refers to involves the reduction of administrative burdens, reduction of CO2 emissions (incorporating both technological changes and the increased use of bio-fuels), research and development (clean renewable fuels and vehicles and intelligent vehicles and roads have been identified as core research priorities within the EU), trade (proposals to assess the potential of using bi-lateral trade agreements, particularly in the Asian region, to improve market access and reinforce the need to enforce intellectual property rights globally).

New Posts for 2007

BRAZIL RETAILING

AMERICAS: Brazilian retail market is attractive to global retailers.

Spending by Brazilian consumers is large and growing. The country is already the 3rd largest global market for soft drinks, the 4th largest for chocolate and cosmetics and personal care products and the 5th largest for beer. The size and potential of the Brazilian market has attracted foreign financial and strategic investors

In the food retailing sector Carrefour, Makro and Wal-Mart (via the acquisitions of Sonae and Bompreço) are all significant players.

Credit expansion has been a contributory factor in the growth of non-food retailing.

E-commerce grew 32% in 2005 albeit from a low base.

CHINA FOOD

ASIA: The growth in processed food consumption in China is driven by the urban population.

The Chinese processed food market is estimated to account for nearly 5.7% of the global total. Up to 30% of the food consumed in certain urban areas is processed.

The growth in income, which is driving these changes, is evidenced by the fact that approximately 88% of urban households now own a refrigerator. The figure for rural areas is 16% which suggests that it will be many years before the consumption of processed foods reaches significant levels amongst this demographic.

UK PHARMACEUTICALS

EUROPE: ABPI takes issue with NICE recommendations.

The Association of the British Pharmaceutical Industry (ABPI) is taking issue with the process by which the National Institute for Health and Clinical Excellence (NICE) reaches its recommendations. NICE is, inter alia, responsible for evaluating new and existing treatments for use within the UK's National Health Service.

NICE state that they base their recommendations on both clinical evidence (how well the medicine or treatment works) and economic evidence (how well the medicine or treatment works in relation to how much it costs the NHS). The ABPI believes that NICE is applying arbitrary thresholds of 'cost-effectiveness' and, where there is uncertainty in the process, patients are often denied the benefit of doubt.

DAIRY PRODUCTS

AMERICAS: The US dairy trade deficit widens to more than $1 billion.

US dairy imports and exports rose to record levels in 2005 whilst the trade deficit widened to more than $1bn. The growth in exports was driven by strong global demand for skimmed milk products; the US was the only significant exporter with surplus stocks. The value of cheese imported increased 3.7% to $1,006m, more than three-quarters of which originated in Europe. The growth in artisanal cheese making, especially in key dairy states such as Wisconsin, is further evidence of growing demand for quality products in this sector.