NZ commercial spending reaches US$174 million
New Zealand commercial spending reaches US$174 million in 2005, will exceed US$177 million in 2006
Auckland, 24 February 2006 – Visa New Zealand today released its local Commercial Consumption Expenditure (CCE) forecast for 2006, which projects that New Zealand’s business and government spending will exceed US$177 million this year.
The CCE index provides the global payment industry, including Visa and its 21,000-member banks, an unbiased and consistent method of monitoring and tracking global business and government expenditure. The first and only standardized metric of its kind, the global CCE index includes all government purchases of goods and services with the exception of payroll.
Asia Pacific is the third-largest spending region among the CCE index’s six regions, behind the US projected total of US$17.4 trillion, and Europe’s predicted 2006 commercial spending level of US$22.1 trillion.
Bruce Mansfield, Executive Vice President Visa Australia and New Zealand, said: “These figures further underpin the phenomenal speed at which the Asia Pacific economy is growing. In just a year, Asia Pacific has moved from the fifth-ranked region for expenditure growth to the second highest, mainly fuelled by growth in China. We expect this growth rate to continue, bringing the region’s total CCE closer to that of Europe.”
Within Asia Pacific, Japan continued to report the biggest CCE spend ($5.4 trillion) followed by China ($3.6 trillion) and India ($1.9 trillion). China represented the highest rate of year-on-year growth at 16 percent, with India reporting 13 percent.
Top ten countries - Asia
Pacific region 2006 CCE $US
SOUTH KOREA 1,757,148
HONG KONG, CHINA 225,548
Expenditure Regional Breakdown
Overall 2005 estimates and 2006 forecasts for electronic and paper-based business and government spending within Visa’s six global regions follows:
Region 2004 Actual 2005 Estimate 2006 Forecast
Europe US$20.1 trillion US$21.1 trillion US$22.1 trillion
United States US$15.1 trillion US$16.3 trillion US$17.4 trillion
Asia Pacific US$14.0 trillion US$15.0 trillion US$16.1 trillion
Central/Eastern Europe, Middle East and Africa US$3.1 trillion US$3.7 trillion US$4.2 trillion
Latin America/Caribbean: US$2.4 trillion US$2.9 trillion US$3.1 trillion
Canada US$1.5 trillion US$1.7 trillion US$1.9 trillion
Total Global CCE US$56.1 trillion US$60.8 trillion US$64.8 trillion
Utilizing methodology developed by Visa and launched in 2004, CCE draws upon government data in methods similar to the Personal Consumption Expenditure (PCE) index, which monitors consumer-related spending. Global CCE is estimated using four key data elements: the amount of business-to-business purchases to acquire goods and services used in production; wholesale and retail purchases of final goods; some business capital expenditures; and government spending on goods and services. Adjustments were made for capitalized expenditures, such as construction and durable defence spending. The calculations measure transactions at basic prices, which include taxes (less subsidies) on production. The types of transactions included in CCE can be captured on a variety of Visa products including Visa Corporate, Visa Commerce, Visa Purchasing, Visa Business and Visa Distribution cards.
Payment trends across Asia Pacific indicate a movement towards electronic-based transactions, providing a significant opportunity for Visa’s suite of commercial products. Visa Commercial provides payment products with information management and services designed to help organizations achieve greater efficiency, control and convenience. Recent examples of government that have experienced the benefits of Visa Commercial programs include the Filipinos and Taiwanese. The Visa eCard in the Philippines and Purchasing Card in Taiwan have brought significant improvements in the control and reduction in costs, greater efficiency in monitoring procurement and less paperwork.