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Consumer Confidence Remains Subdued in Hong Kong and Across Asia Pacific

Hong Kong, 19 December, 2002 - Continued economic uncertainty in the region in the past six months has led the majority of consumers in Asia Pacific to believe that recovery from the global recession is at least another twelve to eighteen months away, according the latest results from the ACNielsen Consumer Confidence survey conducted earlier this month.

Compared to the last survey conducted in July 2002, regional consumers have prolonged the effects of the global recession by another six months.
ACNielsen's consumer confidence poll is an online survey of over 9,800 consumers in 13 Asia Pacific markets.

"Economic uncertainty and concern over terrorism and war have had a one-two punch effect on consumer optimism in the region. With an absence of consistent positive news, people's expectations for recovery are in a holding pattern," said Frank Martell, President, ACNielsen, Asia Pacific.

Survey results reveal that Hong Kong consumers rank among the most pessimistic in the region and most people do not expect recovery until the first quarter of 2004. Japanese consumers also rated among the most pessimistic in the region with 29% saying they 'don't know' when their decade-long recession will finally end, and 19% thinking they will have to wait until 2006 or beyond. "In Japan, we see a growing expectation of a permanent recession," observed Mr. Martell.

While Southeast Asian markets have been particularly impacted by recent terrorism-related events in past months, respondents in every Asia Pacific country registered a dramatic increase in concern for both terrorism and impending war in the next six months. Respondents in Australia and New Zealand are the most concerned.

With the exception of Australia and New Zealand, consumers across the region are holding onto their purse strings and have generally been spending less on lifestyle activities. "Many consumers have cut back on expenses such as spending less on their social life, going out less and even taking taxis less. With no clear indication on when the economy will improve, consumers are spending more cautiously than ever before," said Mr. Martell. "Consumers remain tightfisted for the foreseeable future."

In the last six months, Hong Kong consumers have not increased spending on any aspect of their lifestyle and instead have cut back expenditure in some areas rather significantly.

75% of local consumers say they spent less on luxury items compared to six months ago, and 68% spent less on going out. 64% spent less on holidays. And even expenditure on small ticket items have been scaled back - 58% say they are taking taxis less, and 53% are going to the movies less than they did six months ago.

Needless to say, the gloomy economic climate has impacted spending on major investments and purchases as well. Many Hong Kong consumers have deferred taking an extended holiday, the purchase of new desktop or laptop PC as well as holding off investments in the stock market. Moreover in the last six months, 64% of consumers in Hong Kong said they did not make any major purchase at all.

Are these spending patterns continuing into the new year? While consumers are not expected to open their wallets generously, there are some indications that consumers plan to purchase some items they have been deferring, or perhaps been saving up for.

"Survey results indicate that the most popular buys for 2003 will be digital cameras, PC's and mobile phones," said Mr. Martell.

31% of consumers say they are looking to purchase a new digital camera in the next months. 29% of consumers are looking to purchase a new desktop or laptop PC, and 35% are looking to upgrade to a new mobile phone which offers greater functionality. 23% hope to make some investment in the equities, perhaps good news for the stock market.

These popular items on Hong Kongers shopping list for the next six months are similar across Asia. The hottest item on Santa's wish list this Christmas would have to be a new digital camera - with over a quarter of all consumers in the region planning to purchase one in the next six months. Regional survey results also show that around one in four regional consumers are also looking to upgrade their mobile phones and one in ten are looking to get broadband Internet connection.

The ACNielsen Asia Pacific Consumer Confidence Poll is a regular syndicated online consumer survey, gathering information from regular users of the Internet across Asia Pacific on their attitudes and preferences and consumption of media, products and services across different markets. Clients can insert specific questions as required.

Source: ACNielsen

 

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