Vietnam Experienced The Fourth-Fastest Growth Rate in Asia Pacific: Visa

Recently, Visa International has released the global Commercial Consumption Expenditure (CCE) measurement for 2006 that shows business and government spending in the Asia Pacific region grew seven percent over 2005 expenditure.

 

Vietnam experienced the fourth-fastest growth rate in Asia Pacific in 2006. Vietnam’s total CCE spend in 2006 was US$78.1 billion, which was 16 percent higher than spend in 2005. The top five fastest regional growth rates in 2006 were Indonesia (25 percent), Philippines (18 percent), Sri Lanka (17 percent), Vietnam (16 percent) and Thailand (16 percent).

 

Using the CCE index, a standardized metric to track business and government spending globally, Visa Commercial calculates global CCE in 2006 to be US$66.7 trillion, which represents an increase of eight percent over 2005 expenditures of US $61.8 trillion.  Asia Pacific spend accounted for US$17.0 trillion in 2006.

 

The top five Asia Pacific markets in size of total spend were Japan (US$5.3 trillion), China (US$4.2 trillion), India (US$1.9 trillion), South Korea (US$1.9 trillion) and Australia (US$1.1 trillion).

 

The CCE index provides the global payment industry, including Visa and its member financial institutions, an unbiased and consistent way to monitor global business expenditures. The Visa CCE index includes all commercial spending with the exception of payroll and other select expenditures. 

 

Michael Cannon, senior vice president for Commercial Solutions in Asia-Pacific said “The Asia Pacific region’s growth is understandable given the strength of the economies in our part of the world, China, India and South Korea experienced double-digit growth in 2006, which helped the region grow slightly faster than either Europe or the United States.”

 

Utilizing methodology developed in-house by Visa and unveiled in 2004, CCE draws upon    government data using methods similar to those employed for the Personal Consumption Expenditure (PCE) index, which monitors consumer-related spending. Global CCE is measured 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 to exclude capitalized expenditures, such as construction and durable defense spending. The calculations measure transactions at basic prices, which include taxes (less subsidies) on production. Retroactive adjustments are made to account for any revisions in officially published statistics and economic data in current and previous years. Many types of transactions included in CCE can be captured on a variety of Visa products including Visa Corporate, Visa Purchasing, Visa Business, and Visa Fleet.

 

“Since its inception by Visa Commercial more than three years ago, the global Commercial Consumption Expenditure index has become the de facto metric for tracking business and government spending and the continued transition to electronic payment systems, including the full suite of Visa Commercial products and services,” said Aliza Knox, senior vice president, Visa Commercial, Visa International. “Updated every year, the global CCE index benefits the entire financial services industry by providing an unbiased and consistent way to monitor global commercial expenditures and identifies new growth opportunities for our stakeholders by measuring the traction of various payment types with corporate and government entities.”

 

Visa Commercial provides payment products with information management and services designed to help businesses and government achieve greater efficiency, control and convenience. The global CCE index establishes a valuable baseline for measuring market penetration growth and effectiveness for Visa and its member financial institutions.

The overall 2006 measurement for electronic and paper-based business and government spending within Visa’s six global regions breaks down as follows:

Region	2005	2006
Europe	US$21.2 trillion	US$22.5 trillion
United States	US$16.2 trillion	US$17.3 trillion
Asia Pacific	US$15.9 trillion	US$17.0 trillion
Central/Eastern Europe, Middle East and Africa	US$3.9 trillion	US$4.5 trillion
Latin America/Caribbean:	US$2.9 trillion	US$3.4 trillion
Canada	US$1.7 trillion	US$2.0 trillion
Total Global CCE	US$61.8 trillion	US$66.7 trillion