Purchasing power to rise in Europe

01 November 2011

BERLIN: Shoppers in Europe should see their disposable income rates rise this year, despite the challenging economic climate in the region, a study has argued.

GfK, the research firm, drew on data from 42 countries throughout the continent, and predicted household expenditure would remain "robust" in the face of on-going financial uncertainty.

More specifically, the company estimated European citizens will be worth a collective €8.5tr this year when combining consumer spending and savings.

This equates to €12,774 per person across the 42 featured nations, after totals grow by a projected 3.1% in 2011.

However, the "old" 15 members of the European Union, incorporating countries such as the UK, France, Germany, Italy and Spain, are likely to post a slightly smaller 2.3% increase here.

By contrast, emerging markets that are either full members of the European Union or partners with the organisation, including the Ukraine and Turkey, are in line to witness a more rapid improvement.

In terms of per capita purchasing power, the top three European nations according to GfK are Lichtenstein, Switzerland and Norway, the average resident of which boasts at least €29,028.

Portugal, hit particularly hard by the financial crisis, was in the middle of the 42 outlets assessed, on €10,608, but has fallen behind fast-growing markets like Slovenia.

Despite its anticipated double-digit expansion, Ukraine's typical resident still only has a purchasing power of €1,761, considerably lagging the norm.

Similarly, Poland is also forecast to experience extremely rapid growth on this measure, although the average rating of €6,050 will be just 60% that of Portugal by the close of 2011.

Data sourced from GfK; additional content by Warc staff