Global year-end retail sales were roughly the same as last year, with the Chinese mainland and emerging markets such as Brazil, Mexico, Chile, Poland and Russia faring relatively well, while receipts were temperate in traditional markets, according to a study announced at a press conference by the Hong Kong Trade Development Council (HKTDC).


Even with mostly conducive weather conditions, passable sales results were only recorded for the United States and, to a lesser extent, Germany, while tepid results were seen in the United Kingdom, France and Japan, as well as a downswing in Italy.


Year-end sales performance has gradually become a valuable pointer to retail business in the year ahead, not only in countries that celebrate Christmas but also some markets where Christmas is not a festive season, particularly the mainland.


HKTDC Principal Economist (Global Research) Daniel Poon noted that a cautious mood has prevailed among traditional markets, especially in EU countries most affected by the sovereign debt crisis. While the austerity measures and higher tax burdens will weigh on household budgets, said Mr Poon, a more realistic consumer mindset characterized by increasing acceptance of austerity tends to put a floor on retail sales, in turn whetting an appetite for value-for-money products.


 


Poon suggested that Hong Kong exporters should seek new business opportunities in the emerging world to help realize sales increases. While Central and Eastern Europe will remain a weaker region due to its close integration with the EU, economies endowed with distinct potential are the commodity-exporting nations such as Russia, and Latin American countries such as Brazil, Mexico and Chile. Of more importance is the mainland, where government endeavors to promote consumption and rural development will open up new dimensions for Hong Kong companies accustomed to exporting to overseas markets.



European Union


The sovereign debt crisis, fiscal tightening and fragile euro fundamentals triggered an unparalleled austerity drive, resulting in consumption abstinence overshadowing festive-season good tidings.


Most shoppers stuck to their budgets and were inclined to use mobile devices and social networks to find the best prices. They favored cash and debit cards rather than credit cards to pay for their purchases. As consumers were more concerned with prices, value retailers tended to outsmart department and upscale stores, where sales were in part propped up by an inflow of overseas buyers, especially from the mainland.



Germany was the bright spot in the region. Thanks largely to a stronger labor market and rising wages, holiday sales were estimated to have risen by 1.5 per cent from 2011, roughly in line with last years showing. Product-wise, electronic gadgets sold well, as did traditional toys and selected new technology playthings.

While the year-end performance in France has been less encouraging, and Italys even worse, sales in the UK are expected to have edged up by 1 per cent from last season. British consumers have increasingly acclimatized to new fiscal realities, tending to enjoy themselves while avoiding thoughts of the economic hardships. Consumer electronics were the standout in these three countries, especially for trendy products such as smartphones and tablets.



Japan
As the stimulus from the reconstruction efforts following the disastrous earthquake has started to peter out, year-end sales in Japan were weak.

For most holiday shoppers, dwindling bonuses and sustained anxiety about job security have continued to affect the mood surrounding purchases.


Chinese Mainland


Amid soaring wages and government initiatives to stimulate consumption, retail sales during the first 11 months of 2012 were 14.2 per cent higher than a year ago. In November alone, retail sales grew by 14.9 per cent.

The brisk performance reflected not only the robust spending trend, but also a rising Yuletide spirit across the country.

Feedback from the HKTDCs mainland offices generally shows hearty retail and online sales for most consumer products. Home buying aside, a large number of consumers also thronged Hong Kong or went overseas for holiday shopping sprees.

Other emerging markets

Sustained commodity prices tended to provide a lift to consumer sentiment and festive spending. Brazils Christmas sales did well. While they softened a tad from last years strong gains, Brazilian sales still posted a decent increase.


Chile, Argentina and Mexico showed good sales signs.


As for Central and Eastern Europe, consumer sentiment was overcast by the Eurozones debt crisis, although Christmas sales results were mixed.

Hungary, given its fragile financial conditions, exhibited barely marginal growth in year-end sales. In the Czech Republic, the rise in Christmas sales was tepid due to its heavy reliance on exports to the EU.

In Poland, buoyed by a sound fiscal position and less dependence on external trade, year-end sales fared better. Russia, which has benefited from firm oil and commodity prices, turned in even more handsome results for year-end sales.