Visa Commercial Metric Tracks US$1.1 trillion Increase in Asia Pacific Business and Government Spending

Visa International today released the global Commercial Consumption Expenditure (CCE) measurement for 2006 that shows business and government spending in the Asia Pacific region grew 7% over 2005 expenditure. 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 8% over 2005 expenditures of US $61.8 trillion. Asia Pacific spend accounted for US$17 trillion in 2006.

The CCE index provides the global payment industry, including Visa and its member financial institutions, a 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.”

Singapore’s total CCE spend in 2006 was US$187.6 billion, which was 13% higher than spend in 2005.

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 top five fastest regional growth rates in 2006 were Indonesia (25%), Philippines (18%), Sri Lanka (17%), Vietnam (16%) and Thailand (16%).

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.

Commercial Expenditure Global Breakdown

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

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