International Trade & Economic News: China Mobile Phone Market. Debt & Taxes Go UP.

From Euromonitor: China Passes the One Billion Mark for Mobile Phone Subscriptions.  The number of mobile phone subscriptions in China exceeded the one billion landmark in March 2012, the first country to do so in the world.  Growth in household incomes, infrastructure development and a boom in smartphones have driven subscription rates, providing telecom businesses with opportunities. However, state control, income inequality and still-low per capita mobile penetration holds back sector growth, although consumers are benefitting from increasingly lower prices.

Chinese household possession of a mobile phone has risen from 73.8% to 91.2% over 2006-2011.  The engine behind this growth has been increasing access among lower-income groups, boosted by Chinese vendors ZTE and Huawei releasing budget models to compete with higher-priced foreign brands. There remain strong opportunities in the low-cost sector for wireless handheld devices, especially in rural and inland markets.

China’s mobile phone market has developed apace on the back of soaring economic advancement – real average annual GDP growth over 2006-2011 was at 10.9% – and a concomitant rise in living standards, as well as extended network coverage and increasingly cheaper deals offered by operators.

From OECD: Fiscal Consolidation: How much, how fast and by what means?  The economic crisis that began in 2008 caused government deficits to surge and pushed public indebtedness to 100% of GDP for the OECD as a whole in 2011. In many countries, just stabilising debt, let alone bringing it down to a sustainable level, will be a major challenge. The poor state of public finances will require wide-ranging fiscal consolidation in most countries, particularly in those whose pre-existing imbalances have been aggravated by the crisis, as well as in those facing rapidly rising spending on health and long-term care.

Bringing debt down to prudent levels will require sustained fiscal consolidations of more than 3% of GDP in many, though not all countries. Some countries must anticipate extremely large efforts: Japan faces fiscal tightening of up to 12% of GDP, while consolidation in the United States, the United Kingdom and New Zealand is projected at more than 8% of GDP

From U.S. Census: State Government Tax Collections Increase $62 Billion in 2011.  Income Tax Revenue Up 9.7 Percent; Corporate Tax Revenue Up 9.2 Percent

Overall government tax collections for states increased $62.1 billion to $763.7 billion in fiscal year 2011, the U.S. Census Bureau reported today. Corporate net income tax revenue was at $40.2 billion, up 9.4 percent, while tax revenue on individual income was at $259.1 billion, up 9.8 percent. General sales tax revenue was at $240.9 billion, up 8.2 percent. Corporate net income tax revenue, individual income tax revenue and general sales tax revenue comprised 70.7 percent of all state government tax collections nationally.

All 50 states saw an increase in total tax revenue in fiscal year 2011, led by North Dakota (44.5 percent), Alaska (22.4 percent), California (17.4 percent) and Illinois (15.3 percent).

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