Europeans cut X'mas spending

AsiaOne.com
Europeans cut X'mas spending
Thu, Nov 13, 2008
AFP

PARIS - EUROPEANS are tightening their belts during the holiday season, buying fewer and cheaper gifts while turning to discount stores for puddings and turkeys for their Christmas feasts, a survey showed.

Smarting from the global financial crisis, consumers across Europe plan to cut back holiday-spending by as much as six per cent, according to the survey of 18,000 consumers in 18 countries released by Deloitte on Wednesday.

The drop stands in sharp contrast to last year, when Europeans spent on average five per cent more on gifts and holiday cheer.

Last year, the Irish, Britons and Spaniards burst open their wallets during the holiday season as their economies chugged along and consumer confidence ran high. But now 60 per cent of Europeans believe the economy is headed toward a downturn in 2009 and they are bracing for tough times ahead.

'It's going to be a painful Christmas,' commented researcher Gilles Goldenberg. 'This year, everything is going badly in western Europe.'

Europe's biggest holiday-spenders, the Irish are planning to tone down the merriment, spending less on gifts, traditional foods for the Christmas gluttony and entertainment.

The average Irish household will spend 668 euros (S$1,300) on gifts, seven per cent less than a year ago, 422 euros on special foods and drinks - down two per cent from last year - and 264 euros on entertainment, a drop of five per cent from 2007.

On the other end of the spectrum, the thrifty Germans will spend on average 401 euros, some five per cent less than last year.

In France, where nine out of ten respondents said they believed the country had entered into a recession, holiday spending was also down five per cent for an average of 527 euros.

Office colleagues and friends are falling off Christmas gift lists this year, while spouses are in for a disappointment if they are hoping for pricey high-tech paraphernalia such as GPS navigation systems or MP3 players.

More modestly-priced CDs, gift certificates and books are the order of the day.

Consumers said they still plan to give their children video consoles, computers and other more expensive gifts on their Christmas wishlist but they will be looking closely at sales and hunting down best prices on the Internet.

European households also are planning to make more food purchases from discount stores, with 14 per cent saying they will stock up on turkey, foie gras and other delicacies there, compared to seven per cent last year.

Overall, 71 per cent will buy their Christmas food in supermarkets.

'Given that the crisis we are facing will be long and serious, these consumer attitudes are not just for the Christmas period and are expected to last,' said Mr Goldenberg. -- AFP