Wednesday, October 16, 2013

Urban Java - Per capita expenditure

In this note my objective is to arrive at the per capita spend in Urban Java. I have tried to arrive at this number following two different methods:

1) GDP = around $900 billion
Household expenses (i.e. private consumption excluding purchases of dwellings) = 60% of GDP i.e. around $ 500 billion. (World Bank). i.e. around $2100 per capita.
GDP generated by the urban areas = 74% (expected to grow to 86% by 2030 as per MGI)
This means of consumer spending of $500 billion, roughly $400 billion is by urban areas, assuming same % of consumer spend in urban and rural.
Urban population is of around 120 million + out of which around 80 million + are in Java. Thus, of $400 billion, Java accounts for around $270 billion.

So the target market of Urban Java has a population of 80 million with a market size of $270 billion i.e. per capita spend of around $3400.

2) Java contributes to around 58% of the total GDP (Central Board of Statistics) i.e. around $520 billion. Urban Java's consumption expenditure is higher at 70% (Credit Suisse). Thus, total consumption in Java is around $365 million i.e. per capita spend of around $4500.

Thus, the per capita spend in Urban Java is between $3400 - $4500.





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