Dominican consumers are optimistic
Santo Domingo. The INTEC Confidence Index, 2012 (ICG), improved 6.83 points between July of the 2011 and April of this year, as established by a study carried out by INTEC's Business Area, which indicates that it went from 44.67 to 51.50, ranking first time in several years over 50 points from 2008. This means a significant improvement in the expectations of the population regarding their personal and family situation and the economic performance of the country.
However, the perception of the current situation remains below the 50.0 points, in 47.00 points to be precise, which means that the consumer is still pessimistic in relation to the current situation.
The Future Confidence Index went from 47.81 to 56.01 points (+ 8.20), revealing the optimism and consumer expectations for the economy in the coming months, which can mark trends in consumption that have to be taken into account by the productive sector and services.
The data are contained in the study "INTEC Consumer Confidence Index - June 2012 - Perception summary by lines", disseminated by INTEC during this weekend. The university carries out this research as part of a continuous monitoring of business climate conditions in the country and as a contribution to decision making by economic agents.
The study indicates that the possible acceleration of consumption may be affected by aspects such as a tax reform, corporate taxes, reduction of government spending, difficulties in the international economy, among others, which indicate that these results only indicate the disposition at this time of the Dominicans
Source: 2008-2012 Consumer Confidence Index Surveys. INTEC.
Differences: North / South
The Index reveals differences among consumers in the various regions, but it is striking that the South region was the one with the highest increase in the ICG, with an increase of 12.5 points, leading for the first time in several years this aspect and being located in 55.30. In contrast, the North region increased its INTEC Confidence General Index in 6.58, but it was the only area that remained on the pessimistic scale of the measurement when it was located in 48.65.
However, when establishing the Current Confidence Index, pessimism remains dominant and the only region that passed the 50.0 barrier was precisely the South with a shy 50.37 points.
This trend of an optimistic South and a cautious and even pessimistic North is verified in several of the indicators, as the following table of perception shows:
Average Index of the Southern and Northern Regions in the ICG-INTEC, 2012.
Variable South North
Current family economic situation 50.12 39.94
Future family economic situation 62.95 56.01
Current economic situation of the country 49.06 35.86
Future economic situation of the country 64.08 55.14
Current price change on products 37.74 31.95
Future price change in products 51.48 45.29
Current employment status 55.21 43.03
Future employment status 65.31 58.91
Currently receives more energy 56.17 58.45
Will receive more energy in the future (12 months) 70.32 66.05
The above table reveals that only in the energy issue (if it receives more energy now than in the last twelve months) the North has a slight advantage over the South. In the others, as has been pointed out, the South is more optimistic.
The electric theme, by leaps
The INTEC Confidence Index for the electrical issue has shown a behavior of "jumps": up-down-up-down-up. The graph can better illustrate this:
However, it is good to note that with the exception of December 2009, in the rest of the surveys it has remained above the 50.0 barrier. From July 2011 to April 2012 it went from 52.04 to 58.76, for an increase of 6.72 points. The percentage of those who believed that they currently receive more electricity than in the last twelve months went from 35.3% to 44.1 and decreased in a similar proportion of those who gave a negative answer: from 64.7 to 55.8%. In this way, the balance is tilted towards a more favorable perception of the electricity service, but it continues to be a challenge for this sector, since approximately one in two Dominicans does not perceive an improvement.
Looking ahead to the next 12 months, most of those surveyed expressed being slightly more confident that they will receive more electricity, which is reflected in a perception index of 57.42, better than the 55.44 estimated for December 2009. For example, 46.1% answered “maybe” to the question of whether they will receive more electricity in the next 12 months. In 2009, those who answered this way represented 55.44 of the sample.
Similarly, in all regions respondents reflect greater optimism for the future, except those in the East region, where the Confidence Index drops from 61.28 (in 2009) to 46.67 (in 2010).
By domain, the most critical area was the North where the Index descended from 61.05 to 58.45. On the other hand, the South and the East overflowed optimism when going from 36.87 to 56.17 in the first case (+ 19.30) and from 60.41 to 70.64 in the second case (+ 10.23). The Metro zone had the virtue of placing itself above the 50.0 barrier when going from 49.82 to 57.44.
The following table indicates the perception from: gender, age and income, both valuing the result of the last twelve months and what is expected in the next twelve months. For the past twelve months, women reported receiving more energy than men (46.6 versus 42.7%), who have incomes above RD $ 50,000 express that "yes" received more energy in the last year.
Regarding the future, the doubtful response predominates in men and women (48.4% of respondents and respondents indicated that "maybe" they receive more energy in the next twelve months).
The barrier of pessimism-optimism
The interpretation of the INTEC Consumer Confidence Index or ICC-INTEC is based on the fact that the scores higher than 50.0 points predict economic growth due to the improvement in the perception of economic activity, while the lower indexes to 50 points allow estimating a decrease due to consumer pessimism. An increase from one period to another means an improvement in the perception of economic activity, which could anticipate a growth in family consumption that exceeds the previous period evaluated. A decrease from one study to another means that the perception of economic activity is lower, so we can expect a growth rate of family consumption lower than what was anticipated for the period. A neutral behavior from one study to another assumes a growth rate of family consumption similar to the previous period.
1. IGC-INTEC
2. Family economic situation
3. Economic situation of the country
4. Change in prices
5. Labor condition
6. Purchase or change of cell phone
7. Purchase or exchange of vehicle
8. Change of furniture or appliances
9. Buying or building homes
10. Savings
11. Borrow from banks (credit)
12. Buy supermarkets, stores full
13. Electric power
14. Intentions to buy household appliances
As it can be noted, only three variables are presented with a positive Current Confidence Index: the cell change, the savings and whether or not they receive more electric power. As for the future, only three aspects or variables are placed on the pessimistic side of the barrier: price changes, borrowing from banks and the intention to buy appliances.
Technical data:
The Consumer Confidence Index-INTEC (ICC-INTEC) is an indicator that measures statistically the perception of consumers in relation to expectations or level of optimism with the current and expected medium-term situation of the economy, both in the home and from the country. The calculation of the ICC is carried out in many countries around the world as a way of periodically monitoring the way in which the events of the external environment affect consumers' purchasing decisions.
The ICC is performed in the INTEC by applying personal surveys in the National District and in other 17 provinces, totaling the sample in each study an average of 1,120 individuals for an estimated total margin of error of ± 3%. These surveys are carried out by personnel trained and supervised directly by experts from the university, and then processed in statistics software.
The objective of the study is to measure the Consumer Confidence Index in the Dominican Republic, through the collection of the different attitudes and perceptions that affect the current or future purchasing behavior according to the indicators:
• Economic situation of the household
• Economic situation of the country
• Behavior of prices of products and services
• Availability of employment
• Acquisition of goods: cell phone, vehicle, home, furniture, appliances and basic consumer items in commercial establishments
• Provision for savings
• Willingness to borrow money from financial institutions
• Availability of electrical energy
To acquire ICC results please contact: Yolanda Iris Disla, ext. 453, email: