Global ITC Q1 2017 – US strong, UK tanks

Despite the value of the ITC market in Q1 being the same as a year ago, there were some major differences in regional and country growth rates, which I outline in this post.

The Figure above shows regional spending by quarter since the beginning of 2015. After big improvements in all regions in the first half of 2016, all but the Americas have worsened in 2017. Asia Pacific saw the biggest change in spending since Q4, although Europe (both Eastern and Western) fell furthest in the quarter. The Americas saw the best results, staying slightly positive; its greater size counterbalanced the declines in other regions, preventing the world market from going into the red.

The Figure above shows ITC spending growth rates in the major country markets. In particular:

  • Spending remained strong in the US one quarter into the presidency of Donald Trump; ITC spending there represented 77% of the regional total in the Americas.
  • Japanese customers have been the most enthusiastic purchasers of ITC offerings over the last year, although the level dropped to 0% in Q1 2017.
  • Although China is heavily involved in the ITC industry as a manufacturer and (more recently) acquirer of established suppliers, domestic spending has shown less variation than in other major countries and was negative in Q1 2017.
  • ITC spending in Germany and France has been similar each quarter, demonstrating common thinking in (what will be) the 2 largest remaining countries of the EU; nevertheless, both saw zero growth in Q4 2016 and a slight decline in Q1 2017.
  • Brexit has had a destabalising effect on ITC purchasing in the UK and the situation has worsened each quarter since the decision to leave the EU in June last year. Uncertainty about when, how and by whom the necessary actions will be done and the rapidly falling value of the Pound are the major causes.

There are major differences in political leadership in the US an UK of course; one has a populist demagogue whose most extreme changes can be resisted by the government and/or judiciary and who can be ousted after 4 years, or sooner if impeached; the other is undergoing deep constitutional change without credible leadership from any of its major political parties. It is certain that spending will continue to improve in the US and worsen in the UK.

Contact me if you’d like more detail – on market growth rather than my political frustrations of course!


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