BMI View: A weak economic environment continues to weigh heavy on the Croatian consumer electronicsmarket as 2014 marks the sixth consecutive year of GDP contraction. Declining consumption, highunemployment, currency depreciation and fiscal austerity continue to squeeze demand for devices,countering the positive impact of some technology trends such as adoption of smartphones, tablets andsmart TVs. BMI believes big-ticket items such as TVs and PCs remain hardest hit by the economicchallenges facing Croatia, leaving the handset market as the outperforming sub-segment. The economy willface slow recovery, which should start filtering from 2016; declining average selling prices in several keyproduct categories and comparatively low penetration rates should drive spending growth in the latteryears of our forecast.
Headline Expenditure Projections
Computer Hardware Sales: USD498mn in 2014 to USD489mn in 2015. The outlook remains weakowing to challenging economic conditions that are reducing consumer demand for big-ticket purchases.These factors are also encouraging the shift in sales towards cheaper tablets, creating an additionalsqueeze on the growth of sales value.
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