Disease Blocks Retail Sales

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Last updated at: (Beijing Time) Wednesday, May 14, 2003

Disease Blocks Retail Sales

The fatal severe acute respiratory syndrome (SARS) dealt a body blow to the growth of Beijing's retail sales in April.

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The fatal severe acute respiratory syndrome (SARS) dealt a body blow to the growth of Beijing's retail sales in April.

Figures from the local bureau of statistics show sales in the Chinese capital stood at 14.5 billion yuan (US$1.7 billion) for the month, an increase of 14.6 per cent compared with the same time last year.

"(But) the growth rate was 10 percentage points lower than the first three months,'' the bureau said.

Qi Jingmei, a senior economist with the State Information Centre, said the recent slow growth suggests SARS was having an impact.

"The obvious negative impact of SARS was on tourism, catering and transportation,'' she said.

The retail sales volume of restaurants in Beijing was 830 million yuan (US$100 million) in April, down 4 per cent from a year ago.

The disease also had a knock-on effect on people's spending on food and other necessary items, Qi said.

"They were unwilling to leave their homes,'' she said.

Retail sales of food and clothing were 3.65 billion yuan (US$439.7 million) and 1.35 billion yuan (US$162.6 million), respectively, in April, which were close to the 2002 figures for the month.

Retail sales of daily necessities was 8.96 billion yuan (US$1.1 billion) in the month, an increase of 23.5 per cent.

Retail sales of products related to SARS prevention, such as Chinese traditional medicine and disinfectants, witnessed a significant year-on-year rise, the bureau said, without giving further details.

Zhang Liqun, a senior research fellow with the Development Research Centre at the State Council, said SARS will obviously have an impact on retail sales, but it will not be that large when looking at all of 2003.

Experience from Guangdong Province in southern China suggests the disease will last about three months, he said.

After that period, people will have surplus disposable income and may "make up'' for their reduced spending.

At present, people are still buying daily necessities from big department stores.

"They have to eat every day, although they may not eat in restaurants,'' Zhang said.

But impulse sales of products such as clothing and shoes, which are non-essential, will be hardest hit as there are less window-shoppers on the capital's once bustling streets.

Despite the recent blow, Beijing's retail sales reached 62.7 billion yuan (US$7.6 billion) for the first four months of 2003 -- a year-on-year increase of 21.8 per cent.Enditem

Source:China Daily

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