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Retail Sales Expected to Grow by 10 Percent in First Quarter
The retail sales volume of China' s consumer goods is expected to grow by 10 percent in the first quarter this year to register 923.5 billion yuan, sources with the State Economic and Trade Commission said Tuesday.
Retail sales of consumer goods in March are likely to increase by 8.7 percent from the same period of last year to reach 285.5 billion yuan. The growth rate is 0.1 percentage point more than that of February.
The commission said that market growth momentum in the urban areas will probably slow down a bit in the following few months, as the holiday buying spree fades. In January and February, the holiday months, the growth rate of retail sales in large cities was bullish, 0.6 percentage points more than that in the same period of last year.
Chinese consumers still feel uncertainty about what the on- going reforms in medical care, the pension system and the social security system will bring them, which will dampen consumer's immediate consumption desires.
Moreover, with the deepening of state-owned enterprise reform, more employees will be laid off by the state sector and together with it, lower incomes are foreseeable. All these factors may offset the government's recent positive move to raise the salary of civil servants.
However, the commission drew a rosy picture for the rural consumer market. It is predicted that retail sales in rural China will be more brisk in the following months. The low income level of farmers in 2000 has, to some extent, hampered the growth of the market in the first two months, taking it down 1.7 percentage points from the same period of 2000.
But as China steps up rural tax reform and introduces more favorable policies to improve the consumption environment, the retail market in rural areas will grow at a faster speed in the following months, sources said.
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