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Retail sales in China poised to grow in 2010

Published 19 November 2009

Retail sales in China are projected to surge by 16% in 2010 with strengthening domestic demand continuing to be the focus of the government policy, according to Wang Bin, an official in the market operation department of the Ministry of Commerce.

This anticipated 16% growth in retail sales is by large following similar growth patterns posted by China in previous months. The retail sales in the country were CNY8.97 trillion ($1.31 trillion) during January-September 2009, representing a year-on-year increase of 15.1%, as per the statistics from the National Bureau of Statistics. This growth level might have reached 17%, up 2.8% from the period spanning from January to September 2008, if the effect of price change is deducted. In total, the urban retail sales summed up to CNY6.1 trillion ($0.89 trillion) during the same period, a 14.8% increase from 2008. The retail sales in areas at or below the country level reached CNY2.87 trillion ($0.42 trillion), a 16% year-on-year increase. Wang Bin added that the demand in the country could expand to a great deal. However stimulus policies like those promoting car sales in the rural market are not certain to continue in 2010, but escalating demand in the domestic market is poised to be a crucial aspect of macro policy. Due to global slowdown in 2008, a portion of high-end consumers is, in particular, shifted to middle and low-end segment. Consequently, an increment in the sales/output of middle and low-end segment is expected in such an environment. To meet the requirements of these new consumers shifting from high-end, the middle and low-end brands are likely to make more efforts to enhance their product development, and thereby making their product worth purchase.