China's re­tail sales to grow 10pc in 2018

The Pak Banker - - FRONT PAGE - BEI­JING -AP

China is ex­pected to see re­tail sales of con­sumer goods ex­pand about 10 per­cent to ex­ceed 40 tril­lion yuan ($6.38 tril­lion) this year, a re­port showed Tues­day.

The strong con­sump­tion growth will be pow­ered by in­no­va­tive prod­ucts and ser­vices as more af­flu­ent Chi­nese are will­ing to pay for higher qual­ity and unique ex­pe­ri­ences, ac­cord­ing to a re­port from the re­search in­sti­tute of the China Coun­cil for the Pro­mo­tion of In­ter­na­tional Trade (CCPIT).

Smart ser­vices en­abled by

the in­ter­net will be the most pow­er­ful en­gine for con­sump­tion growth this year, said Zhao Ping, a re­searcher with the in­sti­tute. China's re­tail sales of con­sumer goods ex­panded 10.2 per­cent to ex­ceed 36 tril­lion yuan in 2017, of­fi­cial data showed.

The re­port also es­ti­mated that con­sump­tion will con­trib­ute to over 60 per­cent of to­tal GDP growth while con­sump­tion gaps be­tween ur­ban and ru­ral ar­eas as well as among dif­fer­ent re­gions will nar­row.

Re­tail sales in ru­ral ar­eas are likely to grow 12 per­cent this year, about 1 to 2 per­cent­age points faster than that in ur­ban ar­eas, ac­cord­ing to the re­port. Mean­while, China's con­sump- tion will con­tinue to play an in­te­gral role in boost­ing China's eco­nomic de­vel­op­ment and con­trib­ute over 60 per­cent of GDP growth, a new re­port said. The coun­try also made con­sid­er­able progress in ser­vices and in­no­va­tive com­mod­ity con­sump­tion last year, two sec­tors that are ex­pected to pro­vide the much-needed mo­men­tum for the up­grade and growth of the sec­tor, the China Coun­cil for the Pro­mo­tion of In­ter­na­tional Trade Academy (CCPIT Academy) said in its re­port.

To­tal re­tail sales of con­sumer goods are es­ti­mated to reach 40 tril­lion yuan ($6.35 tril­lion) in 2018, with a nom­i­nal an­nual growth rate of about 10 per­cent and con­tin­u­ing the se­quen- tial growth trend of the last 14 years.

Ac­cord­ing to CCPIT Academy, con­sump­tion has in­creased in the coun­try largely due to in­creases in av­er­age in­come lev­els. "China is now in the group of mid­dle-in­come coun­tries. As a re­sult, both the growth rate and the per­cent­age of com­mod­ity con­sump­tion have been de­clin­ing with ser­vice con­sump­tion the lone bright spot and the main­stay of the econ­omy," it said.

Ex­pe­ri­en­tial con­sump­tion, or con­sump­tion driven by the de­sire for mem­o­rable ex­pe­ri­ences, as part of ser­vice con­sump­tion, has been grow­ing steadily in China. Con­sump­tion per­tain­ing to e-com­merce, such as buy­ing prod­ucts from self-ser­vice su­per­mar­kets, pur­chas­ing flow­ers on­line are ex­pected to trig­ger the con­sump­tion spree in this sec­tor, said Zhao Ping, di­rec­tor of the in­ter­na­tional trade re­search depart­ment at CCPIT Academy and the au­thor of the re­port.

"Be­sides, as ar­ti­fi­cial in­tel­li­gence, cloud com­put­ing and big data tech­nolo­gies ma­ture, the in­no­va­tive com­mod­ity con­sump­tion sec­tor, such as smart homes, and in­ter­net­con­nected cars, will see lots of growth," she added.

Ning Jizhe, head of the Na­tional Bureau of Statis­tics, said that do­mes­tic de­mand has al­ways been a cru­cial pil­lar for China's eco­nomic growth.

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