Chinese retail growth slows
By James Kynge in Beijing
Published: March 16 2004 4:00 | Last Updated: March 16 2004 4:00
Slower growth in China's thriving sales of cars helped restrain overall retail sales in the first two months of this year, reinforcing suggestions that economic growth may also be slowing.
Overall retail sales of Rmb878bn ($106bn, €87bn, £59bn) in January and February were 10.5 per cent higher than in the same period of last year.
That growth rate was down slightly from the 10.9 per cent year-on-year figure in December, but still higher than the 9.1 per cent growth for the whole of 2003. The first two months of each year are taken together to strip out seasonal factors due to Chinese new year, which falls in either January or February.
The figures surprised some stock market analysts, who had been expecting a slowdown in Chinese fixed asset investment and industrial output growth this year, but a mini-boom in consumer spending. So far, data for industrial output, retail sales and inflation are exhibiting a gentle moderating trend.
One explanation is that car sales growth has slowed because of growing congestion and fears over rising car loan default rates.
Sales of cars rose 36 per cent in the first two months of the year to 340,000 units, down from the 75 per cent growth rate seen during 2003, according to the Automobile Manufacturers Association. Automotive Resources Asia, an independent consultancy, predicts total passenger car sales for 2004 will rise 20 per cent to 2.4m units.
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