Go-ahead for department store plans
CHIA Tai International and casino magnate Stanley Ho have been given the green light to run department stores in Tianjin, according to China's Minister of Commerce Hu Ping.
The stores will join two other foreign-invested department stores which have recently been approved to retail in China. The others are in Shanghai and Beijing.
''Also being processed are two applications in Qingdao - the companies involved have connections with Hongkong and Southeast Asia,'' said Mr Hu.
A total of 24 applications have been received since China started to open its retail sector to foreign investment a few months ago.
Six cities have been opened for the operation of approved foreign-invested department stores: Guangzhou, Qingdao, Dalian, Beijing, Tianjin and Shanghai.
Mr Hu said the government had relaxed the requirement for them to balance their foreign exchange needs.
''In some cases, depending on the contract, a store may not be required to export at least the same value of goods as it imports,'' he said.
He added that China's retail sector was likely to be further opened up as the market was growing.
Last year, national retail sales were up 15 per cent on 1991 to 1.08 trillion yuan (about HK$1.45 trillion).
Mr Hu said he expected a similar level of sales this year as the country's policy to cool down an overheated economy would lead to steady development.
He predicted that retail sales would reach 3.2 trillion yuan in 2000.
He said the retail market would also be stable without dramatic ups and downs because it was maturing.
''We have a strong demand for goods which our productivity is high enough to meet,'' said Mr Hu.
''Also, the consumption psychology is mature. They aren't just mad about any goods. They choose what they really need,'' he added.
But high-end products also had their markets: ''In a department store in Dalian, a watch may cost up to 240,000 yuan. But people are still buying them.'' Responding to comments that state-owned department stores did not fare as well as small private enterprises which were flexible, Mr Hu said many medium-sized and big state-owned outlets reported very good business.
Speaking at the Joint-Venture Products Exhibition in Shenzhen yesterday, Mr Hu said he was hopeful China would be granted Most Favoured Nation (MFN) status this year.
''I think they [the US] will see China as a big market . . . They will consider the issue from the interests point of view. Sino-US relations are still hopeful,'' he said.
He added that he was optimistic of China's entry into the General Agreement on Tariffs and Trade (GATT).
Prospects for the country's economy were bright, he said. And any possible intervention by the US Government in the Sino-British political wrangle would not pose a threat to China's economic growth.
''Some people do not like the idea of a strong China, but I don't think any country can stop China's economy from growing,'' he said.