SHENYANG -- A second outlet of the world's largest retailer, Wal-Mart, has seen the establishment of a branch of the Communist Party of China (CPC) in Shenyang, capital of northeast China's Liaoning Province.

Following the establishment of the CPC branch in the Shenyang Wal-Mart Department Store on August 12, another CPC branch was set up in the Taiyuan Road Wal-Mart store on August 18, Wang Jing, head of the Publicity Department of the Heping District Committee of the CPC, said on Friday.

The Taiyuan Road store had three CPC members, Wang said, without elaborating on the establishment of the CPC branch.

A local CPC committee official announced on Thursday that Party and youth league branches were established in the Shenyang Wal-Mart Department Store on August 12, along with a trade union, giving employees access to CPC membership.

They were the first CPC and CYLC branch set up in the Wal-Mart's 22 China outlets which have established trade unions and the first among all 60 Wal-Mart stores nationwide, said Chen Lie, head of the Organization Department of the Dongda District Committee of the CPC.

The CPC and CYLC branches would not interfere with the business development strategy and internal management of the Wal-Mart outlet, Chen said, without explaining the delay in the announcement of the news.

The branches were grassroots organizations of the CPC and the CYLC. "By organizing CPC and CYLC members together, the branches will encourage members to play an exemplary role in doing a good job and that will be helpful to business development," Chen said.

Wal-Mart headquarters did not oppose the establishment of the CPC and CYLC branches, said a manager at the Shenyang outlet, who only gave his surname as Liu and refused to make further comment.

Wal-Mart chiefs could not be reached for comment.

The establishment of CPC branch aroused the attention of the international media. Reuters carried the news, saying, "The world's largest retailer, Wal-Mart,is now host to the world's largest communist party."

Wal-Mart had previously refused to allow the establishment of Party and youth league organizations in its outlet.

The CPC branch indicated that Wal-Mart intended to assimilate with Chinese society, said Zhu Hui, vice-president of the Party School of the Shenyang City Committee of the CPC.

The chain has set up 60 outlets in China, employing 23,000 people, since entering the country in 1996. It plans to open more stores in the country in the future.

Some foreign investors worry that the CPC branches could disrupt operations if they are established in Sino-foreign joint ventures.

"They do not need to worry about that," said Zhu Hui, vice president of the Party School of the Shenyang City Committee of the CPC. "The aim of the CPC is to boost economic development, which accords with the purpose of business development of Wal-Mart and other enterprises."

Under the CPC Constitution, all enterprises, including private businesses, are encouraged to set up CPC organizations. It requires members to set a good example and devote themselves to work. The CPC has more than 70 million members.

Shenyang Wal-Mart Department Store has two CPC members and 16 CYLC members out of 389 employees, 222 of whom are under the age of 28 and eligible to apply for membership of the CYLC. The CPC Constitution allows Chinese citizens over the age 18 to apply for membership.

Sun Haijun and Guan Ting are the two CPC members working at the Shenyang Wal-Mart outlet, located in the Dadong District of the city.

They said the establishment of the Party branch would prompt them to work hard and play an exemplary role. "It's good for business development," said one.

He Zheng, another employee of the store, said he believed the Party and CYLC branches would help unite employees and encourage them to contribute more to the business development.

With 1.6 million employees in 16 countries and regions, Wal-Mart has a history of banning trade unions in its outlets, for which it has been widely criticized by human rights and labor organizations. It also refused to allow the establishment of CPC and CYLC branches in the past.

With mounting pressure from the All-China Federation of Trade Unions (ACFTU) and the public, Wal-Mart China conceded in 2004 in a statement that "should associates request the formation of a union, Wal-Mart China will respect their wishes and honor its obligations under China's trade union law".

Wal-Mart chiefs have promised to help the ACFTU, China's top trade union authority, establish unions in all its outlets across the country.

Joe Hatfield, president of Wal-Mart Asia, has said he hoped to establish a good relationship with the ACFTU and local branches that would be beneficial to Wal-Mart employees and business development.

"We think it is in line with the Chinese government's efforts to build a harmonious society," Hatfield added.

China has seen the establishment of a growing number of CPC branches in foreign-funded enterprises in recent years.

Suzhou city, in the economically-developed Jiangsu Province, has 6,545 foreign-funded enterprises, in which 1,049 CPC branches with 14,041 members have been established.

Established in Tianjin in 1992, Motorola China Electronics Ltd., which ranks second among the top 500 foreign-financed enterprises in China, saw the establishment of a CPC committee in 1997.

Due to their hard work and devotion to the development of the company, 489 CPC members have been named outstanding employees of Motorola China Electronics Ltd. in the past nine years.

Shenyang has set a target to gradually set up trade unions, CPC and CYLC branches in more than 90 percent of the 10,431 foreign-financed enterprises in the city in the coming year.

Shenyang City Committee of the CPC will set up a special committee in the local general federation of trade unions, which will help and guide the establishment of trade unions, CPC and CYLC branches in private businesses.