 Outside View
(China Daily)
Updated: 2008-07-03 07:37 Bears in a China shop Official numbers suggest domestic consumption is in fine fettle but cracks are appearing in discretionary spending, the Financial Times reported on Tuesday. According to CSM Worldwide, an automotive consultancy, car sales in China have been falling month on month since April. Growth in domestic passenger traffic on flights is also decelerating. Meanwhile, according to Citigroup, port volume growth at the key terminals of Shanghai and Shenzhen has fallen to 11 percent and 8 percent respectively. That is half the levels of a year ago. "Car sales in particular are a volatile series and drivers could well be forgiven for deferring purchases at a time when refiners are keeping petrol pumps empty rather than sell the stuff at a loss," the newspaper said, describing last month's earthquake and the snowstorms earlier this year as distorting factors. There are three factors for the ailing consumer sentiment, according to the newspaper. First, inflation and currency appreciation are flattering official data - hence the 28 percent year-on-year rise in May exports versus the more muted growth in numbers of containers passing through the ports. Second, China's inclination to tighter monetary policy. Discretionary spending data are weaker in parts and household bank deposits are rebounding. Third, there is a bigger structural shift under way. "China's shoppers are far from down and out. But there is more fatigue than headline numbers suggest," the Financial Times said. CP adjusts plans after quake The quake that hit Sichuan province is likely to hurt small livestock farms in rural China, with medium-scale and bigger farms emerging as a new trend, the Bangkok Post reported yesterday. According to an executive of the CP Group, the country's largest agricultural conglomerate. The trend conforms with China's policy of modernizing the farm sector, especially livestock farming. The measures would affect key provinces such as Hunan, Hubei, Shanxi, Jiangxi and Anhui where CP had earlier won contracts from central government to improve the farm sector. Damrongdej Chalongphuntarat, a vice-chairman of Chia Tai Group of Companies, CP's China arm, said the tougher standards would cover farms. The improvement would stamp out small-scale farms in the future, giving way to medium-sized ones housing at least 1,500 pigs or 10,000 chickens, he said. The quake has interrupted inland transport and significantly reduced consumption due to falling tourism. However, he was confident of quick rehabilitation in the affected area and nearby provinces, especially Sichuan. Damrongdej, who oversees CP's agro-industry operations in China's southwestern provinces, said that to support the restoration and cope with the expected stronger growth, the group planned to invest heavily in the areas by adding a chicken slaughterhouse and two animal-feed plants in the next two to three years. He said he was confident that the operations would continue to thrive with a forecast of 15 percent sales growth over the year before. Readers' comments are welcome. Please send mail to Letters to the Editor, China Daily, 15 Huixin Dongjie, Chaoyang District, Beijing, 100029 China. Send faxes to (86-10) 6491-8377. Send e-mail to opinion@chinadaily.com.cn or letters@chinadaily.com.cn or to the individual columnists. China Daily reserves the right to edit all letters. Thank you. (China Daily 07/03/2008 page9) |
