Wal-Mart's move to relocate its headquarters in Hong Kong is aimed at overseeing the company's operations on mainland, India and Japan, as well as identifying new business opportunities throughout Asia. Bloombertg

Wal-Mart Stores Inc, the world's most profitable retailer, announced yesterday the establishment of its new Asia regional headquarters in Hong Kong.

The US supermarket operator said it will make use of the city's dynamic transportation and communication infrastructure to bridge its network to Southeast Asia. The retailer also hopes to facilitate a 10 percent growth in global sales target.

Vicente Trius, CEO of Wal-Mart Asia, said yesterday that the Hong Kong regional headquarters will manage the company's current operations in Asia and work for business development.

"Hong Kong is the perfect location to operate a regional headquarters for Asia, as it is centrally located and offers ready access to markets across the region," Trius said.

Wal-Mart said the new headquarters in Hong Kong will oversee the company's operations on the mainland, India and Japan, as well as identify new business opportunities for the company throughout Asia.

The retailer's sales in Southeast Asia are expected to surge substantially to $100 billion this fiscal year, Trius said.

Wal-Mart, a household name in the US, which has roughly 2.1 million employees worldwide, is now looking to expand into Southeast Asia as US consumers are weighed down by housing market slump and tighter access to credit.

"We should be approaching the $100-billion mark this year for international trade," Trius said.

The retailer, a rival of Carrefour in China in terms of sales and stores, took a giant leap in market share as it plans a $1-billion acquisition of local chain Trust-Mart. The deal is expected to be completed by 2010.

Last month Wal-Mart announced a 17 percent jump in second-quarter profits to $3.45 billion, helped by a 17 percent increase in international sales to $25.26 billion.

But the bargain retailer forecasts current quarter results could miss Wall Street estimates as consumers worldwide deal with tough economic times. Analysts said Wal-Mart's third-quarter outlook was lower than some expected, and warned of tougher times ahead.

The retail chain posted $90.6 billion in international sales last fiscal year, about a quarter of overall revenue. It has more than 4,000 stores in the US and 3,000 stores in 13 other countries.

Wal-Mart's major competitors include Germany's Metro, France's Carrefour, Britain's Tesco, and a host of local players in other countries.

Mike Rowse, director-general of Investment Promotion at Invest HK, welcomed Wal-Mart's decision to choose Hong Kong from among other cities in Asia, saying Wal-Mart's establishment of regional headquarters here represents a powerful vote of confidence in the city.

Some 3,900 overseas and Chinese mainland companies operate regional headquarters or regional offices in Hong Kong, according to Invest HK.

Xinhua and Reuters contributed to the story.

(HK Edition 09/04/2008 page2)