China's Commodity Market

    First, market scale expanded continuously, circulation industry played a more important role.

    The scale of consumption market created a new record. Total value of social consumption was RMB51 trillion Yuan in the first eleven months, up by 13%, up by 12.1% in real terms, highest since 1997. It was projected to be RMB61 trillion Yuan in 2005. The top five countries listed in the global retail sales of consumption were US, Japan, China, Britain and France, total retail sales of China was equivalent to one fifth of that of US and half of Japan.

    Growth speed of production material slowed down. Total sales of production material in January through October were RMB11.5 trillion Yuan, up by 15.5% at comparable price, 4.5 percentage points lower than last year. It was projected that total sales in 2005 would be RMB14 trillion Yuan, 2.3 times expanded than that in 1998.

    Capacity to provide new job opportunities was strengthened. News jobs in retail sales, catering and accommodation industry were 2.72 million in the first ten months, accounting for 30.9% of the whole country, 0.2 percentage points higher than that of last year. It was projected to be 56 million at the end of 2005, accounting for 24% of the tertiary industry, ranking second in the non-agricultural industry. People of private companies engaged in circulation industry accounted for 45.4% of total in national private companies, top among all industries. Compared with other countries, percentage of circulation of China was equivalent to one third of that of US.

    Tax paid increased by a big margin. The value-added tax, income tax and business tax paid by circulation industry were RMB303.9 billion Yuan in the first ten months, up by 18.2%. Value-added tax was RMB151.1 billion Yuan, accounting for 17%; business tax was RMB75.5 billion Yuan, accounting for 21.5% and income tax of enterprises was RMB77 billion Yuan, accounting for 19%.

    Second, gap in growth speed among the markets in different areas was minimized

    Gap in growth speed between rural and urban markets was minimized. The Ministry of Commerce started the market project of "Ten Thousands of Villages and Thousand of Townships" this year, built and rebuilt 70 thousand standardized chain stores to step up growth of rural consumption market. Retail sales in the first ten months were up by 11%, 0.5 percentage points higher on an annual basis.

    Gap in growth speed among markets of different areas was minimized. Implementation of west development, central rise and revitalizing the old industrial base of the Northeast improved purchasing capacity of western and central area, and national consumption market developed balanced and coordinately. Development of such west provinces as Shanxi, Inner Mongolia, Jiangxi, Henan, Hunan and Sichuan was faster than average level of the nation.

    Third, short supply of some commodities eased and price rising slowed down

    There are more commodities, supply exceeding the demand. According to statistics of the Ministry of Commerce, supply for 428 commodities exceeded the demand among 600 major commodities, accounting for 71.3%, 1.8 percentage points higher than that in the first half year 2005. Among 300 production materials, supply exceeding demand or keeping balance in demand and supply are 279 production materials, accounting for 93%, up by 16 percentage points. National macro-control policy made short supply and demand for some commodities better.

    Price rising slowed down. Price in the first ten months was up by 1.9%, 2 percentage points than that of last year. Price of production materials in circulation industry was up by 3.9% in the first ten months, 9.7 percentage points down than that of last year.

    Fourth, modern circulation developed fast

    Circulation modernization improved greatly. The retail sales of top 100 chain stores accounted for over 10% of the total retail sales, 1 percentage higher than that in 2004. Total vale of circulation in the first 3 quarters accounted for 20.9% of the GDP, down by 0.4 percentage points. Trading of e-commerce kept fast growth.

    Circulation enterprises became integrated. Large circulation enterprises stepped up restructure and M&A and expanded business scale. The Ministry of Commerce cultivated 20 large scale circulation enterprises with sales of RMB4.3796 trillion Yuan, up by 26.4%, profit of RMB5.03 billion Yuan, up by 38.8%