China’s retail sales grew by 17% to RMB18.12 trillion (US$2.88 trillion) in 2011, according to China’s National Bureau of Statistics. Retail sales in Mainland China are expected to remain strong due to a rising middle class which is expected to offset pressures to the country’s economy from lower export demand and a cooling real estate market.
The Chinese government is attempting to transition into a consumption-based growth model. To spur consumption, they are opening shopping centers around the country. According to the government’s Five-Year Plan, China’s retail sales are expected to grow by 15% a year, reaching RMB32 trillion (US$5.08 trillion).
The fastest growth will not come from coastal mega economies like Beijing, Shanghai or Guangdong, but from smaller provinces where retail sales have huge upward potential.
In 2011, over 29 provinces had over 15% growth, of which the five fastest growing provinces (growth in excess of 18.5%) were Yunnan, Hainan, Tianjin, Chongqing, and Shaanxi.