Chinese retail boom to continue

China's retail sector grew 12.9% last year, and the government, which has begun to push for more domestic consumption, is predicting the growth to continue at an 11% annual rate through 2010.

As might be anticipated, the giants are grabbing the lion's share, with the top thirty retailers averaging an amazing 31% growth last year, according to government figures.

Although foreigners are, understandably, trying to grab as much of this growing pie as possible, they are not likely to get it all.

So far, however, Chinese retailers are holding their own. Domestic companies continue to dominate the Commerce Ministry's list of China's top 30 retailers - whose sales, the ministry reports, rose by 31% in 2005 to $61 billion.

Shanghai Brilliance sits at the top of the heap, recording sales of $9 billion last year. The closest foreign competition at this point is the French giant Carrefour, whose 25% rise in sales last year boosted it to ninth place on the ministry's list, with sales of $2.2 billion. Carrefour, the world's second largest retailer, now has 78 stores in China and plans for many more.

Wal-Mart is not doing all that well, which is true in most of the world outside North America. Suppliers in China tell me that Wal-Mart China is not an impressive operation.