Investment down as sales rise
By Wang Yanlin |
April 16, 2011, Saturday
|
Print Edition
Print Edition
SHANGHAI'S fixed-asset investment dropped 8.1 percent from a year earlier to 93.2 billion yuan (US$14.3 billion) in the first quarter of this year, while retail sales expanded 12.9 percent to 161.8 billion yuan, the Shanghai Statistics Bureau said yesterday.
It reflected the city's efforts to reduce its reliance on investment and exports, and try to create a consumption-led economy, analysts said.
Fixed-asset investment still grew 0.8 percent year on year in 2010, and retail sales have been expanding in the past few months, according to previous data.
"Shanghai has to become less dependent on investment because it is not a sustainable way for development," said Wang Zehua, an analyst at the bureau.
At the height of the global financial crisis in 2008, China resorted to huge government spending in infrastructure to stimulate the economy.
Shanghai followed this path but many analysts said such a strategy should end.
In the January-March quarter, infrastructure investment slumped 40.1 percent from a year earlier to 17.5 billion yuan.
In contrast, investment in manufacturing edged up 0.4 percent to 20.5 billion yuan, and spending on property development expanded 11.3 percent to 46.8 billion yuan.
Consumption in the city has been stable in the first quarter, albeit the pace slowed from 2010's 17.5 percent.
It was mainly because a retreat in sales of vehicles and household appliances after the stimulus package for buying such products was reduced.
Sales of vehicles gained just 7 percent year on year in the first quarter, down 35.3 percentage points from the same period of last year. Sales of home appliances also slowed 25 percentage points from a year earlier to grow 8.6 percent.
But people spent more on jewelry and daily household and personal goods, whose sales grew 27.1 percent and 20 percent respectively between January and March.
Shanghai's exports in March jumped an annual 35.9 percent to US$18.4 billion, and imports expanded 23.2 percent to US$20.5 billion. Both were record highs, the bureau said.
It reflected the city's efforts to reduce its reliance on investment and exports, and try to create a consumption-led economy, analysts said.
Fixed-asset investment still grew 0.8 percent year on year in 2010, and retail sales have been expanding in the past few months, according to previous data.
"Shanghai has to become less dependent on investment because it is not a sustainable way for development," said Wang Zehua, an analyst at the bureau.
At the height of the global financial crisis in 2008, China resorted to huge government spending in infrastructure to stimulate the economy.
Shanghai followed this path but many analysts said such a strategy should end.
In the January-March quarter, infrastructure investment slumped 40.1 percent from a year earlier to 17.5 billion yuan.
In contrast, investment in manufacturing edged up 0.4 percent to 20.5 billion yuan, and spending on property development expanded 11.3 percent to 46.8 billion yuan.
Consumption in the city has been stable in the first quarter, albeit the pace slowed from 2010's 17.5 percent.
It was mainly because a retreat in sales of vehicles and household appliances after the stimulus package for buying such products was reduced.
Sales of vehicles gained just 7 percent year on year in the first quarter, down 35.3 percentage points from the same period of last year. Sales of home appliances also slowed 25 percentage points from a year earlier to grow 8.6 percent.
But people spent more on jewelry and daily household and personal goods, whose sales grew 27.1 percent and 20 percent respectively between January and March.
Shanghai's exports in March jumped an annual 35.9 percent to US$18.4 billion, and imports expanded 23.2 percent to US$20.5 billion. Both were record highs, the bureau said.
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