Services firms worry over fall in business with end of Expo
By Zhang Fengming |
November 4, 2010, Thursday
|
Print Edition
Print Edition
CHINA'S services business confidence dropped to a nearly two-year low on concerns that the conclusion of the World Expo 2010 and tightening measures on the property sector will trim demand, according to an industry survey yesterday.
More than half of the respondents said they expect overall activities to be the same over the next 12 months while less than 40 percent said they expect increased activities and the remaining less than 10 percent said they see lower activities.
The degree of optimism also fell to the third-lowest level since the start of the survey in November 2005.
"Some companies noted that the end of the Shanghai Expo may lead to lower levels of business activity in the coming year," said HSBC China Services Purchasing Managers's Index, based on a survey of private services business, yesterday.
"Government policies aimed at curbing growth of the property sector were also cited by a number of panelists as a reason for pessimism," the report said.
The Expo, which ended on October 31 in Shanghai, attracted more than 73 million visitors - a record in the 159-year history of the exhibition since its debut in London in 1851. During the event, the services sector received a huge boost in the city and surrounding provinces.
In October Chinese service sector activity rose markedly, with the rate of growth quickening from September's 19-month low.
Economists are still optimistic about future growth.
"The modest improvement in the HSBC China Services PMI in October translated into faster job creation," said Qu Hongbin, HSBC chief economist in China. "This should in turn provide solid support to private consumption and demand for services in the coming months, despite the ongoing tightening of the property market."
China launched a new round of tightening measures targeted at property market in September after its April policies showed little effect in reining in prices.
The questionnaires were sent to purchasing executives in over 400 private services companies.
More than half of the respondents said they expect overall activities to be the same over the next 12 months while less than 40 percent said they expect increased activities and the remaining less than 10 percent said they see lower activities.
The degree of optimism also fell to the third-lowest level since the start of the survey in November 2005.
"Some companies noted that the end of the Shanghai Expo may lead to lower levels of business activity in the coming year," said HSBC China Services Purchasing Managers's Index, based on a survey of private services business, yesterday.
"Government policies aimed at curbing growth of the property sector were also cited by a number of panelists as a reason for pessimism," the report said.
The Expo, which ended on October 31 in Shanghai, attracted more than 73 million visitors - a record in the 159-year history of the exhibition since its debut in London in 1851. During the event, the services sector received a huge boost in the city and surrounding provinces.
In October Chinese service sector activity rose markedly, with the rate of growth quickening from September's 19-month low.
Economists are still optimistic about future growth.
"The modest improvement in the HSBC China Services PMI in October translated into faster job creation," said Qu Hongbin, HSBC chief economist in China. "This should in turn provide solid support to private consumption and demand for services in the coming months, despite the ongoing tightening of the property market."
China launched a new round of tightening measures targeted at property market in September after its April policies showed little effect in reining in prices.
The questionnaires were sent to purchasing executives in over 400 private services companies.
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