Wal-Mart, Carrefour outpace China retail boom

Hong Kong, Mar 27: Wal-Mart Stores Inc. and Carrefour S.A. expanded Chinese sales more than 30 percent in 2006 by setting up stores at a rapid clip, a trend likely to persist in 2007 as the world's largest retailers slug it out in a trillion market.

Carrefour, the largest foreign retailer by revenue in the world's fourth-biggest economy after China Resources, racked up 53 percent growth in sales to 24.8 billion yuan (.21 billion) last year, the China Chain Store Franchise Association said.

The French firm, which entered the market a few years before its larger U.S. rival, outpaced Wal-Mart's 30 percent leap to 15.03 billion yuan, and surpassed the overall market's 14 percent rise.

But foreign firms play second fiddle to domestic players in Asia's largest retail arena after Japan.

In 2006, the top retailer by sales was home appliance giant GOME Electrical and its unlisted parent, a Best Buy-like electronics chain run by billionaire Huang Guangyu. The firm grew revenue 74 percent to 86.9 billion yuan -- more than triple what Carrefour raked in.

China is on course to become the world's second-largest consumer market by 2015, but analysts say foreign firms looking to tap that sizzling growth are in for a bumpy ride because of intense local competition and price wars.

Credit Suisse projects that the value of domestic consumption there could hit .8 trillion by 2020. By 2015, only the United States would be a bigger consumer market, it reckoned.

For a ranking of China's 100 largest retail concerns, please click on http://www.ccfa.org.cn/2007ls/2007top100/top100.jsp For a breakdown of foreign or non-domestic players only, please click on http://www.ccfa.org.cn/2007ls/2007top100/out.jsp

Reuters