Retail sales will reach the targeted annual growth rate of 9 per cent this year, assistant Minister of Commerce Huang Hai said yesterday.

The SARS crisis had pulled the growth rate of retail sales to a low 6.6 per cent in the second quarter making the targeted rate difficult to achieve.

"But given the growing trend in recent months and robust spending in catering and hotel industries, I can judge that the 9 per cent rate is reachable,'' Huang said.

Retail sales, an important propeller for the country's economy, grew a year-on-year 8.9 per cent during the first 11 months of the year.

October saw an increase of 10.2 per cent -- the fastest pace in two years -- and November's retail sales rose 9.7 per cent.

Revenue from the catering industry rose by 15 per cent in the third quarter and 17.6 per cent in October contributing greatly to the surge in retail sales along with hotel revenues.

Huang expected catering industry revenues to increase by 13 per cent this year, though it usually has an annual growth rate of 15 to 17 per cent.

Its revenue rose by a slim 2.1 per cent in April year-on-year and fell 15.5 per cent in May. In June, the industry underwent a slow recovery with growth of 3.4 per cent.

Its revenue reached 509.2 billion yuan (US$61.52 billion) last year, rising 16.6 per cent.

Huang believes the hotel industry's resurgence since October can help reduce its SARS-caused loss by more than 20 billion yuan (US$2.42 billion).

The SARS epidemic is expected to cause a loss of 65 billion yuan (US$7.85 billion) to the hotel industry.

The sector last year recorded a revenue of 250 billion yuan (US$30.2 billion).

In April and May hotels saw high vacancy rates as only 10 per cent of the hotel rooms in 10 big cities, such as Beijing and Shanghai, were occupied.

To stimulate a rebound in retail sales following the SARS crisis the Ministry of Commerce organized the first ever national market exploration campaign by forming closer ties between industrial and commercial sectors.

More than 120 prestigious Chinese industrial enterprises and commercial companies, including Haier, Beijing Wangfujing Department Store and Shanghai Bailian Group, agreed to promote the market through closer joint work.

The ministry also supported a series of promotional activities, including 15 national trade fairs.

It pushed local governments to create policies to help small and medium-sized companies improve their performance.

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