Wal-Mart Imports from China Swell by 20%

CHINA — Wal-Mart said it would purchase $18 billion worth from China this year, an increase of more than 20% over 2003, according to China Business Weekly. This is the second year in a row that Wal-Mart's imports from China grew by more than 20%.

And, the trend is expected to continue. President and ceo Lee Scott says the procurement of stock from China will grow at a rate similar to that of Wal-Mart's overall growth worldwide, if not faster, reported to the Chinese weekly.

An unnamed company official also stated that Wal-Mart will extend its procurement base from South China's Pearl River Delta to the North and East China in the next few years.

Wal-Mart shifted its overseas procurement center from Hong Kong to Shenzhen, a city in South China's Guangdong Province, in February 2002 to better serve the purchasing and exporting business.

Last year, Wal-Mart purchased $15 billion worth of goods from China, half from direct purchasing, the rest from its suppliers in China. More than 5,000 Chinese enterprises have established steady supply alliances with Wal-Mart, reports China Business Weekly.

The U.S. trade deficit with China is expected to reach $150 billion this year.

The publication also reported that local experts say Wal-Mart's plan of increasing its procurement from China has granted the firm a positive corporate reputation in the country.

Increased buying from China brings more job opportunities, which wins points with both the government and with potential customers in China, said one government official.

Wal-Mart entered China in 1996 and currently has opened 39 stores, including supercenters, Sam's Clubs and Neighborhood Markets in 15 cities around China, including Beijing, Harbin and Dalian.

It has recently announced the opening of its first store in Shanghai, slated for the middle of next year, according to the report.