Retailer Tesco denies rumors of pullout from China

Tesco China told the Global Times Wednesday that it is committed to staying in China, as the China General Chamber of Commerce (CGCC) denied that foreign-invested enterprises plan to withdraw from China.

"We are committed to long-term development in China and resolved to lead in this huge potential market," said a Tesco China spokesperson, denying reports in Chinese business newspapers saying that Tesco was withdrawing from the Chinese market.

The news reports also said Carrefour planned to pull out, citing unnamed "insiders."

On Tuesday, the China General Chamber of Commerce (CGCC) released a statement denying foreign-invested enterprises plan to withdraw from China.

The statement claimed that there are negative overseas reports about China's foreign-invested enterprises intending to discredit China and China's investment environment, not reflecting reality. The statement was posted by CGCC on its website Tuesday. It was unclear which overseas reports the CGCC was referring to.

The Tesco China spokesperson, who declined to give her name citing company policy, noted the company has made obvious progress in the Chinese market and will continue devoting full efforts to serving Chinese consumers.

After adding nearly 139,000 square meters in 2011, the company's retail area in China is 743,000 square meters. It plans to open 16 new shopping malls, she said.

Carrefour China could not be reached for comment by press time. However, the CGCC statement said that Dai Wei, vice CEO of Carrefour China, paid a special visit to the CGCC and expressed the company's resolve to develop over the long term in China.

Since late August, some financial newspapers reported that Carrefour would sell its China's operation and withdraw from the Chinese market, Dai was quoted as saying.

These false reports harmed current foreign invested firms and misled consumers as well, said the CGCC.

The number of newly established foreign invested firms in China decreased from January to July.

The chamber attributed this decrease to both the worsening eurozone crisis and the sluggish growth in China, rather than China's investment environment.

"Besides the above two factors, the decrease is also the consequence of high labor costs and increasing rents in China," said Feng Pengcheng, a professor from the University of International Business and Economics in Beijing.

In August, Tesco China said it was shutting four supermarkets in China. In July, adidas planned to close its only direct-owned factory in the Chinese mainland.