Hong Kong's retail sales posted their biggest rise in four years in February as tourist arrivals surged and gains in stocks and property prices boosted consumer confidence.

　　Sales increased 13.2 percent from a year earlier after rising a revised 4.2 percent in January, the government said in a statement. That's the largest increase since at least January 2000, and is higher than the median 9.8 percent gain forecast in a Bloomberg News survey of eight economists.

　　"We are very bullish on retail sales," said Joe Lo, a Hong Kong-based economist at Citigroup Inc. "Given the trend of strengthening consumer confidence and influx of mainland tourists, retail sales will grow strongly this year."

　　Rising consumer spending is prompting retailers including Chow Sang Sang International Holdings Ltd and Giordano International Ltd to expand, creating jobs and helping boost economic growth. Stores are scrapping discounts after more than five years of price cuts.

　　The gain in sales is "mainly due to the improved economic climate and an increased number of tourists," said Vincent Chow, general manager of Chow Sang Sang, which has 40 jewelry shops in the city. "If such factors as deflation and the property market continue to improve, the public will likely spend more."

　　The jeweler's first-quarter sales rose about 14 percent, and Chow said it plans to open a 170-square-meter shop in Hong Kong Disneyland, which is scheduled to open late 2005 or early 2006.

　　Giordano International, which owns one of Asia's biggest casual-wear chains, forecasts "double-digit" growth in sales and profit this year, Chairman Peter Lau said last month. The company plans to add 10 shops in Hong Kong this year.

　　Hong Kong's jobless rate fell last month to the lowest in more than a year, and the government predicts the economy will expand 6 percent this year after growing 3.3 percent in 2003. HSBC Holdings Plc, which owns two of Hong Kong's three biggest banks, predicts the economy will expand 6.5 percent this year, while ABN Amro Asia Ltd forecasts 7 percent growth.

　　The number of people visiting Hong Kong rose 8.4 percent to 2.95 million in the first two months of this year from the same period a year ago, according to the Hong Kong Tourism Board. Hotel occupancy rose to 81 percent in February, up from 78 percent in January, the board said.

　　The city's benchmark Hang Seng Index has climbed 2.5 percent this year. Hong Kong property sales, mainly of apartments, almost trebled in March as more people bought homes amid the city's economic recovery.

　　Property prices have gained 34 percent since April last year, according to Midland Realty Holdings Ltd, the city's biggest listed realtor. Developers including Sun Hung Kai Properties Ltd and Cheung Kong Holdings Ltd forecast home prices will rise as much as 15 percent this year.

　　(Bloomberg News)