China's retail sales of consumer goods is expected to rise 12.5 percent in 2005, with its contribution to the gross domestic product predicted to hit 40 percent, a Ministry of Commerce report said Sunday.

According to the ministry estimation, the sales of automobiles and housing would increase by more than 15 percent and around 20 percent, respectively, from the previous year.

The catering sector would retain its strong momentum of growth.

"If no major natural disasters happen, grain output would continue to grow following last year's big rise, which would markedly narrow the gap between supply and demand," said the report.

China's retail sales of consumer goods totaled 5.4 trillion yuan (US$652 billion) last year, up 13.3 percent year-on-year.

Source: Xinhua