STORES | Staff Reporter, China

Weekly News Wrap: New Year travel slump threatens China's retail recovery; India's bourses clear Future-Reliance deal

And over a dozen stores in Japan’s Ginza Six mall closed down.

From Bloomberg:

China expects a sharp downturn in travel over the Lunar New Year period compared with pre-pandemic levels following new restrictions to control coronavirus outbreaks, threatening a nascent-recovery in consumer spending.

In recent weeks dozens of local governments have asked people to stay near their workplaces or to get virus tests and isolate for up to 14 days before returning home in order to prevent the spread of Covid-19.

That threatens a recovery in consumer confidence just as it showed signs of picking up. Spending in restaurants and on accommodation increased in the final three months of last year, following three successive quarters of declines. Retail sales rose 4.6% YoY in December.

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From Reuters:

Indian stock exchanges gave the go ahead for Future Group’s $3.4b deal to sell its retail assets, taking it a step closer toward closing a deal that has soured its ties with its business partner Amazon.

Future and Amazon are locked in legal tussles over the Indian group’s August deal with Reliance Industries. The US-based e-commerce giant alleges the deal breached some of its pre-existing contracts with Future.

In late night notifications, Indian exchanges said they had no objection or adverse observation on the deal, saying they had reached the decision after communicating with India’s markets regulator, the Securities and Exchange Board of India (SEBI).

SEBI has advised that Future should share various details of the company's ongoing litigation with Amazon when it approaches India’s National Company Law Tribunal, which also needs to sign off on the deal, the Bombay Stock Exchange notification said.

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From Reuters:

More than a dozen stores closed in Tokyo’s high-end Ginza Six mall this week as the coronavirus pandemic kept big-spending foreign tourists and other luxury shoppers away from an upscale shopping district famous for brand-name boutiques.

Until the pandemic closed Japan off to most foreign visitors last year, the retail complex, which opened in 2017 with around 240 stores, was a symbol of Ginza’s revival as a popular destination for tourists.

Ginza Six said on Wednesday that around 15 stores, including Italian fashion house Moschino, cosmetics brands Shiseido and Shu Uemura, as well as Salon des Parfums selling Annick Goutal and other fragrance brands, have shut in the past few days.

While Japan has not seen COVID-19 outbreaks on the scale of some other major economies such as the United States and Britain, infections have been rising steadily and the government declared a second state of emergency in early January.

The continued travel ban, particularly the absence of Chinese tourists during next month’s Lunar New Year holiday for a second year running, is also expected to deal a blow to Tokyo retailers, said Atsumi Gamou, head of Japan Tourism Agency.

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