Consumer spending growth good news for service sector
Print Edition
BOOMING tourism, cinema and retail sales during the Spring Festival holiday show that China’s efforts to make its economy more reliant on the consumption power of its vast population is paying off.
Increasingly affluent Chinese are not only willing to spend, they are spending more wisely and healthily.
Aside from big feasts during family reunions, activities such as domestic and overseas travel, movies and health products have caught on.
Shops and restaurants across the country brought in 754 billion yuan (US$115.4 billion), up 11.2 percent over the same period of last year, the Ministry of Commerce said.
Box office takings last Monday, the first day of the Year of the Monkey, hit a record 660 million yuan, it said.
Statistics from e-commerce giant Alibaba showed that about 14 percent of orders during its holiday promotion were delivered to different addresses, meaning about 280 million orders were likely holiday gifts.
“A precondition for online vendors to cash in on the holiday is that express delivery companies continued operating thanks to an ample supply of labor,” said Zhao Ping, a researcher with the China Council for the Promotion of International Trade.
“This is an evidence of how fast the Chinese service industry is growing.”
Restaurants had a busy week from hosting family dinners.
Business was given added impetus as they worked closer with e-commerce platforms.
Sales of 27 restaurants in Chongqing City grew 16.6 percent to 8.4 million yuan thanks to cooperation with online platforms including Meituan and Baidu Nuomi.
As income keeps growing, people have become more enthusiastic with other alternatives to celebrate the Chinese New Year. Family gatherings are no longer restricted to hometowns, but have expanded to exotic locations.
Zhang Li, a resident of Shanghai, on Tuesday took her family on a trip to Thailand.
“An overseas trip is an attractive option,” she said.
According to China’s leading online travel agent Ctrip, 60 percent of the foreign hotel bookings made by Chinese tourists were for four and five-star establishments.
The figure for domestic hotels was 53 percent. Last year, the figures were 51 percent and 35 percent respectively.
“The preference for better hotels means Chinese are willing to spend more to ensure enjoyable trips,” said a company spokesperson.
The booming holiday market is welcome news for China as it strives to retool its economy from investment-led to one that relies more on consumption and innovation.
The economy saw 6.9 percent growth last year, its slowest in a quarter of a century, but consumption emerged as a new growth driver.
Last year, consumption contributed to 66.4 percent of the country’s gross domestic product, up from 51 percent in the previous year.
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