Domestic Consumer Confidence High Despite Slowdown in Economic Growth
Celebrated at the beginning of October, China’s Golden Week holiday sees millions of Chinese citizens traveling, socializing and spending more than usual. To cash in on this lucrative time of the year, retailers offer substantial discounts and promotions in the annual battle for the lion’s share of consumer spending. Reports indicate that overall retails sales grew by 15 percent during the holiday period, which happened to coincide with the country’s mid-Autumn festival to extend the break from routine to a period of eight days, and consumer sentiment is strong despite the ongoing reports of a slowdown in economic growth.
China’s Ministry of Commerce noted that revenues in the retail and catering sectors reached a total of 800.6 billion yuan, as compared with 696.2 billion yuan for the same period last year, bearing in mind that the holiday period in 2011 was seven days compared with eight days in 2012. The increase in consumer spending is good news for China’s authorities as they continue to promote domestic growth to compensate for the slowdown in export demand cause by economic woes in Europe and the United States.
Strong tourism data supports the view that domestic travel and leisure activities are increasing. The increase in travel during the holiday period was assisted by Beijing‘s concession to waive toll fees for cars on major roads, while railway passengers rose by 9.4 percent. Food and beverage demand in major tourism destinations such as Tianjin, Shanghai and Qingdao, increased between 15 and 29 percent compared with 2011 and tourism revenues at 119 of China’s major attractions rose by an average of 25 percent, with visitor number increasing by an average of 21 percent, according to figures released by a government industry regulator.
Home appliances, digital products, cameras, smartphones and computers saw an increase in demand, with sales at HOME Electrical Appliances increasing three-fold at its outlets in Dongguan, in China’s Guangdong Province. Nevertheless, analysts note that internet shopping, and buying of high-end goods overseas where buyers can take advantage of lower taxes and currency differences, have made inroads into the domestic markets of China. Large numbers of Chinese tourists traveled to South Korea, Thailand and Europe during the National Day holiday, with travelers leaving the country for foreign leisure destinations increasing by as much as fifty percent.