China's Consumption Promotion Month to boost retail spending
By Michelle Van den Bergh
This month is China's Consumption Promotion Month. Cities across the country are coming up with ways to stimulate consumption. The latest Chinese economic data showed positive signs of a rebound, with August retail sales rising for the first time this year compare with the same period last year.
The National Consumption Promotion Month, jointly organized by the Ministry of Commerce and the China Media Group, kicked off on September 9 and will continue for the entire month to further bolster market sentiment, boost consumer confidence and promote replenishment of consumption.
Experts say that the recovery in consumption has a lot to do with the robust e-commerce sector in China.
"Chinese people order a lot of things online, without e-commerce, China would have seen an even worse consumption recovery. Online consumption accounts for 25 percent of the country's total consumption, with a double-digit growth rate. But the overall consumption growth is stagnating. So it is important that China has a lot of online consumption," said Chen Jiahe, chief investment officer at Novem Arcae Technologies.
China has come up with a slew of measures to promote consumption during this year's consumption promotion month which will cover both the mid-autumn festival and China National day holiday.
They include opening up more areas for tourism, giving out vouchers for spending, future lifting restrictions on theaters and gyms.
Chen says that looking into the future, China's consumption will recover if the country manages to keep the pandemic under control. But the recovery will take time.
Increasing consumption is an important part of China's supply-side reform and dual circulation economy policy.
With 400 million middle-class population and the help of high tech such as mobile payment, clouding computing, and smart logistics, many are confident that consumption will return to be the main growth driver of China's economy.