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Editor's note: Xue Tianhang is an associate researcher of the Research Center for Regional Coordinated Development, Zhejiang University. The article reflects the author's opinions and not necessarily the views of CGTN. It has been translated from Chinese and edited for brevity and clarity.
In 2024, global economic growth slowed due to factors such as escalating regional conflicts, trade tensions, and worsening debt issues in some countries. According to the latest forecast by the International Monetary Fund (IMF) in October, global economic growth was projected to reach 3.2 percent in 2024, not only lower than the 3.3 percent growth in 2023 but also below the average level of the years before the pandemic.
A sign on the International Monetary Fund (IMF) headquarters building in Washington, D.C., US. /CFP
Amid this complex and challenging global economic and trade landscape, China's economic strengths, including a solid foundation, numerous advantages, robust resilience, and vast potential, became more pronounced in 2024. The country not only successfully tackled various challenges but also experienced economic recovery and improvements despite fluctuations. China is expected to achieve a growth target of around 5 percent for the year. The domestic consumer market continued to recover, with a clear trend of consumption upgrading, making domestic demand a key driver for economic growth. Particularly after the central government's introduction of a package of incremental policies in September 2024, market confidence was further boosted, and the consumption sector demonstrated even greater resilience and vitality.
First, consumption scales hit historic highs. According to the latest data from the National Bureau of Statistics, consumption continued to grow in 2024. From January to November, total retail sales of consumer goods reached 44.3 trillion yuan ($6.32 trillion), a 3.5 percent year-on-year increase. Driven by policies such as goods trade-in programs and consumption vouchers, along with end-of-year shopping and promotional events, sectors like home appliances and audiovisual equipment, furniture, and automobiles delivered impressive performance in the fourth quarter. In November, retail sales in these categories grew by 22.2 percent, 10.5 percent, and 6.6 percent year-on-year, respectively.
Consumer shopping for appliances at an electrical appliance mall, in Hefei, Anhui Province, December 13, 2024. /CFP
Second, the service consumption sector experienced swift growth, reflecting people's aspirations for a better life and higher-quality consumption. From January to November, retail sales in the service sector grew by 6.4 percent year-on-year, outpacing the growth rate of goods retail by 3.2 percentage points. The share of per capita consumption expenditure on services in total consumption expenditure also rose further.
Third, consumption methods became more diversified, and consumption channels more streamlined, unleashing even greater vitality in consumption. From January to November, online consumption continued to lead, with online retail sales of physical goods reaching 11.8 trillion yuan, up 6.8 percent, accounting for 26.7 percent of total retail sales of consumer goods. E-commerce platforms continued to innovate their service models, offering consumers more convenient and efficient shopping experiences while also facilitating the matching of supply and demand in the consumption sector. For example, in the agricultural products sector, according to a report from Douyin E-commerce, from September 2023 to September 2024, the platform helped sell 7.1 billion orders of specialty agricultural products, expanding the reach of high-quality specialty agricultural products from rural to urban areas.
Staff work on a sorting line at an express logistics company in Qingzhou, Shandong Province, December 12, 2024. /CFP
Fourth, domestic demand recovery contributed to a positive shift in consumer price indexes. In December 2024, China's core consumer price index (CPI) rose by 0.4 percent year-on-year for the third consecutive month and climbed 0.2 percent month-on-month, surpassing the average of the past five years. The price indices for household services, tourism, and dining out also saw varying degrees of increase. The improvement in these core indicators not only reflects the recovery of domestic demand but also signals that there is still considerable potential to further stimulate consumption demand.
At the meeting of the Political Bureau of the CPC Central Committee in the fourth quarter of 2024, it was emphasized that "efforts should be made to vigorously boost consumption, improve investment efficiency, and expand domestic demand on all fronts". In 2025, China will continue to place a high priority on boosting consumption and expanding demand. Policies such as goods trade-in programs and consumption subsidies will continue, offering stronger support and covering a broader range of areas. With robust policy backing, China's consumer market will continue to evolve toward greater diversification, personalization, and intelligence, playing an even more crucial role as the "ballast stone" in economic growth.
(Cover via CFP)