What is China doing to boost its domestic consumption?

As the helicopter lifts off the ground, tourists on board are offered a view of the Jade Dragon Snow Mountain they couldn't have possibly imagined.

The helicopter ride, located in Lijiang, Yunnan Province, features a flightseeing tour of the city and its surrounding natural landscapes. Among them, the Jade Dragon Snow Mountain stands out as a major tourist attraction, which features stunning snow-capped peaks and glacier views. Rolling out a low-altitude tour of the mountain is an example of how China is redefining its tourism experience and unlocking new consumption potential.

As China's economy enters a new stage of development with the rise of household income, the country is placing increasing emphasis on consumption as a key engine for growth. In July, China released its first five-year plan dedicated exclusively to expanding consumption, which targets 60 trillion yuan (about $8.8 trillion) in annual sales of consumer goods by 2030.

With the total retail sales of consumer goods reaching 50 trillion yuan in 2025, how does China plan to achieve this 20% growth in the next five years?

Emphasis on service consumption

Lijiang offers a glimpse into China's strategy, which highlights its determination to boost service consumption.

Creativity is the keyword behind building new consumption models. Not only is the city breaking tourists' expectations by promoting low-altitude flight journeys that reshape immersive tourism, but its unique offerings are also helping enhance visitors' experiences. For instance, the "Be a Naxi Person for a Day" program offers tourists a glimpse into the lives of people from the Naxi ethnic group. This immersive cultural program allows visitors to engage with local traditions and everyday life in Naxi villages, creating new avenues of consumption and growth.

Xu Hongcai, chairman of Beijing Honglve Consulting Co., Ltd. and chief economist of the World Innovation Development Cooperation Organization, told CGTN that creating new consumption scenarios is especially important for service consumption because what people are buying is essentially the process and experience rather than ownership of a product. As marginal utility declines at a slower pace, repeat consumption is driven by constantly evolving scenarios, such as concerts, grassroots sports events and immersive cultural tourism experiences.

By reshaping the way goods and services are designed, delivered and experienced, the country is advancing a supply-side transformation that expands consumer choices, improves the consumption environment and unlocks new growth opportunities.

Technology-backed consumption

Technology is also playing an ever more present role in boosting China's domestic consumption.

Longfusi, a prominent cultural and commercial landmark in Beijing, is witnessing how history and traditions are being revitalized by technology. Boasting a history of more than 600 years, Longfusi once hosted the city's most popular temple fair. Today, as visitors walk around the neighborhood, they can still see blue-grey bricks and dark grey tiles, hallmarks of traditional Beijing architecture that stand witness to its rich cultural heritage.

The neighborhood has now been turned into a cultural landmark that showcases the fusion between history and modern technology.

In June, the Beijing Digital Economy Experience Week kicked off at Longfusi. The fair brought together more than 40 digital technology companies, showcasing some of the latest innovations like smart education, AI toys, robots, extended reality (XR) experiences and AI-driven e-commerce. Visitors can explore real-world applications of cutting-edge technologies while shopping for a range of digital products.

By blending heritage with new consumption experiences, Longfusi is turning cultural resources into economic vitality and unlocking new consumption potential.

Xu said that the implementation of technology in consumption is multifaceted. On the supply side, technology can use consumer data to manage product manufacturing, shifting production from a "produce first, sell later" model to a "production based on demand" model. This enables small-batch rapid response, shorter delivery cycles for automobiles and faster development of new food products.

On the demand side, AI models can stimulate consumption by providing recommendations based on their understanding of consumers' use scenarios. Consumers can place orders with a single voice command, make payments by simply looking through AI glasses or receive proactive reminders from AI health agents to replace filters.

From healthcare, elderly care and childcare to education, sports and entertainment, China is undergoing a critical transition as the country pivots from manufacturing to consumption-led demand.