Holiday consumption mirrors strong internal impetus of Chinese economy

By Du Haitao, Wang Ke, People’s Daily

“I knew there would be a lot of tourists, but I never expected so many,” said Li Xin, who runs a B&B hotel near the Longmen Grottoes, a tourist site boasting a history of more than 1,500 years in Luoyang, central China’s Henan province.

According to Li, the hotel had been fully booked half a month before the May Day holiday.

“We have a full house every day, and customers have to wait for a table during peak time,” said Lu Jun, who works at a restaurant in a shopping mall in Chaoyang district, Beijing, adding that there was an obvious surge in the number of diners during the May Day holiday.

China’s consumer market has witnessed an all-around growth during the five-day holiday as people were gratified by seasonal and quality products, featured and experiential services, as well as innovative and intelligent consumption.

According to statistics released by the Ministry of Commerce (MOFCOM) and the Ministry of Culture and Tourism (MCT), domestic trips during the May Day holiday this year jumped 70.83 percent year on year, and tourism revenue soared 128.9 percent from a year ago. Besides, sales of key retail and catering companies during the holiday increased by 18.9 percent from the days in 2022.

The remarkable performance mirrored the vitality and potential of the Chinese consumption market, and witnessed the strong internal impetus of the Chinese economy.

On May 2, a camping site in Mentougou district, Beijing welcomed a number of visitors. “It’s fun to be here because I can get together with my friends while taking my child closer to nature,” said Zhang Jia, who drove more than two hours to the site from Beijing’s Chaoyang district.

During the May Day holiday, more than 9.12 million tourist trips were made to the Chinese capital, which led to tourism revenue of 13.46 billion yuan ($1.95 billion). Both the two figures exceeded the 2019 level, registering a strong recovery in the city’s cultural and tourism consumption.

MOFCOM statistics showed that China saw a 24.4 percent increase in sales nationwide in petroleum products, a 20.9 percent up in automobiles, an 18.4 percent growth in clothing, a 16.5 percent expansion in cosmetics, and a 13.9 percent rise in home appliances.

Besides, the passenger flow and turnover of national demonstration pedestrian streets increased by 121.4 percent and 87.6 percent, respectively, compared with the same period last year, while sales of key catering enterprises increased by 57.9 percent year on year, it said.

According to MCT estimates, Chinese people made 274 million domestic trips during the five-day break that began on April 29, up over 19 percent from 2019 before the COVID-19 outbreak. Tourism revenue reached nearly 148.06 billion yuan, recovering to the pre-pandemic level in 2019.

From commodities to services, and online shopping to brick-and-mortar malls, new scenarios kept emerging during the May Day holiday, which spurred people’s will to consume and injected new vitality into the market.

At the Liangjiang International Film City, a tourist attraction in southwest China’s Chongqing municipality, a live-action performance was staged at night during the holiday. Tourists were wandering there in traditional costumes to experience the charm of the local culture.

“Today, we can not only sightsee, joint entertainment activities and taste delicious food at tourist attractions, but also experience local history and culture in an immersive manner. This just enriches the tourism experience,” said a tourist named Sun Wei, who was enjoying the performance.

“Holiday consumption shows an obvious trend of upgrading, with emerging new scenarios and models. It mirrored the personalized and diversified demand upgrade of Chinese consumers,” said Zhang Jixing, deputy director of the market research department of the Academy of China Council for the Promotion of International Trade.

The consumption during the May Day holiday indicated a rising propensity to consume, which heralded that the consumer market would keep recovering in the long run, Zhang said, adding that consumption is expected to play a bigger role in driving China’s economic growth.

According to him, improved employment, which was revealed by an obvious drop in the surveyed urban unemployment rate in March, is conducive to increasing residents’ income and enhancing their consumption capability. He believes that emerging scenarios and models will further spur people’s will to consume.

The propensity to consume of Chinese residents stood at 62 percent in the first quarter of this year, an increase of 0.2 percentage points from a year ago. From the perspective of medium and long-term development, China is in a stage of rapid consumption upgrade, enjoying bright prospects in the long run.