Consumption drive gets fresh focus

2024-02-07 09:41:16China Daily Editor : Li Yan ECNS App Download

Shoppers browse festive goods at a supermarket in Huai'an, Jiangsu province. (ZHAO QIRUI/FOR CHINA DAILY)

China will roll out a series of well-targeted policy measures aimed at shifting the focus of consumption from post-pandemic recovery to sustainable expansion, so as to stimulate domestic demand, boost consumer confidence and drive long-term economic growth, officials and experts said.

In the face of sluggish external demand, the robust growth in consumer spending and its increasing foundational role in China's economy call for stronger steps to enhance the provision of high-quality goods and services and enhance the business environment, in order to tap into this vast market potential, they said.

The significant contribution of consumption to economic expansion, accounting for 82.5 percent, had solidified its role as a primary driver of growth last year, said Sheng Qiuping, vice-minister of commerce, at a news conference on Tuesday.

China's total retail sales of consumer goods, a major indicator of the country's consumption strength, climbed 7.2 percent year-on-year to reach 47.15 trillion yuan ($6.56 trillion) in 2023, according to data from the National Bureau of Statistics.

Going forward, the country is targeting the stabilization and expansion of traditional consumption sectors that are closely related to people's daily lives, Sheng said, adding the key areas of focus include automobiles, appliances and home furnishings.

Big-ticket items such as automobiles have emerged as a crucial pillar supporting the country's domestic consumption, said Xu Hongcai, deputy director of the China Association of Policy Science's Economic Policy Committee.

Total car sales in China increased by 12 percent to top 30.09 million units in 2023. In particular, sales of new energy vehicles exceeded 9.49 million units, surging almost 38 percent from the previous year, according to the Ministry of Industry and Information Technology.

Proactive measures such as issuing consumer vouchers and providing trade-in subsidies should be leveraged by localities to not only stimulate demand for new vehicles but also promote the adoption of greener and more energy-efficient models, Xu said.

Meanwhile, amid the country's ongoing efforts to encourage consumers to upgrade their household items and drive sales in relevant industries, the MOC, along with other departments concerned, introduced some measures on Thursday to strengthen the recycling system for discarded appliances and furniture.

In addition, new forms of consumption, characterized by green, healthy and smart choices, have flourished and become a key dynamo driving consumption growth, said Sheng, adding that dedicated efforts will be channeled toward bigger strides on this front.

E-commerce, a pivotal component of new consumption patterns, registered record online retail sales of 15.4 trillion yuan in 2023, securing its position as the global leader for the 11th consecutive year, the MOC said.

While the new consumption sector continues to thrive, issues like regional disparities, inadequate infrastructure and lagging public services have come to the fore, said Zhu Keli, founding director of the China Institute of New Economy.

In addition, a mismatch between policy supply and actual development needs, and the need for optimization of the business environment are key areas that require attention, Zhu said, adding that more government support will be needed to address these challenges.

China will also set its sights on expanding service consumption as a key priority to optimize and upgrade its consumption structure, aiming to foster improved living standards and enhance people's overall well-being.

Miao Muyang, director-general of the department of industrial development in the Ministry of Culture and Tourism, said that as Spring Festival approaches, local governments across China are gearing up to distribute over 600 million yuan in consumer discounts to promote cultural and tourism consumption.

The discounts can be utilized for a wide range of experiences, including performances, scenic areas, local delicacies, hotels and homestays, Miao said.

A survey conducted by National Business Daily and HCR, a Beijing-based market research company, reveals that consumers are highly enthusiastic about traveling during the holiday period, with an average planned duration of 5.32 days. More than 50 percent of respondents estimate that their per capita expenditure will range from 2,001 yuan to 6,000 yuan.

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