China’s retail sales for the Lunar New Year holiday surged 19 percent year-on-year in one of the biggest rises in a decade, signalling a surge in domestic consumption, according to state media.
Shops and restaurants across the country rang up 404.5 billion yuan (US$61.41 billion) in sales, up nearly a fifth from the New Year period last year, the Ministry of Commerce said in a statement.
“Despite the high inflation rate in 2010, the increase is still remarkable,” Lu Zheng-wei (魯政委), chief economist at the Industrial Bank was quoted as telling the China Daily. “It underscores the initial success of China’s transformation to develop its economy through domestic consumption.”
Last year’s Lunar New Year holiday generated 340 billion yuan in sales, a 17.2 percent increase from the previous year, and was welcomed as a sign that spending was rising in China after the global economic crisis.
The global financial crisis increased pressure on China to rebalance its economy by reducing its reliance on exports for growth and spurring more domestic consumption.
The growth mainly reflected consumers’ rising incomes, Lu said. Growth in rural incomes last year outpaced urban areas for the first time in 13 years, according to official statistics.
The week-long holiday is the only time that many of the country’s estimated 230 million migrant workers are able to visit home.
Restaurants in Shandong, Shaanxi and Heilongjiang provinces saw revenues jump by more than 20 percent from last year, while Shanghai saw revenues rise fourfold, the ministry said.