The downward pressure on China’s consumption persisted over the Lunar New Year holiday, the annual festival when people travel, shop and give gifts or money.
People in China spent 1.01 trillion yuan (US$149 billion) at restaurants, shopping malls and online outlets over the week-long holiday, according to the Chinese Ministry of Commerce.
That was 8.5 percent higher than during last year’s festive period, but the slowest increase since at least 2011.
Photo: Reuters
Increasingly frugal Chinese consumers are sending chills through global investors, with the pullback in spending hitting the profits of companies such as Apple Inc, Swatch Group AG and luxury car makers.
Weaker growth, the trade war with the US and a crackdown on debt all undercut momentum last year, sending auto purchases into a contraction for the first time in almost three decades and retail sales growth to the slowest pace since 2002.
“We believe household consumption will likely be sluggish, “ Nomura Holding Inc chief China economist Lu Ting (陸挺) wrote, citing the quick buildup of household debt, lackluster income growth outlook amid the economic slowdown and the cooling property sector.
“We expect the government to rely more on infrastructure investment to stabilize economic growth, but it may take time for infrastructure investment projects to start,” Lu said.
Spending at tourist venues rose 8.2 percent to 513.9 billion yuan, state broadcaster CCTV said, citing data from the ministry, slower than the 12.6 percent rise last year.
Domestic box office revenue was 1 percent higher than last year, according to a report in The Paper, which cited statistics from a cinema ticketing service platform of Alibaba Pictures Group (阿里巴巴影業集團).
Those who are still shopping are increasingly doing it online, with JD.com (京東) reporting a 43 percent jump in sales around the holiday versus a year earlier.
Cellphones, computers and home appliances were at the top of shopping lists, and there was a surge in purchases of kitchenware and furniture, according to a report from the second largest e-commerce site in the nation.
Spending growth in smaller cities jumped 55 percent on Alibaba Group Holding’s (阿里巴巴) Tmall (天貓), faster than in major metropolises, where residents are being squeezed by higher housing prices.
Tourists chose Hong Kong, Thailand and Macau as their top overseas destinations, according to Alibaba’s online tourism site.
The US was the seventh most-popular spot, even amid the trade tensions.
Chinese mainland visitors to Macau reached almost 900,000 during the week-long holiday, climbing 26 percent from last year’s festive holiday, according to Macau’s tourism office.
That was more than double last year’s growth, but actual casino revenue data might not look as rosy as the visitation numbers.
“The Chinese New Year holiday season was decent this year, but definitely not as strong as the visitation number shows,” Union Gaming Securities Asia Ltd analyst Grant Govertsen said yesterday.
Based on spot checks on the ground, Govertsen said that many mainland visitors to Macau are day trippers who travel to check out the new bridge linking Zhuhai on the mainland to Macau and leave soon after without stopping at the territory’s casinos or spending money in the city.
Among the rows of vibrators, rubber torsos and leather harnesses at a Chinese sex toys exhibition in Shanghai this weekend, the beginnings of an artificial intelligence (AI)-driven shift in the industry quietly pulsed. China manufactures about 70 percent of the world’s sex toys, most of it the “hardware” on display at the fair — whether that be technicolor tentacled dildos or hyper-realistic personalized silicone dolls. Yet smart toys have been rising in popularity for some time. Many major European and US brands already offer tech-enhanced products that can enable long-distance love, monitor well-being and even bring people one step closer to
Malaysia’s leader yesterday announced plans to build a massive semiconductor design park, aiming to boost the Southeast Asian nation’s role in the global chip industry. A prominent player in the semiconductor industry for decades, Malaysia accounts for an estimated 13 percent of global back-end manufacturing, according to German tech giant Bosch. Now it wants to go beyond production and emerge as a chip design powerhouse too, Malaysian Prime Minister Anwar Ibrahim said. “I am pleased to announce the largest IC (integrated circuit) Design Park in Southeast Asia, that will house world-class anchor tenants and collaborate with global companies such as Arm [Holdings PLC],”
TRANSFORMATION: Taiwan is now home to the largest Google hardware research and development center outside of the US, thanks to the nation’s economic policies President Tsai Ing-wen (蔡英文) yesterday attended an event marking the opening of Google’s second hardware research and development (R&D) office in Taiwan, which was held at New Taipei City’s Banciao District (板橋). This signals Taiwan’s transformation into the world’s largest Google hardware research and development center outside of the US, validating the nation’s economic policy in the past eight years, she said. The “five plus two” innovative industries policy, “six core strategic industries” initiative and infrastructure projects have grown the national industry and established resilient supply chains that withstood the COVID-19 pandemic, Tsai said. Taiwan has improved investment conditions of the domestic economy
Sales in the retail, and food and beverage sectors last month continued to rise, increasing 0.7 percent and 13.6 percent respectively from a year earlier, setting record highs for the month of March, the Ministry of Economic Affairs said yesterday. Sales in the wholesale sector also grew last month by 4.6 annually, mainly due to the business opportunities for emerging applications related to artificial intelligence (AI) and high-performance computing technologies, the ministry said in a report. The ministry forecast that retail, and food and beverage sales this month would retain their growth momentum as the former would benefit from Tomb Sweeping Day