Consumer sentiment holds up even as economic growth slows
Chinese consumer confidence remained high in the third quarter even though economic growth fell to the slowest pace since the 2008 global financial crisis.
Research firm Nielsen said on Thursday that its confidence index of Chinese consumers stood at 111, marking the fourth consecutive quarter at that level.
GDP growth in the third quarter was 7.3 percent, down 0.2 point from the second quarter, theNational Bureau of Statistics has reported.
“Thenumberis a very encouraging sign for the future consumer-led economy we are all looking at,” said Patrick Dodd, managing director of Nielsen China.
“When we look at the consumer confidence index, we are really looking at people’s intentions on consumption. And when you look at GDP, that is just a much wider case. There are some correlations, but I would not look at them too closely,” Dodd said.
The consumer confidence index is based on three key factors: job prospects, personal financesandwillingness to spend, saidDodd.
“Wage inflation is moving at a very nice pace, andwithalowinflation rate, disposable income is at a very good level. The government focuses on jobs across all cities, so the job prospects for people across all tiers are looking quite bright.
“This combination of more disposable income, low inflation and job prospects being high all contribute to the high level of consumer confidence,” he said.
According to the NBS, the real disposable incomes of urban residents in 28 provinciallevel areas rose by 6.9 percent during the first three quarters of this year. The report also found that: • Consumer confidence levels among city tiers and regions have been converging since the first quarter of 2014.
• There are four super urban clusters that are strategically crucial to China’s economic growth: Shanghai-Hangzhou-Nanjing, BeijingGuangzhou-Shenzhen and Jinan-Qingdao.
• The key drivers of rising willingness to spend vary among regions, while different regions also tend to have somewhat different spending patterns. For example, consumers in richer northern cities spend more on products that will improve their life quality, such as clothing, dining out and telephone fees.
“Spending decisions really depend on the developmentstatus ofconsumersin different regions and areas in such a dynamic market as China,” Dodd said.
“If you just take a look at what happened on Tuesday, the Singles’ Day, it is a good indication that people are willing to spend their money on products they desire.”
During the annual Nov 11 Singles’ Day e-commerce event, online sales on Alibaba GroupHolding Ltd’s Tmall.com, Taobao.com and its overseas outlets topped 57.1 billion yuan ($9.34 billion). Contact the writers at chengyingqi@ chinadaily.com.cn and huyuanyuan@ chinadaily.com.cn