Con­sump­tion re­mains key driver

China Daily European Weekly - - Business - By ZHU WENQIAN zhuwen­qian@chi­nadaily.com

China’s do­mes­tic con­sump­tion has re­mained a strong con­trib­u­tor to the econ­omy, help­ing to drive growth as the coun­try has un­der­gone eco­nomic re­struc­tur­ing in re­cent years.

But last year it lagged, ac­cord­ing to the lat­est of­fi­cial sta­tis­tics re­leased in Bei­jing on Jan 20.

Data re­leased by the Na­tional Bureau of Sta­tis­tics showed that in 2016, do­mes­tic con­sump­tion con­tributed 64.6 per­cent to growth in GDP, dipping 1.8 per­cent­age points from a year ago.

From 2012 to 2014, con­sump­tion con­tributed around 50 per­cent to GDP growth, and the ris­ing ra­tio has in­di­cated a solid growth in con­sumer spend­ing and im­prove­ment in in­dus­trial struc­tures, an­a­lysts say.

“The con­sump­tion sec­tor has been a strong area of the Chi­nese econ­omy, which has been dragged down by slow­ing ex­ports and in­vest­ments,” says Zhao Ping, deputy di­rec­tor of the Chi­nese Acad­emy of In­ter­na­tional Trade and Eco­nomic Co­op­er­a­tion, un­der the Min­istry of Com­merce.

Cur­rently, China is push­ing to stim­u­late growth by fo­cus­ing on sup­ply-side re­form, which aims to cut low-end in­dus­trial ca­pac­ity, in­crease high-tech pro­duc­tion, en­cour­age on­line shop­ping and stim­u­late the ser­vice sec­tor.

Last year, GDP grew 6.7 per­cent year-on-year, the slow­est ex­pan­sion in more than two decades, but still within a rea­son­able range, the sta­tis­tics bureau says.

In 2016, to­tal re­tail sales climbed by 10.4 per­cent year-on-year to 33.23 tril­lion yuan ($4.83 tril­lion; 4.49 tril­lion eu­ros; £3.87 tril­lion), stay­ing flat with the growth rates of the first three quar­ters last year. Dur­ing the same pe­riod, cater­ing sales reached 3.58 tril­lion yuan, ris­ing 10.8 per­cent yearon-year, the bureau an­nounced at a news con­fer­ence on Jan 20 in Bei­jing.

On­line sales re­mained strong last year, surg­ing 26.2 per­cent from a year ago to 5.16 tril­lion yuan. Sales of phys­i­cal goods on­line ac­counted for 12.6 per­cent of to­tal re­tail sales.

On Nov 11 last year, China’s e-com­merce gi­ant Alibaba smashed its sales record once again dur­ing its an­nual Sin­gles Day fes­ti­val, with con­sumers spend­ing 120.7 bil­lion yuan dur­ing the 24-hour shop­ping frenzy on the com­pany’s e-com­merce por­tals such as Taobao.com and Tmall.com.

LI TIECHENG / FOR CHINA DAILY

A GIRL chooses dec­o­ra­tions in Jinzhou, Liaon­ing prov­ince, for the up­com­ing Spring Fes­ti­val.

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