Consumption to witness robust uptrend in China next year

BEIJING: Consumption is expected to see a robust uptrend in China next year on the back of strong domestic demand and various other measures, officials from the Ministry of Commerce said.

“Despite the Covid-19 effect in the first quarter of the year, consumption in key sectors such as automobiles, home appliances, catering sector and commodities witnessed a stable recovery in the last few months, as the strict prevention and control measures to keep the disease at bay started yielding results,” said Wang Bingnan, Vice-minister of Commerce.

To further expand domestic consumption, China would introduce a series of measures to boost demand in sectors such as automobiles, home appliances, furniture, construction materials, catering sector and commodities, which accounted for about one-fourth of the total retail sales in China last year, he said.

Rural consumption, accounting for 14.7% of total retail sales in the country, will be another sector that will be an important area for expansion of domestic demand.

In October, retail sales climbed 4.3% on a yearly basis, up one percentage point from the 3.3% gain in September. It was the third consecutive month that the reading stayed in the positive territory, he said.

Although retail sales dropped by 5.9% on a yearly basis during the first 10 months, the decline was 5.5 percentage points less than that in the first six months of the year. Automobile sales rose by 12% in October on a yearly basis, registering another round of double-digit growth for four consecutive months.

Catering consumption saw a growth of 0.8% on a yearly basis in October, the first positive growth in the year. Sales of home appliances and furniture rose by 3.2% and 1.9% in October on a monthly basis, while for construction materials it was 3.7%. Rural consumption increased by 5.1% on a yearly basis in October, up 1.1 percentage points on a monthly basis.

The ministry would team up with other government departments to promote consumption without diluting any of the measures to prevent and control the pandemic, said the Vice-minister.

Greater support will be given to expand automobile consumption, including fine-tuning restrictive measures on automobiles purchase, stimulating secondhand automobile market, and promoting new energy vehicle development. Promotional campaigns will be held for vehicle purchases in rural areas.

Consumption upgrade of home appliances will also be encouraged, and in some regions subsidies will be provided for purchase of green smart home appliances, including trade-in programmes.

Promotional campaigns on catering consumption will also be held, and service providers would be encouraged to combine online and offline channels while making product and service innovations. In rural areas, measures will be taken to improve logistics and product quality to stimulate consumption, according to Liu Jinxi, an official with the All China Federation of Supply and Marketing Cooperatives.

Wang Bin, deputy director-general of the ministry’s department of market operations and consumption promotion, said domestic consumption would see further expansion due to its strong credentials and the upward trajectory of the stabilising Chinese economy.