YEAR OF THE GOAT COMES IN LIKE A LION
Thanh Du, left, dances with a lion controlled by Happy Tran and Quang Le as part of a ceremonial dance at Pho Da Buddhist Temple on Somerset St. Wednesday in preparation for Chinese New Year celebrations for the Year of the Goat — or is it Sheep?
DATES
Chinese New Year 2015 begins on Feb. 19 and ends on March 5. It is day one, month one of the Chinese lunar calendar, and its date in January or February varies from year to year (always somewhere from Jan. 21 to Feb. 20).
SYMBOL
2015 is a year of the “Goat” in the Chinese 12-year animal zodiac cycle. If you were born in a Goat year you should be particularly careful in 2015, according to Chinese astrology.
GATHERING
The New Year’s Eve dinner is called Reunion Dinner, and is believed to be the most important meal of the year.
FOOD
Certain foods are enjoyed during the festival because of their symbolic meanings, based on their names or appearance. For example, fish is a must because the Chinese word for fish sounds like the word for surplus. Eating fish is believed to bring a surplus of money and good luck in the coming year.
GIFTS
People exchange gifts during the festival. The most common gifts are money inside red envelopes, which are given to children and retired adults.
FACTORY FREEZE
Chinese factories shut down for the holiday and then some, with hundreds of millions of migrant workers heading to their hometowns, part of the world’s largest mass movement of people. In the lead-up to the holiday, factories run flat out to fill orders before shutting. The holiday itself runs from Feb. 18 to 24 this year, but workers start setting off as much as two weeks earlier on packed trains and buses. After the holiday they may take the same amount of time to return, or not. The holiday is a prime occasion to switch jobs.
It all means an annual headache for retailers and importers overseas who rely on China. Shipping companies warn customers that China’s transport and logistics networks are at capacity and their shipments must be at ports two weeks ahead of the holiday to stand a chance of getting on a boat before the country shuts down. This year, shipping delays are compounded by a slowdown at U.S. West Coast ports.
QUIET MARKETS
Stock market trading shudders to a halt as mainland China shuts for an entire week and financial hubs such as Hong Kong and Singapore take a break as well, albeit shorter. Numerous other countries including South Korea and Vietnam also observe Lunar New Year holidays. Muslim-majority Malaysia and Indonesia, with large Chinese minorities, take holidays too.
Trading volumes “drop off considerably” about three working days before the start of the holiday, said Andrew Sullivan, managing director at Haitong Securities in Hong Kong. This year, Friday was “the last day that you can sell in Hong Kong and get your money before Chinese New Year” under trading settlement rules, he said. Foreign investors also tend to wind down trading in Asia as the holiday nears, Sullivan said.
GLOBAL SHOPPING
The festival is traditionally the most important time of the year for family reunions, but as China has become prosperous, an increasing number of wealthy Chinese are opting to travel abroad. That translates into big business for global luxury brands. Many British department stores, for example, are pulling out all the stops to woo mainland Chinese shoppers. (Designer handbags, watches and jewelry can be up to 30-per-cent cheaper in Europe because of high luxury taxes in China.)
Harrods is selling its own brand of red envelopes traditionally used to give “lai see,” or lucky money. Selfridges and luxury brand Burberry are each offering cards and envelopes personalized with Chinese calligraphy. Designer label Vivienne Westwood has launched a collectors’ necklace featuring a sheep pendant. Shoppers at Fortnum & Mason paying with UnionPay cards — China’s homegrown payment network — will get bonus gifts.
Chinese spending in Britain last February jumped 23 per cent over the same month in 2012, said Gordon Clark, manager at Global Blue, a Switzerland-based firm that tracks luxury retail spending worldwide. Chinese shoppers spend an average 739 pounds ($1,137 US) per transaction in Britain each February, mostly on luxury jewelry, watches and designer clothes.
ECONOMIC DISTORTION
Because the Lunar New Year never falls on the same date, it plays havoc with Chinese economic data at the start of the year. Economists are cautious not to read too much into figures from January or February, and prefer to wait until March to see the trends lest they make an incorrect interpretation of the world’s second-biggest economy. Last year, the holiday started on the last day of January which meant activity was more compressed as factories rushed to get their orders out the door. This year, the holiday falls about two and half weeks later, so factories had more time to work on orders. The result is that this year’s January trade data, for example, was artificially weak.
“We always warn about the CNY effect and the risk of reading too much into these figures at this time of year,” said Julian Evans-Pritchard of Capital Economics. “This affects most of the data out of China in January and February as well (as) headline export growth in countries such as Korea that are heavily dependent on the Chinese market.”
HOLIDAY SURPRISE
Just because it’s a holiday doesn’t mean there won’t be any major surprises. Chinese officials are notorious for releasing big news during important holidays, unexpected announcements that “hit you with your pants down unprepared,” said Francis Lun, CEO of GEO Securities. The timing may be an attempt to reduce the impact on financial markets, or for the more skeptical, to bury bad news. In 2011, the central bank raised interest rates at the tail end of Chinese New Year.