Boosting rural consumption key to economy

Boosting consumption has been a major topic of discussion at many recent local legislative conferences, with many provincial-level administrations setting targets for social retail consumption growth this year. Hainan, Shanxi, and Yunnan provinces are targeting growth rates higher than 10 percent, while Henan, Shaanxi and Gansu provinces are targeting over 7 percent growth.

In order to boost consumption, various provinces are adopting positive policies, such as encouraging new types of consumption and boosting rural consumption. Dutyfree shops have become hot spots as a result.

That is a good move. As 2021 heralds the 14th Five-Year Plan period (2021-25), boosting consumption will help in restructuring the economy and realizing high-quality growth.

The first step toward boosting consumption is raising people’s incomes. Only when they have a growing income will people increase spending. In 2020, the national average income per person was 32,189 yuan ($4,990), 2.1 percent higher than that in 2019. Around 11.86 million new jobs were created, 2.86 million more than the 9 million planned, and for the second year in a row the GDP per capita exceeded $10,000, laying a solid foundation for increased consumption in 2021.

Online shopping, working from home and online education flourished in 2020, pushing up consumption and boosting economic growth. However, problems such as the lack of infrastructure, relatively weak ability of service, and lax regulation remain. It is necessary to continue improving these new consumption modes to get optimum results.

Several provincial-level administrations plan to improve rural consumption levels. In 2019, national rural retail sales reached 6.03 trillion yuan, 9 percent higher than in 2018. In 2020, despite the novel coronavirus epidemic, rural consumption showed resilience; some rural areas even registered positive growth. In the future, rural consumption should become an essential part of the total social consumption.

Local governments must take more measures to boost consumption, which not only directly raises people’s living standards, but also propels the economy forward.