China next month plans to launch a series of promotional activities, including a new consumer goods expo in southern Hainan Province, to boost spending as the Chinese retail sector recovers from consumer caution induced by COVID-19.
Expanding domestic consumption is a priority in China’s “dual circulation” economic strategy first highlighted by Chinese President Xi Jinping (習近平) in May last year, which also called for a reduced dependence on foreign markets.
China’s retail sales last month surged 34.2 percent year-on-year, surpassing a 28.0 percent gain expected by analysts and more than the 33.8 percent jump in January-to-February.
Photo: Ng Han Guan, AP
More significantly, retail revenues were 12.9 percent higher than March 2019, before the COVID-19 pandemic.
As China enters a five-day Labor Day holiday, it plans to launch the month-long spending campaign in Shanghai on Saturday with activities including an auto show, Chinese Ministry of Commerce spokesman Gao Feng (高峰) told a news conference on Sunday.
Other major cities such as Beijing, Chongqing and Suzhou are also to hold sales in May, he added.
E-commerce platforms are to offer sales on food, travel, and cultural and sporting products by “good quality brands” for half a month.
Events planned in other cities include a food fair in Yangzhou city in eastern Jiangsu Province from Thursday and a fair from May 12 in Guangzhou in southern Guangdong Province that showcases well-known brands.
The city of Haikou on the subtropical island of Hainan — positioned by Beijing as a major Chinese consumption and tourism hub — is to hold an inaugural consumer goods expo from Friday next week to May 10.
Besides domestic products, the expo is to showcase consumer brands from 69 countries and regions including Japan, the UK and the US, with more than 10,000 merchandisers and more than 200,000 visitors anticipated.
Global brands such as Swatch Group AG, Shiseido Co, Dell Technologies Inc and Tesla Inc have confirmed their participation in the expo, Chinese state media has reported.
Separately, confidence among China’s small and medium-sized enterprises (SMEs) picked up for a second month in a survey of more than 500 companies by Standard Chartered PLC, with the rise in expectations pointing to an even better performance this quarter than in the first three months of the year.
“Export-oriented SMEs continued to outperform domestically focused SMEs, with faster production and higher output price gains,” Standard Chartered economists Shen Lan (沈蘭) and Ding Shuang (丁爽) wrote in a report. “The services sector is catching up at a faster pace, driven by the transport and logistics, [information technology] and commercial services industries, while the catering and accommodation sectors remain sluggish.”
The improvement in services was due to the “removal of restrictive measures and [COVID-19] vaccine rollout. While export demand stayed resilient, domestic demand also started to pick up,” they said.
Additional reporting by Bloomberg
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