ECONOMIC ENGINE
China has the largest middle-class in the world, with a population of 300 million, and it is growing fast, accounting for 30 percent of the world's total.
The government predicts the group, which has ever stronger and more sophisticated consumers demands, will play a significant role in propping up the economy.
The celebration of Chinese New Year is seeing new modes of spending as more families favor organic food, shop online, dine outside, and entertain themselves.
A recent report said about 6.5 million overseas trips will be made by Chinese during the holiday. Online travel service provider Ctrip said people have booked outbound tours to over 700 cities in 68 countries and regions on its platform, with destinations as far afield as Antarctica.
"The key term for this year's holiday will be 'consumption upgrade,' with higher-quality products and services gaining popularity," said Wang Bingnan, vice minister of commerce.
Wang Yang said that back in the 1990s his father always took him to farmer's markets only to buy local meat and chicken ahead of holidays. "But now it is a fashion to shop overseas and shop online," he said.
"This is a very important trend that will prompt marked changes in the growth pattern and quality of the economy," said Mao Shengyong, spokesperson of the National Bureau of Statistics (NBS).
A major aspect of such changes is an economy less reliant on investment that analysts believe has become less effective and can easily cause structural imbalances. Consumption is now a key economic driver and contributed 58.8 percent to the domestic gross product growth in 2017, according to the NBS.
Consulting firm McKinsey & Company said in a report that China's consumer confidence hit its highest in 10 years, partly due to the tech-savvy younger generation born in the age of the Internet.
The power of consumption will likely continue due to improve people's incomes. Morgan Stanley expects China to gain high-income status as early as 2025.
RURAL POTENTIAL
There is also huge consumption potential in less-prosperous rural areas, which are narrowing the gap with cities, as the country moves to revitalize its rural regions.
In 2017, retail sales of consumer products in rural areas surged 11.8 percent to 5.2 trillion yuan, outpacing the 10 percent rate in urban areas, according to the NBS. Online sales topped 1.24 trillion yuan, up 39.1-percent year on year.
The growth was attributed to policies to boost the incomes of farmers. In 2017, per capita disposable income of rural residents increased 7.3 percent, faster than both urban growth and GDP expansion.
In a key report to the 19th National Congress of the Communist Party of China, the strategy of rural revitalization was proposed as a "historic task" essential for accomplishing China's modernization goals and building a moderately prosperous society.
E-commerce is helping the process, with more and more of the rural population going online for business and shopping.
"Internet commerce has restructured production and logistics in rural areas, which has also helped farmers raise incomes, particularly in the country's west," said Mao Risheng, a researcher with Chinese Academy of Social Sciences.
According to a report by the e-commerce giant Alibaba, there are 2,118 Taobao villages, referring to villages where over 10 percent of households are involved in online selling, with total annual transactions of more than 10 million yuan.
It is expected that the number of Taobao village will hit over 5,500 in 2020, bringing more than 3 million jobs to the countryside.
Retail sales in rural areas will remain robust this year, with a 12 percent growth pace, 1 or 2 percentage points faster than in the cities, according to a report by the China Council for the Promotion of International Trade.
