EconoScope | China's policies drive roaring recovery in consumption
(ECNS) -- Three figures show that China's economic growth is roaring in consumption.
First, retail sales rose at the strongest pace in eight months in October. Second, the consumer confidence index rebounded for the first time after six consecutive months of decline. Third, on Nov. 11, express delivery volumes reached 701 million packages, setting a new record for Singles' Day.
For some time now, international voices have claimed that they have not seen China announce sufficient policies to stimulate demand, reduce overcapacity and promote economic growth.
However, foreign media including Bloomberg have been quick to report the recovery of Chinese economy.
This indicates that a thriving Chinese economy is vital to the world. After all, if the world's second largest economy catches a cold, the global economy is likely to sneeze along with it.
The two newly intensified policies—large-scale equipment upgrades and trade-in of consumer goods—have boosted China’s consumption and social investment.
According to data from the National Bureau of Statistics of China, the market sales growth in October showed a significant rebound, with total retail sales of consumer goods increasing by 4.8 percent year-on-year, accelerating by 1.6 percentage points from the previous month.
Taking new energy vehicles (NEVs) as an example, driven by the trade-in policy, NEV production and sales reached 1.463 million and 1.43 million units respectively in October, up 48 percent and 49.6 percent, reaching all-time highs for both monthly production and sales.
Looking at online consumption, the recently concluded Singles' Day event was for the first time paired with the trade-in policy, adding fuel to people’s enthusiasm for shopping. Several e-commerce platforms saw a significant surge in the number of users making purchases.
Besides, after a deep adjustment, China’s real estate market has started to stabilize. For the first time since 2007, October transactions exceeded those in September.
All these factors signal a shift toward stronger consumption in China. This is the combined effect of existing policies and a package of targeted incremental fiscal policy measures under China's concerted and sustained efforts to boost spending.
In the future, China will further drive its economy. More efforts for large-scale equipment upgrades and the trade-in policy have been included in next year's key tasks, with stronger fiscal policies to follow.
Zhang Yansheng, a researcher at the Academy of Macroeconomic Research of China, told China News Network that China, as a major driver of future global economic growth, is focusing on expanding domestic demand and imports. The China International Import Expo (CIIE) is an example of it offering a public good to the world.
The 7th CIIE, which concluded on Nov. 10, saw over $80 billion in intended transactions, underscoring the importance of China’s vast market for global economic growth.
Zhang believes that China's focus on expanding domestic demand serves not only to achieve macroeconomic balance, but also to support the development of Chinese-style modernization and make a greater contribution to global economic growth.
Expanding domestic demand, promoting high-level opening-up and accelerating the development of new quality productive forces will fundamentally shape China's role and standing in the Asia-Pacific region and on the global arena, Zhang concluded.