China’s income, job woes still weigh heavy as consumption campaign targets 5 key cites
Events will take place in Shanghai, Beijing, Guangzhou, Tianjin and Chongqing in November to coincide with China’s annual Singles’ Day event
Questions have been raised about how long growth momentum from a month-long consumption promotion campaign in five economically vital cities could last, with analysts pointing to income and job uncertainties that still haunt Chinese households.
The cities, which contributed 13 per cent of China’s gross domestic product last year, have reported some of the most notable tightening in spending in the past two years, despite being home to a large proportion of the middle class and wealthy population.
While retail sales in China grew by 3.3 per cent in the first three quarters of the year, the consumption gauge in Shanghai and Tianjin fell by over 3 per cent, while Beijing also saw a decline of 1.6 per cent.
Under the consumption campaign in November, local governments will distribute consumption vouchers, and encourage brands that have yet to open a store in an area to establish new stores.
In Beijing, local governments and enterprises will jointly issue over 10 billion yuan (US$1.4 billion) in subsidies, while nearly 50 international brands, in sectors including fashion and beauty, are set to open their first stores in the city.
