Macroscope | Stable consumer-led growth a must for China’s economic transformation
But three possible headwinds for the household sector in 2018 – correction in property prices, slowdown in consumer credit growth and easing of wage growth – could set back China’s plans
With the two-week long Spring Festival celebrations coming to an end, the Year of the Dog is now in full swing. For an economist, the Lunar New Year festivities offer important clues for gauging the pulse of the economy.
This is because the festival is often characterised by a bifurcation in the economy: the industrial sectors are in hibernation with millions of migrant workers returning home for holidays, while the consumer part of the economy is buoyed by strong festive-spending spree.
As China rebalances towards a consumption-driven economy, this therefore offers a critical window into the health of a very important part of the economy.
And the overall performance, in absolute terms, was not too shabby.
During the Golden Week, from February 15 to 21, total retail sales nationwide rose 10.2 per cent compared to the same period last year. Spending on leisure and entertainment services saw particularly fast growth, with box office receipts surging 43.5 per cent.