How China’s lottery boom reflects a ‘long and challenging road’ to its economic recovery
- Shifting consumption habits among Chinese consumers show how their risk appetites are changing, and many are willing to spend a small amount on the slim chance of a life-changing payout
- China’s lottery sales surpassed US$66 billion in the first 10 months of the year – an average of nearly US$50 per person
Every time she travels to a new Chinese city, Shi Xiangyu tries her luck at one of the local lottery shops that have become increasingly ubiquitous across the country over the past couple of years.
“I am seeing more lottery shops everywhere, which has fuelled my interest,” the 28-year-old said. “Sometimes there are city-exclusive scratch cards, too.
“Seeing other people win makes me want to try my luck, or just for fun.”
Indeed, as economic uncertainties mount and the nation’s uneven recovery has suppressed incomes, many Chinese people have grown more passionate about partaking in the lottery.
The shifting risk appetite among some consumers means they are more willing to spend a small amount of money on a lottery ticket to test their luck, even if the odds of winning are astronomical, according to analysts.
Lottery sales totalled nearly 476 billion yuan (US$66.6 billion) in the first 10 months of the year, according to data from the Ministry of Finance. That equates to an average of 340 yuan (US$47.50) spent on tickets by each of China’s 1.4 billion residents. Additionally, sales were up 53 per cent nationwide, compared with the same period last year – a rise of nearly 165 billion yuan.
Qichacha, a corporate data provider, said the registration of lottery-related companies in China grew by 38 per cent during the first 10 months of 2023, compared with a year earlier. In the past five years, such registrations have increased by 188 per cent, and each newly registered company can bring a number of new lottery booths.
The rise in lottery consumption suggests that opportunities for wealth accumulation through working are thought to be diminishing.
However, in a June report, researchers at Anbound, an independent think tank headquartered in Beijing, said that “booming lottery sales signal a long and challenging road ahead for the domestic economic recovery, indicating that market confidence still needs to be stimulated”.
“As economic recovery is sluggish and consumer spending is subdued, lottery tickets should represent a non-essential expenditure, while people seem to be moving from a ‘relatively risk-averse’ stance to a ‘relatively risk-seeking’ one,” the report said. “The rise in lottery consumption suggests that opportunities for wealth accumulation through working are thought to be diminishing.
“Hence, people are more inclined to take a chance with a lottery ticket, hoping for a stroke of luck that could lead to sudden wealth.”
Consumers and investors have been struggling through China’s post-Covid economic recovery that has been slowed by domestic and international headwinds and tumult in the property market.
All 31 provincial-level jurisdictions saw lottery sales jump in the year’s first 10 months, with Guangdong, Jiangsu and Zhejiang taking the lead in sales growth.
Gambling in China is generally banned apart from the China Sports Lottery and China Welfare Lottery, both of which have traditional lotteries that involve selecting numbers and buying scratch cards.
Finance ministry figures show that sports betting grew by 68 per cent in the first 10 months of 2023, year on year, while lottery and scratch-off sales grew by 91 and 88 per cent, respectively.
