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Chinese Consumers Slashed Spending on National Day Holiday

Well-known Taiwanese news site Anue recently reported that Mainland consumers slashed spending on travel and movies during the National Day holiday week as government Covid control measures led to fewer people going out. Data from the China National Railway Group shows that from September 28 to October 8, the number of railway passengers nationwide was estimated to be 68.5 million, mainly for family visits, short-distance travel and tourism. This represents a sharp drop of about 38 percent compared with the same period last year. According to statistics of Maoyan Entertainment, the Mainland movie box office has also fallen sharply, with sales reaching only 1.4 billion yuan (around US$197 million) as of October 7. This number is less than one-third of last year’s National Day holiday box office. It is also not comparable to the nearly RMB 4 billion (around US$562) in 2020. Weak spending data is a big bear for a pickup in Chinese consumption amid heightened risks to economic growth. The housing slump has yet to ease, global demand for Chinese goods has cooled, and the Chinese currency has depreciated. Still, economists say the chances of Beijing loosening its Zero-Covid policy in a short period of time remains low. Goldman Sachs expects that the government’s Covid control measures are expected to continue until the end of the second quarter of next year. Many economists have lowered their growth estimates on the Chinese economy.

Source: Anue, October 7, 2022