Surge in China Service Consumption Drives Economic Growth
This summer, China’s economy received a substantial boost, largely fueled by a surge in China Service Consumptionacross various sectors such as tourism, entertainment, and sports. This trend highlights the growing importance of China Service Consumption in driving the nation’s economic development.
Expanding Cultural and Tourism Events
The Ministry of Culture and Tourism reported that China hosted around 37,000 cultural and tourism events spanning over 4,000 categories this summer. These events catered to popular interests like night tours, summer vacations, and family-oriented activities, drawing large crowds and significantly enhancing economic activity. This surge in service consumption clearly underscores its vital role in China’s economy.
China Service Consumption Boosts Domestic Tourism on the Rise
Additionally, data from Ctrip, a leading online travel service provider, shows a steady increase in domestic tourism. For instance, searches for hotels and flight tickets rose by over 20% year on year, while domestic car rental orders surged by more than 40%. Moreover, single-day car rental orders reached record highs, with a 50% year-on-year increase. The average cost of car rentals also increased by 20% compared to last summer, reflecting the high demand for travel during the vacation season.
“The strong demand for car rentals underscores the travel surge during the summer holidays,” noted Song Zhen, vice president of Ctrip Group. He pointed out that the self-driving tourism market is particularly gaining momentum, especially in northwest China.
China Service Consumption Drives Growth in Entertainment and Sports
Beyond tourism, the box office in China also thrived, surpassing 10 billion yuan (about $1.4 billion) over the weekend, according to ticketing platform data. Meanwhile, sporting activities saw a significant rise, driven in part by the recent Paris Olympic Games. Data from the e-commerce platform Meituan reveals that search volumes for sports activities in July increased by approximately 180% from June. Additionally, orders for badminton grew by 90% year on year, while group purchase orders for tennis surged by 172%.
Government Support and Future Prospects
In response to this economic momentum, the State Council issued guidelines detailing 20 key tasks for advancing service consumption. These tasks include unlocking potential in sectors like hospitality, domestic services, elderly care, and tourism, promoting new forms of consumption, easing market access, and providing more policy support.
Furthermore, experts are optimistic about the continued growth of service consumption in China, noting that demand for services such as education, entertainment, tourism, and culture is rising as the country moves toward a high-income economy. Zhu Min, former deputy managing director of the International Monetary Fund, emphasized that China’s future reforms—such as increasing national income, continuing urbanization, and enhancing social insurance, education, and healthcare systems—will further stimulate service consumption.
Service Consumption: A Major Economic Driver
Official data shows that in the first half of the year, China’s retail sales of services grew by 7.5% year on year, outpacing goods sales by 4.3 percentage points. Service consumption, therefore, accounted for 45.6% of the country’s per capita consumer spending during this period. As highlighted in a recent meeting on priorities for the second half of 2024, service consumption is expected to play a major role in expanding and upgrading overall consumption, making a significant contribution to China’s economic growth.