Golden Week Sales Exceed Expectations

In contrast to gloomy international projections, economic realities suggest that China’s Golden Week may have exceeded expectations.

I spent China’s 70-year National Day festivities in Shanghai, China's global financial hub, and Guangzhou, the global trade hub of the Guangdong-Hong Kong-Macao Greater Bay Area. In both, China’s massive transition toward consumption and innovation is now an increasing reality.

Due to US tariff wars, Chinese mass consumers – like their peers in the United States, Europe, and Japan – are cost-conscious, increasingly discriminate and sophisticated in their spending. Indeed, sales of gold jewelry boomed during the holidays, fueled by gold prices, holiday festivities and the wedding season.

But unlike their counterparts in advanced economies where middle-classes are shrinking, Chinese middle classes continue to grow, expand and consume. That is a great opportunity in China and abroad alike.

The just-ended Golden Week is a case in point.

Golden Week retail sales 8.5% up                     

In effect, China has two “Golden Week” holidays; the Lunar New Year around January and February, and the National Day week in early October. Both are seen as a barometer for Chinese private consumption, due to gift-giving, family reunions, thriving retail and catering.

Last February, the Lunar New Year showed the slowest increase in years, according to international media. Yet, Chinese retail sales actually rose almost 7% from a year earlier.

Prior to the National Day Golden Week, once again, much of the international media expected the trade wars to undermine Chinese holiday sales. And again, they were proved wrong. During the holidays, retail sales growth exceeded China’s growth rate by almost a half, with online sales soaring even higher.

During the Golden Week, Chinese retail and catering businesses saw sales of $213 billion, up 8.5% on the same period last year (spending on consumer services is not yet included, but will be released later in the month). New highlights featured spending on tourism, culture and sports, and “first-store economy”; that is, new brands launching their first brick-and-mortar stores.

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Disclaimer: Dr. Dan Steinbock is an internationally recognized strategist of the multipolar world and the founder of Difference Group. He has served at the India, China and America Institute ...

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