Consuming for growth + Is China decoupling? • China.Table

Singles’ Day: consumption strengthens growth
Domestic strategy weakens networks
Producer prices rise sharply again
Supply chain law: German companies in China are preparing
End for VW’s Santana
Sporting goods companies suffer under boycott calls
Profile: Minxin Pei – harsh critic of the CP

Dear reader,

Today is 11/11. And since the date only consists of the number 1, it is also known as “Singles’ Day” in China. Alibaba had once introduced it and at the same time declared it a shopping day. In the meantime, German stores like Lidl and Saturn also invite customers to Singles’ Day and celebrate it with a discount battle. Frank Sieren has analyzed the fact that consumer spending is Beijing’s strongest tool for driving domestic growth to catch up with the developed economies of the West.

Does China still need us? Fabian Peltsch took on this question. He spoke with sinologists and economic experts about whether the People’s Republic is increasingly barricading itself with its current economic strategies, and if these barricades are leading to an even quicker and extensive decoupling from the West.

Minxin Pei is notorious for not holding back on criticism when it comes to the Communist Party of his home country. For Pei, the cult of personality around State and Party leader Xi Jinping is the biggest obstacle to China’s growth. In today’s profile, the 63-year-old sums up the current state: “The reign of fear has returned to policy, and not just for ordinary citizens, but also the CCP elite,” he explains from his chosen home of California.

Have a pleasant rest of the week!

Your
Ning Wang

Feature

Chinese consumption strengthens economy

If the leadership in Beijing has its way, China’s economic growth will rest more than ever on the shoulders of domestic consumers. After all, domestic consumption is the least affected by foreign policy influences. Today’s Singles Day, the world’s largest shopping event, shows the current state of Chinese consumers. This date has also become very important for Western companies.

By
Frank Sieren

Floods, power shortages, and occasional COVID-19 outbreaks have put the Chinese economy to test several times in recent months. However, even this hardly dampened consumer sentiment.

Despite weaker-than-expected figures, total retail sales of consumer goods rose by 16 percent year-on-year to ¥31.8 trillion ($4.9 trillion) in the first three quarters of the year, according to the National Bureau of Statistics. Chinese retail sales, a benchmark of consumption, rebounded more than expected, growing 4.4 percent year-on-year in September.

This means that consumer spending continues to be the biggest growth driver of the Chinese economy. In the first three quarters of this year, it contributed 64.8 percent to China’s GDP. As a result, the People’s Republic is slowly but surely catching up with the developed economies of the West in terms of domestic consumption. Compared to the USA, for example, there is still some room for improvement. There, a share of 69 percent was measured in the 2nd quarter, the highest since the Second World War. In the third quarter, however, the figure dropped again slightly to 68.8, a value that China has never reached. In the export nation of Germany, on the other hand, the figure is normally just over 50 percent but has slipped below the 50 percent mark due to the lasting effects of the Covid pandemic.

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