The Golden Week refers to three separate 7-8 day long national holidays that have occurred annually in China since 2000. The holidays usually occur around Chinese New Year in January or February, then May, then October and are intended to promote internal consumption. Citizens receive several days of paid holiday, where they can travel to visit family and friends, which results in a period of heightened travel activity and spending for the country. Although the pandemic has led to decreased income and therefore decreased spending for most residents, this year’s October festival saw an impressive rate of transactions, having been the first holiday post-pandemic stabilisation. The success may have been indicated by the triumph of China’s Celebrated 6.18 festival which reached historic results earlier this year, and the government estimates travellers generated around 466 billion yuan this October.
A revival to the domestic tourism market
Calculations by the China Tourism Academy (Data Centre of the Ministry of Culture and Tourism), showed that the country received 637 million domestic tourists during the 8 days, bringing a year-on-year recovery of 79.0% on a comparable basis. An increase in consumption, sales and revenue was only natural after such a substantial flow of tourists.
The festival offered prosperity of a range of industries, especially the national railways. Data from the China National Railway Group revealed that 126.87 million passengers travelled during the 11 days between the 28th September and the 8th of October - an average of 11.53 million passengers per day. This is an 84% increase from the same period last year, an enormous success for the national railways and a clear indicator that the domestic tourism industry is already recovering post-covid.
Additionally, hotel bookings were stimulated too, as many China citizens returned to their home cities and visited friends in other areas. Domestic hotel bookings reached a record high, with a year-on-year increase of 40%, according to data from Tongcheng Yilong, a leader in China’sn online travel industry. The transaction value of hotel bookings was even higher than that of the May holiday, WeChat payment data revealed that between October 1-3, the hotel industry’s payment transaction amount on WeChat rose by 70.75%.
Things are looking bright for the Chinese economy
However, it was not just the tourism industry that has prospered. Online shopping orders, online education platforms, and even in-person shopping also reaped the benefits of the holiday.
Suning.com, a large China-based retailer, saw their online orders increase by 157% during the period and in the 7 days prior to the holiday, the transaction value of China UnionPay online reached 2.16 trillion yuan. Additionally, data from Alipay’s digital life platform showed that shopping mall transactions increased by almost 250% along with a shocking 577% on people attending cinemas.
As most countries are (understandably) scraping to regain some footing amidst the global pandemic, China’s economy has impressively bounced back and most industries appear to have benefited in some way from the holiday.
Consumption in Shanghai
Although the whole of China clearly saw the financial benefits of the holiday, Shanghai alone did exceptionally well. The city’s 437 large commercial enterprises saw sales reaching 12.38 billion yuan, increasing by 13.7% from the same period in 2019.
Some companies and industries that have seen admirable successes:
The 8-day national holiday stimulated country-wide consumption and provided the opportunity for tourism and travel to dramatically pick back up, pointing towards a promising and lucrative future for those with an investment in the broader Chinese market.
The combination of the revival of domestic travel, the surge in the number of tourists travelling and spending in alternative locations, the revival of the hotel industry and the public transport industry, and an increase in online spending has accelerated China’s potential for stable economic growth in the future, and we look forward to the industries and businesses these successes will nurture.
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