China News This Week: Wednesday 9 March 2022
This week's news and trends in China:
Chinese Consumers
China On Verge of High-Income Status After Wealth Measure Jumps 20%: Chinese gross national income (GNI) rose 20% in nominal terms to $12,438 per capita. The World Bank regards $12,695 as the minimum amount for a high-income country. The jump owed to a speedy economic rebound from the disruption caused by the coronavirus, as well as a strong yuan that boosted the dollar figure.
Households' Income and Consumption Expenditure in 2021: In 2021, Chinese residents' per capita disposable income reached ¥35,128 ($5,558), up 9.1% from 2020 or 8.1% in real terms. Urban residents' incomes grew 8.2% to ¥47,412 ($7,496) and rural residents were up 10.5%, but still hovering at less than 40% of their city peers at ¥18,931 ($2,993). Per capita consumption expenditure was ¥24,100 ($3,811), 13.6% more than 2020 - 12.6% in real terms. It increased 11.8% over 2019. Food, tobacco and alcohol accounted for the largest share of consumption at 29.8%. Education, culture and recreation was the fastest growing at 27.9% since 2020.
China’s Urbanisation Push Could be at a ‘Bottleneck’, with Slowest Migration Growth Rate in Quarter-Century: China's urbanisation rate of permanent residents rose by 0.83 percentage points to 64.72% last year, the first rise of less than 1 percentage point in 25 years. Urban area populations increased by 12.05 million. The pace of urbanisation has been trending down since 2015. The migration to cities slowed further in 2021 as a result of Covid.
China Signals More Policy Support With 5.5% Growth Target: The growth goal is the lowest in more than three decades but above consensus forecasts and far higher than the IMF's 4.8% projection. Beijing vows to step up monetary policy implementation and economists see more rate cuts and fiscal spending on the cards to hit the target.
How China’s 'Soft' Brands are Going Global: Following in the footsteps of manufacturers like Haier and Huawei, Chinese fashion, gaming, and media companies are shaking up global consumption patterns.
Digital China
China Drafts New Rules to Control Notifications and Pop-Ups: The rules hope to stop Chinese apps’ excessive use of the tools and control what content gets shared in the notifications. Chinese Android phone users are estimated to receive 100 notifications every day on average. The Chinese regulator has also urged tech companies to stop forcing users to download apps.
Food & Beverage
China Can’t Count on Global Markets for Food Security, Xi Jinping Says: China’s president has underscored food security as a top priority, ordering greater self-reliance in food production to ensure the country’s development as one of the key messages coming from China's annual "Two Sessions" meeting currently underway in Beijing.
Thailand Hopes 10-Tonne Jasmine Rice Donation Will Hook Chinese Consumers: Thailand’s Commerce Ministry donated 10 tonnes of Thai jasmine rice to poor women and children in China’s Fujian province recently in a bid to raise awareness of Thai rice and penetrate the Chinese market.
Parenting
‘Corporate Daigou Boom’: Formula Firm Bubs Boosted by Formal Platforms for Sellers: Infant formula maker Bubs reported a record high gross revenue coming from corporate daigou companies, which help individual sellers navigate hurdles such as procurement and deliveries. The segment grew 276% from the prior period. Last week Bubs doubled down on China signing an incentivised share agreement with its lead daigou distributor, HK-based Willis Trading.
From Patriarch to Peppa Pig: China’s New, Softer Generation of Dads: China’s men have long clung to a traditional model of fatherhood: focusing on their careers and letting women handle the childcare. Now, that’s finally starting to change.
Chinese Tourists
Outlook for China Tourism in 2022: Trends to Watch in Uncertain Times: International travel remains attractive, but is still considered unsafe according to a McKinsey survey. Desire for overseas travel has rebounded to pre-pandemic levels with APAC being the top choice (24%). In the survey taken before recent conflicts in Eastern Europe, Southeast Asia, Europe, Russia, and Japan are named as the most desired overseas destinations. To travel internationally, the Chinese consumer wants to see close to zero COVID-19 cases in the destination country (86% rated this as a top 3 factor). The second most important factor for Chinese travellers is the removal of quarantine in China upon return (84%). Outdoor scenic, culture & history and beach & resort are the most interested categories of trips.
The World’s First Fila-Branded Hotel to Open in Shanghai: Global sportswear label Fila is set to introduce the world’s first Fila-branded hotel in Shanghai under a partnership with Hyatt, as part of parent company's Anta's new HQ. Opening in 2024, the eco-friendly headquarters complex will span five independent buildings, housing offices, shops, food and beverage outlets to become "a destination for sports retail."
Beauty
Shanghai Restricts Chinese Minors from Cosmetic Surgery and Bans Tattoos: The Shanghai government has banned anyone under the age of 18 from getting cosmetic surgery without approval from parents or legal guardians. Tattoo parlours are completely banned from offering their services to minors. Only 14% of cosmetic surgery service providers in China are estimated to be legally registered.
L’Oréal on How Luxury Fragrance Growth is Being Driven by ‘Explosion’ of Interest in China: L’Oréal Group has credited the boom in luxury fragrance to the growing appreciation among Chinese consumers and expects it to continue growing by double-digits in the coming years.
Education
Most Support 'Double Reduction' Policy, Report Said: More than 90% of students, teachers and parents said they are in favour of the "double reduction" policy, which reduces students' extracurricular tutoring and homework burdens, according to a report by the China Institute of Education and Social Development at Beijing Normal University.
Environment
China’s Clean Energy Conundrum: More than 5 million Chinese residents and roughly 25% of the coastline in China is in highly vulnerable areas due to climate change, with numbers expected to double in the next 80 years according to a UN report. China will suffer the world’s biggest economic losses from rising sea levels and the resulting floods. Guangzhou, in particular, is said to be the most economically vulnerable city in the world to rising sea levels in the next three decades, with estimated losses of $254 million per year under a 1.5°C warming.
