Increased consumer spending has helped China’s economy rebound following its lengthy COVID lockdown.
Figures from the country’s National Bureau of Statistics released Tuesday (April 18) showed China’s economy growing 4.5% during the first three months of the year.
Helping drive this growth was an increase in retail sales of consumer goods, up 5.8% year over year after a 2.7% decline the previous quarter. According to the statistics bureau, consumers upped their spending on everything from clothing to food to jewelry.
Online retail sales were up 8.6%, the bureau said, accounting for nearly a quarter of all retail sales during the quarter.
However, a report Tuesday by The Wall Street Journal quoted Louise Loo, China economist at Oxford Economics in Singapore, who said that the consumer-centric nature of this rebound indicates its effects may not lead to a recovery overseas.
“Anyone looking for China to save the global economy this year might be somewhat disappointed,” said Loo, per the report.
The WSJ report also noted that the International Monetary Fund projects China’s economy will grow by 5.2% this year, compared to a 1.6% forecast for the U.S. and 2.8% worldwide.
The first few months of the year had suggested that consumer spending in China hadn’t surged the way many anticipated it would when the government eased its pandemic restrictions.
Comments from the CEOs of eCommerce firms JD.com and Alibaba in March indicated the country’s consumer spending had not yet recovered from the downturn that was seen during the pandemic.
JD.com CEO and Executive Director Lei Xu called the recovery it had seen in the earlier part of this year “imbalanced,” postulating that consumer spending may not pick up until the second half of the year.
Other brands have pinned their hopes on China’s desire for luxury goods, such as LVMH, which said last week that a 17% increase in first-quarter sales was due in part to the resumption of shopping among Chinese consumers.
The Chinese government said in early March that its economic growth target for the year is 5%, with consumption driving a large part of that growth.
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