Passengers check in at Hangzhou Xiaoshan International Airport in East China's Zhejiang Province on August 30, 2023. Photo: VCG

Consumer spending witnessed a rise during summer holidays in China, as various sectors welcomed a surge in retail sales.

In Yiwu, East China's Zhejiang Province, known as the world's capital for small commodities, sun-ray protection products from "facekinis" to arm sleeves saw hot sales amid steaming heat waves. Hordes of customers visited the city every day, including wholesalers looking to purchase in bulk. The sales of fashionable sun-ray protection products spiked by 841 percent from last year's summer time on e-commerce platform JD.com.

Although women have always been the main force in the consumption of sun-ray protection equipment, the products have also become popular among men this year due to the exceptionally hot weather, reflecting a new market opportunity for manufacturers.

China, with 1.4 billion people, has a diverse consumer market that offers enormous business opportunities with the recent growth-reinforcing policies from the country's top policymakers and a package of new stimulus measures from Beijing are implemented, experts said. They are confident that the world's second largest economy will regain momentum in late 2023 and 2024.

According to the mid-year earnings reports issued by dozens of public companies, most witnessed a jump in revenues and profits, reflecting a dynamic consumption market during summer holidays.

Notable rise of consumers 

H World Group, a major player in hotel industry, saw business revenues hit 10.01 billion yuan ($1.38 billion) in the first half of 2023, up 65.1 percent year-on-year, with net profit attributable to shareholders of the parent company coming in at 2 billion yuan, a jump of 304.59 percent on a yearly basis.

Notably, many companies' business expansion even exceeded the level seen in the pre-COVID years. For instance, A-share listed Anhui Jiuhuashan Tourism Development generated net profit of 111 million yuan in the first six months this year, 37 percent higher than the same period in 2019.

Meanwhile, as more people sought to travel during the summer holidays, Chinese airliners embraced an upturn in market demand. As of August 31, among the nine airliners that have released their half-year financial performance reports, four have achieved profitability.

Despite China's top four airliners including Air China, China Southern Airlines, China Eastern Airlines and Hainan Airline still losing a combined 10 billion yuan in the first half the year, the loss is a significant reduction from 62.5 billion yuan seen in the first six months last year .

Domestic tourist visits reached 1.839 billion during this year's summer holidays, while domestic tourism revenue surged to 1.21 trillion yuan, accounting for 28.7 percent of the annual domestic tourism revenue, data from the China Tourism Academy showed. "Tourism activity during summer this year is significantly higher than that of the same period in 2019, reaching the highest level seen in the past five years," Dai Bin, head of the academy, said.

The tourism boom has spread from upstream spending represented by transportation, accommodation and catering, to downstream services represented by shopping and entertainment, according to Dai.

China's box office revenues during summer time reached 20.6 billion yuan between June and August, official data showed.

Looking forward, the summer holidays' buoyant sentiment has injected impetus and confidence to domestic market recovery in the remainder of the year, which will greatly help sustain the post-pandemic economic recovery, Dai told the Global Times.

In less than a month, China will usher in the Mid-Autumn Festival and the National Day holidays from September 29 to October 6, which is expected to further drive up domestic consumption.

Tongcheng Travel, a travel agency based in Suzhou, East China's Jiangsu Province, predicted the summer travel heat will likely continue during the upcoming 8-day holidays with those hot scenic spots set to attract more tourists than pre-pandemic levels. According to data from Umetrip, a popular flight information app in China, the number of domestic air ticket bookings for the long holidays have exceeded 1.6 million as of August 29.  

Recovery gaining pace

Based on current air ticket booking numbers, the upcoming holidays will unleash even more domestic demand. With rapid recovery in international flight routes, daily travel numbers will likely witness an accelerated pace of growth, a spokesperson from Spring Airlines, China's largest budget carrier, said.

Wang Qing, chief macroeconomic analyst at Golden Credit Rating International, told the Global Times that China's recovery momentum is apparently improving, as shown by recently released official data.

China's official manufacturing purchasing managers' index (PMI) continued to improve in August, standing at 49.7, up 0.4 points from the previous month, marking the third consecutive month of year-on-year increases, despite the index still remaining in contraction territory.

"Some economic indexes are still running at a low level, meaning more muscular tools to bolster the economy could be meted out in the coming months , in particular in the property sector," Wang said, adding that the fourth quarter is likely to witness the effect of recent stimulus measures.

Despite the challenges as reflected by some recent economic data, China will maintain its strategic focus and advance with targeted stimulus measures in its continuous effort to bolster market confidence, experts said, refuting Western claims that China's growth engine is sputtering which will have adverse impact on global growth.

One of Western concerns is that "China lacks new growth drivers" and that if the property sector continues to be weak, the overall economy will be sucked down with it.

Following a key policy meeting on July 24, Chinese government agencies and local governments are taking actions which include vigorous policies to build a more solid foundation to ramp up the pace of economic recovery. 

In the property sector, relevant Chinese authorities have started to roll out effective support measures lately.

On Friday, China's top-tier cities Beijing and Shanghai both announced that homebuyers and their immediate family members will be considered as first-time homebuyers eligible for lower down payments and lower mortgage rates, regardless of their past mortgage history, which sends a strong signal that the government is determined to revive the real estate sector. 

Zhou Maohua, an economist at Everbright Bank, told the Global Times that the Chinese economy keeps on recovering, though facing some challenges, and the policymakers' prudent monetary policy is expected to help counter-cyclical adjustments, while injecting more momentum to the overall recovery.