Consumer confidence in China rebounds

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Last updated at: (Beijing Time) Sunday, January 25, 2004

Consumer confidence in China rebounds

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A survey by Mastercard International (MI) has shown that the consumer confidence index on China's mainland has rebounded from 68.0 in June 2003 to the current 83.7, 12.7 points higher than the average level of the past several years.

"It indicates that Chinese mainland consumers' market confidence has recovered from the haze brought by SARS," said Feng Weiquan, MI's deputy president.

The regular survey, conducted twice a year in June and December,and covering 13 countries in the Asia-Pacific region, appraises consumers' views of the economic environment in the next six months.

The survey analyzed consumers' views in five aspects, including employment prospects, national economy, fixed income, stock market and living standards, Feng said.

According to the survey, among residents in Beijing, Shanghai and Guangzhou, Shanghai residents are the most optimistic about the economic environment as the consumer confidence index has risen from 72.0 to 86.0, the third highest point in recent years, while the figure of Beijing has reached 84.5 from 69.9 six months ago, and that of Guangzhou has rebounded from 62.1 to 80.1.

Such an optimistic mood will benefit the whole economic environment in the Asia-Pacific region, said Feng.

The rebound of consumer confidence reflects the forceful impetus of China's economic development, said Wang Yuehun, chief economic consultant of MI in Asia-Pacific region.

According to Wang, as the annual increase rate of China's gross national product (GNP) has reached 8.5 percent despite the SARS epidemic, the annual increase rate of 2004 is estimated to be between 9 to 10 percent.

The broad area of Chinese villages and hinterlands will become the hotspot of investment in 2004 and Chinese economic development will see the rapid growth of its imports with the extension of the domestic market, said Wang.

As the average growth rate of imports of consumer goods has reached 33 percent, China has become the driving force of the economic development in the Asia-Pacific region, Wang said.

HK's consumers confidence returns

Consumers confidence is slowly returning in Hong Kong, with fewer people saying they intended to cut spending in the Lunar New Year than the past six years, according to a news paper report on Jan. 25.

A telephone survey of about 1,000 respondents, which was carried out by the Democratic Alliance for Betterment of Hong Kong, found 64 percent of the Hong Kong people planned to spend either the same amount or more than they did during last year's New Year holidays.

Fewer people said they would cut their spending on clothes (48.8 percent), gifts (39 percent) and travel (46 percent) in the period.

According to the survey, fewer people cut spending at the end of last year on clothing (49.6 percent), food and drink (40 percent) and entertainment (48.3 percent).

"With the continued fall in the unemployment rate, consumers confidence has returned somewhat," said legislator Chan Kam Lam, the party's spokesman for economic affairs. He said that the influx of mainland travelers boosted the local business.

To back the economic revitalization, the party appealed to the government to continue to help improve the business environment by cutting tariffs and simplifying licensing procedures in the new year.

Source: Xinhua

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