China News Agency, Beijing, January 26th: How does the Chinese Spring Festival economy affect the world?
Author Chen BoProfessor of Huazhong University of Science and Technology, Dean of Optics Valley Free Trade Research Institute
In the past, when it came to the "shopping season", many people would think of the Christmas shopping season in the West, and were deeply impressed by the lively shopping scene of "Black Friday".
The reason why the Western Christmas shopping season is widely known is not only the economic prosperity of Western countries, but also its role in stimulating the import of foreign goods, allowing the world to share the dividends of the Christmas holiday economy.
For Chinese people around the world, the Lunar New Year is undoubtedly the most important festival.
However, for a long time in the past, due to the relatively low level of consumption in China internationally, the Spring Festival economy was basically only digested domestically, far from the influence of the Christmas economy.
Times have changed, and now China's gross domestic product (GDP) ranks second in the world, and its per capita GDP exceeds US$12,000, making it an upper-middle-income country.
The improvement of people's income and the pursuit of quality of life have also brought prosperity to consumption.
The New Year’s goods purchased by ordinary households are no longer limited to basic daily necessities such as food, clothing, and daily necessities. Instead, there has been an obvious consumption upgrade, and the proportion of high-end consumer goods and imported goods is increasing.
Like Western Christmas, the Chinese Spring Festival has gradually become a worldwide festival, and its economic spillover effect is increasingly affecting the world.
The Spring Festival lighting in the Xujiahui business district in Shanghai.
Photo by Chen Yuyu
The rise of China's Spring Festival economy has an important role in stimulating the development of world economy and trade.
On domestic shopping websites, various Spring Festival promotions such as "Foreign Goods Going to the Countryside", "Global Gift Hunting" and "Global Flash Sale" have enabled many overseas merchants to seize the business opportunity of upgrading consumption during the Spring Festival and make huge profits.
Taking Germany as an example, consumption during the Spring Festival has benefited German brands active in the Chinese market, and "Made in Germany" products such as automobiles, food and cosmetics are very popular among Chinese consumers.
In addition to "bringing in" imported products, the enthusiasm of Chinese residents to make full use of the long Spring Festival holiday to "go out" has also continued to rise. Many Chinese people have begun to enjoy the exotic flavor of the "foreign Spring Festival".
In order to attract Chinese tourists, countries around the world have made the Spring Festival an international festival.
For example, Sydney, Australia is an important city inhabited by international Chinese.
To welcome the Chinese New Year, Sydney has launched a series of activities.
Now every Lunar New Year, Sydney's Chinatown is decorated with festive colors of red, gold and pink, showing the full "New Year flavor" of the Spring Festival.
Scotland's National Museum will hang lanterns of unicorns and Chinese dragons on its roof to wake up sleeping Edinburgh on the morning of the Chinese New Year, reminding people that the festive activities of the Chinese New Year have begun.
In addition, some cities in western countries welcome tourists from China and the world through Chinese-style ink painting exhibitions, bilingual carnivals, Chinese-style music and dance performances, and celebrate the Spring Festival together.
The New Year's Eve dog lantern guarding Sydney's Chinatown.
Photo by Tao Shelan
As far as the world is concerned, the rise of China's Spring Festival economy has brought at least five far-reaching impacts in the following five aspects.
First of all, the global shopping season has begun to show the "Christmas + Spring Festival" model.
The traditional Western shopping festival begins with "Black Friday" at the end of November each year and ends on New Year's Day of the following year.
The Spring Festival shopping season in China basically starts on New Year's Day and lasts until the fifteenth day of the first lunar month (usually until early February).
In other words, the rise of the Spring Festival economy in the world has doubled the time of the global shopping peak, effectively boosting world demand and stimulating the global economy.
Keynes, the father of modern macroeconomics, believed that "demand determines supply".
The new demand of the Spring Festival economy has created new supply and even more job opportunities for the world, making the global economy more dynamic.
Second, China's "buyer" status has been enhanced.
As we all know, one of the important experiences of China's reform and opening up over the past 40 years is the success of the export-driven economic growth model.
China replaced Germany in 2009 and became the world's largest exporter for the first time, becoming a veritable "world factory" and the largest seller in the global market.
Although China's position as the leader of the "seller" has not come easily, it is not "pleasing" in the global market.
Sell-side countries complain about fierce competition from China, and buyer countries complain about trade deficits.
Therefore, China has proposed a new trade development strategy of "buy the world and sell the world".
After creating the Canton Fair brand oriented to promoting exports, China has organized the "Shanghai Import Expo" oriented to imports, which has become one of the focuses of the world's attention.
The Spring Festival economy has strengthened China's "buyer" status. While balancing trade, it also allows the world to understand and adapt to China's characteristics in terms of quality standards, cultural habits, and behavioral preferences.
The Estee Lauder cosmetics booth at the Shanghai International Import Expo.
Photo by Tang Yanjun
Third, it has changed the structural characteristics and business models of international demand, and has increasingly highlighted Chinese characteristics.
With the rapid improvement of Chinese people's living standards, more and more well-off families put 3C electronic products, international beauty brands, high-end clothing and high-value products full of exotic characteristics in the "Spring Festival shopping cart", many of which are Exotics.
These high import demands in the Spring Festival economy are gradually changing the structure of international commodity demand, and more and more manufacturers in the world are beginning to consider the needs of the Spring Festival economy in their production and business plans.
Another feature of the Spring Festival economy is the rise of the e-commerce model.
With the emergence of e-commerce platforms such as Ali, JD.com, and Pinduoduo, China's retail model has undergone revolutionary changes. Consumers prefer to choose and buy their favorite products through the e-commerce model.
In addition, China also encourages the development of cross-border e-commerce, and the corresponding tariff arrangements are more clear and reasonable.
The import model in the Spring Festival economy is different from the traditional import model in the Christmas shopping season. The latter is mainly based on the general import model, while the former is more focused on the cross-border e-commerce model.
It can be seen that the Spring Festival economy has also promoted the transformation of the digital model of international trade represented by cross-border e-commerce.
Cross-border e-commerce live streaming.
Photo by Yu Fangping
Fourth, more Chinese elements have been incorporated into the international tourism culture.
According to data released by the China Tourism Academy, the scale of China's outbound travel market reached 155 million in 2019, and the overseas consumption of outbound tourists exceeded US$133.8 billion.
Regardless of the scale of outbound tourism consumption or the number of outbound tourists, China has become the number one in the world.
The Spring Festival holiday is one of the most popular times for Chinese residents to travel abroad. In addition to experiencing foreign cultures and enjoying foreign goods and services, the travel consumption demand for the Spring Festival also includes the demand for goods and services with Chinese cultural characteristics and in line with Chinese consumption habits. Favored, foreign businessmen will naturally not ignore it.
It is worth noting that during the Spring Festival, due to the convenience of climate and geography, Chinese residents prefer to travel abroad in Asia-Pacific countries.
With the official implementation of the "Regional Comprehensive Economic Partnership Agreement" (RCEP) in January 2022, China's Spring Festival economy, whether in terms of tourism consumption or cross-border e-commerce, will gradually show in the Asia-Pacific region due to the high-level RCEP cooperation and opening up more prominent influence.
Chinese people's outbound travel groups for the Spring Festival.
Photo by Zhong Xin
Therefore, Chinese New Year is increasingly becoming a worldwide holiday.
The globalization of the Spring Festival economy has also become an important channel to show the world the charm of Chinese traditions such as Chinese history, culture, and customs.
Fifth, the internationalization of the Spring Festival economy is expected to help China cultivate foreign friends' consumption habits for Chinese goods and services.
Although China has the reputation of "the world's factory", this also reflects the reality that China's exports are mainly industrial products (especially OEM and processing).
Generally speaking, consumer products have a higher rate of added value.
Therefore, in order to increase the value-added rate of China's export products, on the one hand, we need to increase the technological content of industrial exports, and on the other hand, we also need to increase the export proportion of consumer goods.
With the rise of the Spring Festival economy around the world, when foreigners experience Chinese New Year products with overseas Chinese, they actually provide a stage for the display of characteristic consumer products rich in Chinese elements in the international market.
In addition, the internationalization of the Spring Festival economy is also expected to help China's service industry go global.
The internationalization of the Spring Festival economy will not only attract more and more foreigners to come to China to experience the charm of authentic Chinese traditional culture and customs, but also spread more calligraphy, painting, music, performances, etc. abroad.
In February 2018, during the Spring Festival, the NBA Development League team held a special Chinese New Year event in Toronto, Canada.
The picture shows a lion dance performance in the competition.
Photo by Yu Ruidong
Over the past three years, the COVID-19 epidemic has brought profound changes to business cooperation and cultural exchanges among countries, and China has also been deeply affected.
However, as China's epidemic control measures continue to be optimized, China's connection with the world is rapidly recovering.
The Chinese Spring Festival economy has once again attracted the attention of the world, providing an opportunity for the world to share joy and prosperity.
(Finish)
About the Author:
Chen Bo is a professor and doctoral supervisor of Huazhong University of Science and Technology, director of Openness and Development Research Center, president of Optics Valley Free Trade Research Institute, a double-appointed professor of Hainan University, and a visiting researcher of the Dallas Branch of the Federal Reserve Bank.
The main research directions are international trade, Chinese economy and international economic cooperation. He has published more than 20 papers in top international journals of international economics and comparative economics, as well as top domestic economic management journals such as Economic Research and Management World, and participated in hosting Conducted research and consulting work in Shanghai, Fujian, Hubei, Hainan and other free trade zones/ports.
Won the titles of Central China Outstanding Scholar and Chutian Scholar.