Editor's Note: The boom and burp cycle of China's tumultuous economy continues with a Golden Week spike in the travel, catering, and film industries despite a slowing economy that has shaken consumer confidence. The article reports on the numbers seen in these industries over the holidays.

Chinese spent a lot of RMB during Golden Week this year. The week was a bright spot in a still weak economy for consumer spending.

Investors have been pessimistic about the Chinese economy as growth slows and numbers continue to drop. Mainland A-shares have plunged, the RMB was recently devalued, and investment growth has been weak. Declining PPI (producer price index) coupled with rising production costs has made it difficult for domestic businesses. In all, news about China’s economy has been troubling as of late, to say the least.

However, National Day and Golden Week provided a small economic boost. 750 million Chinese traveled during Golden Week. Consumer spending in retail sales and the catering industry broke the trillion Yuan mark. The number of Chinese who traveled abroad during the vacation was also high. This shows that the Chinese economy is still full of vitality, and has further growth potential for the future.

Ministry of Commerce spokesperson Shen Danyang said that Golden Week consumption was characterized by five different things: 1. The rapid growth of overall consumption; 2. Retail spending; 3. Spending on catering; 4. Spending on leisure activities; 5. Stabilized prices of every day necessities.

The Ministry of Commerce reported that from October 1 to 7, retail sales and the food and beverage industries pulled in 1.082 trillion Yuan, equal to Kuwait’s 2014 GDP. This marks an increase of 11% from last year.

A Booming Catering Industry
The catering industry did extremely well over Golden Week, as many large events and weddings were held over the break. The catering industry grew during the holiday in a number of regions including Jiangsu (where it grew by 17.6%), Inner Mongolia (15.7%), Hubei (14.5%), Henan (14.3%), and Xinjiang (14.1%).

In Jiangsu, for example, about 70,000 couples were married over the holiday, consuming more than 2 billion Yuan worth of wedding fare. In Tianjin, more than 30,000 couples were married. Every day, 47 hotels in the city catered over 4,600 tables of food.

Big Spending on Travel
Travel was also a key factor in the Golden Week economic boost. In all, 750 million Chinese traveled over the holiday, 639 million of them on the road, an increase of 1.6% from last year. The role that tourism plays in increasing national consumption is obvious. 15 provinces and municipalities report tourism revenues of 39.21 billion Yuan for the week.

13 provinces reported tourism growth of more than 10% over the period. Shandong, Sichuan, Henan, Shanxi, Shaanxi, and Hunan brought in a combined 20 billion Yuan in tourism during the vacation week.

MOC research institute expert Zhao Ping said that in August this year, sales from restaurants and retail totaled almost 2.5 trillion Yuan. This makes the amount spent from October 1 to October 7, just over a trillion Yuan, quite outstanding in such a short amount of time. This indicates that consumer demand during Golden Week was especially strong.

Box Offices Numbers High
In the seven days of Golden Week, box office revenues reached 1.85 billion Yuan, a 70% increase from the previous year. Spending at the movies during Golden Week has sustained high growth since 2009. The consumption of culture and entertainment during Golden Week has become a staple of holiday spending for Chinese.

Holiday spending was also in full swing for cross-border travel, online shopping and other areas. The Chinese consumer economy is still growing in size and importance.

Consumption patterns in China are changing, and it will be crucial for investors to grasp the new trends. Consumption is becoming more personalized and diversified, and goods and services in China will evolve to reflect that.

China’s per capita GDP currently stands at about 6,800 U.S. Dollars, about the same as the United States’ per capital GDP in the 1950s, and Japan’s in the 1970s. It is expected that China’s per capita GDP will increase by 15% by 2025.

Source: QQ News

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Keywords: Golden week economic boost China economy boost