Xinhua Insight: Domestic consumption drives up Christmas spree

Wu Yong's four-year old son cannot wait to see Santa and find out what is inside his Christmas stocking this year.

Wu and his wife are not big fans of the western festival, but they spend a lot every year to delight their son.

This year they ordered a Christmas tree online for 85 yuan (12.2 U.S. dollars), a Christmas stocking for 29 yuan, and some LEGO costing 598 yuan. In addition, their son's kindergarten charged each family 50 yuan for a dinner.

Christmas, a once exotic foreign holiday, has turned into a highly profitable annual celebration in China. But after two big online shopping days in one month, Singles' Day and December 12th, most consumers are reluctant to spend more, so Christmas is being used to target specific groups -- couples and children.

In a Wal-Mart in Beijing, a boy and his mother were picking out presents for a Santa gift exchange, a Christmas ritual at most preschools in big cities such as Beijing and Shanghai.

"I want to pick something special for my friends," he said.

"My wife and I feel quite sad that kindergartens are paying so much attention on western festivals like Christmas and Halloween, but so little to traditional Chinese holidays," said Wu. "But anyway, it is worth it as long as our son is happy."

On China's major e-commerce giant JD.com, a rose in a glass ball is on sale as a limited edition Christmas gift. It is priced at 1,314 yuan, and symbolizes life-long love.

Restaurants and romantic films on Christmas Eve are hot too, with many already fully booked, especially with this year's celebration falling on the weekend.

Traffic congestion during peak hours on Christmas Eve is expected to be bad in big cities as people head for parties. Entertainment venues such as cinemas, KTVs expect at least an 80 percent more business than usual.

Factories in China's largest small commodity wholesale market Yiwu, making Christmas products, have suffered from weak overseas demand.

"I have been in Yiwu since 2010. This year is the hardest," said Wu Shufang, owner of a Christmas tree factory.

China is a traditional exporter of Christmas products. The US Census Bureau estimates that the United States imported Christmas decorations worth more than 1.1 billion U.S. dollars this year, accounting for 92 percent of the country's total of such imports.

But China is losing its role as a cheap commodity producer.

Wu earned little this year despite 30 people working at her factory since February.

"The price of boxes to pack the trees rose 70 percent in November. Luckily we had enough boxes in stock, but it will definitely affect us next year," Wu Shufang said.

Two thirds of Wu Shufang's Christmas trees go to Russia, Germany and Brazil. This year exports fell 15 percent.

According to Yiwu customs, exports of Christmas products declined by 18.5 percent to 1.7 billion yuan year on year from January to November 2016.

"Yiwu is gradually losing its cost advantage and the manufacturing sector is shifting to Southeast Asia," said Zhang Handong, head of Zhejiang Academy of Commerce.

The shrinking foreign market has forced Wu Shufang to focus on the domestic market.

"I heard e-commerce is big these days, but I'm too old to run an online store, but I am considering signing up as a Christmas products supplier for Taobao," Wu Shufang said. Endi