Consumer Confidence Remains Strong
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Kirk John-Williams registered a cosmetics trading company in China only three months ago. Although the world economy has been affected by the financial crisis, the Trinidad and Tobago businessman is confident in the Chinese consuming market.
"The financial crisis won't have too much impact on Chinese consuming market. The upper class may have been affected by the economic downturn, but most people from middle class are not badly hit. Chinese consumers are still willing to spend," he said.
Economists believe China's exports may recover later this year. The most effective means to spur economy at the moment should be stimulating domestic consumption.
"China should have learnt a lesson that an export-oriented economy is not sustainable. Stimulating domestic consumption will not only spur the economy, but also meet the needs of the general public," a researcher from China National School of Administration, Ding Yuanzhu, told Xinhua.
China's economy rose 6.1 percent year on year in the first quarter. Consumption contributed more than 4 of those percentage points, retail sales during the same period increased by 15.9 percent. Urban residents' disposable income rose 11.2 percent and rural residents' rose 8.6 percent.
Chinese consumers are less pessimistic on economy than other countries'. According to a survey by Nielsen of 50 countries and regions, only 35 percent of Chinese people believed the domestic economy was in a contraction. The figure was the lowest among the 50 world markets.
The survey report said Chinese consumers were "willing to spend and feel that the next 12 months would be a good time to buy things they needed."
"Chinese consumers still have strong confidence on economy. People are still willing to travel, spend money on clothes and buy advanced technologies. This is a young but energetic group," Neilson's Vice Chair Susan Whiting said.
The Neilson contributed the confidence to the 4-trillion-yuan (US$585 billion) stimulus package and abundant domestic deposit.
In the auto market, stimulus packages are taking effect. Auto sales showed strong signs of recovery after the country cut purchase taxes for small engine-sized cars and rolled out detailed stimulus package for auto sales in rural areas.
According to the China Association of Automobile Manufacturers, auto sales topped 2.64 million units in the first quarter, up nearly 6 percent year on year. The quarterly sales overtook the United States for the first time to become the world's largest auto market.
Ye Zi, who has been working in Beijing for nearly three years, just bought a 1.6 liter car which cost her more than 100,000 yuan.