The ongoing trade war with the United States and several other factors may have slowed down the Chinese economy, but it apparently hasn't affected China's shopping habits. There were some growing concerns from local companies of possible decreased profits this year, but the ongoing Chinese New Year celebrations have proven otherwise.
The start of the annual Chinese holiday will see millions of people traveling across the country and abroad to see relatives and to go on vacations. The holiday also marks a rapid increase in spending, with families going out to restaurants and to different retail stores. Last year, Chinese citizens spent an estimated US$189 billion on food, travel, and retail items. This year's celebration is expected to show the same amount of spending as China welcomes the Year of the Pig.
According to experts, wealthy Chinese consumers will likely not change their spending habits this year. However, middle-class consumers may try to cut back. Spending on items such as jewelry isn't expected to decrease this year. Gold and other jewelry are seen as an appropriate gift this time of year, specifically given by older generations to newer ones. While it might not be possible to see substantial growth in sales this year, figures are expected to still remain the same.
Retail stores that sell popular luxury brands don't expect a large decline in sales as well. There is apparently still a lot of demand for luxury shopping items from Chinese consumers. This includes high-end bags, leather goods, clothing, and liquor. While some products have seen a slight decline in sales, such as Swiss watches and imported electronics, most other sectors have largely been unaffected.
Unlike previous generations, new generation Chinese consumers now tend to choose to travel abroad instead of going to their hometowns. A third of the world's duty-free spending is by Chinese consumers. With hundreds of millions of Chinese tourists expected to participate in the annual migration and millions more traveling overseas, duty-free spending is expected to more of the same if not higher. This year, most tourists are also choosing to travel outside of China, mostly to more affordable Asian destinations, due to the decline in the value of Yuan.
Gambling in China is also a big contributor to the overall spending during this time of the year. Casino operators in Macau and other parts of China don't expect a lot of changes in spending habits. Some analysts, however, do expect a decline of about 1 percent this year when compared to 2018. Chinese consumers will likely still arrive in droves to Macau during the holiday season, especially since there are new exhibitions and resorts opening this year.
