Must-Read China Economic News (Jan. 8-14)
China's foreign trade hits new high in 2024, visa-free trips to China double in 2024, and the 2025 Spring Festival travel rush starts with 9 bln trips expected, and more.
Greetings and welcome to the latest edition of Peking Ensight! We're thrilled to have you join us once again as we navigate the ever-evolving landscape of the Chinese economy.
⭐Under the Spotlight
China's foreign trade hits new high in 2024
China's foreign trade hit a record high of 43.85 trillion yuan (about 6.1 trillion U.S. dollars) in 2024, up 5 percent year on year, as the country further consolidated its top position globally in goods trade.
In 2024, China saw rapid growth in exports of high-tech products such as electric vehicles, 3D printers, and industrial robots. The nation was also at the forefront of green trade, with its green products trade making a significant contribution to the global response to climate change and green transition.
China's growing imports have helped drive trading partners' development. Imports of clothing, fruits, and wine rose 5.6 percent, 8.6 percent, and 38.8 percent, respectively, customs data showed.
General Administration of Customs deputy head Wang Lingjun said China's foreign trade growth was a result of a raft of timely incremental policies rolled out by the central authorities as well as measures aimed at stabilizing foreign trade last year.
China has become a major trading partner of more than 150 countries and regions, and the country's circle of friends in foreign trade is getting larger, Wang said.
Chinese netizens welcome influx of "TikTok refugees"
Chinese internet users on the popular social networking platform Xiaohongshu have noticed a sudden influx of foreign newcomers who claim to have migrated from TikTok due to concerns about a potential ban by the U.S. government within the week.
The surge in activity has propelled Xiaohongshu, also known as RedNote abroad, to the top of the U.S. Apple app store download rankings within just a few days.
TikTok, owned by Chinese internet company ByteDance but operated independently, has approximately 170 million users in the United States, nearly half that country's population. Washington has sought to ban TikTok for many years, citing unfounded national security concerns and alleged risks to data privacy. It faces a possible ban on Jan. 19 as the U.S. Supreme Court is set to rule on enforcing a law that could either ban TikTok or force ByteDance to sell it to an American firm.
"U.S. TikTok users are voting with their feet," said Lyu Xiang, a non-resident senior fellow at the Center for China and Globalization. "This demonstrates that suppressing normal business activities of non-U.S. companies is unpopular, as such actions by U.S. politicians are harming the immediate interests of the American public."
Founded in 2013, Xiaohongshu initially focused on shopping tips but has evolved into a comprehensive lifestyle platform, blending social media and e-commerce. Users can share content and purchase products directly through the app, creating a seamless shopping experience.
China's Spring Festival travel rush starts with 9 bln trips expected
China ushered in its largest annual population migration on Jan. 14, 15 days ahead of the Spring Festival, also known as Chinese Lunar New Year.
This marks the first chunyun, or Spring Festival travel rush, after UNESCO inscribed the Spring Festival on its intangible cultural heritage list in December last year.
Nine billion passenger trips are expected during this year's travel rush period that ends on Feb. 22 -- with both rail and air passenger trips set to hit record highs.
This 40-day travel surge will see hundreds of millions of people in China returning to their hometowns for family reunions.
World's largest ice-snow theme park attracts 1 million visitors in 20 days
The bustling Harbin Ice-Snow World, the world's largest ice-and-snow theme park, has welcomed more than 1 million visitors just 20 days after it opened on Dec. 21, 2024, setting a record high for the annual winter wonder that has delighted guests for 26 years.
Harbin, capital of northeast China's Heilongjiang, has emerged as one of the country's top winter travel destinations, attracting visitors from around the globe.
The park design incorporates elements inspired by the upcoming 2025 Harbin Asian Winter Games, set to open in February, as well as the upcoming Spring Festival, which will take place at the end of January.
In addition to the park's popular attractions, which include super ice slides, ice palaces and sculpture as well as various ice and snow fun sports, visitors are also drawn to the local cuisine. A particular fan favorite among tourists is the big hotpot, which features a mix of over 30 varieties of ingredients and offers a warm and satisfying dining experience.
Young Chinese consumers turn to "guzi" goods for good moods
Many young Chinese people are attracted by the emerging "guzi consumption" phenomenon and are willing to shop for "good moods" -- paying for the emotional value of the guzi.
The word "guzi," a homonym for the English word "goods," refers to badges, acrylic figure stands, cards and other merchandise featuring ACG (animation, comic and game) culture elements. Most guzi cost no more than 100 yuan (about 13.9 U.S. dollars), and the most commonly seen ones are badges of around 15 yuan each. A few rare guzi may reach prices of more than 1,000 yuan.
In recent years, with the rise of the ACG industry, more and more young people, especially Generation Z and younger generations, have become keen on collecting guzi products, and this emerging trend has created fresh business opportunities.
According to a McKinsey survey, 64 percent of Chinese consumers attach more importance to emotional consumption, and this is evident among young consumers in particular.
⭐ Key Macroeconomic Indicators
China's auto output, sales reach new heights in 2024
China's auto sector hit a milestone in 2024 as both production and sales exceeded 31 million units, industry data showed.
Total auto output reached 31.28 million units last year, up 3.7 percent from the 2023 level, and sales rose 4.5 percent to reach 31.44 million units, according to the China Association of Automobile Manufacturers.
New energy vehicle sales accounted for 40.9 percent of all new car sales in 2024, an increase of 9.3 percentage points from 2023. Last year, the country exported 5.86 million vehicles, up 19.3 percent year on year.
Industry observers say China's auto sector is projected to maintain its growth momentum in 2025, as greater potential of the automobile market is expected to be unleashed following the implementation of a series of supportive measures.
Visa-free trips to China double in 2024
The number of inbound trips made by foreigners to China under the country's visa-free policies in 2024 doubled compared with the previous year, government data showed.
Border inspection agencies across China handled 64.88 million cross-border trips by foreigners in 2024, up 82.9 percent from a year earlier. Among them, more than 20 million inbound trips by foreigners were made visa-free, a year-on-year increase of 112.3 percent, according to statistics released by the National Immigration Administration.
In 2024, China introduced a series of new visa-free entry and transit policies, providing foreign nationals with greater convenience to visit the country and demonstrating its unswerving determination and commitment to opening-up.
The latest moves include an extended visa-free entry policy introduced in November last year to allow ordinary passport holders from 38 countries to visit China for a maximum of 30 days without applying for a visa. In the following month, China announced a relaxation of the visa-free transit policy, extending the permitted stay for eligible foreign travelers to 240 hours from the previous periods of either 72 hours or 144 hours.
China's express delivery sector posts fast growth in 2024
China's courier sector handled 174.5 billion parcels in 2024, a surge of 21 percent year on year, and the sector's total revenue expanded 13 percent to 1.4 trillion yuan (about 195 billion U.S. dollars), the State Post Bureau (SPB) data showed.
The sector reached a historic milestone in 2024, when its annual express delivery volume surpassed the 150-billion-parcel mark for the first time, just a decade after the country's total parcel volume had crossed the 10-billion mark in 2014.
China handles more than 5,400 parcels per second, and the Chinese receive over 100 parcels on average per person annually, according to the SPB.
More Chinese firms travel abroad for business cooperation opportunities
The China Council for the Promotion of International Trade (CCPIT) said more than 2,249 groups of enterprises visited 102 countries and regions to conduct market research and hold business talks last year.
In 2024, some 50,000 Chinese enterprises held 1,166 overseas exhibitions in total, up 29.4 percent year on year. CCPIT head Ren Hongbin said that the council will make further efforts to help cultivate new momentum in foreign trade through measures including increasing support for overseas exhibitions and actively engaging with international exhibition organizing bodies.
⭐ Policy Moves Much Talked About
China pledges efforts to maintain stable RMB exchange rate
China will unswervingly keep the RMB exchange rate basically stable at a reasonable and balanced level, according to a meeting.
The People's Bank of China, China's central bank, and the State Administration of Foreign Exchange in the meeting said they will continue to take comprehensive measures to stabilize expectations, enhance resilience and strengthen management of the foreign exchange market.
Resolute efforts will be made to rectify pro-cyclical market behaviors, address actions that disrupt market order, and guard against the risk of exchange rate overshooting, the meeting said.
China vows "highly proactive" fiscal policy to shore up economy
China is poised to implement a clear-cut fiscal policy in 2025 that aims to intensify countercyclical regulation and will be "highly proactive," officials said Friday.
As part of the policy, the size of China's fiscal deficit will increase significantly in 2025, Vice Minister of Finance Liao Min told a press conference.
Liao said considering the increasing size of China's GDP, the total fiscal expenditure will further be expanded, and countercyclical adjustment efforts will also be stepped up to provide solid support for the sustained recovery of the economy.
The policy also takes fiscal sustainability in the medium and long term into consideration, so that it is prudent at the same time. Specific policy measures must go through statutory procedures before being launched, Liao said.
China to increase finance support for green, low-carbon development
China's financial sector will promote the steady growth of green finance in support of green and low-carbon development, as the world's second-largest economy presses ahead with building a beautiful China, a central bank official has said.
Zhu Hexin, deputy governor of the People's Bank of China (PBOC), China's central bank, said that while doing this, the financial sector must focus on the effectiveness of green finance in generating environmental benefits and promoting industrial transformation and upgrading.
"Building a Beautiful China" is among the priorities of China's efforts to deepen reform comprehensively as the nation seeks to ramp up green transition in all areas of economic and social development and improve the environmental governance system.
As of the end of the third quarter of 2024, China's outstanding balance of green loans exceeded 35 trillion yuan, and the stock of green bonds issued stood at nearly 2 trillion yuan, ranking among the top in the world.
Compiled by Allen Zhu