This summer, tourism has regained momentum, with study tours and summer camps targeting students as well as new travel options like city walks all becoming more popular. This phenomenon has been dubbed the "summer economy."
Before the pandemic, summer was a season for potential consumption sprees. The rebound of the summer economy after three years demonstrates how the Chinese economy is not only returning to normal following a short deviation but also breaking new ground.
Consumption is a major driver of growth, especially given that China has a huge market with a population of 1.4 billion people. Boosting consumer confidence is one of the main tasks of the Chinese Government this year. On July 24, the Political Bureau of the Central Committee of the Communist Party of China, consisting of the Party's highest-ranking officials, held a meeting to analyze the current state of the economy and make arrangements for the second half of the year. The meeting called on the government to focus on leveraging the role of consumption to fuel economic growth.
Moreover, meeting people's aspirations for a better life, a goal that President Xi Jinping has reiterated since taking the top job in the Party in late 2012, makes it imperative to improve the consumer experience. The government is contributing to a consumption boom by introducing favorable policies and inspiring businesses to innovate their services. The travel industry, for one, has designed tailored programs in a bid to satisfy diverse needs in the summer high season.
This year, despite the weakening external demand, domestic consumption has been picking up rapidly and is again becoming the most powerful force driving economic growth. In the first half of the year, the contribution of consumption to economic growth reached 77.2 percent, a significant increase compared to the rate for the entire previous year.
The government will take measures to bolster consumption in key sectors such as automobiles, electronic products and household items. Spending on services, including sports, leisure, culture and tourism, is also being encouraged, according to a statement released after the July 24 meeting.
With the implementation of policies to expand domestic demand, investment and consumption are expected to maintain stable growth in the second half of the year.