CPI (Consumer Price Index) for September 2024 rose 0.4%
In September 2024, China’s consumer price index (CPI) rose 0.4% year-on-year. Among them, urban areas rose 0.4%, and rural areas rose 0.6%. Food prices increased by 3.3%, while non-food prices decreased by 0.2%. Consumer goods prices rose by 0.5%, and service prices increased by 0.2%. From January to September, the national CPI rose 0.3% year-on-year.
Key Metrics:
- CPI rose 0.4% year-on-year in September, with food and tobacco prices up 2.3%, and non-food prices down by 0.2%.
- Pork prices increased 16.2%, contributing about 0.21 percentage points to CPI growth.
- Fresh vegetable prices rose 22.9%, contributing about 0.48 percentage points to CPI growth.
- Prices for other major categories showed mixed changes, with clothing, education, and medical care rising, while transportation and communication fell.
Month-to-month changes:
On a month-on-month basis, the CPI remained flat in September. Food and tobacco prices rose 0.5%, while non-food prices fell by 0.2%. Consumer goods prices rose by 0.2%, and service prices fell by 0.3%. Fresh vegetable prices rose by 4.3% month-on-month, contributing approximately 0.11 percentage points to CPI growth. Pork prices increased by 0.4%, contributing about 0.01 percentage points to CPI growth.
Prices for other major categories varied, with transportation and communication, household goods and services, and other goods and services mostly falling.
Data Source: https://www.stats.gov.cn/sj/zxfb/202410/t20241013_1956899.html
China’s top private firms cut jobs, await greater support to allay anxieties
Released on October 12th by All-China Federation of Industry and Commerce, the top 500 private enterprises employed 10.66 million people last year, a drop of over 314,000 jobs compared to the previous year. This trend has raised concerns about the impact of the domestic economic slowdown on private businesses and emphasized the need for further support, especially following a new draft law aimed at reviving the private economy.
Economists, like Harry Murphy Cruise from Moody’s Analytics, point out that the decline in employment, despite rising revenues, signals the uncertainty faced by firms. Factors such as increased automation and efforts to boost efficiency in competitive markets, particularly within manufacturing, may also be contributing to the job cuts. Notably, 66.4% of the private enterprises surveyed are in manufacturing, a traditionally labor-intensive sector, which has been increasingly shifting towards digitalization and intelligent production.
The financial performance of these companies showed resilience, with a nearly 3% increase in net profits after taxes, reaching CNY 1.69 trillion (USD 239 billion) in total. However, the drop in employment marks the largest decline since 2011, reflecting the broader economic challenges faced by major sectors like real estate, internet services, and automotive industries, which also saw layoffs.
China’s private economy, responsible for more than half of the country’s tax revenues, over 60% of the national gross domestic product and over 80% of urban employment, faces regulatory and policy uncertainties that hold back further growth. While Beijing is pushing forward legislation to promote the private economy, analysts remain cautious about its effectiveness, particularly for non-technology sectors. The draft law, currently open for public feedback, reflects growing urgency in promoting domestic private sector activity amid rising global trade barriers.
China to end Australian lobster ban by end of year, ‘huge relief’ for industry
China will soon lift its unofficial ban on Australian live lobsters, ending more than three years of trade restrictions. This development follows a meeting between Chinese Premier Li Qiang and Australian Prime Minister Anthony Albanese during the ASEAN Summit in Laos. The ban, which was imposed in 2020, is set to be removed by the end of the year, with a full resumption of trade expected soon after.
Before the restrictions, China was Australia’s largest market for lobsters, purchasing 95% of its A$750 million (USD 504 million) lobster exports in 2019. However, the trade came to a halt after the previous Australian government called for an investigation into the origins of COVID-19, straining relations with China.
David Olsson, president of the Australia China Business Council, expressed relief over the decision, saying it will restore a crucial trade flow and bolster confidence in Australia’s broader trade relationship with China. Albanese noted that the removal of the ban is timely, as it will allow Australian exporters to benefit during the Chinese New Year celebrations, especially in regions like Geraldton, South Australia, and Tasmania.
Premier Li stated that the relationship between the two countries is improving, with China aiming to enhance mutual understanding and strengthen strategic partnerships. This move follows other positive steps in trade relations, such as China lifting tariffs on Australian wine (up to 218.4%) and removing bans on several Australian beef processing facilities earlier this year.
Global Trade in Transition: The 136th Canton Fair and China’s Export Challenges
The 136th Canton Fair, China’s largest trade exhibition, is set to open on October 15th in Guangzhou, amid shifting global trade dynamics. While traditionally a key event for businesses sourcing products from China, the landscape has evolved, and the need for attendance is changing.
A record 246,000 international visitors attended the fair’s spring session in April, yet the total value of deals signed was only up 10% from the previous edition, reaching USD 24.7 billion. This remains below the USD 29.4 billion recorded at the last pre-pandemic session in 2019.
Exports remain crucial to China’s economy, contributing 13.9% of GDP growth in the first half of 2024. While the US and Europe remain significant markets for Chinese goods, buyers from emerging markets are becoming more prominent. In the first eight months of 2024, 45.8% of exports went to countries involved in China’s Belt and Road Initiative, up from 28.4% in 2018.
The Canton Fair is widely viewed as a barometer of China’s trade prospects. As of Wednesday, over 125,000 overseas buyers had preregistered for the fair, its organiser said on Thursday. Among them, 75.7 per cent are from countries along the belt and road plan’s trade routes, while only 12.5 per cent are from European and North American countries, two major destinations for made-in-China products.
Many product categories are no longer solely reliant on imports from China, as suppliers from other countries now offer comparable quality and greater flexibility, particularly for smaller batch orders. Items such as hardware, cosmetics, food, and daily necessities are increasingly sourced from alternative markets at lower prices. While Chinese goods, such as electric vehicles, continue to be strong contenders, rising competition from Southeast Asia, South America, and the Middle East is creating more pressure on Chinese exporters, impacting the profit margins.
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Data Source: https://www.scmp.com/economy/china-economy/article/3281961/are-prospects-chinas-exporters-picking-eve-canton-fair
China Sees 765 Million Domestic Trips During 2024 National Day Holiday
The Ministry of Culture and Tourism released data on October 8th showing a stable and orderly cultural and tourism market across the country during the 2024 National Day holiday. According to estimates by the ministry, 765 million domestic trips were made over the seven-day holiday, a year-on-year increase of 5.9%, and a 10.2% rise compared to the same period in 2019. Domestic tourist spending totaled CNY 700.817 billion, up 6.3% year-on-year and 7.9% higher than 2019.
Patriotism combined with strong travel enthusiasm, with red tourism becoming a popular way for people to celebrate National Day. Over 1,000 “Creative Rural Life Season” activities, themed around celebrating the harvest and National Day, were held across the country, significantly boosting rural tourism orders. According to data from Ctrip, there was a 40% year-on-year increase in county tourism orders, driven by a growing trend among young travelers for “county escapes.” Local authorities increased personnel support, implemented crowd control measures, and enhanced management efficiency during peak travel periods, ensuring that tourists had a safe, secure, and pleasant experience. Many local governments opened government offices to visitors, providing access to facilities like dining halls and parking lots, alleviating holiday dining and parking challenges, which received widespread praise.
Performances also fueled new consumer demand. During the holiday, 44,300 commercial performances were held nationwide, up 14.5% year-on-year, with ticket revenue reaching CNY 2.209 billion, a 25.9% increase. The number of attendees grew by 13.3% to 11.697 million. Nighttime tourist attractions were also popular, with national-level nighttime cultural and tourism consumption zones attracting 96.8623 million visitors per night, a 25.4% increase compared to the same period in 2023.
According to monitoring by Fliggy, cultural tourism themes such as Hanfu photography tours, intangible cultural heritage experiences, and in-depth tours of historical sites were particularly popular. Cultural venues continued to see high demand, with many offering extended hours and night tour programs. Nearly 3,900 events related to intangible cultural heritage were held nationwide during the holiday, and activities like visiting heritage markets, watching heritage performances, and tasting heritage food became the new favorites of young tourists.
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