Has China Adapted to Covid?

china tourists-Oct-2020

Well good morning and greetings from Shunyi where it is Tuesday 13th October. Like most of China, we are back after an unusual 8 days National Day / Mid Autumn Festival holiday. Unusual in several aspects. Firstly, unusual in that the two fell on the same day, as we mentioned here.

Also, unusual as it is the first real test of the resilience of the China economy and Chinese people’s willingness to travel- and more importantly, spend after the Corina Virus. Have Chinese decided to live with Covid? Will this holiday, predicted to be busy, be the salvation for many in the hospitality sectors? We will take a quick look at this, courtesy of our friends Caixin Globa l- for whom we thank for the image. Do check out more from the China National holiday week here.

This holiday is the second biggest / most important in China after the Lunar New Year break AKA Spring Festival. We were curious to see just how much the virus would impact this years. Airline booking figures indicated this was going to be bigger than previous months when Covid virus saw many Chinese stay home. However the question was not just about numbers but also spending. No one in their right mind was expecting it to be a “normal” National Day holiday. The burning question was; “would it be anything close to a lifeline for businesses already struggling?”

Some international media had already picked up on figures showing Septembers retail spending down compared to previous months. Were they correct in predicting China’s recovery was short lived? Or wishful thinking? We took a different view. Whilst the previous 2 months had been exceptional we reasoned that coming immediately after restrictions had been relaxed was not so unexpected. Much like a dammed river builds up pressure. Once released the initial flow is a torrent, eventually scaling back to normal. Also, 20 years experience shows us that there is often a slight plateau in the lead up to both these holidays as people either prebook, prepare or save for them. Lets take a look at the bigger picture.

National Day Holiday Travel

More than half a billion Chinese took to the road during this year’s weeklong National Day holiday.
The eight-day holiday recorded 637 million trips nationwide, 79% as many as last year.

“Though still deeply negative in year-over-year terms, the National Day Golden Week data mark a significant improvement from the holiday data of previous months,” financial services company Nomura Holdings said in a research report. It said China’s economic performance is still held back by a mix of factors, including remaining social distancing rules

read more: Caixin.com

Looking at September 2020

China’s services activity expanded at the fastest pace in three months in September with a sustained increase in total new business, a Caixin survey showed. However. September manufacturing edged down to 53 from a more than nine-year high of 53.1 in August. The Caixin China Composite PMI came in at 54.5 last month, down from 55.1 in August,.

Digital currency 

China gives away $1.5 million to test digital currency

China’s southern megacity of Shenzhen will use new digital yuan to provide 10 million yuan ($1.5 million) of coupons to residents, worth 200 yuan each. These can spend from Oct. 12 to Oct. 18 in nearly 3,400 designated shops capable of accepting digital yuan payments, from supermarkets, convenience stores to gas stations.

Summary Of China National Holiday Spend

Bearing in mind that this was an 8 day break, compared to the usual 7, travel numbers down by over 20% obviously it is not the silver bullet needed by China’s hospitality / retail industry. However, it may bring much needed relief to some, or be too little too late for others.

Overall figures, p+ China’s end of third quarter economic data is yet to be released.Mainstream media will cover these so Aim2D will not. At the end of the day, China is a biggish country, consequently some regions, cities benefited, whilst others felt little difference. Eg, sales at duty-free stores in Hainan Island in southern China exceeded 1 billion yuan ($155 million) over the National Day holiday week. Increasing nearly 150% from the same period in 2019, according to customs authorities.

During the eight-day holiday over 146,000 people made more than 998,000 purchases at duty-free stores. At Riyue Plaza Duty Free, customers queued outside for 1 hour before opening. Waiting time at some cosmetic checkouts exceeded 20 minutes.

A little further north, East China’s Jiangsu province received 46.63 million visitors bringing in revenue of 51.26 billion yuan (about $7.6 billion). Tourist numbers bounced back to about 81% of the level during the same period last year, while revenue recovered about 71%.

On the flip side, Macao’s long awaited mainland tourists seems not to have reached expectations and according to local sources, was a “mild beginning of rebound.” Tourist numbers of 72,684 equated to a decrease of 86.2% compared with the same period in 2019. Police were on hand but crowd management measures were not required.

Miss Zhao, a shopkeeper of a cookie and souvenir store, said they had prepared for an increasing number of tourists during the National Day holiday, but there were not so many as expected.

Please note, part of this post is drawn from edited highlights of various Caixin articles, some of which may be member only. Jiangsu and Macao articles Courtesy of China Daily.


Hello, I’m Everlyne Yu, founder and CEO of Uengager and WPBeijing Marketing Studio 2003.

I have a wealth of knowledge and experience in the China market and have been privileged to work with many international clients, such as VW and their release of their Bora and the extremely successful CC as well as a long term, ongoing relationship with Sodexo.

Selected Clients

I am happy to chat and discuss any questions, no matter how small or trivial you may think. Probably someone has already asked the same question- many times!

In China Marketing- there is no such thing as a silly question.

To see how your brand can flourish in China, please talk to Everlyne now, or understand more about me.

Ev Yu
Everlyne Yu CEO Uengager

Published by Bicyu.com

Bicyu is a NZ registered, British owned MarTech business based in Beijing providing marketing, tech, education and information services to European, NZ, Australian, UK, African, and Asian firms doing business in China. We work with local ones too. We've been here doing this since 2003. We also incorporate Aim2D and Uengager in our small brand list.

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