China May Day holiday spending shows mixed picture on post-COVID recovery (updated)

Maoyan Entertainment

06/05/2024 09:49

(Adds analyst comments in paragraphs 5-7.)
    By Sophie Yu and Casey Hall
       BEIJING, May 6 (Reuters) - Domestic travellers spent
166.9 billion yuan ($23.13 billion) during one of China's
longest breaks, the May Day holiday, a rise of 13.5% from
pre-pandemic levels, government data showed on Monday, but
expenditure per head lagged 2019 rates.
    Boosting consumer confidence has presented a key challenge
for Chinese authorities this year amid a declining property
market, high youth unemployment and deflation pressures. 
    The total spent over the May 1 to 5 holiday was 12.7% higher
than last year, shortly after China lifted COVID-19 curbs, and
the tourism ministry recorded 295 million domestic trips during
the holiday. 
    But spending of 565.7 yuan per head during the holiday
period, a key opportunity for residents to go on family trips as
the weather warms and spring flowers bloom, was down 11.5% from
pre-COVID levels in 2019, Reuters calculations based on official
data show. 
    The data dampens hopes for rebounding consumption after
spending strengthened during another recent holiday, the Tomb
Sweeping festival, but wasn't a surprise, said Jonathan Yan, a
Shanghai-based partner at consultancy Roland Berger.
    "Overall, I think people are tightening their belts and
confidence is subdued, but they still want experience," Yan
said, adding that many travellers opted for short-haul overseas
destinations such as Japan and Korea for the five-day break. 
    "They are not spending more money than before, but still
travelling while trading down a bit or spending less on
shopping," he said.
    Domestic airline fares fell in the run-up to the holiday, as
forecasts suggested more travellers were opting to drive
instead, or had booked early to save.
    The number of short trips grew noticeably during the break,
Guotai Junan Securities said in a research note on Monday.
    Growth in the number of trips in small cities and counties
outstripped that in big cities, travel giant Trip.com added.
    Box-office sales of 1.53 billion yuan roughly matched last
year's figure of 1.52 billion over the corresponding period, the
China Film Administration said.
    "Formed Police Unit", a film about Chinese police on
overseas peacekeeping missions for the United Nations, topped
the holiday box-office charts with earnings of more than 400
million yuan, data from box-office tracker Maoyan  1896.HK 
showed.
    ($1=7.2147 Chinese yuan renminbi)

 (Reporting by Sophie Yu and
Casey Hall; Editing by Clarence Fernandez and Bernadette Baum)
 ((Sophie.Yu@thomsonreuters.com; 861056692136;))