Consumption upgrade in China set to boost the world economy

Note: The following is an edited translation of a commentary from the Chinese-language "Commentaries on International Affairs."

China is in an era of consumption upgrades! One day after the first China International Import Expo resulted in deals worth 57.8 billion US dollars, e-commerce giant Alibaba logged in record sales of over 30 billion US dollars in its annual Singles' Day online shopping promotion on November 11th.  This level of purchasing power not only indicates the huge potential of the Chinese consumer market, but also shows that an era of increasingly high-end, personalized and diversified consumption upgrades has come.

A giant electronic screen at the media center in Shanghai shows the total gross merchandise volume from online shopping on Alibaba marketplaces Tmall and Taobao on November 11, reaching 213.5 billion yuan (30.7 billion U.S. dollars) during Singles' Day or 11.11 Global Shopping Festival. [Photo: IC]

Now in its tenth year, the "Double Eleven" online shopping event has evolved into a global affair, with consumers living in each of the world's time zones making purchases through Alibaba for the first time this year. Transaction volumes surpassed 100 billion yuan (US$ 14.37 billion) within two hours after midnight on Sunday, reaching this threshold seven hours earlier than last year. The final results show sales volumes have exceeded 200 billion yuan for the first time. 

What made this year's Double Eleven promotion different is that it came on the heels of the first CIIE, where businesses from around the world flocked in an attempt to introduce high-quality goods and services to the Chinese people. The strong buying power then continued with Alibaba's online retail platform Tmall alone reaping transaction volumes worth 213.5 billion yuan (US$30.69 billion). Chinese consumers went online in search of exotic foods such as Mexican avocado, Argentine red shrimp and Danish salmon, electronics such as sweeping robots, high-end humidifiers and smart door locks, as well as medical services. Buying high-quality products from around the world is now becoming the norm in China.

This year's shopping event also saw sales at physical stores surge, which the initiators of "Double Eleven" may have never expected. 

Over the past decade, "Double Eleven" has seen transaction volumes soar to 213.5 billion yuan from 50 million yuan in its first year. The number of product brands available has surged from 27 to over 180,000. The bestsellers have shifted from heaters and humidifiers to sweeping robots and intelligent voice translators. And the sales channel has expanded from online platforms to include offline stores. The evolution of "Double Eleven" reflects the changes in the consumption patterns of the Chinese people and the transition of the Chinese economy to high-quality development, indicating the public's confidence in the country's economic prospects.

Statistics show consumption accounted for 78 percent of China's GDP growth during the first three quarters of 2018, up 14 percentage points over the same period last year. Consumption is only going to grow and develop as an important pillar for the high-quality development of the Chinese economy. The first import expo has opened up a new door for the rest of the world to further explore the Chinese consumer market. And the record sales of the "Double Eleven" shopping promotion shows how strong the demand for consumption upgrading is, and how much potential is in the Chinese market. 

Over the next 15 years, China is expected to import more than 30 trillion US dollars of goods and 10 trillion dollars of services. During this process of further opening up and interconnection, China will become a more powerful engine driving the world economic growth.