How China’s COVID-zero strategy tarnished Golden Week
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Initial results are in for China’s consumer behavior during the weeklong holiday, and there’s not much to cheer about.
- Road trips were down over a third compared to 2019 during the normally travel-heavy holiday. Even the 2020 numbers were slightly better than this year’s.
- Instead, consumers stayed local. A Meituan analysis showed nearly 80% of users were in their own homes when ordering delivery.
- Box office figures were better than 2020 but just below 2019 numbers.
The context: After confronting this summer’s Delta outbreak, China seems to have gotten all pain, no gain. COVID-19 is still around — two cases discovered in a part of Xinjiang forced it into a days-long lockdown, disrupting holiday travel — and consumer sentiment remains stubbornly low:
- Retail sales, even online, had tepid growth compared to expectations, and restaurant spending fell 4.5% on-year in August.
- Nearly half of urban dwellers are saving more and spending less, according to a survey by China’s central bank conducted last quarter.
The takeaway: People in China — and other countries who until recently had COVID-zero strategies — are fatigued by constant lockdowns and becoming risk-averse about spending and future planning. It’s too soon to tell whether that will last — but it’s clear that China’s pandemic perfectionism has diminishing returns.
