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China’s post-Covid consumer rebound clouded by ‘unstable’ incomes, lingering virus fears
- Chinese households’ bank deposits grew by nearly 18 trillion yuan (US$2.67 trillion) last year, official data shows
- But consumer confidence is down amid concern over fresh Covid outbreaks and weak income prospects, say economists
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Ma Zhen, a sales manager from the Chinese city of Guangzhou, had his eyes set on a 7-seater multiple-purpose vehicle.
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As China lifted mobility restrictions last month in an exit from nearly three years of zero-Covid, the senior salesman was eager to embrace the freedom and travel with his wife, parents and two children.
But eventually, after weighing up his financial situation for the year ahead, he decided against it; 300,000 yuan (US$44,787), or more than 4,000 yuan in monthly payments over the next five years, was just not feasible amid such economic uncertainty.
The annual income of his wife, a public school teacher, plunged by 20 per cent last year, as local governments’ coffers across China were strained by massive public spending on mandatory Covid testing and other medical bills. Ma does not expect much of a pay rise for himself this year, either.
My income has been very unstable, especially during lockdowns
“My income has been very unstable, especially during lockdowns when I could not make business trips to visit clients,” he said.
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