China Says Its Own Consumers Will Save the Day. But Theyre Not Buying.
As the United States and China barreled headfirst into full-fledged trade war this week, one of Beijing’s most fashionable shopping districts was still bustling.People browsed a high-end perfumery, lounged outside coffee shops and waited in a wraparound line for a trendy bakery.That is just the type of scene the Chinese government wants to see as it steels for what could be a total breakdown of trade with the United States.
As President Trump maintains tariffs of at least 125 percent on its goods, China has vowed not to back down.Besides hitting back with its own tariffs — 84 percent on all imports from the United States — the government has promised to make up for the blow to exports, on which China’s economy currently relies, by getting its people to spend more.“In the face of high tariffs continuing to shrink the space for trade with the United States,” read a commentary on Sunday in People’s Daily, the Chinese Communist Party mouthpiece, China will “make consumption the main driving force and ballast stone of economic growth, and deliver on the advantages of a super-large market.”But that is easier said than done.
Domestic consumption in China was anemic even before the tariffs.The post-pandemic economic recovery has been lackluster, factories have shuttered and youth unemployment is high.
Home prices, the bedrock of many middle-class Chinese families’ wealth, have plummeted.Even the busy scene at the Beijing shopping area, Taikoo Li, was deceptive.
When Chinese people do go out, they increasingly tend to look for bargains or simply browse.Qu Nan, the 38-year-old founder of a construction company, was sitting at a Starbucks in Taikoo Li.
But he wasn’t drinking anything, just meeting a friend.We are having trouble retrieving the article content.Please enable JavaScript in your browser settings.Thank you for your patience while we verify access.If you are in Reader mode please exit and log into your Times account, or subscribe for a...