Save articles for later
Add articles to your saved list and come back to them any time.
What in the World, a free weekly newsletter from our foreign correspondents, is sent every Thursday. Below is an excerpt. Sign up to get the whole newsletter delivered to your inbox.
Golden Week is usually a time for Chinese children to travel home to see their parents, for retirees to head overseas, for students to splurge on shopping and first-home buyers to buy property.
Far from an ancient tradition, it was introduced by the Chinese government in 2000 to squeeze together multiple holidays, including the Mid-Autumn Festival and China’s National Day, to minimise disruption to workplaces and boost the domestic tourism market.
China’s Golden Week is traditionally a time for visiting family, travel and spending money.Credit: Bloomberg
Beijing borrowed the name from Japan (although the Chinese are unlikely to acknowledge that), where a film executive coined the term in 1951 in reference to a week-long break that routinely delivered bumper box-office takings.
In short, it means money, money, money. But this year, Golden Week, which fell in the first week of October, was not so golden. The movies flopped – box office takings were down 39 per cent from 2019 levels. The number of travellers using China’s largest payment app Alipay was 20 per cent lower than in 2019. And average daily home sales were down 17 per cent compared to the same time last year when the country was still in the grip of its COVID-zero policy.
A giant rabbit lantern to mark Mid-Autumn Festival during the19th Asian Games in Hangzhou, ChinaCredit: AP
This last statistic is particularly bad news. As much as 80 per cent of household wealth is tied up in property. That means when property prices fall, so does a homeowner’s perception of their own wealth, pulling them back from the shops and making them more conservative in their spending. That causes a ripple effect throughout the entire economy.
China’s largest private property developer, Country Garden, warned this week it could default on its debts. Embattled property giant Evergrande’s investors fear they could be headed for an “uncontrollable collapse”. On Tuesday, Pierre-Olivier Gourinchas, the head of the International Monetary Fund’s research department, identified the Chinese real estate market as the number one threat to global growth. “Downside risks still dominate,” he said. “They now stem mainly from China’s growth slowdown due to the stress in the real estate sector.”
It’s grim. So grim that Chinese policymakers are considering issuing at least 1 trillion yuan ($213 billion) for spending on infrastructure, Bloomberg reported, which would push the country’s budget deficit over the 3 per cent target it set earlier this year.
Next week President Xi Jinping will welcome his Russian counterpart Vladimir Putin and other leaders to Beijing for the Belt and Road Forum. Banners have been put up around the city celebrating Xi’s signature multinational infrastructure bonanza.
It won’t just be Putin being treated to a show. TV viewers will get The Road to Prosperity, a six-part documentary series celebrating the 10th anniversary of the massive Belt and Road global infrastructure program, screened nightly on the country’s biggest channel, CCTV.
As they sit in their apartments helplessly watching their wealth fall, some viewers might wonder whether the $373 billion spent so far building Belt and Road highways in the Pacific, trains in Laos and stadiums in the Middle East might have been better spent at home.
Get a note directly from our foreign correspondents on what’s making headlines around the world. Sign up for the weekly What in the World newsletter here.
Most Viewed in World
From our partners
Source: Read Full Article
