China consumers proving resilient amid economic gloom

As China prepared to celebrate the year of the monkey in early February, there were many who wondered if the celebrations would be muted because of the effects of the perceived economic slowdown as Q4 GDP growth came in at 6.8 percent. That was lower than expected and came as industrial production slowed, exports and imports remained sluggish and prices fell, highlighting deflationary pressures in the economy. On the surface, the implications on ordinary Chinese travellers were clear-cut. With budgets tighter, growth slowing and the RMB devaluing in 2015 the belief was that outbound tourism would be hit. Add in the Chinese government crackdown on corruption and the conclusion was clear – sectors like gaming that had prospered this century on the basis there was a never-ending supply of newly affluent Chinese customers were going to face difficult times this year. However, the picture isn’t clear. On the macroeconomic side the more...

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