The Chinese New Year festival, celebrated by over a billion people this year, is marking the beginning of the Year of the Dragon. Despite the festivities, however, the traditional wish for prosperity may have lost its appeal due to economic challenges. With a weakening economy and declining consumption, spending money has become a priority for many during this important holiday.
Authorities and schools are closed as China is illuminated with hundreds of thousands of red lanterns. Families come together to celebrate and exchange small red envelopes containing cash and gifts. This year’s celebration is particularly significant as it marks the first year without Covid restrictions. To stimulate consumer spending, e-commerce platforms are offering special New Year discounts in an attempt to rekindle a slow economy that grew by just 5.2% last year and met only the official goal of roughly 5%.
Despite these efforts, China’s export engine is still struggling due to rising unemployment, deflation, and increasing distrust in economic performance. Additionally, the real estate crisis related to Evergrante’s billion-euro bankruptcy continues to impact China’s economy negatively. Many factories are idle during this holiday week, affecting exports and global supply chains.
The pandemic has also sparked a significant wave of travel this year, with billions of individual trips estimated to take place as travel restrictions loosened. While many Chinese are visiting local destinations such as Harbin’s Ice and Snow Festival, there is also an increased interest in international travel with flights increasing to places like Japan and Thailand. However, group trips to Europe and other far-flung places have yet to thrive due to high prices and the lead time needed to organize such trips.
In conclusion, while many Chinese are celebrating the start of the Year of the Dragon with hope for better days ahead, economic challenges continue to impact their ability to fully enjoy this important holiday season.