SHANGHAI — At last week’s Chic Shanghai fashion and accessories fair, the focus shifted from previous editions amid broader consumer trends in China and government guidelines for industry recently laid out at the 19th National Congress in Beijing, which closed Tuesday.
Since 2016, China’s consumer market has increasingly been influenced by a strengthening middle class willing to pay more for goods that are premium, personalized and have a positive impact on quality of life.
The phenomenon, known locally as the “consumer upgrade,” has been cited by the central government as a factor in moving China’s economy from a production to consumer model in order to maintain healthy growth. In 2017, consumption accounted for 58.8 percent of China’s economy.
Despite a bumpy ride for luxury retailers, with domestic demand only picking up again over the past 12 to 18 months after several years of decline, consumer spending overall has remained consistently strong, clocking growth of more than 10 percent a year, according to China’s National Bureau of Statistics. Retail sales of consumer goods grew 10.2 percent year-on-year to reach 36.63 trillion yuan, about $5.69 trillion at current exchange, in 2017, a 0.2 percent drop in growth from the year earlier. Consumer confidence has also hit record highs in recent months, according to Nielson China surveys.