The Chinese economy has been all over the press recently, with the slowdown panicking some economists, who fear that the sharp fall in China’s stock prices last year could affect the global economy in 2016.
However, official figures suggest that economic growth may have stabilized at about 6.5 per cent during the end of 2015 – still nowhere near the double-digit norm prior to the crisis, but not the catastrophe predicted by some.
Let’s look at the figures. According to Forbes, the Chinese stocks rally started after the New Year holiday last year from a level of 3,229 in late February for the Shanghai Composite. After a concerning climb to almost 5,200 in June, the index was back to roughly where it started (3,209 on August 24) after six months. The Financial Times concurs. Last week, China revealed that December’s economic figures were better than expected, with fourth-quarter GDP growth marginally behind forecasts, at 6.8 per cent. The UNWTO does not expect the supposed slowdown in the Chinese economy to put a brake on the number of people looking to travel outside China.
“You need to put the slowdown in perspective, it’s a slowdown from 7 percent to 5 or 6 percent,” says John Kestor, the director of the tourist market trends program at UNWTO, adding it was a growth that many nations would be “very jealous” about.
Optimists also point to China’s affluent and expanding middle class, 136 million of whom are expected to fly internationally in 2016, and to the lucrative Chinese High Net Worth Individuals (who have investable finance of at least £650,000) who in 2015 named international travel as their most desired pursuit.
More importantly for the shift in economic structure, December retail sales growth was above the full-year trend!
All in all, the outlook is still good for Chinese outbound travel.
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