Chinese Savers Won’t Save China
Households have less money to spend than many think.
There isn’t much left for shopping.
Photographer: Giulia Marchi/Bloomberg
Chinese are, in the popular imagination as well as some economic statistics, inveterate savers. According to the International Monetary Fund, the Chinese savings rate stood at an astonishing 46 percent in 2016, compared to a global average around 25 percent. Chinese planners have long sought to bring that ratio down in order to promote consumption and ease the economy’s overreliance on investment. If only Chinese would shop more, the thinking goes, China wouldn’t need to rely on smokestack factories and boondoggle infrastructure projects to drive growth.
There’s one problem with this theory, though: Chinese may not have as much money to spend as the headline numbers would indicate.